Consumer Behaviour Analysis
Internal Influence on Consumers Decisions
The principal objective of marketing is to get consumers to purchase the product the marketer’s company makes or sells in preference to a similar product from another producer or an alternative product. An understanding of Consumer Behaviour is essential for effective marketing. For example, Harley Davidson must first convince purchasers to buy a motorcycle in preference to an automobile. They must then convince the purchaser that a Harley Davidson is preferable to a Yamaha or a Honda. The first question is why anyone would want to purchase anything as dangerous and uncomfortable to use as a motorcycle. Only once the prospective purchaser has resolved this issue does the second question become relevant: namely, which motorcycle?
The objective of this project is to examine those elements that go into both the decisions. What are really being discussed are psychology and human wants and needs. What makes a person decide to buy a motorcycle and then how is the decision made as to the particular make, model and colour? The marketers at Harley Davidson wax rhapsodic about HOGS, members of the Harley Owners Group who they have at least temporarily convinced that the ultimate goal in life is the ownership and riding of a Harley Davidson Motorcycle. (Harley-Davidson UK, 2010) What is of interest is: how did this come about? What makes a person purchase such a vehicle? There is a decision process going on that is the key to the question. There are three categories of influence on consumer decisions such as buying a Harley Davidson motorcycle or almost anything else, Internal, situational and social. (Solomon, et al. 2009)
Stages of the consumer buying process
There are really six stages of the consumer buying process. The making of a purchasing is only one stage of the process, and not necessarily the final one. Not all decision processes lead to a purchase.Consumer decisions do not always include all 5 or 6 stages. The academic question here concerning the number of stages in the purchase processis are the decision to purchase and the actual purchase separate steps. (tutor2u, 2010) The complexity of the decision determines the number of stages required to reach the decision. The first state is recognition that there is a need for a product or service, or put another way, a difference between the current actual state and some desired state. (Ying-Ping et al, 2008) Marketing does not always “create the need”, but it can. If the consumer is hungry he or she needs to eat. This has little to do with marketing. Conversely an advertisement for shoes can stimulate the recognition that the consumer does need a new pair of shoes. Here the first stage was stimulus of the need for shoes.
The second stage is the search for information. This can consist of an internal memory search. If there is no adequate internal memory information that is a requirement of a search of external sources that can include word of mouth from friends or relatives or from marketer dominated sources; public sources, comparison shopping, etc. If the information search is successful the potential buyer will have a variety of possible alternatives.
The third state is the evaluation of the alternatives. This involves the establishment of criteria; what features does the customer want or not want? There is usually a ranking or weighting of potential features. (Solomon, et al. 2009)
The purchase decision is the fourth stage and may include a number of alternatives, product, package, store, method of purchase etc. This leads to stage five that is the actual purchase, which may involve a time lapse between four and five.
The sixth and final stage is post-purchase evaluation. There is an evaluation of the outcome of the decision process satisfaction or dissatisfaction. (Brown, 1996)
The internal decision processes.
The internal decision process represents the differences between how various individuals will process the information they receive through perception, exposure interpretation and attention. Perception is nothing but an approximation of reality. It is an attempt by the brain to make sense out of the diverse stimuli to which the subject is exposed. In the terms of marketing there is exposure to numerous commercial messages, mostly in random order and unsought. Only on particular occasions does the typical consumer “tune in” to this random noise of unsought advertising. An example of an exception might be a consumer who has decided to purchase an automobile. The previously insignificant auto dealer advertising might suddenly become interesting. The fact is that ordinarily a single exposure is not sufficient to impact the individual. What are usually necessary are countless repetitions of the same message or logo. An example is the Nike “Swoosh” logo. Perhaps an even better example is “Coke red”. The red of the Coca Cola label and the red Coke can are almost universally recognised. The stimulus may be pleasant, unpleasant or surprising to gain attention. An unpleasant stimulus can be an extremely effective one in terms of gaining attention. (Perner, no date)
The auto dealer advertisement example above is an example of consumer attention to an advertisement. If the subject of the advertisement is a current want or need it is more likely to gain the attention of the subject than an advertisement of a product in which there is no immediate interest. A hungry person is far more likely to pay attention to an advertisement for a food product or a restaurant than one for a sewing machine. This probably would be true even if the subject were in the market for a sewing machine. The immediate need, food, would take precedence. The other key to attention is the perceptibility of the message. A message written in type too small to read obviously would have little value. The message on a highway billboard would have to be short enough and legible enough to grasp when driving past it at relatively high speed.
Interpretation is the relationship of perceived stimuli to a product or service. A picture of a cool fruit drink against a sunny beach setting would presumably produce a positive interpretation of the refreshing qualities of the product. The same image of a cool fruit drink against a snow ski scene would not product the desired response, but if a cup of hot chocolate of coffee were substituted for the cool drink the immediate association would be positive. (Solomon, et al. 2009)
Another input concerning interpretation is the attitude of the consumer toward the product. This may include beliefs, feelings concerning the product, and the resulting behavioural intentions of the consumer. This involves a variety of consumer buying behaviour. The level of involvement in the purchase, the importance and level of interest in the particular product drive the behaviour involved. The purchase of milk is an example of low levels of involvement. The discussion earlier of the purchase of a Harley Davidson motorcycle is the quintessential high level of involvement example. There are the three primary risks that drive involvement involved, personal risk, social risk and economic risk. The personal risk might involve the purchase of a costly item on credit that could lead to financial difficulty. The social risk (or objective) might be the perceptions of friends and relatives about the purchase of a “Harley”. The economic risk is that it involves the investment of perhaps £15,000 in a machine that will engender eventual hatred, because the purchaser does not like riding in the rain so common in the United Kingdom. (Brown, 1996)
The driving forces behind consumer decisions
A psychologist named Abraham Maslow developed a hierarchy of needs in a paper entitled “A Theory of Human Motivation” in 1943. This concept of the development of the needs and desires of human beings has become among many other things one of the driving forces in marketing, although Maslow’s theory has been criticised for being way too simplistic and general. The usual graphic used to represent Maslow’s concepts is a pyramid such as the one depicted below.
Source: University of Maryland
The most basic needs depicted on the bottom are referred to as physiological needs and include among others life elements such as food, water and sleep. As referred to above hunger is a powerful driving force and obviously a key driver in food, beverage and restaurant marketing. There is little need for the marketer to worry about creating a need, only offering ways to satisfy a need that is already very strong.
The next level is safety, the need for security of body, the family, health and other needs only slightly less basic than the psychological level. Here there is still little need to stimulate the desire of the prospective customer to achieve these things, only to convince them that the alarm system, annuity policy or retirement plan being offered is the most attractive product to fill the prospects needs.
The third level is love and belonging, friendship, family and sexual intimacy. This is part of the appeal of campaigns such as “the Pepsi generation” or the social hours at various pubs and clubs.These first three are the truly basic needs and must be satisfied prior to reaching levels four, esteem and the final or fifth level self-actualization.
Clearly, marketing appeals to all the levels of the hierarch of needs, but for many goods it is involved primarily on the fourth level or esteem and in some respect self-actualization or “contentment”. It would be difficult to conceive of reaching a level of self-actualization without self-esteem and confidence, which in turn relate to achievement and respect of and by others. The choice of a motorcar is often offered as an example of the satisfaction of the need for prestige or status. At the final level products such as travel and education may be included. The British army bases its advertising for recruits on, “Be the Best.” (Simons, Irwin, Dunnien, 1987
There are also indications that a large variety of other forces are involved in consumer decisions and buying patterns. Tor example, various geographic regions have highly specialized markets that may be growing at rates dissimilar to the overall market. One such example is the South African market for men’s apparel. There is evidence that this market is growing more rapidly than the overall retail market, and more rapidly than women’s apparel which has historically dominated the scene. (Du Preez, Visser, Zietsman, 2007)
Another driving force behind consumer behaviour is ethical considerations. For example, some Islamic women may have a totally different approach to purchase decisions. The Islamic woman is not permitted to be associated with any consumption business activity until she fully knows the position of the Shari’a as regards its permissibility or otherwise – if she is a strict Muslim who follows a literalist interpretation of the Koran. Islam has recognized business practices as legitimate economic activities of human being. This obviously will have a profound impact on any marketing aimed at Islamic women. (Bala, 2008)
Another consideration toward consume behaviour is presented in an article in Consumer Policy Review by Meranda Lewis that examines “Behaviour Change and Public Policy”. While the article is strongly political and attacks the Labour Government it makes some interesting points concerning the ability of government and government policy to change consumer behaviours. Ms. Lewis cites such activities as, “…the burden of disease now mainly comes from largely preventable problems such as obesity, smoking or alcohol misuse, and major causes of disease in Western societies are associated with behaviour.” The government also has programs involving antisocial behaviour and recycling. It is clear that all of these programs have a significant impact on consumer decisions and behaviour. (Lewis, 2008)
Another factor in purchase decisions is social habitué. Brendan Richardson uses the example of football and the identification of fans with their favourite teams. There is a relationship between the basking in reflected glory of being a fan of a successful team and the purchasing patterns of the fans. This is an attempt at the raising of social esteem levels through association with highly successful others, or at least that is the theory put forth in the literature. Conversely, there is the proposition that the consumer tends to disassociate from a loosing team, hence fails to purchase products associated with the unsuccessful team. (Richardson, 2004)
There is also marketing “gravitational theory” which in the marketing context is associated with time, distance or cost as key consideration in many marketing contexts. It has for example been used as a basis for the location models used for determining the location of shopping centres and the location of shops within the centres. It is also common to substitute time as a measure of separation between consumers and suppliers. The theory as related to marketing proposes that the distance between consumers and suppliers is a major element in consumer decisions. There are views that, “geographic distance, road distance, travel times and travel costs have all been used as measures of distance”. (Doghlan, 2006)
Types of consumer buying decisions
There are four primary categories of consumer buying, routine response, limited decision making, extensive decision-making and impulse buying.
Routine response is the sort of response involved in buying a bottle of milk or a loaf of bread. The consumer has a place (or places) he or she ordinarily goes to purchase such items and either has no brand preference or a favourite brand. Very often the stimulus for need recognition is seeing the product on a store shelf. (Lamb, Hair, McDaniel, 2010)
Limited decision making consumer buying is the response to the need for consumer products that are only needed occasionally or in situations when a consumer feels the need to gain information on a brand with which he or she is unfamiliar. It is a purchase in a category of product with which the consumer is familiar, but will devote a reasonable amount of time to gain the relative knowledge of the product.
Extensive decision-making purchases are major purchases for which the customer spends considerable time researching the facts on various choices and then deliberates extensively over the final choice. The actual decision-making may assume multiple levels in which the consumer makes “pre-search decisions” and only when this is complete begins the research phase of the purchase decision process. (Punj, 1993)
Impulse buying is characterized by high emotional activation, low levels of cognitive control, and largely reactive behaviour. It is not clear to what levels each of these can be identified in terms of marketing approaches. It is presupposed that emotions play a major role in creating impulse purchases. There are some studies that support the supposition that emotion is a major component and this raises the question for marketers as to how to engender the desired emotions. (Weinberg, 1982)
There is a relatively new school of thought that, in fact, a substantial portion of consumer purchase behaviour does not involve decision-making, even of the first purchase. This suggests that the historic and current emphasis of decision-making man discourage investigation of other important elements in consumer behaviour. (Simons, Irwin, Drinnien, 1987)
The personal elements that effect consumer purchase decisions.
There is obviously a close link between willingness and ability to consume. George Katona first introduced the distinction between willingness and ability to buy. (Katona, 1960) The ability to purchase relies on the objective factors that determine the actual purchase. Willingness to purchase captures subjective factors like attitude and mood. In modern marketing research it is possible to reconcile Katona’s theories with such abstracts as inter-temporal utility maximization if allowance is made for varying preferences over time that is exogenous to the consumer and determined by the social environment. (Roos, 2008)Inter-temporal refers to measurement over time. Inter-temporal choice is based on the relative value people assign to two or outcomes at different time; usually considered today compared to some possible future date.The concept of utility maximization is to gain the greatest benefit or utility possible. This can be interpreted as does the consumer buy now or wait until some more advantageous time. What the real question often will be is how long will it take for the consumer to save enough money to buy the desired item. (Kenny, T. 2007)
Another element that will often have a considerable impact on the purchase decision of the consumer is age. Purchase of a high performance car is often associated with youth and the desire for speed and “showing off.” The alternative market for high performance sports cars is middle aged or older men who associate the purchase with their “young image” or the nostalgia of lost youth now that they are finally financially able to afford the indulgence to their egos.
Family life style is another element that can influence purchase decisions. As the family ages, and children leave their childhood homes the lifestyles of the remaining family members changes to reflect new circumstances. Singles are more likely to indulge themselves with expensive autos and clothing than the parents of a family young family that need baby furniture and insurance more than an expensive car. As the children grow and leave home they have the opportunity to move to a home on the Mediterranean. (Solomon et al, 20009)
Summary and conclusions
Consumer behaviour is a key study for the marketer of any product that is oriented to the consumer. This varies from hand soap to high performance cars to fashions. Understanding what the factors are that motivate the particular consumer groups that will use the product and what motivates them to choose one product over another is the key to successful marketing and product development. Simply making the product regardless of the quality is only the first step. In many cases the first step is to identify a “hole” in the market and develop a product to fit a perceived consumer need.
Successful marketing is the driver behind any successful business, and this implies understand the motivations and desires of the customers that will form the market for the product. This is as true for industrial products as for consumer products. In every organisation there is an individual that makes purchase decisions and it is necessary to fill that individual’s wants and needs.
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