Consumer behaviour



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CONSUMER BEHAVIOUR

According to Wayne et al, consumer behaviour reflects the totality of consumer decisions with respect to acquisition, consumption and disposition of goods, service, activities, experience, people and ideas by (human) decision making units (over time).

NB Consumers are end users of goods and services ie they buy goods and services for their own benefit and enjoyment. Customers buy goods and services for resale.

Consumer behaviour has two kinds of consuming entities;



  1. Personal consumer

  2. Organisational Consumer (Profit, Non profit, Government agencies and Institutions all must buy products, equipment and service in order to run their organisations.

Defining Consumer Behaviour

Schiffman and Kanuk (2004) defined consumer behaviour as; the behaviour that consumers display in searching for, purchasing, using, evaluating and disposing of products and service that they expect will satisfy their needs.

Mowen and Minor (1998) defined it as the study of buying units and the exchange process involved in acquiring consuming and disposing of goods, services, experience and ideas.

David (2002) define it as the mental and emotion, physical activities that people engage in when selecting, purchasing and disposing, using of products and services so as to satisfy needs and desire.

Therefore, consumer behaviour deals with how do we get information about the product, how do we access alternative products, why do different people choose and use different products, who influences them, how are brand loyalties formed?



Consumer behaviour reflects:

The totality of decisions

About the consumption

Of an offering

By decision making units

Over time

Whether


Acquisition

Product

Information gatherer

Hours

What


Usage

Services

Influencer

Days

Why


Disposition

Experience

Decider

Weeks

How





Activities

Purchaser

Months

When





People

User

Years

Where





Ideas







How much














How often













How long














Marketing Strategies and Tactics

Three broad categories in Consumer Behaviour



  1. Acquiring

Buying represents one type of acquisition, however there us leasing, Trading and Sharing.

  1. Using

Consumers acquire an offering then they use it. Whether or how we use and offering symbolises something about who we are, what we value and what we believe in, for example, the food we eat, clothes we wear, music we listen to etc.

  1. Disposing

How consumers get rid on an offering does have an implication on marketers for example recycling.

Why study Consumer Behaviour?

Markets are defined in terms of people: No people no market. Organisations survive through consumers and customers who purchase their goods and services. The purpose of businesses or organisations is to maximise the consumption of goods and service, to maximise the quality of life through supply and consumption of goods and services and to maximise the protection of people who consume goods and services.

Evaluation of effective marketing must be through the satisfaction of consumers and customer with the goods that the organisation manufactures and supplies. The understanding of behaviour motives make-ups or individual making up the society or the market for goods and services is the primary aim for studying consumer behaviour so as to effectively market these goods and services.

Consumer behaviour focuses on how individuals make decisions to spend their available resources (money, time, effort) on consumption related items. This includes what they buy, why they buy, when, where, how often they use it, where they buy it etc.



Six principles guide marketers in their decision to focus on these issues.

  1. There is need to manage basic needs effectively.

  2. There is need to manage the supply of goods and service effectively, efficiently and economically.

  3. To promote innovation

  4. To inform and educate consumers

  5. To curb potential harm to themselves and society (consumers by definition includes us all)

  6. To make certain assumptions in an effort to achieve these goals.

Studying consumer behaviour will assist you as a consumer to understand consumption related decision, what we buy, why we buy, what are the promotional influences that persuade us to buy. Consumers are the largest economic group in the economy affecting and affected by almost every public and private decision.

Factors influencing consumer behaviour

  1. Internal Factors

Motivation

Perception

Personality

Attitudes

Learning


  1. External Factors

Culture

Family


Opinion leaders

Reference Group

Nowadays, everything that we do, there is need to consider the ethical issues. Gone are the days when organisations had to adhere to marketing concepts to sale their products. There is need for consumer ethics.

Consumerism and Ethical Issues

The social marketing concept calls on marketers to fulfil the needs of the target market in ways that improve society as a whole while fulfilling the needs of the organisation. The societal marketing concept also recognises that companies that incorporate social responsibility and ethical issues will attract and maintain loyal customers. Ethical issues will prevent companies from exploiting consumers.



Teleological moral systems

(a person’s choice is based on what is best for everyone involved ie the greatest good for the greatest number)

Teleological moral systems are characterized primarily by a focus on the consequences which any action might have. Thus, in order to make correct moral choices, we have to have some understanding of what will result from our choices. When we make choices which result in the correct consequences, then we are acting morally; when we make choices which result in the incorrect consequences, then we are acting immorally.

The idea that the moral worth of an action is determined by the consequences of that action is often labeled consequentialism. Usually, the "correct consequences" are those which are most beneficial to humanity - they may promote human happiness, human pleasure, human satisfaction, human survival or simply the general welfare of all humans. Whatever the consequences are, it is believed that those consequences are intrinsically good and valuable, and that is why actions which lead to those consequences are moral while actions which lead away from them are immoral.

The word teleology comes from the Greek roots telos, which means end, and logos, which means science. Thus, teleology is the "science of ends." Key questions which teleological ethical systems ask include:


  1. What will be the consequences of this action?

  2. What will be the consequences of inaction?

  3. How do I weigh the harm against the benefits of this action?

According to this theory it is perfectly ethical for a company to conceal potential negative consequences of a product trial from early adopters of the product if a large number of people are likely to benefit once the product is perfected. Example is The original Coke’s secret formula was argued by scientists as being harmful to consumer health and as such, the Coca Cola company redesigned the beverage to what it is today. Regardless, they have managed to maintain their market share.

Criticism of Teleology

One common criticism of teleological moral systems is the fact that a moral duty is derived from a set of circumstances lacking any moral component. For example, when a teleological system declares that choices are moral if they enhance human happiness, it isn't argued that "human happiness" is intrinsically moral itself. Nevertheless, a choice which enhances that happiness is moral. How does it happen that one can lead to the other?

Critics also often point out the impossibility of actually determining the full range of consequences any action will have, thus rendering attempts to evaluate the morality of an action based upon those consequences similarly impossible. In addition, there is much disagreement over how or even if different consequences can really be quantified in the way necessary for some moral calculations to be made. Just how much "good" is necessary to outweigh some "evil," and why?

Deontology (Do unto others as you would want them to do unto you)

It deals with the methods and intentions involved in a particular behaviour. The Deontology theory focuses on the results of particular action and tends to place greater weight on personal and social values than economic values. It suggests that individuals should be willing to have their actions becoming universal laws that would apply equally to themselves as to all others. For example, a Christian would have to abide by the Christian ethics which make it immoral to lie. Another example is that during the Nazi Germany, it was considered immoral for a German to lie about the location of Jews hideout. In that scenario, it was duty to be truthful despite the fact that divulging the Jews’ location meant harm to them.

Marketers should reduce consumer complaints and activism by taking preventive actions such as improving quality of products, expanding service and lowering prices, participating in consumer activities by initiating an active program such as educating consumers to shop more wisely, cooperating with government agencies (eg Consumer Council of Zimbabwe) and consumer groups in their consumer education programs.

Unethical behaviour in consumerism

Misrepresentation, Bribery, Untruthful presentation, Exaggeration, Low price goods Low quality, Vandalism, Change price tags, Hoarding of products, Shoplifting, Use of sexual appeals on selling



Family influences on consumption related behaviour

The institution of the family has been acknowledged universally as the oldest institution in history. What is a Family?

According to Bredemeier and Stevenson (1966), family is a group of people linked by blood and marriage who occupy a common household and are usually characterised by economic cooperation and solidarity. According to this definition, members of the family are therefore formed as a social phenomenon within a framework of two ties ie blood and marriage. The relationship between the members is therefore biological and social thus relationship between parents and children is biological and between parents is social as their union is only possible through patterns of marriage.

More recently, a family has been defined as consisting of two or more persons related by blood, marriage or adoption residing together.



Types of families

  1. Married couple (husband and wife)

  2. Nuclear Family (husband, wife and children)

  3. Extended Family (nuclear family including blood relatives)

  4. Single parent Family (one parent living with one or more children as a result of divorce, separation, death of spouse, and out of wedlock birth)

Functions of a family

  1. Provider of economic well-being

  2. Emotional support

  3. Suitable family lifestyle is decided through discussion

  4. Family member socialisation – this is the process that introduces children to basic values and ways of behaviour in culture including moral and religious principles, grooming standards, appropriate dressing, speech and suitable education goals.

The children’s experience is reinforced and refined as they grow from childhood to adolescence and eventually adulthood.

  1. Consumer socialisation – it is one of the most important functions of the family and comprises of processes through which people especially through which children acquire skills, knowledge and attitudes relevant to the functioning in the marketplace. In consumer socialisation, parents should act as role models. Children observe parents and learn consumer behaviour.

Family decision making roles

In the family, key consumption roles include initiator, influencer, decider, buyer and users. Marketers can direct their appeal to any member of the family since one member of the family can play all the above listed roles. The household decision making has three important players ie the husband, the wife and the children.



Dynamics of Wife/Husband decision-making

Some products are husband dominated whilst others are wife dominated. The marketer should therefore know which products are husband dominated or wife dominated so as to tailor-make his appeal.

Examples of wife dominated products include grocery products, and clothing.

Examples of husband dominated products include cars, car parts

Examples of joint decisions making products include household furniture.

Children are targeted by marketers because they can recall brands and their experience with brands. They are therefore good targets for creating brand loyalty.

The role of the wife and children has also changed over the years where wives are becoming bread winners whilst the husband becomes the childrearer and children have also become indirect influencers.

Importance of Family to the Marketer


  1. The marketer should understand that family members have greater consumption influence

  2. Note that parents are the dominant consumer decision makers

  3. You need to distinguish products associated with femininity and masculinity

  4. You need to realise that children influence consumption decisions and actual purchase of the product

  5. You also need to access different consumer needs in the family

  6. You also need to note that the wife is the main purchase agent

  7. Note that the father is the final signatory on the purchase of big items

  8. Realise that purchase may need mutual consensus

  9. Note the power of women in family purchase decision making matters

  10. Realise that men and women respond differently to marketing messages

  11. Parents want to raise their children according to current lifestyle

  12. Target breadwinners in marketing a product

  13. Children are agents of change in a family

  14. Children have greater exposure to marketing media

  15. Children spread marketing messages that elderly people

Family life cycle

It refers to the position in life based on such demographic factors as age, marital status, and presence of children and age of children. According to Blackwell et al (2001), the family changes over time passing through a series of stages called the Family Life cycle (FLC).



Bachelorhood

Married Couple/Honeymooners

Parenthood

Post parenthood

Dissolution Phase

Bachelorhood Phase

This phase is characterised by an adult living alone (thus living apart from parents). Marketers of fashion, health products, insurance companies, housing agents, cars, latest products should target this group. Most of their income is spent on entertainment. They tend to watch late night programmes therefore, marketers targeting this group should flight their adverts during late night programmes. The price (skim/high), distribution



Married Couple/Honeymooners

They are characterised by young couples that are just married. Manufacturers of household furniture, house insurance companies, high quality electrical products, restaurant usually target these newly weds. They usually practice joint decision making when purchasing products. They also watch television during family time viewing hence promotion targeting these newly weds should be flighted around this time. They can use skim pricing since honeymooners buy expensive products.



Parenthood Phase

The phase is composed of a married couple with at least one child living at home. This phase consists of three classes;



  1. Parents with children at Pre-school

Marketers of toys, washing detergents, baby foods and educational toys should target this phase

  1. Parents with children at Intermediary school

Households with children in intermediary schools tend to spend more on clothing, electric gadgets such as DVDs, CDs, school uniforms, audio equipment, snacks, and cordial juices. Television watching may include family time viewing and late night movies over the weekend. Products (add features to your product, have jumping castles, hold birthday parties, babysitters etc). You need to charge low prices, promote during family time viewing and intensively distribute the products.

  1. Parents with children at tertiary school

They spend more on tertiary fees, want more money for entertainment, and need to charge average prices for parents to afford. They prefer to eat out at Takeaways, nightspots.

Post parenthood Phase

This refers to an older couple with no children living at home. It is typical in the western economies. This is the lucrative stage for manufacturer of cars, furniture, travel agents, hotel and health providers. There is increase in income and decrease in burden therefore they have got more disposable income. They also tend to invest more that the other groups in financial products and vacation. Usually, they are interested in watching sport on television and news. In our African economy, marketers of fertilizers and crop seeds needs to target should target this group.



Dissolution Phase

It is characterised by one of the original spouses leaving. Marketers of Christian care, medical practioners, NGOs.



Implications of the family life cycle to a marketer

The FLC is another way that the market segments itself. Understanding the FLC helps the marketer develop and offer products that deliver the benefits that are sought by individuals and families as they move through life cycle spectrum. There is need to adjust products and service to fit the need of individuals at different levels of the FLC.



Culture and consumption behaviour

Culture is a set of traditional beliefs and values that are transmitted and shared in a given society. Culture then means a lot of things to many people. It encompasses the norms, beliefs, values, art and knowledge which influence the behaviour of consumers in a given location and time.


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