Introduction to Consumer

Behaviour
By
Prof. Yogesh Funde

Course Syllabus

Diversity of consumer behaviour and role of consumer

behaviour in marketing strategy
Individual Aspects of consumer behaviour: Perception,
Learning and information processing
Motivation and Involvement, Attitudes and Personality
External influences affecting consumer behavior: Social
Class; Opinion Leaders; Reference Groups
Role of culture and subcultures; Family
Organizational factors affecting consumer behavior
Consumer Decision making process, Market
Segmentation
Applications of Consumer behavior Studies,
Consumerism in India
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Marking Scheme

External exam :- 30
Internal assessment:

Attendence:- 5
Class participation:- 5
Assignments:- 10

Prof. Yogesh Funde

Session Objectives

Define Consumer Behaviour

Why we study consumer Behaviour ?
Two major approaches to study consumer
behaviour
Importance of studying consumer behaviourMarketing concept
Role of consumer behaviour in developing
Marketing Strategy.

Prof. Yogesh Funde

Opening Vignette
Wal Mart Story
Wal-Mart opened its store in Latin America.
The sales have been disappointing and
questions are raised whether Wal-Mart magic
can work in Latin America. Wal-Mart designed
its store like any other Wal-Mart store in US:narrow aisles with a lot of merchandise, huge
parking lots, many products with red, white
and blue banners, and so on. Why did WalMart magic could not work ?

Prof. Yogesh Funde

Why Did Wal-Mart Fail ?

Latin Americans shop with their families and

require large aisles.
Most of them do not own cars hence require
door to door transportation service.
Red, white and blue banners gives impression
of Yankee imperialism.
The bottom line is Wal-Mart forgot to study
the Customer.

Prof. Yogesh Funde

Mahabharat
War
Arjun / Duryodhan Krishna
D to reach first, sits by the side of head of
sleeping K
A, late, but happy to see D sitting there,
sits near feet of K, waking up man sees the
things on the side of his feet first
K wakes up, sees A, asks what he wants
D objects claiming that he came first**
K It is not imp who came first, it matters
whom did I see first (CLEVER A)

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Development of the Marketing Concept

Production
Concept
Product Concept
Selling Concept
Marketing
Concept

The Production Concept

Assumes that consumers are interested

primarily in product availability at low
prices
Marketing objectives:

Cheap, efficient production

Intensive distribution
Market expansion

The Product Concept

Assumes that consumers will buy the

product that offers them the highest
quality, the best performance, and the
most features
Marketing objectives:

Quality improvement
Addition of features

Tendency toward Marketing Myopia

The Selling Concept

Assumes that consumers are unlikely to

buy a product unless they are aggressively
persuaded to do so
Marketing objectives:

Sell, sell, sell

Lack of concern for customer needs and

satisfaction

The Marketing Concept

Assumes that to be successful, a company

must determine the needs and wants of
specific target markets and deliver the
desired satisfactions better than the
competition
Marketing objectives:
Profits

through customer
satisfaction

Buyer Behavior
Behavior
As you look at history its apparent that
human behavior is much more easier to
predict than the weather.
Behavior

is a mirror in which everyone shows

image.

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Prof. Yogesh Funde

Buyer Behavior Defined

Consumer behavior involve all the consumer

activities associated with the purchase, use
and disposal of goods and services, including
consumers emotional, mental and behavioral
responses that precede, determine and follow
these activities.

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Prof. Yogesh Funde

Buyer Behavior
The study of buyer behavior includes the
study of:
What they buy?
Why they buy?
How they buy?
When they buy?
How often they buy?
From where they buy?

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Personal Consumer
The individual who buys goods
and services for his or her own
use, for household use, for the
use of a family member, or for
a friend.

Organizational Consumer
A business, government
agency, or other institution
(profit or nonprofit) that buys
the goods, services, and/or
equipment necessary for the
organization to function.

Consumer Activities

Purchase Activities

Use Activities

Gathering and evaluating information about

product and services and choosing where to make
purchase.
Where, when and how consumption take place.

Disposal Activities

How do they get rid of the product?

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Prof. Yogesh Funde

Consumer Responses

Emotional Response (Affective responses)

Mental Responses (cognitive Responses)

Emotions, feelings and moods

Consumers thought processes, opinions, beliefs,
attitudes and intentions

Behavioural Responses.

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Overt decisions and actions during the purchase,

use and disposal activities.

Prof. Yogesh Funde

Example 1.

Real estate agents in Vancouver, Canada are

able to command higher prices for house
numbers which contain the number 8, and
lower prices for number 4

Why?

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Prof. Yogesh Funde

Example 2

During periods when consumers are not

shopping much (e.g., bad economy), store
managers often play slow music within
stores

During busy periods (e.g., holiday season),

fast music is played

Why?

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Example 3.

In the US, the Marlboro cowboy is usually

shown alone

Ad.

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Example 3.

In Japan, the Marlboro cowboy is usually

shown as part of a group

Ad.

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WHY??

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Solution.

Culture has an influence on consumer

behavior

US culture = importance of individual; not

true in Asia

Japanese consumers think a single cowboy

looks lonely and poor

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Just an ordinary worker on a farm

Prof. Yogesh Funde

The pride of your home

What is the latest consumer durable product you have

bought for your house?
Whose idea was to get that product? Why did he/she feel
that you needed that product?
Who fixed the budget? What was the procedure for fixing
budget? Who paid for the product?
Whom did you consult before deciding?
Why did you select the particular brand and not the other?
Who selected the particular brand?
Where did you buy it and why from there only?
What is your feeling after buying and using that product?
Any other aspects worth mention?**
Time 15 mins. Randomly selected 3 to present.

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Buyer Roles
Initiato
r

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Influence
r

Payer

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Decider

Buyer

User

Why Study Consumer Behavior?

To improve Business performance through

customer focused strategies.
To influence public policy.

Understand publics need and wants

To protect public from unfair, unethical and
dangerous business practices.

To educate and help consumers make better

decisions.
Social Marketing

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Prof. Yogesh Funde

Successful Relationships

Customer
Value

Customer
Retention

Customer
Satisfaction

Buying Motives

Fear
Profit
Vanity
Pride
Fashion
Love & Affection

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Health

Comfort and Convenience

Curiosity

Admiration

Jealousy

Patronage

Prof. Yogesh Funde

Types of Buyers

Friendly Buyer
Reserved Buyer
Silent Buyer
Undecided Buyer
Price Conscious
Buyer
Argumentative Buyer
Suspicious Buyer

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Rude Buyer

Intelligent Buyer

Impatient Buyer

Bargain Buyer

Impulsive Buyer

Over-cautious Buyer

Slow-thinking Buyer

Prof. Yogesh Funde

External
Infuence

Process

Consumer Decision
Making

Output

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PostDecision
Behavior

Input

Firms Marketing Efforts

1. Product
2. Promotion
3. Price
4. Channels of
distribution

Need
Recognition
Prepurchas
e Search
Evaluation
of
Alternatives

Sociocultural
Environment
1. Family
2. Informal sources
3. Other noncommercial
sources
4. Social class
5. Subculture and
culture
Psychological Field
1. Motivation
2. Perception
3. Learning
4. Personality
5. Attitudes
Experience

A Model of
Consumer
Decision Making

Purchase
1. Trial
2. Repeat purchase
Postpurchase
Evaluation

Prof. Yogesh Funde

Coke Case Study-Questions

1.
2.
3.

4.
5.

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What factors led to Coca-Colas huge

initial popularity?
What was Pepsis strategy?
Coca-Cola responded with New Coke:
what happened as a result? (summarize
facts from case)
How did Coca-Cola end up making such a
big mistake?
What would you have done?

Prof. Yogesh Funde

Lessons from Coke

Concentrate on your brand perceptions

Dont clone your rival

Feel the love

Marketing is a battle of perceptions, not

products- Jack Trout

Successful brands dont have trade marks, they

have love marks instead-Kevin Roberts,
CEO,Satchi & Satchi

Dont be scared to U-Turn

Do the right market research

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Prof. Yogesh Funde