Theories of consumer behaviour

Introduction Solomon (2011) defines consumer behavior as â€Å"the processes involved when individuals or groups select, purchase, use, or dispose off products, services, ideas, or experiences to satisfy needs and desires’† (p. 41).Advertising We will write a custom assessment sample on Theories of consumer behaviour specifically for you for only $16.05 $11/page Learn More Studying the behavior of consumers is very important because it helps develop marketing strategies and public policies. It also promotes social marketing which is provides the marketers with adequate knowledge about the needs of consumers. Consumer behavior enhances maximum satisfaction of the needs of consumers and the development of better products (Perner, 2011). To maximize profitability is important for marketing and this can only be achieved by developing good strategies of identifying the behavior of consumers towards the products in the market. The main objective in marketing is to retain existing customers and get new ones. All business activities are supported by the good relationship with the consumers. Learning consumer behavior in both business-to-businesses marketing as well as business-to-consumer marketing is very important in improving the performance of a business (Deaton Muellbauer, 1980). Effect of culture on consumer behavior Culture affects the consumer behavior in different ways depending on the cultural background of an individual. The subjective cultures which affect a consumer are the regional, ethnic, religious, linguistic, national, professional, organizational and group cultures. Culture is composed of beliefs, values, practices and attitudes that a person or a group of people have. Culture affects the personality traits and the social norms that people have. Behavioral intentions are developed from the social norms, cultures and sub-cultures and the cognitive beliefs that people have. These will in return influence and shape the consumer behavior. It is important to mention that culture is learned from the environment in which we live in and by sharing ideas with different people (Schiffman Kanuk , 2010). Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Source: Schiffman Kanuk (2010). Consumer decision making model Consumers make decisions by applying a particular process to solve the problems that affect them. There are different levels of solving problems by the consumers depending on the extent of the problem. For instance, extensive problem solving requires a lot of information to solve problems. Consumers must have criteria to evaluate the problem and identify possible ways of tackling the problems affecting them (Jobber Lancaster, 2009). By the application of limited problem solving, a criterion for evaluation is selected and it is fine-tuned by collecting additional information. Routinized response behavior is experienced especially when reviewing what the consumers already know. Consumer decision making can be categorized into four views. An economic view, passive view, cognitive view and emotional view (Solomon, 2011). The external influences to the consumer decision making behavior are firm’s marketing efforts and the socio-cultural environment. The firm’s marketing efforts consist of the product, promotion, price and the channels of distribution that a particular company uses. The son the other hand, the socio-cultural environment consists of the family members, information sources, other noncommercial sources, social classes and subculture as well as culture (Solomon, 2011). The process of consumer decision making then starts when the consumer recognizes his/her needs and repurchase search is done to identify all possible alternatives. The consumer then evaluates all possible alternatives to solve the problem. The evaluation process will be determi ned by the experience that the consumer or other people have concerning the products.Advertising We will write a custom assessment sample on Theories of consumer behaviour specifically for you for only $16.05 $11/page Learn More The evaluation process will be affected by the psychological field which is composed of motivation, perception, learning, personality and attitudes towards the products in the market (Solomon, 2011). The consumer makes a decision to purchase a specific product in the market after careful evaluation. The post-decision behavior will determine whether the consumer will re-purchase the same product. The first purchase is a trial to test whether the product can satisfy the needs that the consumer has. The post-purchase evaluation is done when the product has satisfied the consumer in the first place. The experience that the consumer generates from using the product determines the loyalty that will be developed by the consumer towards the product. This process is summarized in the figure below (Solomon, 2011). Source: Solomon (2011). Consumer research process This process starts when a marketer identifies a particular product to sell to a specific group of people. The initial stage starts with segmenting the market, followed by targeting the specific segments to deal with and positioning the products in the segments selected to ensure the consumers are captured (Mullen Johnson, 1990). Segmentation Market segmentation is the process of identifying different market groups with similar characteristics and delivering products to these groups depending on these characteristics. Marketers study the consumer behavior of people in a given field and they group consumers with particular needs together and develop marketing strategies for each group.Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Market segmentation helps marketers to deliver products according to specific needs for all consumer groups. Marketers are able to tune their marketing strategies to capture the demand for their products from those particular individuals who may have an interest in such products (Solomon, 2011). For example, it would be unwise to develop marketing strategies for selling hairspray to bald-headed individuals as explained in the diagram below: Source: Solomon (2011). Consumers have different needs depending on their income levels, culture, political systems, religion, geographic location and other features that can be used to distinguish them. Delivering products by use of the same approach may fail because consumer groups have different needs and they require these needs satisfied in a unique manner. A company that segments its market offers the same product to different consumer groups using different strategies to ensure that the needs of all the consumers are satisfied (Sandhusen, 2000). An example of market segmentation is a case of Toyota Company. The company has segmented its market depending on the income groups and regional location of all consumer groups. The company manufactures automobile products and markets these products are marketed to customers depending on their income capacity (Perner, 2011). Targeting Market targeting is the process of identifying specific markets to sell products. It involves identifying the characteristics of the various markets and all consumer groups. Marketers then manufacture products which are focused on the specific needs of the consumer groups (Sandhusen, 2000). Marketers have the obligation to satisfy the needs of their target customers by providing the best products and services. This will compel any competitor from dominating the market. On the other hand, marketers should improve the wellbeing of the people consuming their products and the society in which they are operating. This should be achieved while achievi ng the objectives and goals of the organization (Ferrell Hartline, 2008). There are several factors that marketers should consider when targeting a specific market segment. For instance, how well a particular segment served by other companies in the market, the size of the market segment and the potential for growth in the particular market segment (McDonald Dunbar, 2004). An example of market targeting is evident in the activities of Apple Inc. The company manufactures computer hardware and software products. In the recent past the company has started to manufacture electronics to venture into market segments with different needs. The company has realized that the young generation requires unique products and this can only be achieved by delivering products which target this group of customers. Apple Inc has introduced the iPod, iMovie among other products targeting the young generation (Perner, 2011). Positioning Positioning is the process of delivering products to the right con sumer groups at the right time in the right manner. Companies position their products in the market to ensure that the consumers can get access to the products more easily. To improve the performance of a company in the market, the products should be positioned in a peculiar way to ensure that customers are not attracted by products from competitors. In a competitive market all companies aim at getting a strategic market position to ensure their products attract as many customers as possible (Sandhusen, 2000). An example of market positioning is experienced by the holiday and leisure products. Such products are located near leisure zones and they are mostly marketed during holiday seasons. Another example is the automobile industry; companies in the industry have made a lot of effort to ensure that they position their products in a unique manner (Horner Swarbrooke, 2005). Another example is found in the case of Apple Inc. The company has positioned itself in the market by developin g the concept of user-friendly products for all its products. The company promotes its products by developing the concept of consumer-friendly products for the software, hardware and electronic products that the company manufactures (Perner, 2011). Marketing strategies Marketing strategies are the various policies that companies use to deliver their products to the consumers to ensure they fulfill the demand for their products. Companies have strategies that are established to promote the marketing process and to improve the performance and competitiveness of a company in the market. Strategies provide a guideline for the marketers to use when implementing their objectives and provide a good foundation for improving the competitiveness of a company in the market (Sandhusen, 2000). An example of a marketing strategy is a policy that is created by Apple Inc to apply online marketing. This strategy was applied to increase the sales of the company by targeting more consumer groups and i mproving the procedures of marketing the products of the company. Ethical issues Ethical issues have been of great concern in the marketing processes because there are many stakeholders affected by marketing activities. Artificial needs are created when marketing activities are done and this causes a lot of questions about the ethical standards. For instance, advertising products causes materialism to prevail in the market and this affects the ethical standards of the consumers. Some of the ethical questions that marketers encounter are: whether the products’ design can meet the existing needs of the consumers, whether the advertising process helps communicate the availability of the products in the market and many other questions. In addition, there have been many ethical questions about the importance of advertising and marketing processes (Schlegelmilch, 1998). Examples of ethical issues being experienced in marketing processes today are marketing products to children. Thi s has been criticized as a method of exploitative targeting and ethical standards have been of great concern to many stakeholders. Food marketing to children has been found to cause obesity. Children are influenced to consume certain products which are not healthy to their lifestyle and this has caused the prevalence of childhood diseases such as obesity. Various stakeholders have been concerned about the introduction of legislation to regulate consumption behavior of young people in the society. Another example relates to sale of pharmaceutical products direct to consumers. This has raised a lot of concern about the ethical standards because consumers have misused drugs due to aggressive advertising by these companies (Schiffman, Kanuk, 2010). Forced exposure to advertising has been of great concern and this has caused a lot of concern about the ethical position of the advertising companies. Marketers have also influenced consumers to change their perception about products in the market as a strategy to increase consumption. False and misleading advertising has been experienced in the markets today and this has been of great concern about the ethical backgrounds of the advertising companies. There are other socially undesirable representations done by marketers and this causes a lot of concern about the ethical standards of the companies marketing their products (Schiffman Kanuk, 2010). To enhance ethical standards among the marketers, companies have introduced some measures to improve the welfare of the consumers and other stakeholders. Some of these measures are social responsibilities which have been done to improve the image of companies (Peter Olson, 2009). This has been done by advocating socially beneficial causes to promote the welfare of the communities which support companies in their business endeavors. Green marketing has also been adopted to promote the use of healthy, reusable and eco-friendly products. Companies have also promoted consumer e thics by encouraging people to recycle used products, returning used products and encouraging software privacy (Schiffman Kanuk , 2010). Motivation process model Consumer motivation is an important process because it enhances buying process. Motivation starts with unfulfilled needs, wants and desires that consumers have. This causes tension and a drive to achieve the needs is developed. This process is affected by the personality, perception, learning process and attitudes of the consumers towards the products and the organization marketing such products. A specific behavior is developed by consumers once they start realizing their needs and this behavior is directed towards fulfilling the needs. Once the consumers identify the specific products that can fulfill their needs they get satisfaction and the tension is reduced. This is a cyclic process because new needs and wants arise on the daily lives of people (Schiffman Kanuk, 2010). Source: Schiffman Kanuk (2010). The observati on made from the above diagram is that consumers follow a specific model from the time they realize that they have a particular need to the time they start consuming the products. Consumer needs may be categorized as innate or acquired. Innate needs are biogenic and they become the basic needs in human life for example, the need to eat, cloth and shelter. Acquired needs are developed from the cultural and environmental systems and these are usually secondary in nature for example, the need to own a dream car (Mowen Minor, 2001). On the other hand, goals are grouped into generic and product specific goals. Generic goals are developed by consumers to fulfill their needs whereas product specific goals are acquired from the brands of products and services in the market (Schiffman Kanuk, 2010). An example of a motivation model is a case where an individual has the need to purchase a dream car. The drive to own a car is developed from the people that person socialize with and the financ ial class. This drive emanates from the need and desire to own the car and the individual will behave in a particular manner to ensure the desire is fulfilled. Consumer values Consumer values are enhanced by the cultural background, family influences, media, peer pressure and religious beliefs. Identifying the specific values that consumers uphold is very important in developing the consumer behavior of specific people. Values that a person has will determine the kind of product s/he consumes and marketers should be very accurate especially when segmenting, targeting and positioning their products in the market (Mooij Mooij, 2010). It is important to note that consumers never fully satisfy their needs because new needs arise after the satisfaction of old needs. When goals are achieved people set new goals which are higher than the previous ones. The need to achieve goals is aroused by the emotions, physiological, cognitive and environmental factors (Mooij Mooij, 2010). Psychologic al needs Theories on consumer decision-making vary according to assumptions regarding the nature of human behavior. A comparison of the economic, passive, cognitive and emotional models of consumer decision-making shows that all consumers behave in a particular manner when making their purchase decision. Consumers develop psychological needs when they identify certain products in the market. They are motivated to purchase such products when they get people to provide adequate information about such products. Motivation also emanates from observation about usage of the products by other people in the market. When consumers are satisfied by particular products they develop the need to re-purchase the products and this causes consumer loyalty to develop (Perner, 2011). The perception of consumers towards certain products affects their ability to purchase. Perception refers to the image developed by customers for certain products and this is causes the consumers to purchase and continue using products from a certain company. Perception is developed from past experiences that consumers have concerning certain products in the market. Marketers have a duty to change the perception of the consumers by actively promoting the products to consumers to create awareness about the importance of the products and to remove the negative attitude they have developed (Perner, 2011). Attitude is developed by consumers depending on the cultural background, exposure of the customers to similar products, and the approach applied by the company. When customers develop a bad attitude about the products in the market it becomes challenging to reverse the trend. Active campaigns are required to remove the negative attitudes that consumers have towards the products in the market (Perner, 2011). The model of passive view requires that marketers should train the consumers to overcome the fears and tension about using products. This can be done by pestering a positive attitude towards the p roducts in the market and changing negative perception about products offered in the market. Behavior change is made by introducing new cultures for the consumers. Cultural change can only be done by liaising with all the stakeholders of the company and the community to ensure that the consumers are ready to develop positive attitudes towards the products in the market (Perner, 2011). A contrast of the economic, passive, cognitive and emotional models of consumer decision making provides that shows that people have different emotional characteristics and this will determine their purchase behaviors. The economic class of a person also will determine the decision making process and the theories developed may be not true. People behave differently and their decision making process will be determined by the environment and the experiences they have had in the past about the products (Perner, 2011). Home ownership is an example of psychological need that many people have and this has mo tivated many people to seek information about mortgage plans and other schemes which can enable them own a home before they retire from employment. The desire is shaped by the economic, passive, cognitive and emotional models of consumer decision making. Culture has also played a key role in the development of the need to own a home before a person retires. It is a culture that every person earning some income should be able to provide shelter for the family. This culture has shaped the decision making of people and as such people have developed a savings habit to purchase such products. Conclusion Consumer behavior is an integral part of marketing processes adopted by any company. Marketers must identify the culture, behavior and all aspects of their consumers so that they can maintain a competitive position in the market. Additionally, the proper channels of introducing products in the market should be followed to enhance quick acceptance and adoption of products. Therefore, marke ters should apply the process of segmentation, targeting and positioning to ensure the customers become loyal to their products. This process should coincide with the decision making process by the consumers to ensure potential consumers are attracted while the existing ones are retained. List of references Deaton, A. Muellbauer, J. (1980). Economics and consumer behavior. Cambridge, Cambridge University Press. Ferrell, O. C. Hartline, M. D. (2008). Marketing Strategy. Cengage Learning. Horner, S. Swarbrooke, J. (2005). Leisure marketing: a global perspective. Oxford, Butterworth-Heinemann. Jobber , D. Lancaster , G., (2009). Selling and Sales Management. 8th Edition. Financial Times Press McDonald, M. Dunbar, I. (2004). Market segmentation: how to do it, how to profit from it. Oxford. Butterworth-Heinemann. Mooij, M. K. Mooij, M. (2010). Consumer Behavior and Culture: Consequences for Global Marketing and Advertising. London, Sage. Mowen, J. C. Minor, M. (2001). Consumer beh avior: a framework. New York: NY, Prentice Hall. Mullen, B. Johnson, C. (1990). The psychology of consumer behavior. New Jersey: NJ, Routledge. Perner, L. (2011). Consumer behavior: the psychology of marketing. Retrieved from http://www.consumerpsychologist.com/ Peter, J. P. Olson, J. C. (2009). Consumer Behavior. New York, McGraw-Hill. Sandhusen, R. L. (2000). Markets. New York, NY: Barron’s Educational Series. Schlegelmilch, B. B. (1998). Marketing ethics: an international perspective. London, Cengage Learning EMEA. Schiffman , L., Kanuk , L., (2010). Consumer Behavior: International Edition. 10th Edition, London: Pearson Higher Education Solomon, M., (2011). Consumer Behavior: Buying, Having and Being, Global Edition, 9th Edition, Pearson Higher Education. Taylor, C.R. and Lee, D., (2007). Cross-cultural Buyer Behavior. (Series: Advances in International Marketing v.18) Emerald Group Publishing. This assessment on Theories of consumer behaviour was written and submitted by user Dalton Brooks to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.