1

1)state any five characteristics of consumer behavior.

Important Characteristics of Consumer Behaviour are given below:

1. Consumer Behaviour involves Products, Services, Activities, and Ideas:

In the scope of consumer behaviour, not only products (like toilet soaps), are included but also
the services (flying by an airliner), and activities (getting children vaccinated for polio), and
ideas (saying no to drugs). Thus consumer behaviour rotates around offerings.

2. Consumer Behaviour involves more than Buying:

Consumer behaviour is not restricted only to buying the offering. It includes buying (acquiring
the offering), using, and disposing. Usage has many connotations – first, it has important
symbolic implications for the consumer. The saree and the jewellery being put on by ladies in the
wedding influence marketing strategies and tactics.

Usage can also influence other behaviours. Secondly, it may also influence other behaviours. Not
satisfied the product or services may lead to consumer complaints and protests. Finally,
consumer behaviour also evaluates as how do consumers get rid of an offering, they previously
acquired.

In India, people from older generation still do not throw things, once acquired. People still prefer
to use old thing after getting repaired. In case of cars, the car companies attach value to the old
cars taken by the automobile companies in exchange of a new car. However, the new generation
philosophy is to throw the things like that of westerners.

3. Consumer Behaviour is a Dynamic Process:

Consumer Behaviour is dynamic because the thinking, feelings, and actions of individual
consumers, targeted groups, and the society at large are constantly changing. Maruti Suzuki
produces number of cars, as needs and wants may change at different times for different
consumer groups.

The sequence of acquisition, consumption, and disposition can occur over time in a dynamic
sequence. The sequence can be over in a matter of hours to years. Suppose a family has acquired
a new Tata Indica car. Its usage will provide the family whether it drives well, is economical,
impresses others, and does minimal harm to the ecological environment – all these will affect
when, whether, how, and why the family will dispose of the car by selling or junking it.
 2

Disposition of the car will affect when, whether, how, and why its members acquire another car
in the future. Consumer behaviour is a process which includes issues that influence the consumer
before, during, and after a purchase.

4. Consumer Behaviour involves Interactions among Many People:

Consumer behaviour does not mean action of a single individual. Interactions may take place
among a group of friends, a few co-workers, or an entire family. The individuals may take
different roles.

For example, to buy a car the adult son may gather the information, the younger daughter may
influence the buying decision, parents may finally be the buyers. The car may be used by one or
all the members in the family. Similarly several family members may be involved in disposing
the car.

5. Consumer Behaviour involves Many Decisions:

Consumer behaviour needs understanding whether (to acquire/use/ dispose of an offering), what
(to acquire/use/dispose), why (to acquire/use/dispose of an offering or not)), when (time), where
(place), how (ways of acquiring, using, and disposing), how much (volume), how often
(frequency), and how long (till what time) consumers will buy, use or dispose of an offering.
 3

2)Differentiate between consumer and customer.

Ans) Definition of Customer

By Customer, we mean a person who buys the goods or services and pays the price thereof. The
word customer is derived from the term ‘custom’ which means ‘practice’, so the word customer
means the individual or entity who purchases product or services from a seller at regular
intervals. It can also be known as client or buyer. They are divided into two categories:

 Trade Customers: The customers who purchase goods in order to add value and resell
them. These include Manufacturers, Wholesalers, Distributors, Retailers etc.
 Final Customer: They are the customers who purchase it either for their own use or to
hand over it to the final user.

The customers are regarded as the king, in every business because they help in earning revenue.
The businesses focus on converting shoppers into buyers. They also try to maintain a good
relationship with the customers in order to keep the business going. Below given are the three
kinds of customers:

 Former customers or ex-customers

 Existing customers
 Prospective customers

Definition of Consumer

We define consumer, as a person who is the end user of the product. The word consumer is made
from the word ‘consume’ which means ‘to use’. In this way, the word consumer means a person
who purchases the product or service for his own use or consumption.

As per the Consumer Protection Act, 1986, it does not include the person who purchases the
commodity for the purpose of adding value or resale for any commercial purpose. However, a
person can use those goods or services to earn livelihood or self-employment. Any type of user,
other than the buyer who purchases goods, consumes the goods by taking permission of the
buyer will also come under the category of Consumer. It includes the person who avails the
services for any consideration. Moreover, the beneficiary of such services will also be regarded
as the consumer. There are three Consumer protection council in India:

 At national level: Central Protection Council

 At state level: State Protection Council
 At district level: District Protection Council
 4

3)mention the different consumer roles.

Ans) Different roles of consumers When thinking about the motives for consumption it is worth
being aware that the individual who stands in the background of the purchase and other
consumption decisions has many alternative and overlapping roles. Gabriel and Lang (1995)
have presented many of them, of which the most prominent ones regarding green consumption
are presented here by utilising also the article “21st century consumers” (New Internationalist
2006). Altogether, consumers’ different roles set challenge to the management and design of a
social campaign in which focus the consumer is. It is difficult to foretell what appeals consumers
and motivates them to take action. Nonetheless, each of these roles depicts naturally one kind of
generalised image of consumer. In reality, an individual consumer is a mix of different aspects
and different roles are activated in different situations. But still when thinking about green
consumption, these may give some food for thought for marketing managers. Citizen – consumer
There is a powerful tension between the concepts of citizen and consumer, people acting in
double roles: as consumers and as citizens. People’s acts as consumers cannot be detached from
their actions as citizens especially when it comes to sustainability. In brief, people, as consumers,
act with a short-term orientation looking for the direct fulfilment of needs and wants without
considering sustainability. As citizens their actions are guided by a long-term orientation, where
the individual takes into consideration environmental matters and also shows responsibility
towards others. The concept of a citizen implies both control and balance over rights and duties
and active participation as members of society. Moreover, in the role of citizen, individuals are
supposed to take a moral standpoint when making their choices. In recent years the re-emergence
of the idea of citizen has been applied, not surprisingly, in the context of environmentalism.
Environmental citizenship entails the emergence of exactly the kind of individual described
above, an active individual that feels no fear to defend the rights of the majority and who
carefully evaluates different alternatives and moral questions when making decisions. He/she
also knows, cares and acts with responsibility towards the environment. Environmental
citizenship calls for individuals, for example, to take part in government-directed top-down
informative campaigns that strive for a better environment via the activation of consumers, such
as the campaigns to reduce climate change that where topic in many case studies. Currently,
political culture is poised between giving primacy to voting or shopping. Since the late 20th
century, consumerist values have spread and mutated throughout society. They have turned
politics into a spectator sport and politicians into competing brands. They have eroded welfare
systems and promoted the achievement of freedom, happiness, good health and education
through individual choice exercised through the market. The concept of citizen-consumer was
pondered over in some case studies. In Greece’s case (Gr 1) the campaign leant quite heavily on
the citizen. The campaign goal was to create informed and aware citizens of 6-12 years old
children who, when adults, will seek the best means to use energy. Likewise, in one UK case the
activities had “the dual objectives to engage and inform citizens about how they can live lower
carbon lifestyles as well as providing them with practical help and solutions on a range of
measures which can be taken in the home.” The chooser Choice is a core value at the heart of
consumerist culture. The underlying rationale is ‘the more choice the better’ for consumers, the
economy and society. But it has its limitations. Choice without information is not real choice, yet
how can consumers get all the facts they need? Choice is also not absolute. ‘I choose to drive to
 5

the supermarket in my car’ can close off other options such as: ‘I choose to buy all my food from
locally owned shops I can walk to’. Much so-called ‘consumer choice’ boils down to relative
trivialities, compared to matters of life and death, political and civil rights, or the future of the
planet. Surely choice should not just be a matter of which product to select, but also of whether
and how to consume. These issues were maybe not so visibly seen in the case studies, although
some of them discussed, for example, the importance of freedom of choice. The Spanish case on
salesmen training for white goods (E 8) paid attention to delivering information to consumers in
order to help them to make environmentally better choices. The activist A long tradition of
individual and collective consumer activism across the world has taken many forms: campaigns,
legal cases, education, whistle-blowing, direct action. The Irish gave the ‘boycott’ its name, but
Americans practised it much earlier against the British in the struggle for independence, as did
the people of the Indian subcontinent following Gandhi’s lead. The 20th century co-operative
movement enabled some consumers to take control of production. In the US, consumer advocate
Ralph Nader rallied activists to fight against corporate greed. Today a new wave is bringing
together different existing strands of activism and trying to restructure consumption completely,
on more ethical and ecological grounds, exposing and rejecting exploitative conditions, unfair
trading relationships, pollution and waste
 6

4)Define consumer motivation.

Ans) Meaning and Definition:

Consumer behaviour is the study of how individual customers, groups or organizations select,
buy, use, and dispose ideas, goods, and services to satisfy their needs and wants. It refers to the
actions of the consumers in the marketplace and the underlying motives for those actions.

Marketers expect that by understanding what causes the consumers to buy particular goods and
services, they will be able to determine—which products are needed in the marketplace, which
are obsolete, and how best to present the goods to the consumers.

The study of consumer behaviour assumes that the consumers are actors in the marketplace. The
perspective of role theory assumes that consumers play various roles in the marketplace. Starting
from the information provider, from the user to the payer and to the disposer, consumers play
these roles in the decision process.

The roles also vary in different consumption situations; for example, a mother plays the role of
an influencer in a child’s purchase process, whereas she plays the role of a disposer for the
products consumed by the family.
 7

4)Define personality.

Personality is the product of social interaction in group life. In society every person has different
traits such as skin, color, height and weight. They have different types of personalities because
individuals are not alike. It refers to the habits, attitudes as well as physical traits of a person
which are not same but have vary from group to group and society to society, everyone has
personality, which may be good or bad, impressive or unimpressive. It develops during the
process of socialization in a culture of a specific group or society. One cannot determine it of an
individual exactly because it varies from culture to culture and time to time. For example, a killer
is considered criminal in peace time and hero in war. The feeling and actions of an individual
during interaction moulds the personality. It is the sum of total behaviors of the individual and
covers both overt and covert behaviors, interests, mentality and intelligence. It is the sum of
physical and mental abilities and capabilities.
Personality has been derived from the Latin word “persona” which means “mask” used by the
actors to change their appearance. It is the combination of an individual thoughts, characteristics,
behaviors, attitude, idea and habits.

5)List the components of self-concept.

Ans) 1) physical self-concept 3) emotional self-concept

2) social self-concept 4) intellectual self-concept

They are separate because each is unique on its own

However they are also interrelated because our self-concept in one area can influence our self-
concept in another area.

For example-- if your self-concept is shaky in one area it may inhibit the risks I’m willing to take
in another area, such as my social life and it may interfere with my ability to express myself
emotionally (emotional self-concept).

In contrast-- if I’m feeling positive about my physical self-concept, it may make me feel more
confident about my social self.

Goal: we want congruency between the components of the self.

Generally speaking-- the greater the gap between the way we perceive ourselves and the way we
really want to be, the more dissatisfied with ourselves we tend toThe Self-Concept is an
internalized set of perceptions each of us has about ourselves that is relatively stable over time,
consistent across situations, resistant to change and of central importance to us (Caproni, 2000)
 8

It is composed of our beliefs, interests, skills, strengths, weaknesses and what makes us
similar to others.

It influences our fundamental beliefs about who we are, who we should be and who we can
become.

It is socially constructed throughout life and influences how we think:

* school * communities

*family * religious affiliation

* workplace

*social institutions

The self-concept is important because it influences the following:

1) Attention: the self-concept acts like a filter by allowing and disallowing information to
enter our mind; we tend to notice things that are important to our self-concept.

2) Interpretation and Decision Making: our self-concept provides us with a frame of

reference for making sense of what we notice.

3) Social Relations: our self-concept influences who we see as different or as similar to us,
who we trust and the networks of people we create; assumptions we have of others

4) Moral Decision Making: our self-concept influences our ideas about right and wrong,
ethical and unethical.

5) Ability to Cope with Stress: our self-concept helps us deal with the challenges of daily
stress; a healthy self-concept provides us with psychological resources to work through the stress
in life, give us confidence during times of change
 9

Long answer type questions

1)what do you mean by consumer behavior? Highlight the reason for studying
consumer behavior.

Ans) The Consumer Behavior is the observational activity conducted to study the behavior of the

consumers in the marketplace from the time they enter the market and initiate the buying

decision till the final purchase is made. Business JargonsMarketingConsumer Behavior

Consumer Behavior
Definition: The Consumer Behavior is the observational activity conducted to study the behavior
of the consumers in the marketplace from the time they enter the market and initiate the buying
decision till the final purchase is made.

In other words, consumer behavior is the study of how the consumers, make purchase decisions
and what are the underlying factors that influence such decisions. The marketers believe that by
understanding what compels an individual to buy a particular product or service over the
other, it is easy to identify which product are in need and which have become obsolete and
accordingly the marketing strategies could be designed.

Importance of Consumer Behavior

1. It is essential for the marketer to study the behavior of the consumers in order to make better
strategic marketing decisions. If the marketer has complete knowledge about the consumer’s
likings or disliking, then he can predict the response of the potential customers towards his
offerings.

Thus, by studying the consumer behavior before and during purchase helps in production
scheduling, designing, pricing, positioning, segmentation, advertising and other promotional
activities.

2. The study of consumer behavior is equally important for the non-profit organizations such as
governmental agencies, hospitals, NGO’s, charitable organizations. For example, the polio
campaigns can be designed for the vulnerable sections of the society who cannot afford the basic
livelihood.
 10

3. The Government also studies the consumer behavior to provide them with the necessary goods
and services, understanding the potential future problems, such as pollution, anti-plastic drive,
Swacch Bharat Abhiyan, traffic, etc.
4. For legislation, it is again essential to understand the consumer behavior, then only the protective
measures against the consumer exploitation can be taken. Such as mandatory information on the
packaging related to manufacturing date, expiry date, terms of use, etc.
5. The understanding of a behavior of a consumer is necessary before the launch of the demarketing
programmes. For example, motives, attitude, behavior of the customers behind the purchase of
injurious products Viz. Cigarettes, Tobacco, etc. should be properly understood.

Thus, marketers try to understand the consumer psychology with respect to their purchase
decisions and identify the factors influencing the consumer behavior.

Consumer decisions are affected by their behaviour. Therefore, consumer behaviour is said to be
an applied discipline. This leads to the microperspective and societal perspective.

Micro PerspectiveIt involves understanding consumer for the purpose of helping a firm or
organization to achieve its objectives. All the Managers in different departments are keen to
understand the consumer.
They may be Advertising Managers, Product Designers, Marketing and Sales Managers and so
on.

Societal Perspective is on the macro level. Consumers collectively influenced Economic and
social conditions within a society. Consumers strongly influence what will be product, what
resources will be used and it affects our standard of living.
Management is the youngest of sciences and oldest of arts and consumer behaviour in
management is a very young discipline. Various scholars and academicians concentrated on itat a
much later stage. It was during the 1950s, that marketing concept developed, and thus theneed to
study the behaviour of consumers was recognized. Marketing starts with the needs ofthe
customer and ends with his satisfaction. When everything revolves round the customerthen the
study of consumer behaviour becomes a necessity. It starts with buying of goods. Goods can be
bought individually, or in groups. Goods can be bought under stress (to satisfy an immediate
 11

need), for comfort and luxury in small quantities or in bulk. For all this, exchange is required.
This exchange is usually between the seller and the buyer. It can also be between consumers.
To understand the likes and dislikes of the consumer, extensive consumer research studies are
being conducted. These researches try to find out:
1. What the consumer thinks of the company’s products and those of its competitors?
2. How can the product be improved in their opinion?
3. How the customers use the product?
4. What is the customer’s attitude towards the product and its advertizing?
5. What is the role of the customer in his family?
The following key questions should be answered for consumer research. A market comes into
existence because it fulfils the needs of the consumer. In this connection, a marketeer has to
know the 70s framework for consumer research. Taking from an example of soap.

Consumer behaviour is a complex, dynamic, multi-dimensional process, and all marketing

decisions are based on assumptions about consumer behaviour. Marketing strategy is the game
plan which the firms must adhere to, in order to outdo the competitor or the plans to achieve the
desired objective. In formulating the marketing strategy, to sell the product effectively, cost-
benefit analysis must be undertaken.

Role or importance of study of consumer behaviour can be explained with reference to the points

stated as under:
1. Modern Philosophy:
 12

It concerns with modern marketing philosophy – identify consumers’ needs and satisfy them

more effectively than competitors. It makes marketing consumer-oriented. It is the key to

succeed.

2. Achievement of Goals:
The key to a company’s survival, profitability, and growth in a highly competitive marketing

environment is its ability to identify and satisfy unfulfilled consumer needs better and sooner
than the competitors. Thus, consumer behaviour helps in achieving marketing goals.

3. Useful for Dealers and Salesmen:

The study of consumer behaviour is not useful for the company alone. Knowledge of consumer

behaviour is equally useful for middlemen and salesmen to perform their tasks effectively in

meeting consumers needs and wants successfully. Consumer behaviour, thus, improves
performance of the entire distribution system.

4. More Relevant Marketing Programme:

Marketing programme, consisting of product, price, promotion, and distribution decisions, can be

prepared more objectively. The programme can be more relevant if it is based on the study of

consumer behaviour. Meaningful marketing programme is instrumental in realizing marketing

goals.

5. Adjusting Marketing Programme over Time:

Consumer behaviour studies the consumer response pattern on a continuous basis. So, a marketer

can easily come to know the changes taking place in the market. Based on the current market

trend, the marketer can make necessary changes in marketing programme to adjust with the
market.

6. Predicting Market Trend:

Consumer behaviour can also aid in projecting the future market trends. Marketer finds enough
time to prepare for exploiting the emerging opportunities, and/or facing challenges and threats.
 13

7. Consumer Differentiation:

Market exhibits considerable differentiations. Each segment needs and wants different products.

For every segment, a separate marketing programme is needed. Knowledge of consumer

differentiation is a key to fit marking offers with different groups of buyers. Consumer behaviour
study supplies the details about consumer differentiations.

8. Creation and Retention of Consumers:

Marketers who base their offerings on a recognition of consumer needs find a ready market for

their products. Company finds it easy to sell its products. In the same way, the company, due to

continuous study of consumer behaviour and attempts to meet changing expectations of the
buyers, can retain its consumers for a long period.

9. Competition:
Consumer behaviour study assists in facing competition, too. Based on consumers’ expectations,

more competitive advantages can be offered. It is useful in improving competitive strengths of

the company.

10. Developing New Products:

New product is developed in respect of needs and wants of the target market. In order to develop

the best-fit product, a marketer must know adequately about the market. Thus, the study of
consumer behaviour is the base for developing a new product successfully.

11. Dynamic Nature of Market:

Consumer behaviour focuses on dynamic nature of the market. It helps the manager to be

dynamic, alert, and active in satisfying consumers better and sooner than competitors. Consumer
behaviour is indispensable to watch movements of the markets.

12. Effective Use of Productive Resources:

 14

The study of consumer behaviour assists the manager to make the organisational efforts

consumer-oriented. It ensures an exact use of resources for achieving maximum efficiency. Each
unit of resources can contribute maximum to objectives.
 15

2)discuss various factors that influence consumer behavior in detail.

Ans) The Consumer Behavior is the study of how an individual decides to purchase a particular
product over the other and what are the underlying factors that mold such behavior.

Factors Influencing Consumer Behavior

The marketers try to understand the actions of the consumers in the marketplace and the
underlying motives for such actions. These motives are the factors that influence the consumer
behavior. These are:

Psychological Factors: The human psychology plays a crucial role in designing the consumer’s
preferences and likes or dislikes for a particular product and services. Some of the important
psychological factors are:

 Motivation
 Perception
 Learning
 Attitudes and Beliefs
 16

Social Factors: The human beings live in a complex social environment wherein they are
surrounded by several people who have different buying behaviors. Since the man is a social
animal who likes to be acceptable by all tries to imitate the behaviors that are socially acceptable.
Hence, the social factors influence the buying behavior of an individual to a great extent. Some
of the social factors are:

 Family
 Reference Groups
 Roles and status
Cultural Factors: It is believed that an individual learns the set of values, perceptions, behaviors,
and preferences at a very early stage of his childhood from the people especially, the family and
the other key institutions which were around during his developmental stage. Thus, the
behavioral patterns are developed from the culture where he or she is brought up. Several
cultural factors are:

 Culture
 Subculture
 Social Class
Personal Factors: There are several factors personal to the individuals that influence their buying
decisions. Some of them are:

 Age
 Income
 Occupation
 Lifestyle
Economic Factors: The last but not the least is the economic factors which have a significant
influence on the buying decision of an individual. These are:

 Personal Income
 Family Income
 Income Expectations
 Consumer Credit
 Liquid Assets of the Consumer
 Savings
These are some of the underlying factors that influence the consumer behavior, and the marketer
must keep these in mind, so that appropriate strategic marketing decision is made.
 17

3)discuss the scope of consumer behavior in detail.

Ans)The term consumer behaviour, individual buyer behaviour, end user behaviour and
consumer buying behaviour all stands for the same. Consumer behaviour is the study of how
individuals, groups and Organisation select buy, use and dispose of goods and services, ideas or
experiences to satisfy their needs and wants.

Consumer behaviour may be defined as the decision process and physical activity individuals
engage in when evaluating, acquiring, using or disposing of goods and services.

According to Belch and Belch "consumer behaviour is the process and activities people engage
in when searching for, selecting,purchasing, using, evaluating and disposing of products and
services so as to satisfy their needs and desires".

Nature of Consumer Behaviour:

Systematic process : Consumer behaviour is a systematic process relating to buying decisions of

the customers. The buying process consists of the following steps :

 Need identification to buy the product

 Information search relating to the product
 Listining and evaluating the alternative
 Purchase decision
 Post purchase evaluation by the marketer

Influenced by various factors : Consumer behaviour is influenced by a number of factors the

factors that influence consumers include marketing, personal, psychological, situational, social
and cultural etc.
 18

Different for different customers : All consumers do not behave in the same manner. Different
consumers behave differently. The different in consumer behaviour is due to individual factors
such as nature of the consumer's lifestyle, culture etc.

Different for different products : Consumer behaviour is different for different products there are
some consumers who may buy more quantity of certain items and very low quantity of some
other items.

vary across regions : The consumer behaviour vary across States, regions and countries. For

instance, the behaviour of urban consumers is different from that of rural consumers. normally

rural consumers are conservative (traditional) in their buying behaviour.

Vital for marketers : Marketers need to have a good knowledge of consumer behaviour they

need to study the various factors that influence consumer behaviour of the target customers. The

knowledge of consumer behaviour enables marketers to take appropriate marketing decisions.

Reflect status : Consumer buying behaviour is not only influenced by status of a consumer coma

but it also reflect it. Those consumers who owned luxury cars, watches and other items are

considered by others as persons of higher status.

 19

Result in spread effect : Consumer behaviour as a spread effect. The buying behaviour of one

person may influence the buying behaviour of another person. For instance, a customer may

always prefer to buy premium brands of clothing, watches and other items etc. This may

influence some of his friends, neighbours and colleagues. This is one of the reasons why

marketers use celebrities like Shahrukh Khan, sachin to endorse their brands.

Undergoes a change : The consumer behaviour undergoes a change over a period of time

depending upon changes in age , education and income level etc, for example, kids may prefer

colourful dresses but as they grow up as teenagers and young adults, they may prefer trendy

clothes.

Information search : Search for information is a common consumer behaviour. Consumers

cannot purchase goods and services if they are unaware that a good or service exists. When a

consumer decides to buy a certain item, his decision must be based on the information he has

gethered about what products our services are available to fulfill his needs. There might be a

product available that would be better suited to the consumers needs, but if he is an aware of

product, he will not buy it.

 20

Brand loyalty : Brand loyalty is another characteristic of consumer behaviour. Brand loyalty is

the tendency of a consumer to buy product products or services from a certain company that one

likes or equates with having high quality goods and services. For example, if Naina's first car

was a Honda as a teenager and the car lasted 200,000 miles, she might have a tendency to buy

hondas again in the future due to her previous positive experience. This brand loyalty may be so

strong that she forgoes the information search all together when considering for next vehicle.

Scope of Consumer Behaviour:

1) Consumer behaviour and marketing management : Effective business managers realise the

importance of marketing to the success of their firm. A sound understanding of consumer

behaviour is essential to the long run success of any marketing program. In fact, it is seen as a

comerstone of the Marketing concept, an important orientation of philosophy of many marketing

managers. The essence of the Marketing concept is captured in three interrelated orientations

consumers needs and wants, company integrated strategy.

 21

2) Consumer behaviour and non profit and social marketing : In today's world even the non-

profit organisations like government agencies, religious sects, universities and charitable

institutions have to market their services for ideas to the "target group of consumers or

institution." At other times these groups are required to appeal to the general public for support

of certain causes or ideas. Also they make their contribution towards eradication of the problems

of the society. Thus a clear understanding of the consumer behaviour and decision making

process will assist these efforts.

3) Consumer behaviour and government decision making : In recent years the relevance of

consumer behaviour principles to government decision making. Two major areas of activities

have been affected:

i) Government services: It is increasingly and that government provision of public services can

benefit significantly from an understanding of the consumers, or users, of these services.

 22

ii) consumer protection: Many Agencies at all levels of government are involved with regulating

business practices for the purpose of protecting consumers welfare.

4) Consumer behaviour and demarketing: It has become increasingly clear that consumers are

entering an era of scarcity in terms of some natural gas and water. These scarcities have led to

promotions stressing conservation rather than consumption. In other circumstances, consumers

have been encouraged to decrease or stop their use of particular goods believed to have harmful

effects. Programs designed to reduce drug abuse, gambling, and similar types of conception

examples. These actions have been undertaken by government agencies non profit organisations,

and other private groups. The term "demarketing" refers to all such efforts to encourage

consumers to reduce their consumption of a particular product or services.

5) Consumer behaviour and consumer education: Consumer also stands to benefit directly from

orderly investigations of their own behaviour. This can occur on an individual basis or as part of

more formal educational programs. For example, when consumers learn that a large proportion
 23

of the billions spend annually on grocery products is used for impulse purchases and not spend

according to pre planned shopping list, consumers may be more willing to plan effort to save

money. In general, as marketers that can influence consumers' purchases, consumers have the

opportunity to understand better how they affect their own behaviour.

Importance of consumer behaviour:

1) production policies: The study of consumer behaviour effects production policies of

enterprise. Consumer behaviour discovers the habits, tastes and preferences of consumers and

such discovery enables and enterprise to plan and develop its products according to these

specifications. It is necessary for an enterprise to be in continuous touch with the changes in

consumer behaviour so that necessary changes in products may be made.

2) Price policies: The buyer behaviour is equally important in having price policies. The buyers

of some products purchase only because particular articles are cheaper than the competitive

articles available in the market.

 24

3) Decision regarding channels of distribution: The goods, which are sold and solely on the basis

of low price mast and economical distribution channels. In case of those articles, which week

T.V. sets, refrigerators etc. Must have different channels of distribution. Thus, decisions

regarding channels of distribution are taken on the basis of consumer behaviour.

4) Decision regarding sales promotion: Study of consumer behaviour is also vital in making

decisions regarding sales promotion. It enables the producer to know what motive prompt

consumer to make purchase and the same are utilised in promotional campaigns to awaken desire

to purchase.

5) Exploiting marketing opportunities: Study of consumer behaviour helps the marketers to

understand the consumers needs, aspirations, expectations, problems etc. This knowledge will

be useful to the marketers in exploiting marketing opportunities and meeting the challenges of

the market.
 25

6) Consumer do not always act or react predictably: The consumers of the past used to react to

price levels as if price and quality had positive relation. Today, week value for money, lesser

price but with superior features. The consumers response indicates that the shift had occurred.

7) Highly diversified consumer preferences: This shift has occurred due to availability of more

choice now. Thus study of consumer behaviour is important to understand the changes.

8) Rapid introduction of new products: Rapid introduction of new product with technological

advancement has made the job of studying consumer behaviour more imperative. For example,

the information Technologies are changing very fast in personal computer industry.

9) Implementing the "Marketing concept": This calls for studying the consumer behaviour, all

customers need have to be given priority. Thus identification of target market before production

becomes essential to deliver the desired customer satisfaction and delight.

 26

Applications of consumer behaviour:

1) Analysing market opportunity: Consumer behaviour study help in identifying the unfulfilled

needs and wants of consumers. This requires examining the friends and conditions operating in

the Marketplace, consumers lifestyle, income levels and energy influences. This may reveal

unsatisfied needs and wants. Mosquito repellents have been marketed in response to a genuine

and unfulfilled consumer need.

2) Selecting target market: Review of market opportunities often helps in identifying district

consumer segments with very distinct and unique wants and needs. Identifying these groups,

behave and how they make purchase decisions enable the marketer to design and market

products or services particularly suited to their wants and needs. For example, please sleep

revealed that many existing and potential shampoo users did not want to buy shampoo fax price

at rate 60 for more and would rather prefer a low price package containing enough quantity for

one or two washers. This finding LED companies to introduce the shampoos sachet, which

become a good seller.

 27

3) Marketing-mix decisions: Once unsatisfied needs and wants are identified, the marketer has to

determine the right mix of product, price, distribution and promotion. Where too, consumer

behaviour study is very helpful in finding answers too many preplexing questions. The factors of

marketing mix decisions are:

i) product ii) price iii) promotion iv) distribution

4) Use in social and non profits marketing: Consumer behaviour studies are useful to design

marketing strategies by social, governmental and not for profit organisations to make their

programmes more effective such as family planning, awareness about AIDS.

4)list the new consumption pattern of Indian consumer.

Ans) 1. The digitization of economic and social life in Asia generally and India specifically
promises to bring great changes to consumption patterns. We’ve seen this dramatically
in China in recent years—Cindy alludes to this in her description of the impact of e-
commerce on consumer behavior in rural areas that previously had limited buying options. We
might expect similar changes to come to India’s rural areas as national e-commerce
networks develop.

2. A number of Indians still don’t own a smartphone, but adoption is increasing rapidly, which
should nudge further use of digital payments by consumers. Given continued increases in wages
and decreasing cost of smartphones
 28

MORE ON THIS TOPIC FROM FORBES

iPhone 11 Buyer Warning As 'All-New' Apple iPhone Takes Shape
Galaxy S11, Note 11 Shock As Cancellation Fears Grow
5 Best On-Ear Headphones Of 2019
, I’d guess most Indians will own a smartphone within the next 5-10 years. At the same time,
we’ll see increasing merchant acceptance of digital payments, for example through QR codes
and the UPI system, neither of which require an expensive point-of-sale terminal. This should
give a continued boost to the development of digital commerce, which can open up the entire
economy to a lot of innovation and efficiency gains.

3. The recent implementation of a national Goods and Services Tax (GST) is typically thought of
as a supply-side, structural reform, but it will impact long-term consumption as
well. Rationalizing local and state taxes into a standardized national system should decrease
fragmentation of domestic supply chains and encourage the development of more national
markets (while also raising revenue). The GST, by its nature, will impact consumption patterns.
Generally speaking, the consumption tax levied on goods by the GST should be lower than the
previous effective rate amalgamated from state and local taxes. In addition, if the intended
supply-side effects take hold and provide efficiencies to domestic manufacturing and supply
chains, that should reduce costs of final goods and services and boost consumption.

4. India’s modern economic development has been notable for the sustained contribution of
consumption. In the long run, consumption is supported by strong employment and wage growth
and the consumer confidence that flows from these fundamentals. Moving forward, the economy
will need to provide jobs for its young, growing workforce to sustain this impressive run of
consumption-led growth.
 29

5)discuss the changing consumer trends of Indian consumer.

Ans) The Indian consumer market has higher disposable income the development of modern
urban lifestyles. Increase in consumer awareness has affected buyer’s behavior in cities, towns
and even rural areas. According to a 2010 report by McKinsey & Co., India is set to grow into
the fifth largest consumer market in the world by 2025. Rising incomes in the hands of a young
population, a growing economy, expansion in the availability of products and services and easy
availability of credit all has given rise to new consumer segments and a rising acceptability of
debt, whether it is mobile phones, credit cards, apparel or organized retail, people clearly seem to
be spending more, particularly on discretionary items. The credit facility from business houses
has been increasing at a rapid rate. This shows the terrific cut-throat competition in the ever
changing market.
OBJECTIVES
1. To recognize the different consumer types & communicate accordingly.
2. To know the factors those affect their buying behavior.
3. Understand buying behavior & consumer decision making process.
4. To know what strategies the marketer can adopt to influence the consumer purchasing
behavior.
LIMITATIONS

The study focuses and emphasizes on a sample size of 50 in and around Raipur due to the time
and cost constraint. Since the area of study has only been Raipur and also on a select sample of
50 the results may or may not be applicable to the other cities in India. Changing Trends in
Indian Consumer Behaviour Purchasing urban products is taking place in India at a tremendous
pace and is influencing the life style and buying behavior of the consumers. The working
urbanites are depending more on fast and ready-to-serve food, they take less pain in traditional
method of cooking and cleaning. Bulk purchases from hyper stores seem to be the trend these
days, rather than frequent visits to the neighborhood market or store or vendor. A large number
of consumers are visiting especially to the Malls rather than the plenty of shops available to the
next door. Trendy Life Style The current urban middle and upper class Indian consumer buying
behavior to a large extent has western influence. There is an increase in positive attitude towards
western A Study on Changing Buying Behaviour of Indian Customers 3 trends. The Indian
 30

consumer has become much more open-minded and experimental in his/her perspective. Foreign
brands have gained wide consumer acceptance in India, they include items such as; Beverages,
Packed food, Ready to eat food , Pre-cooked food, Canned food, Personal care products ,
Audio/video products, Garment and apparel, Footwear , Sportswear, Toys and Gift items .
Spending Behaviour of Consumer The way Indian consumers are spending their money on
various items has changed in recent years. The share being spent on the basis (food and
beverages) are falling. For urban India, averagely 30 days consumer expenditure was split up
into food, and for nonfood. Food expenditure includes cereals and cereal substitutes, milk, milk
products, vegetables, edible oil and others. Non-food expenditure included fuel and light, and
rest on clothing, footwear and on other non-food expenditure. In India, the higher income group
spends more amount of their income on luxury goods and trendy products than fact moving
consumer products. The middle income group spends more on consumer expendables than the
rich.

The last twenty years has seen a metamorphosis in terms of lifestyle preferences and buying
trends among Indian consumers. With the opening up of the Indian economy in 1991, urban
India embraced consumerism and a hunger for branded products emerged. A young working
population, that lives by the "work hard and live well" mantra, has powered the Indian retail
market through the first decade of the millennium resulting in strong year on year growth over
the last few years.

The change in consumer preferences is most apparent in fashion apparel. Men were the first early
adapters of western-wear in India, with many converting to readymade garments in the early
90's. Over the last decade, we have also seen a significant change in the way women dress,
moving from traditional Indian wear to western or fusion wear a trend that is especially popular
in larger cities such as Delhi, Mumbai and Bangalore.

The growing awareness of global fashion trends has been fuelled by the internet and the fashion
and lifestyle media. As a result, the typical upper middle class consumer is conscious not only of
the international styles but also about the lifestyle attributes connected to the brand, leading to
the significant growth of organized retail in India.

From a business perspective, the dynamics of the Indian market offers us an exciting opportunity
to introduce collections that capture the latest global fashion trends, whilst also ensuring they are
suitable for Indian tastes.
 31

For example, until a few years ago, linen lacked popularity in India. It was perceived as difficult
to care for and wear as it easily creased. However, the acceptance of linen as a comfortable
fabric, perfect for our warm climate, has increased due to the development of performance
enhancing fibres that make it more crease resistant and therefore easier and smarter to wear.
Recognising the new popularity of linen amongst our customers, we have been able to stretch the
seasons through local sourcing and now offer linen products all year round in both formal and
casualwear. Most popular in West and South, linen now accounts for 15% of our total sales in
India.

The popularity of international style and dressing has also seen significant growth in the lingerie
market in India worth Rs 17,470 crores in 2012 the market is expected to grow by a staggering
54% by 2017. In the last six months, weve seen our lingerie sales increase by a third as
customers continue to look for more choice, whether everyday underwear, clever lingerie
solutions such as innovative shapewear or glamorous silk and lace pieces. This growing demand
is exactly why India was our first choice international market to launch our brand new Marks &
Spencer Lingerie & Beauty department at our flagship store in Bandra, Mumbai.

The massive influence of Bollywood on fashion continues to be another driver towards

international styles. With almost every second movie now being filmed abroad, it is common for
stars to wear international brands on screen and off it which influences consumers across the
country. Stylish tunics, jeggings and dresses, commonly worn by the stars, are some of our best
selling products. Last month we were delighted to be joined by Bipasha Basu and Sonakshi
Sinha to celebrate the opening of our largest store in India. The dresses they wore have been a
instant hits with our customers.

What remains clear is while there is changing behavior amongst Indian consumers; quality and
value continue to be at the heart of their purchasing decisions. The consumer is increasingly
savvy, shopping around to ensure that they derive the best value from their purchases. This
means that retailers have to carefully choose their catalogue and prices. To cater for this, we
offer our customers a variety of price points including outstanding value basics such as M&S
Collection t-shirts with STAYNEW finish which keeps the fabric looking newer for longer and
our exclusive Savile Row Inspired collection which offers customers the very best of British
tailoring at affordable prices.

With rising incomes among the Indian middle class and continued popularity of international
fashions; we believe the demand for western-wear will continue to increase across the country.
There is a real opportunity for us, not only in established cities like Delhi but smaller cities such
as Kochi and Surat, where we are already seeing customers embrace our clothing collections and
we expect will fuel the next wave in modern retail.
 32

6)highlight the drivers of change in Indian consumer behavior.

Ans) The drive to learn and improve

Humans possess an innate desire to learn and improve. Over the last million years we have
evolved based on our ability to adapt to new environments through continuous learning. In more
recent times we have embraced the idea that in order to manage something, one must first be able
to measure or baseline it.
As a result the concept of the “quantified self” has recently emerged. This concept is based on
the idea that mobile technologies and digital platforms can now support consumers in managing
their every-day lives, helping them to learn about themselves and then improve in whatever
aspect they choose to, be it eating more healthily, learning a new skill or keeping fit (Economist,
2012). There has been a significant rise in the availability of hardware and software to monitor
everything from sleep patterns to exercise regimes. 2013 saw an explosion in the availability of
these devices with products from Fitbit, Jawbone and Nike accounting for 97% of the
$300million market for digital fitness devices (Dolan, 2014).

In addition to the rapid growth of the self-monitoring market, the desire to learn and improve has
also manifested itself via the development of learning via MOOCs (Massive Open Online
Courses). Digital education platforms now provide access to learning for hundreds of thousands
of people around the globe. Providers such as edX, Coursera and Skillshare have created a surge
in the number of online courses available to those with internet access (Finder, 2013). Despite
ongoing challenges regarding completion rates (Fowler, 2013), MOOCs appear to be here to stay
as a genuine challenge to the old established methods of learning.

These developments emphasise that the drive to learn and improve continues to represent an
opportunity for businesses. However, in order to stand out from the crowd, successful
organisations need to present consumers with a compelling proposition which both captures their
attention and offers easy and user-friendly access to platforms which help them realise their
learning and development ambitions.

2. The drive to defend and protect

Defending ourselves against outside threats is no longer just about locking the front door, or
keeping valuables in the safe. The advent of the digital era has been accompanied by a huge
increase in the amount of personal data shared online, with critical implications for personal data
security.

Consumers now research, bank, shop and socialise on the internet, with the average person in the
UK spending an estimated 1 out of every 12 waking minutes online (Sweney, 2013). Digital
thieves can now dial straight into our living rooms, our offices and even our pockets. In February
of this year Tesco was forced to suspend more than 2,000 customer accounts after hackers posted
 33

login details online and stole loyalty card points (Felsted, 2014). In the same month crowd-
funding platform Kickstarter was attacked by hackers, compromising usernames, passwords, e-
mail addresses and mailing addresses (Frizell, 2014).

Despite this danger, many commentators have criticised businesses for a lack of awareness
regarding best practice cyber-security measures. Consumers need to be vigilant too. Anti-virus
software seller Norton recently estimated that 48 percent of smartphone and tablet owners took
no basic security measures such as using passwords or security software (France-Presse, 2014).

Whilst requirements for personal digital security have moved beyond simple password protection
(for instance, initiatives such as two-factor authentication using verification codes sent to
individual’s phones in tandem with passwords have become increasingly common), the question
remains whether businesses are doing enough to protect consumer data?

As the amount of time consumers spend online, and the volume of data they consume and share
continues to rise, businesses that recognise the need to protect consumers and assure them about
the security of the information they share will be more trusted than those who choose to ignore
data security or offer inadequate protection for consumers. At best those that fail to protect
consumers are a PR disaster waiting to happen and at worst these organisations risk losing both
our trust and ultimately a share of our wallets.

3. The drive to be more efficient

Time is one commodity that we can’t make more of. As a result helping consumers to manage
their lives in a more efficient and productive way is a big opportunity for organisations who can
provide technologies that facilitate smarter living.

Innovations such as cloud synchronization, offered by the likes of Apple, Evernote and Dropbox,
are allowing us to work in a more distributed and decentralized manner. Productivity increases
for users are translating into real business opportunity for these providers. In January of this year
Dropbox raised a further $250 million in a funding round which values the business at
approximately $10 billion (Macmillan, 2014).

Related to the idea of managing our lives more efficiently is the emerging market for
technologies linked to the “Internet of Things”, whereby everyday objects are connected and can
be managed remotely online. Samsung’s Smart Home system now claims to connect household
appliances ranging from TVs and washing machines to central heating. These connected devices
can be managed via smartphone applications through a single integrated platform. Consumers
can now turn on the oven or switch on their air conditioning via their smartphones while on their
way home from work (Baldwin, 2014).

The growth of multichannel delivery options represents another manifestation of the modern
consumer’s desire to save time and effort. Almost one in every five multichannel sales now make
use of “click & collect” services according to a recent quarterly benchmark of UK e-retail
performance, with 19% of multichannel retailer sales completed using click & collect fulfilment
offers in the third quarter of 2013 (Anonymous, 2013).
 34

Convenience is now a key motivator for consumers. Businesses that have recognised this will be
in a more advantageous position than those who fail or refuse to modify their product and service
offers to accommodate today’s busy lifestyles. Indeed, those that turn a blind eye to the changing
habits of consumers will find themselves increasingly irrelevant over time.

4. The drive to bond and form relationships

Humans are social animals. As a result many business models have developed over the last
decade based on our desire to socialise and form relationships. The obvious recent successes
include Facebook, Twitter and LinkedIn. There are also specialist groups, including those for
sport (e.g. Strava), photography (e.g. Flickr), dating (e.g. Match.com) and countless others.
Socialising is big business. Facebook is now valued at over $170bn, and recently paid $19bn for
messaging application WhatsApp (BBC, 2014).

Robert Dunbar, an evolutionary psychologist, has conducted numerous studies into the
relationship between the cognitive ability of humans and social group size. He is credited with
the discovery of the “Dunbar Number” – the number of meaningful relationships that a human is
capable of sustaining before they lose their sense of connection (Bennett, 2013). The number is
commonly viewed as being in the region of 150 relationships.

As we expand our social circles via digital technologies businesses need to be cognisant of
limitations such as those proposed by Dunbar. Whilst Digital technologies have opened up the
opportunity to connect with others far beyond our immediate relationships, more relationships
does not necessarily translate into more value for consumers. Organisations who can help us to
develop deeper and more meaningful relationships are more likely to have a loyal following than
those who simply focus on adding numbers.

Digital social platforms have also provided consumers with the ability to present themselves
through multiple personas – for instance, one might have a professional persona for business
networks (LinkedIn), a corporate profile (Yammer), a social persona (Facebook), and perhaps
even an avatar for gaming networks (e.g. the Electronic Arts Gameface sports avatar). The
concept of consumers adopting multiple selves is not in itself new, but digital platforms allow
consumers to shape and represent many more “versions” of themselves. As we adapt to living
across multiple digital networks our ability to communicate and connect with different audiences
through different voices online is evolving (Casserly, 2011).

Smart organisations are recognising that there is an opportunity to support consumers to exist
and present themselves in different guises. They are providing us with the tools and platforms to
shape our online identities, and at the same time matching desired personas with the brands,
products and services that support our desired perceptions.
 35

5. The drive to acquire status

Status, the relative rank or position an individual holds in a group or society, has long been
present in the off-line world. Emerging digital technologies have provided consumers with new
opportunities to acquire status online. Whether it’s the number of followers you have on twitter,
the strength of your online social influence as identified by your Klout score, or the number of
venues for which you hold a Foursquare “Mayorship”, digital platforms have afforded
consumers the opportunity to develop and nurture their online status. In some cases these are
linked to off-line activities. For example social fitness network Strava’s “King of the Mountain”
status is awarded to the cyclist or runner with the fastest time on a designated stretch of a route.
Whilst attracting criticism for supposedly turning cyclists into racers, and encouraging “reckless”
cycling, it has been a key factor in the growth of the network (Delaney, 2013).

Digital businesses are increasingly recognising the power of status and developing products and
services which leverage principles such as game thinking and game mechanics (summarised as
“gamification”). Business models which tap into these innate drive to be seen as an authority on
a subject or activity are becoming increasingly prevalent.

6. The drive to feel and experience

Maslow’s seminal paper, “A Theory of Human Motivation” (Maslow, 1943), argued for the
existence of a “hierarchy of needs”, which mapped out human motivations as layers on a
pyramid. Each layer built upon a core motivating element. The most fundamental layers included
needs linked to physiological, safety, love/belonging and esteem drivers, with the ultimate goal
being to reach the top of the pyramid and achieve self-actualization. A person reaching self-
actualization would have realised their full potential. However, Maslow neglected to explicitly
identify the human drive to feel and experience.

Perhaps as a consequence of the amount of time consumers now spend in front of digital devices,
sensory stimuli and experiences have become critical differentiators for products and services.
Consider Burberry, a global fashion brand, and the success it has experienced as a result of its
ability to blend the digital and physical retail environments. Burberry’s flagship store epitomises
the experience, appealing to the customer’s senses whilst also providing continuity across online
channels with multiple digital touch points. Educating customers about buying online also
encourages customers to purchase more often from the website when they are away from a store
(Batten N. , 2012). Virgin Media is another example of a brand that blends the online and offline
worlds, making entertainment retail stimulating at the point of purchase by helping customers to
play, browse, watch and interact with its products and services (Withers, 2013).
 36

7)what are the various individual determinants of consumer behavior?explain

with suitable EXAMPLES.
ANS)Determinants of Consumer Behaviour

Motivation and Involvement

In a society, different consumers exhibit different consumer behaviour because they are unique
and have unique sets of needs. Motivation is that internal force that activates some needs and
provides direction of behaviour towards fulfilment of these needs.
While talking of motivation, we cannot afford to forget the Maslow’s Hierarchy of needs which
tells us about the primary and secondary needs. First the biological needs of hunger, thirst,
shelter are satisfied then the safety needs and then the psychological desires of being accepted in
society, seeking status, esteem, etc. aresatisfied. People adopt different methods to fulfil their
needs. The need of transport can be metby car, rail, bus or aeroplane. People choose different
modes of transport because of their level of involvement in different activities.

Involvement refers to the personal relevance or importance of a product or a service, that a

consumer perceives in a given situation. Depending on the value and personal interest, a
consumer can have a high or low involvement. For a professional tennis player, the choice of a
tennis racket is made with great care. He sees the weight, size, grip and tension of the strings,
etc. The racket is his most important professional tool. Similarly, a professional photographer has
to buy a camera with the right specifications and attributes. For another person, a tennis racket
may only be a means of entertainment or in the case of a camera, the recording of family and
other events by a camera which is convenient and handy.

Attitudes
These are learned predispositions towards people, objects and events. Attitudes are responsible
for our responses and are not inborn but are learnt from people around us.
Our attitudes influence our purchase decisions and consumer behaviour. A person having a
carefree attitude will buy an object without much involvement. People who want to play safe and
avoid risk talking, will go for a safe investment. People who want convenience and are short of
domestic help, will have a positive attitudes towards canned and frozen foods.
 37

Personality and Self-concept

It is the sum total of our mental, physical and moral qualities and characteristics that are present
in us and that make us what we are. Consumers try to buy the products that match their
personality. People wanting to look manly will buy products with a macho appeal, which would
enhance their image and personality. People who give emphasis on comfort and care, will
purchase comfort products and so on. If one wants to emulate a film star his choice will be
different from others.
Learning and Memory
Every day we are exposed to a wide range of information, but retain only a small portion of it.
We tend to remember the information that we are interested in or, that is important to us. In a
family different members of the family are interested in different types of information which
they individually retain. Mothers retain information regarding household items. Father retains
information regarding his interest in cars, motor cycles and other objects. Children are interested
in objects of their interest like amusement parks, joy rides, Barbie dolls, etc.
Our motives, attitudes, personality filters the information. Keeping only relevant information in
our minds and, keeping the others out. This is known as selective retention. We retain in our
memory only selective information that is of interest to us.
Information Processing
All consumers analyse and process the information they receive. These are activities that a
consumer engages in, while gathering, assimilating and evaluating information.
Consumersassimilate and evaluate selective information and this reflects on their motives,
attitudes andpersonality and self-concept. Same information can be evaluated in a different
manner by different individuals. The most common example is a glass half filled with a liquid. It
can be interpreted as “half empty” or half full. The first is a pessimistic view and the other is an
optimistic view of processing the information.

The determinants of consumer behaviour can be grouped into three major captions namely,

economic, psychological and sociological. An attempt is made to elucidate these with least
complications.
 38

I. Economic Determinants:

Economic scientists were the first among social scientists to study consumers and their behaviour

and provided the details about the solutions to the consumer and consumption problems.
Economists, as we are aware, took man as a social and rational animal.

The basic economic determinants among others are:

1. Personal income:

One’s income is the reward for one’s economic efforts. Income means purchasing power. When

we talk of income in marketing sense, we are more concerned with ‘disposable income’ and
“discretionary income’.

‘Disposable income’ is the amount of money that a consumer has at his disposal for spending or

saving or both. In other words, of the total gross income, whatever balance remains after meeting
preemptive demands like taxes, debt repayment and debt servicing charges and the like.

Any change in disposable income will have change in consumer buying decisions. Decline in

disposable income reduces the consumer spending; however, when disposable income rises,
consumer spending not only rises but makes them to go in for more of luxuries.

In other words, disposable income causes change in the relative demand for different categories
of products and services. On the other hand, ‘discretionary income’ is the income which is
available after meeting the basic needs of living.

It is the residual disposable income left after meeting all the expenses essential to provide a

minimum subsistence needs to a family. Discretionary income changes have their own
implications.
 39

A rise in discretionary income results in usually an increased spending by consumers on those

items that raise their living standards. Therefore, a continuous rise in the discretionary income is
likely to change the very life-style of the consumers.

2. Family income:

Where a consumer is the member of a joint family, the buyer behaviour is influenced by the

family income rather than the individual income. It does not mean that one can ignore the

individual income, for family income is the aggregate of individual income of all the members of
the family.

In a joint family, it may so happen that a rise in an individual member’s income may be

neutralised by a fall in another member’s income. That is why; it is the relationship between the

family size or the requirements and the income that finally determines the buying behaviour or
the family members.

3. Consumer income expectations:

ADVERTISEMENTS:

Many a times, it is the future income expectations of the consumer that influences such consumer

behaviour. It is the optimism or the pessimism about consumer income that determines the level
of current spending.

If there are bleak prospects of future expected income, he spends less now and saves more and

vice versa. It is worth the noting here that the force and vitality of a tendency to spend or save
depends on the nature of consumer needs.

In case of basic needs of living, such tendency will be too weak for no consumer denies the

minimum subsistence level merely because to bleak future income expectations. However, in
 40

case of non-essential goods, such tendency may be very strong to save than to spend if he is
expecting weak future income generation and vice versa.

4. Consumer liquid assets:

It is the consumer liquid asset position that influences the consumer behaviour. Liquid assets of

consumers are the assets held in the money or near-money forms of investments. The best

examples of this kind are hard cash, bank balance, bank deposits, shares and bonds and saving

certificates. These assets are built up to buy some consumer durables or to meet unexpected
future needs or contingencies.

ADVERTISEMENTS:

If a person has more such liquid assets, more carefree he comes in spending the current or the
regular income.

5. Consumer credit:
 41

Availability or paucity of consumer credit has its impact on consumer buying behaviour.

Consumer credit is a facility extended by a market to postpone the payment of products bought
to some future date.

Consumer credit takes number of shapes like deferred payment, instalment purchasing, hire-

purchase arrangements and the like. Easy availability of consumer credit makes the consumer to

go in for those consumer durables which he would have postponed otherwise. Further, it makes
him to spend more freely the current income.

6. The level of standard of living:

ADVERTISEMENTS:

The consumer behaviour has the impact of the established standard of living to which he is

accustomed. Even if consumer income goes down, the consumer spending will not come down
proportionately because, it is very difficult to come down from an established standard of living.

On the other hand, rise in income tends to improve upon the established standard of living. In

case the income falls, the short-fall is made good by borrowings to a certain extend over a short
period of time.

II. Psychological Determinants:

Psychologists have also provided certain clues as to why a consumer behaves this way or that

way. The major psychological determinants internal to the individual are motivation perception
learning, attitude and personality.

Here is an attempt to explain and to know their implications in so far as consumer behaviour is
concerned.

1. Motivation:
 42

Motivation is the ‘why’ of behaviour. It is an intervening variable between stimulus and response
and a governing force of consumer behaviour.

“Motivation refers to the drives, urges, wishes or desires which initiate the sequence of events

known as behaviour.” as defined by Professor M.C. Burk. Motivation is an active, strong driving

force that exists to reduce a state of tension and to protect, satisfy and enhance the individual and

his self-concept. It is one that leads the individual to act in a particular way. It is the complex
net-work of psychological and physiological mechanisms.

Therefore, motives can be conscious or unconscious, rational or emotional, positive or negative.

These motives range from a mere biological desires like hunger and thirst to the most advanced
scientific pursuits like landing on the Moon or Mars.

It was Abraham Maslow who developed five steps human need hierarchy those of survival-
Safety Belongingness and Love-Easteem and Self Actualisation.

According to him, fulfillment of one will lead to the fulfillment of higher motives. The

implications are that as we move up in the ladder, the input of marketing becomes more and
more deep and subtle.

2. Perception:

Marketing management is concerned with the understanding of the process of perception

because, perception leads to thought and thought leads to action. Perception is the process
whereby stimuli are received and interpreted by the individual and translated into a response.

In other words, perception is the process by which the mind receives, organises and interprets

physical stimuli. To perceive is to see, hear, touch, taste, smell and sense internally something or
some event or some relation.
 43

Perception is selective because, and individual cannot possibly perceive all stimulus objects

within his perceptional field; hence, he perceives selectively. Perception is organized because,

perceptions have meaning for the individual and they do not represent a buzzing confusion.

Perception depends upon stimulus factors. That is, the nature of physical stimulus itself is a
determinant of perception.

The variables like colour size, contrast, intensity, frequency and movement are of this kind.

Again, perception depends on the personal factors. What the individual brings to the situation

governs perception his ability to see or hear the message, his needs, his moods, memory,
expressions and values all these modify the message reception.

The personal factor of perception is his self concept, need, span of apprehension, mental set and
the past experiences.

ADVERTISEMENTS:

Perception has its own impact on consumer behaviour or consumer decision-making. Let us take

some such cases:

Perception and communication:

It is estimated that 90 per cent of the stimuli that the individuals perceive come through sight and
rest from hearing. That is why, advertisements bank heavily audio on visual stimuli.

However, it does not mean that loud noises, bright colours and large ads themselves guarantee

consumer attention and response. Contrary to this, it is the use of haunting melodies, pastel

shades, regional accents and careful adjustment of ad size in relation to the total page or poster
size all affect perception and these factors may give better results.

ADVERTISEMENTS:
 44

Product and brand perception:

Good many studies have been made of the ways in which the consumers perceive the products

and the brands they choose regularly. It is brand images and the brand differentiation that play

vital role in perception in addition to the physical characteristics of the product. Therefore, it is a

must for a marketer to examine all the factors that impinge on the construction of a brand image
to ascertain their effects on consumer perception of the company’s marketing mix.

Price perception:

Price is another element of marketing mix where perception has its implications. Studies have

proved beyond doubt that consumers judge product or service quality by price. ‘Higher the price
better the quality’ that goes.

This goes on establishing that there is going to the direct or positive relationship between price

and demand where marketer is cared to gain. Another aspect of this price perception is
psychological pricing.

The reasoning behind such pricing strategies is that consumers are likely to perceive used in cut-
price sales promotions to increase the feeling that a price has been drastically reduced.

Store perception:
There are five major components of stores image namely, location design-product assortment-

services and personnel each of which contributes to consumer perception of the place from
which he or she buys.

Mere physical attributes do to talk of a store image. Other intangible factors, too, influence

consumer perception of stores image such as advertising, inter-personal communication and

experience.
 45

Consumer perceptions of stores are greatly influenced by consumer’s own self- perception and
motives. Further, consumer’s self-images influence the places in which they shop.

Perceived risk:

The concept of perceived-risk recognizes that consumer experiences a sense of risk in purchase
and that consumer behaviour can be studied profitably as a risk reducing behaviour.

Consumer behaviour involves risk in the sense that any action of a consumer will produce results

which he cannot predict with certainty. The perception of risk in a purchase situation is a

function of the possible consequences and the product uncertainty involved. Perceived risk can
be divided into forms namely, ‘functional’ and ‘psychological’.

Functional risk is related with the performance and the psychosocial risk is related with the fact
whether the product enhances one’s sense of well being or self-concept.

The level of perceived risk is a function of the uncertainty involved and the possible

consequences of purchase and can be reduced by gaining greater certainty or by minimising

consequences. In most cases, it is increasing the element of certainty.

3. Learning:

In behavioural science, learning means any change in behaviour which comes about as a result of

experience. Learning is the process of acquiring knowledge. Consumer behaviour is a process of

learning because; it is modified according to the customer’s past experience and the objectives he

or she has set. This process of learning is made up of four stages namely, Drive- cue-response
and Reinforcement. ‘Drive’ refers to an internal state of tension which warrants action.

Thus, hunger or thirst can be a drive. A ‘cue’ is an environmental stimulus. For instance, it can

be an ad on food item or soft- drink, ‘Response’ represents the person’s reaction to cues within
 46

his environment. Here, it can be purchased of food item or soft-drink. ‘Reinforcement’ is the
responses reward.

The food item or soft-drink. ‘Reinforcement’ is the response reward. The food item or soft drink

satisfies the hunger or the thirst. When reinforcement happens, the response may be duplicated
resulting in habit formation or absence of reinforcement results in extinction of learnt habit.

As most consumer behaviour is learnt behaviour, it has deep impact on consumer buying

process. Prior experience and learning acts as buying guide. In-spite of such habitual behaviour,
one can think of reasonable amount of brand switching, trying new products, does take place.

The strong tendency of most consumers to develop brand loyalties definitely benefits the makers

of established brands. This makes the manufacturer of a new brand to face difficulty in breaking
such loyalties and encouraging brand switching.

He succeeds in his efforts when he shows that his product is potentially much more satisfying

than his competitors. Free sampling, in store trial and demonstrations and deal activities may be
used to break the existing brand barrier to establish new patterns of purchase behaviour.

To the extent the learning and brand loyalty can be gained for a product, the manufacturer
activates a more stable sales profile less vulnerable to the competitive inroads.

4. Attitude:

The concept of attitude occupies a central position in the consumer behaviour studies in

particular and social psychology in general because; attitude measurements help in

understanding and prediction of consumer behaviour. ‘Attitude’ refers to a predisposition to

behave in a particular way when presented with a given stimulus and the attitudes towards
people, places, products and things can be positive or negative or favourable or unfavourable.
 47

Attitudes develop gradually as a result of experience; they emerge from interaction of a person

with family, friends, and reference groups. There are three distinct components of attitude

namely, cognitive, affective and co-native. ‘Cognitive’ component is what an individual believes

about an object, thing or an event whether it is good or bad, necessary or unnecessary, useful or
useless.

It is based on the reason and is linked with knowledge and about the object, thing or an event

whether it is pleasant or unpleasant, tasty how an individual responds to the object, thing or an
event. It is based on the other two components and is related with his behaviour.

Each of the three attitude components vary according to both the situation and the person. The

marketing manager’s success is determined partly by his ability to understand, predict and
influence the consumer attitudes.

The marketer may be interested in confirming the existing attitudes, or change in the existing
attitudes or create new attitudes depending on how his product is performing in the market.

Attitude confirmation is, perhaps, the easiest course of action which is followed in case of

established products. Such an act involves only reminding the consumers as to why they like it
and why they should continue it to purchase.

Attitude changing is more difficult task than mere confirming it. It is a change from disposition
to act in the direction of the original attitude to a disposition to act in the opposite direction.

A product disliked is to be liked by the consumers. It is really a difficult process. Attitude

creation is to make the consumers to forget the old products or brands and to make them to go in

for new product or brand entirely altogether, in fact, it is comparatively easier to create new

attitudes than to change the existing one. The most powerful instrument of attitude change and
creation is advertising.
 48

5. Personality:

Very often, the word ‘personality’ is used to refer to the capacity of a person for popularity,

friendliness or charisma. However, in strict sense, it refers to the essential differences between
one individual and another.

Therefore, personality consists of the mannerisms, habits and actions that make a person an

individual and thereby serve to make him distinct from everyone else. It is the function of innate
drives, learned motives and experience.

This means that an individual responds with certain amount of consistency to similar stimuli.
Personality is the interplay of three components namely, ‘id’, ‘the ego’ and the ‘super ego’.

The ‘id’ governs the basic drives and the instincts of an individual. On the other hand, the ‘super

ego’ disciplines the ‘id’ by suppressing anti-social behaviour; it drives the individual in the
direction of more high minded pursuits of civilizations.

The ‘ego’ component is the executive and makes the conscious decisions and reconciles the

inflicting demands of ‘id’ and ‘super ego’, wherever necessary. For instance, ‘id’ may force an

individual to make full use of consumer credit to buy an automobile, ‘super ego’ dissuades such
an activity as borrowing is a kind of social sin in Indian society.

It is ‘ego’ that reconciles these and works out a compromise making the individual to pay
instalments regularly without any strain on his regular budget.

The personality of an individual is either expressed in terms of traits or type. The personality
traits may be aggressiveness honesty anxiety independence sociability and so on.

The personality types may be introvert or extrovert or another classification as tradition direction
outer direction and inner direction. Each of these traits and types has been explored as the
possible clues to the behaviour of consumers.
 49

Evaluation of personality’s role in marketing is seen in drawing consumer profiles and

psychographic market segmentation.

III. Sociological Determinants:

In the area of psychological determinants, the consumer behaviour was seen from the stand point

view of an individual. However, the sociologists and social psychologists have attempted to

explain the behaviour of a group of individuals and the way in which it affects and conditions
and individual’s behaviour in marketing or purchase decisions.

These groups of individuals as determinants are:

(1) Family

(2) Reference groups

(3) Opinion leaders

(4) Social class and

(5) Caste and culture.

Let us see these in brief to know their marketing implications:

1. Family:

Many of the decisions made by consumers are taken within the environment of the family and

are affected by the desires, attitudes, and values of the other family members. Family, as a

primary group, is vital because, it links the individual with a wider society and it is through this

that the individual learns the roles appropriate to the adult life. The family can be ‘nuclear’ or
‘extended’.

A ‘nuclear’ family is a two generational family which consists, usually, a mother-father and
children. The ‘extended’ family is one that spans at-least three generations which consists of
 50

mother-father- children-grandparents uncle-aunts, cousins-nephews and other in-laws. There is

another way of classifying the family based on family life-cycle.

This classification is ‘home making phase’ from marriage to birth of the first child; the

‘procreation phase’ from the birth of the first child to the marriage of the first child’s; the

dispersion phase’ from the marriage of the first child to the marriage of the last and the ‘final
phase’ from the marriage of the last child to the death of original partners.

The family impact on consumer buying behaviour can be traced in two ways:

1. The family influence on the individual personality characteristics, attitudes and the evaluative
criteria and

2. The family influence in the decision-making process involved in the purchases. Family is both

a purchasing and consuming unit. Therefore, it is essential to note the distinguished family roles
of the members.

These roles are:

Initiator:
The person who senses the need for the purchase;

Influencer:
The person who provides input into the purchase decision;

Decider:
The person who has the final say over the decision and

User:
The person who is most directly involved in using the purchase.
 51

That is why; every marketer is keenly interested in four points in case of family purchase. There

are:
1. Who influences the buying?

2. Who does family buying?

3. Who makes buying decision?

4. Who uses the product?

In nuclear families, it is mostly the house-wife that has an upper hand in family purchases
regarding her family role such as food, clothing, cosmetics, interior decoration and jewelleries.

Father has say over clothing, education, insurance etc., The children have say in clothes, sports-
equipments and recreational facilities such as TV, stereo-sets and the like.

Family life-cycle also has its own influence on buying behaviour. Thus, the proportion of a

family budget spent on food, clothing and children goes on increasing in the ‘procreation stage’
than in ‘home making stage’.

2. Reference groups:

Each person in the society is not only the member of his family but the member of some group or
groups outside the family circle. These groups can be called as ‘reference groups’.

‘Reference groups’ are those groups which an individual identifies with to the extent that these
groups become a standard or norm which influences his behaviour.

Reference group is a social and professional group that influences the individual’s opinions,

beliefs and aspirations. It is one that provides an individual with a sense of identity,
accomplishment and stability.
 52

Generally, a person refers to any one of the following types of reference groups in building his or
her behaviour.

A. The groups that serve as comparison points:

Here, the individual compares himself, his attitudes, his behaviour and his performance with the
group of members. Thus, he may feel poor if members are richer than himself or vice versa.

B. Groups to which a person aspires to belong:

Here, the individual aspires to be the member of such group and imitates the behaviour of that

group including buying behaviour. Thus, the group may be of higher social status or a cult group
such as ‘hippies’ or the ‘jet-set’.

C. Groups whose social perspectives are assumed by the individual as a frame-work of reference

for his own actions:

Here, an individual may adopt the views of the group without becoming a member. A person

need not be a professional sportsman to have the opinion and outlook of a professional
sportsman.

Some non-military persons behave more than ‘military’ personnel. Similarly, a person belonging

to minority may adopt the values and the perspectives of a majority which he dislikes by very
nature.

Consumers as social animals spend most of their time in group situations, and accept information
provided by their groups on products, price, performance, style and the like.

It is group norms that direct the attention of its members towards a new product, a new brand.

These reference groups have face to face interactions that provide word of mouth communication

which is more powerful than formal advertising. A satisfied customer becomes the salesman of
the product.
 53

3. Opinion leaders:

Like reference groups, ‘opinion leaders’ or ‘influentials’ play a key role in influencing the

buying behaviour of their followers. Very often we come across situations where a person refers

to an individual than a group in formulating his or her behaviour pattern. The individual to whom
such reference is made by a person or persons is the opinion leader.

The beliefs, preferences, attitudes, actions and behaviour of the leader set a trend and a pattern

for others to follow in given situation. In very intimate reference group, there is a reference
person, an informal group leader.

The group of followers respects him and looks up to him. He is the innovator in the group of

followers who respect him and look up to him. He is the innovator in the group who first tries
new ideas and products and then propagates them to his followers.

Marketers very often try to catch hold of the opinion leaders through ads and other means of

communication. If they succeed in selling their ideas and products to the opinion leaders, then
they have sold it to the entire group of followers behind them.

4. Social class and caste:

Buying behaviour of individuals is also influenced by the social class and the caste to which they
belong. Social class is a relatively permanent and homogeneous division of a society into which

individuals or families sharing similar values, life-style, interests and behaviour can be
categorized. Social class is a larger group than intimate group in structure.

Constitution of a social class is determined by the income, authority, power, ownership, life-

styles, education, consumption patterns, occupation, type and place of residence of the individual

members. In our country, we can think of three classes are as ‘rich’, ‘middle’ and ‘poor’. Caste,

on the other hand, is the group of the membership by birth. It is not the wealth but the birth that
 54

decides his or her caste. These castes were based on activity specialisation of profession or
occupation.

In our country, we have four such broad categorization as ‘Brahmins’ ‘Kshatriyas’ ‘Vaishyas’
and ‘Shudras’.

From the marketing stand point, both social class and caste frame are quite relevant as buyer

behaviour is influenced by these. Each class and caste develops its own standards of style, living
and behaviour patterns.

It is not a surprise, and then if the members of such a class select a particular brand of product,
shops at a particular store which caters to their group norms.

This does not mean that all the members of the group buy the same products, same brands, or

conform to same styles; however, more or less, it becomes a pattern with differential range of

likings and leanings. Thus, ‘Shudras’ may not enter the restaurants where ‘Brahmins’ and
‘Kshatriyas’ enter, though the ‘shudras’ are not barred from entering.

It is because of income pattern and traditional respect for higher castes, for in the eyes of Indian
Constitution, all are equal.

5. Culture:

Culture adds yet another dimension to the study of consumer behaviour. ‘Culture” refers to all

those symbols, anti-factor and behavioural patterns which are passed on socially from one
generation to the next.

It includes cognitive elements, beliefs, values, and norms, signs and non-normative behaviour.

Cultures are specific to the areas in which they evolve. Yet two nations can enjoy a common
cultural heritage. Thus, each nation has its distinct culture ; however, in a particular nation, there
may be subcultures identified on the basis of ethnicity, nationality, religion and race.
 55

Cultural and sub-cultural groups have their unique consumption patterns that provide important
bases to the marketers.

Cultural trends have significant implications for market segmentation, product development,

advertising, merchandising, branding and packaging. While designing the marketing-mix, it is

but essential to determine the broad cultural values that are relevant to the product as well as the
most effective means of conveying these values.

A shrewd marketer never contradicts these cultural values in product, promotion, price and
distribution.
 56

8)explain the influence of personality on consumer behaivour.

Ans) Influences of Personality on the Consumer Decision Process

Perception

Perception in marketing is described as a process by which a consumer identifies, organizes, and

interprets information to create meaning.

LEARNING OBJECTIVES

Describe the characteristics of perception as a part of the consumer buying decision process

KEY TAKEAWAYS

Key Points

 Perception is a psychological variable involved in the Purchase Decision Process that is

known to influence Consumer Behavior.
 elective Perception is the process by which individuals perceive what they want to in
media messages and disregard the rest.
 Seymor Smith, a prominent advertising researcher, found evidence for selective perception
in advertising research in the early 1960s, and he defined it to be “a procedure by which
people let in, or screen out, advertising material they have an opportunity to see or hear.
 Selective perceptions is categorized under two types: Low level – Perceptual vigilance and
High level – Perceptual defense.
 Perception can be shaped by learning, memory and expectations.

Key Terms

 Consumer Behavior: The study of individuals, groups, or organizations and the processes
they use to select, secure, and dispose of products, services, experiences, or ideas to satisfy
needs; and the impacts that these processes have on the consumer and society.
 Purchase Decision Process: The decision-making processes undertaken by consumers in
regard to a potential market transaction before, during, and after the purchase of a product
or service.
 Perception: The organization, identification and interpretation of sensory information in
order to represent and understand the environment.
 57

Perception

Perception can have various meanings but in marketing, it is often described as a process by
which a consumer identifies, organizes, and interprets information to create meaning. A
consumer will selectively perceive what they will ultimately classify as their needs and wants.

Necker Cube and Rubin Vase: These are two optical illusions that illustrate how perception may
differ from reality. On the left, we see a cube when in fact it is a flat image on our screen. On the
right, the vase actually resembles two faces looking at each other.

Perception is a psychological variable involved in the purchase decision process that is known to
influence consumer behavior. Other variables included in this consumer process include:
motivation, learning, attitude, personality, and lifestyle. All of these concepts are crucial in
interpreting the consumer buying process and can also help guide marketing efforts.

Selective Perception is the process by which individuals perceive what they want to in media
messages and disregard the rest.

Seymor Smith, a prominent advertising researcher, found evidence for selective perception in
advertising research in the early 1960s, and he defined it to be “a procedure by which people let
in, or screen out, advertising material they have an opportunity to see or hear. They do so
because of their attitudes, beliefs, usage preferences and habits, conditioning, etc.” People who
like, buy, or are considering buying a brand are more likely to notice advertising than are those
who are neutral toward the brand. This fact has repercussions within the field of advertising
research because any post-advertising analysis that examines the differences in attitudes or
buying behavior among those aware versus those unaware of advertising is flawed unless pre-
existing differences are controlled for.

Selective perceptions is categorized under two types: a low level of perception, known as
perceptual vigilance, and a higher level of perception, known as perceptual defense.

Perception can be shaped by learning, memory and expectations.

Motivation

Motivation is a psychological incentive or reason for doing something.

LEARNING OBJECTIVES

Review the methodology of motivation as it applies to the consumer buying decision process
 58

KEY TAKEAWAYS

Key Points

 Consumer behavior is strongly influenced by many internal and external factors.

 Internal conditions include demographics, psychographics, personality, motivation,
knowledge, attitudes, beliefs, and feelings.
 External influences include culture, sub-culture, locality, royalty, ethnicity, family, social
class, past experience reference groups, lifestyle, and market mix factors.
 An individual’s motivation, perception, attitude, and beliefs are considered psychological
factors.

Key Terms

 External, or extrinsic Motivation: The performance of an activity in order to attain an

outcome, which then contradicts intrinsic motivation.
 Intrinsic Motivation: The incentive to undertake an activity based on the expected
enjoyment of the activity itself, rather than external benefits that might result.
 motivation: The psychological feature that arouses an organism to action toward a desired
goal and elicits, controls, and sustains certain goal directed behaviors.

Consumer behavior is strongly influenced by many internal and external factors, including:

 Internal conditions: demographics, psychographics (lifestyle), personality motivation,

knowledge, attitudes, beliefs, and feelings
 External influences: culture, sub-culture, locality, royalty, ethnicity, family, social class,
past experience reference groups, lifestyle, and market mix factors

An individual’s motivation, perception, attitude, and beliefs are considered psychological factors.
Other factors such as income level, personality, occupation, and lifestyle are categorized as
personal factors. Motivation is versatile enough that it spans multiple areas, including
physiological, behavioral, cognitive, and social.

Motivation may be rooted in a basic human need to minimize physical pain and maximize
pleasure, and it may include specific needs such as eating and resting. However, motivation is
ultimately linked to emotion.

Intrinsic and Extrinsic Motivation

Motivation can originate from oneself (intrinsic) or from other people (extrinsic).

 Internal, or intrinsic motivation ismotivation that is driven by an interest or enjoyment in

the task itself, and exists within the individual rather than relying on any external pressure.
 59

Intrinsic motivation is based on taking pleasure in an activity rather than working towards
an external reward. Intrinsic motivation has been studied since the early 1970s.
 External, or extrinsic motivation comes from outside of the individual. Common extrinsic
motivations are rewards, like money, and the threat of punishment. Competition is
extrinsic because it encourages the performer to win, not simply to enjoy the intrinsic
rewards of the activity. A cheering crowd and trophies are also extrinsic incentives.

Widely Recognized Motivational Theories

 Incentive Theory: A reward, tangible or intangible, is presented after the occurrence of a

behavior, with the intent of causing the behavior to occur again. Incentive theory in
psychology treats motivation and behavior of the individual as though they are influenced
by beliefs, such as engaging in activities that are expected to be profitable.
 Escape-seeking dichotomy model: Escapism and seeking are major factors influencing
decision making. Escapism is a need to break away from a daily life routine, whereas
seeking is described as the desire to learn or gain some inner benefits through travelling.
 60

Drive-Reduction Theory: Clark Hull was the behaviorist who developed the drive-reduction
theory of motivation.
 Drive-reduction theory: Individuals have certain biological drives, such as hunger. As time
passes the strength of the drive increases if it is not satisfied (in this case by eating). Upon
satisfying a drive, the drive’s strength is reduced.
 Cognitive dissonance theory: Cognitive dissonance occurs when an individual experiences
an inconsistency between their views of the world around them and their own personal
feelings and actions.

Learning

Learning in marketing is known as a psychological variable that can significantly affect the
purchase decision process for consumers.

LEARNING OBJECTIVES

Review the characteristics of learning as it relates to the consumer buying decision process

KEY TAKEAWAYS

Key Points

 Learning is the process of acquiring new, or modifying existing, knowledge, behaviors,

skills, values, or preferences. This process may involve synthesizing different types of
information.
 Learning is considered to have a psychological influence on consumer behavior, along
with motivation and personality, perception, values, beliefs, and attitudes and lifestyle.
 There are three main categories of learning theory: behaviorism, cognitivism, and
constructivism.

Key Terms

 Learning: The process of acquiring new, or modifying existing, knowledge, behaviors,

skills, values, or preferences. This process may involve synthesizing different types of
information.
 Purchase Decision Process: The decision-making processes undertaken by consumers in
regard to a potential market transaction before, during, and after the purchase of a product
or service.

In consumer marketing, learning is known as a psychological variable that can significantly

affect the purchase decision process for consumers. Learning is the process of acquiring new, or
modifying existing, knowledge, behaviors, skills, values, or preferences. This process may
 61

involve synthesizing different types of information. The ability to learn is possessed by humans,
animals, and some machines.

Learning is considered to have a psychological influence on consumer behavior, along with

motivation and personality, perception, values, beliefs, and attitudes and lifestyle.

Types of learning include:

 Simple non-associative learning (habituation and sensitization)

 Associative learning
 Imprinting
 Observational learning
 Episodic learning
 Multimedia learning
 E-learning
 Rote learning
 Informal learning
 Formal learning
 Tangential learning
 Dialogic learning

There are three main categories of learning theory: behaviorism, cognitivism, and
constructivism. Behaviorism focuses only on the objectively observable aspects of learning.
Cognitive theories look beyond behavior to explain brain-based learning. Constructivism views
learning as a process in which the learner actively constructs or builds new ideas or concepts.

Merriam and Caffarella (1991) highlight four approaches or orientations to learning: behaviorist,
cognitivist, humanist, and social or situational. These approaches involve contrasting ideas as to
the purpose and process of learning and education, in addition to the role that educators should
take.
 62

David Kolb’s model

David Kolb’s model: The David A. Kolb styles model is based on the experiential learning
theory.

The David A. Kolb styles model is based on the experiential learning theory, which was
explained in his book Experiential Learning: Experience as the Source of Learning
and Development (1984). The ELT model outlines two related approaches toward grasping
experience: concrete experience and abstract conceptualization, as well as two related
approaches toward transforming experience: reflective observation and active experimentation.

According to Kolb’s model, the ideal learning process engages all four of these modes in
response to situational demands. As individuals attempt to use all four approaches, however, they
tend to develop strengths in one experience-grasping approach and one experience-transforming
approach. The resulting learning styles are combinations of the individual’s preferred
approaches. These learning styles include:

1. Converger;
2. Diverger;
3. Assimilator;
4. Accommodator.

Convergers are characterized by abstract conceptualization and active experimentation. They are
good at making practical applications of ideas and using deductive reasoning to solve problems.

Divergers tend toward concrete experience and reflective observation. They are imaginative and
are good at coming up with ideas and seeing things from different perspectives.
 63

Assimilators are characterized by abstract conceptualization and reflective observation. They are
capable of creating theoretical models by means of inductive reasoning.

Accommodators use concrete experience and active experimentation. They are good at actively
engaging with the world and actually doing things instead of merely reading about and studying
them.

Kolb’s model gave rise to the Learning Style Inventory, an assessment method used to determine
an individual’s learning style. An individual may exhibit a preference for one of the four styles—
accommodating, converging, diverging, and assimilating—depending on his or her approach to
learning via the experiential learning theory model.

Attitude

Attitude is a psychological variable that is known to affect the purchase decision process of
consumers.

LEARNING OBJECTIVES

Illustrate how attitude impacts the consume buying decision

KEY TAKEAWAYS

Key Points

 An attitude can generally contain a positive or negative evaluation of people, objects,

event, activities, ideas, or anything in the environment.
 Carl Jung ‘s definition of attitude is a “readiness of the psyche to act or react in a certain
way”.
 Attitudes can be difficult to measure because attitudes are ultimately a hypothetical
construct that cannot be observed directly.
 Attitudes can be measured by the use of physiological cues like facial expressions, vocal
changes, and other body rate measures.

Key Terms

 Carl Jung: (26 July 1875 – 6 June 1961) was a Swiss psychologist and psychiatrist who
founded analytical psychology. Jung proposed and developed the concepts of the
extraverted and the introverted personality, archetypes, and the collective unconscious. His
work has been influential in psychiatry and in the study of religion, literature, and related
fields.
 64

 attitude: an expression of favor or disfavor toward a person, place, thing, or event (the
attitude object). Prominent psychologist Gordon Allport once described attitudes “the most
distinctive and indispensable concept in contemporary social psychology. “

Attitude is a psychological variable that is known to affect the purchase decision process of
consumers. Other variables are perception, learning, personality, and lifestyle.

An attitude generally contains a positive or negative evaluation of people, objects, event,

activities, ideas, or anything else in the environment. However, people can also be conflicted or
ambivalent toward an object, meaning that they might at different times express both positive
and negative attitudes toward the same object.

Attitude is one of Carl Jung’s 57 definitions in Chapter XI of Psychological Types. Jung’s

definition of attitude is a “readiness of the psyche to act or react in a certain way.”
 65

Carl Jung: Carl Jung developed a definition of attitude as it relates to the field of Psychology.

Attitudes can be difficult to measure because attitudes are a hypothetical construct that cannot be
observed directly. Attempted measures may include the use of physiological cues like facial
expressions, vocal changes, and other body rate measures. For instance, fear is associated with
raised eyebrows, increased heart rate and increase body tension.

Attitudes can be changed through persuasion in response to communication. Experimental

research into the factors that can affect the persuasiveness of a message include:

1. Target Characteristics: These are characteristics that refer to the person who receives and
processes a message. One such trait is intelligence – more intelligent people seem to be
less easily persuaded by one-sided messages. Another variable that has been studied in this
category is self-esteem.
2. Source Characteristics: The major source characteristics are expertise, trustworthiness, and
interpersonal attraction or attractiveness. The credibility of a perceived message has been
found to be a key variable here; if one reads a report about health and believes it came
from a professional medical journal, one may be more easily persuaded than if one
believes it is from a popular newspaper.
3. Message Characteristics: The nature of the message plays a role in persuasion. Sometimes
presenting both sides of a story is useful to help change attitudes. When people are not
motivated to process the message, simply the number of arguments presented in a
persuasive message will influence attitude change, such that a greater number of
arguments will produce greater attitude change.
4. Cognitive Routes: A message can appeal to an individual’s cognitive evaluation to help
change an attitude. In the central route to persuasion, the individual is presented with the
data and motivated to evaluate the data and arrive at an attitude-changing conclusion. In
the peripheral route to attitude change, the individual is encouraged to look not at the
content but at the source. This is commonly seen in modern advertisements that feature
celebrities.

Lifestyle

In consumer marketing, lifestyle is considered a psychological variable known to influence the

buyer decision process for consumers.

LEARNING OBJECTIVES

Indicate how lifestyle or personality influences buying decisions

KEY TAKEAWAYS

Key Points
 66

 Lifestyle is also referred to as a buyer characteristic in the Black Box Model, which shows
the interaction of stimuli, consumer characteristics, decision process, and consumer
responses.
 The Black Box Model considers the buyer’s response as a result of a conscious, rational
decision process, in which it is assumed that the buyer has recognized the problem.
 The Black Box Model is related to the Black Box Theory of Behaviorism, where the focus
is not set on the processes inside a consumer, but the relation between the stimuli and the
response of the consumer.

Key Terms

 Buyer Decision Process: the decision making processes undertaken by consumers in

regard to a potential market transaction before, during, and after the purchase of a product
or service.
 Black Box Model: shows the interaction of stimuli, consumer characteristics, decision
process and consumer responses.

Lifestyle can be broadly defined as the way a person lives. In sociology, a lifestyle typically
reflects an individual’s attitudes, values, or world view. A lifestyle is a means of forging a sense
of self and to create cultural symbols that resonate with personal identity.
 67

Television and Obesity: Lifestyle choices, like increasing sedentary behaviors, can lead to
obesity.

Not all aspects of a lifestyle are voluntary. However, in consumer marketing, lifestyle is
considered a psychological variable known to influence the buyer decision process of consumers.

Lifestyle is also referred to as a buyer characteristic in the Black Box Model, which shows the
interaction of stimuli, consumer characteristics, decision process, and consumer responses. The
Black Box Model is related to the Black Box Theory of Behaviorism, where the focus is set not
on the processes inside a consumer, but the relation between the stimuli and the response of the
consumer.

In this theory, the marketing stimuli ( product, price, place and promotion) are planned and
processed by companies, whereas the environmental stimuli are based on the economical,
political, and cultural circumstances of a society. The buyer’s “black box” contains the buyer
 68

characteristics (e.g., attitudes, motivation, perception, lifestyle, personality, and knowledge) and
the decision process (e.g., problem recognition, information research, alternative evaluation,
purchase decision, and post-purchase behavior) which determine the buyer’s response (e.g.,
product choice, brand choice, dealer choice, purchase timing, and purchase amount).

The Black Box Model considers the buyer’s response as a result of a conscious, rational decision
process, in which it is assumed that the buyer has recognized the problem. However, in reality,
many decisions are not made in awareness of a determined problem by the consumer.

Shaping Public Policy and Educating Consumers

Companies can use marketing to educate consumers on a particular issue in an effort to help
shape public policy.

LEARNING OBJECTIVES

Discuss the elements of public policy and the education of customers

KEY TAKEAWAYS

Key Points

 The study of consumer behavior can be applied to improving marketing strategies, shaping
public policies, influencing society, and improving consumer knowledge.
 Public policy, as government action, is generally known as the principled guide to action
taken by the administrative or executive branches of the state with regard to a class of
issues in a manner consistent with law and institutional customs.
 Shaping public policy is a complex and multifaceted process that involves the interplay of
numerous individuals and interest groups competing and collaborating to influence
policymakers to act in a particular way.
 Social marketing applies a “customer oriented” approach and uses the concepts and tools
used by commercial marketers in pursuit of social goals like anti-smoking campaigns or
fund raising for NGOs.
 Health promotion is broadly defined as the process of enabling people to increase control
over and improve their health. It occurs through developing healthy public policy that
addresses the prerequisites of health such as income, housing, food security, employment,
and quality working conditions.

Key Terms

 Social Marketing: the systematic application of marketing, along with other concepts and
techniques, to achieve specific behavioral goals for a social good.
 69

 public policy: the set of policies (laws, plans, actions, behaviors) of a government; plans
and methods of action that govern that society; a system of laws, courses of action, and
priorities directing a government action.

The study of consumer behavior can be applied to improving marketing strategies, shaping
public policies, influencing society, and improving consumer knowledge.

Public policy, as government action, is generally known as the principled guide to action taken
by the administrative or executive branches of the state with regard to a class of issues in a
manner consistent with law and institutional customs. In the United States, this concept refers not
only to the result of policies, but more broadly to the decision making and analysis of
governmental decisions. Public policy is commonly embodied in constitutions, legislative acts,
and judicial decisions.

Shaping public policy is a complex and multifaceted process that involves the interplay of
numerous individuals and interest groups competing and collaborating to influence policymakers
to act in a particular way. These individuals and groups use a variety of tactics and tools to
advance their aims, including advocating their positions publicly, attempting to educate
supporters, opponents and consumers, and mobilizing allies on a particular issue.

Social marketing can help persuade and educate consumers on societal issues with the ultimate
goal of helping to shape public policy. For example, social marketers, dealing with goals such as
reducing cigarette smoking or encouraging condom use, have more difficult goals. They must
make potentially difficult and long-term behavioral change in target populations by educating
them. Social marketing applies a “customer oriented” approach and uses the concepts and tools
used by commercial marketers in pursuit of social goals like anti-smoking campaigns or
fundraising for NGOs.
 70

Anti-Smoking Campaign : The purpose of an anti-smoking campaign is to educate consumers

about health risks associated with smoking.

Health promotion is broadly defined as the process of enabling people to increase control over
and improve their health. It occurs through developing healthy public policy that addresses the
prerequisites of health such as income, housing, food security, employment, and quality working
conditions. There is a tendency among public health officials and governments—and this is
especially the case in liberal nations such as Canada and the USA—to reduce health promotion
to health education and social marketing focused on changing behavioral risk factors.

Trait theory

In psychology, trait theory (also called dispositional theory) is an approach to the study of
human personality. Trait theorists are primarily interested in the measurement of traits, which
can be defined as habitual patterns of behavior, thought, and emotion.[1] According to this
perspective, traits are aspects of personality that are relatively stable over time, differ across
individuals (e.g. some people are outgoing whereas others are not), are relatively consistent over
situations, and influence behavior. Traits are in contrast to states, which are more transitory
dispositions.
 71

In some theories and systems, traits are something a person either has or does not have, but in
many others traits are dimensions such as extraversion vs. introversion, with each person rating
somewhere along this spectrum.
There are two approaches to define traits: as internal causal properties or as purely descriptive
summaries. The internal causal definition states that traits influence our behaviours, leading us to
do things in line with that trait. On the other hand, traits as descriptive summaries are
descriptions of our actions that don't try to infer causality.[2]
Big Five personality traits

The Big Five personality traits, also known as the five-factor model (FFM) and the OCEAN
model, is a taxonomy for personality traits.[1] When factor analysis (a statistical technique) is
applied to personality survey data, some words used to describe aspects of personality are often
applied to the same person. For example, someone described as conscientious is more likely to
be described as "always prepared" rather than "messy". This theory is based therefore on the
association between words but not on neuropsychological experiments. This theory uses
descriptors of common language and therefore suggests five broad dimensions commonly used
to describe the human personality and psyche.[2][3]
The five factors are:

 Openness to experience (inventive/curious vs. consistent/cautious)

 Conscientiousness (efficient/organized vs. easy-going/careless)
 Extraversion (outgoing/energetic vs. solitary/reserved)
 Agreeableness (friendly/compassionate vs. challenging/detached)
 Neuroticism (sensitive/nervous vs. secure/confident)
The five factors are represented by the acronym OCEAN or CANOE. Beneath each proposed
global factor, there are a number of correlated and more specific primary factors. For example,
extraversion is said to include such related qualities as gregariousness, assertiveness, excitement
seeking, warmth, activity, and positive emotions.[4]
Family life and the way someone was raised will also affect these traits. Twin studies and other
research have shown that about half of the variation between individuals results from their
genetics and half from their environments. Researchers have found conscientiousness,
extraversion, openness to experience, and neuroticism to be relatively stable from childhood
through adulthood.

These five categories are usually described as follows.

 72

Openness

This trait features characteristics such as imagination and insight.1 People who are high in this
trait also tend to have a broad range of interests. They are curious about the world and other
people and eager to learn new things and enjoy new experiences.

People who are high in this trait tend to be more adventurous and creative. People low in this
trait are often much more traditional and may struggle with abstract thinking.

High
 Very creative
 Open to trying new things
 Focused on tackling new challenges

 Happy to think about abstract concepts

Low
 Dislikes change
 Does not enjoy new things
 Resists new ideas
 Not very imaginative
 Dislikes abstract or theoretical concepts
Conscientiousness

Standard features of this dimension include high levels of thoughtfulness, good impulse control,
and goal-directed behaviors.1 Highly conscientious people tend to be organized and mindful of
details. They plan ahead, think about how their behavior affects others, and are mindful of
deadlines.

High
 Spends time preparing
 Finishes important tasks right away
 Pays attention to detail
 Enjoys having a set schedule
Low
 Dislikes structure and schedules
 Makes messes and doesn't take care of things
 Fails to return things or put them back where they belong
 Procrastinates important tasks
 Fails to complete necessary or assigned tasks
 73

Extraversion

Extraversion (or extroversion) is characterized by excitability, sociability, talkativeness,

assertiveness, and high amounts of emotional expressiveness.1 People who are high in
extraversion are outgoing and tend to gain energy in social situations. Being around other people
helps them feel energized and excited.

People who are low in extraversion (or introverted) tend to be more reserved and have less
energy to expend in social settings. Social events can feel draining and introverts often require a
period of solitude and quiet in order to "recharge."

High
 Enjoys being the center of attention
 Likes to start conversations
 Enjoys meeting new people
 Has a wide social circle of friends and acquaintances
 Finds it easy to make new friends
 Feels energized when around other people
 Say things before thinking about them
Low
 Prefers solitude
 Feels exhausted when having to socialize a lot
 Finds it difficult to start conversations
 Dislikes making small talk
 Carefully thinks things through before speaking
 Dislikes being the center of attention
How Extroversion in Personality Influences Behavior

Agreeableness

This personality dimension includes attributes such as trust, altruism, kindness, affection, and
other prosocial behaviors.1 People who are high in agreeableness tend to be more cooperative
while those low in this trait tend to be more competitive and sometimes even manipulative.

High
 Has a great deal of interest in other people
 Cares about others
 Feels empathy and concern for other people
 Enjoys helping and contributing to the happiness of other people
 Assists others who are in need of help
Low
 74

 Takes little interest in others

 Doesn't care about how other people feel
 Has little interest in other people's problems
 Insults and belittles others
 Manipulates others to get what they want
Neuroticism

Neuroticism is a trait characterized by sadness, moodiness, and emotional instability. 1

Individuals who are high in this trait tend to experience mood swings, anxiety, irritability, and
sadness. Those low in this trait tend to be more stable and emotionally resilient.

High
 Experiences a lot of stress
 Worries about many different things
 Gets upset easily
 Experiences dramatic shifts in mood
 Feels anxious
 Struggles to bounce back after stressful events
Low
 Emotionally stable
 Deals well with stress
 Rarely feels sad or depressed
 Doesn't worry much
 Is very relaxed
10)What do you mean by developing self concepts ?Explain the influence of self concept on
consumer behavior.

Ans)Development of Self-Concept

Self-concept begins to develop in early childhood. This process continues throughout the
lifespan. However, it is between early childhood and adolescence that self-concept experiences
the most growth.

By age 2, children begin to differentiate themselves from others. By the ages of 3 and 4, children
understand that they are separate and unique selves. At this stage, a child's self-image is largely
descriptive, based mostly on physical characteristics or concrete details. Yet, children
increasingly pay attention to their capabilities, and by about 6 years old, children can
communicate what they want and need. They are also starting to define themselves in terms of
social groups.

Between the ages of 7 and 11, children begin to make social comparisons and consider how
they’re perceived by others. At this stage, children’s descriptions of themselves become more
 75

abstract. They begin to describe themselves in terms of abilities and not just concrete details, and
they realize that their characteristics exist on a continuum. For example, a child at this stage will
begin to see himself as more athletic than some and less athletic than others, rather than simply
athletic or not athletic. At this point, the ideal self and self-image start to develop.

Adolescence is a key period for self-concept. The self-concept established during adolescence is
usually the basis for the self-concept for the remainder of one’s life. During the adolescent years,
people experiment with different roles, personas, and selves. For adolescents, self-concept is
influenced by success in areas they value and the responses of others valued to them. Success
and approval can contribute to greater self-esteem and a stronger self-concept into adulthood.

Self Concept in Consumer Behaviour

Self-concept can be described simply as how one perceives himself and his behavior in the

market place. It is the attitude one holds towards himself. What one thinks of himself. The self

concept is not very realistic because an unconscious component is always present. It can be

divided into six types, as given below:

1. Actual self: How a person actually perceives himself.

2. Ideal self: How a person would like to perceive himself.
3. Social self: How a person thinks others perceive him.
4. Ideal social self: How a person would like others to perceive him.
5. Expected self: An image of self somewhere in between the actual and ideal self.
6. Situational self: A person’s self image in a specific situation.
Self-concept is a social phenomenon. It is an attitude to the self. Consequently, the way we dress,
the products we use, the services we require, depend on how we want to perceive ourselves.
There is a relationship between the self-image of a person and the product one wants to buy.
Products act as symbols for consumers.

First the consumers are asked to rate their self-concept on the differential scale. Then they are
asked to rate product brands on the same scales. The responses that watch with the brands are
expected to be preferred by consumers.
 76

After matching the self-concept with the brand image, the individual tries to find products for his
satisfaction. If he is satisfied, his self-concept gets reinforced as shown in the figure.

The interaction between the product and self-concept can be situation specific. In some
situations, the self-concept can be enhanced or reinforced to a lesser or higher degree. Marketers
use these tools as a guide to product and brand choices.

11)discuss the process of perception.

Ans) Perceptional Process : Perception is a process consisting of several sub processes. We can
take an input –throughput output approach to understand the dynamics of the perceptual process.
This approach emphasizes that there is input which is processed and gives output. The stimuli in
the environment-objects, events, or people-can be considered as the perceptual inputs. The actual
transformation of these inputs through the perceptual mechanism of selection, organization, and
interpretation can be treated as the throughputs, and the resultant opinions, feelings, attitudes etc.
which ultimately influence our behavior, can be viewed as the perceptual outputs. This
simplified process of perception

Perceptual Inputs : strictly speaking, perceptual inputs in the form of stimuli are not part of
actual perceptual process through these are necessary for the occurrence of perception. Stimuli
may be in the form of objects, events, or people. Thus everything in the setting where events
occur, or which contributes to the occurrence of events, can be termed as perceptual input.
Further the characteristics of stimuli are important as these affect the extent to which the
perceiver is attracted to these which affects the selection of stimuli for perception along with
other variables affecting selection of stimuli like like perceiver’s characteristics and situational
variables. When the perceiver interacts with a stimulus, sensation takes place which, we have
seen earlier starts perceptual process.
 77

Perceptual Mechanism: Perceptual mechanism involves three elements- selection of stimuli,

organization of stimuli, and interpretation of stimuli.

Selection of stimuli: After receiving the stimuli from the environment, some are selected for
further processing while others are screened out because it is possible for a person to selected all
stimuli which he sees in the environment. There are two types of factors which affect selection of
stimuli. These are external and related to stimuli and internal related to the perceiver. These
external and internal factors are of several types. We shall discuss these factors and their impact
on the selection of stimuli in the subsequent section of this chapter dealing with perceptual
selectivity.

Organization of Stimuli: After the stimuli are received, these are organized in some form in order
to make sense out of that. The various forms of organizing stimuli are figure-ground perceptual
grouping, simplification, and closer.

Interpretation of Stimuli: The perceptual inputs that have been organized will have to be
interpreted by the perceiver so that he can sense and extract some meaning of what is going on in
the situation. People interpret the meaning of what they have selectively perceived and organized
in terms of their own assumptions of people, things and situation. They also become judgmental
as well and tend to interpret the thing as good/bad, beautiful/ugly and so on which are quite
relative terms. In such a process, there are chances of misinterpretation. Interpretation of stimuli
is affected by characteristics of stimuli, situations under which perception takes place, and
characteristics of the perceiver. These factors also affect the total perceptual process.

Perceptual Outputs: Based on perceptual mechanism which ends with interpretation of stimuli,
perceptual outputs emerge. These outputs may be in the form of covert actions development of
attitudes, opinions, beliefs, impression about the stimuli under consideration. These outputs
along with other factors affecting human behavior may result in overt behavior. For overt
behavior to occur, perception is not the sole decider though it is important. For example, when a
person sees an advertisement of a product, he may perceive that the product is good. This
perception, however, may not be enough for the person to buy the product (overt behavior). The
actual buying may depend on the availability of the product, perceiver’s need for product and his
propensity and capacity to spend money for buying the product.
 78

12)EXPLAIN THE ELEMENTS OF PERCEPTION WITH SUITABLE

EXAMPLES

Perception is a process of sensory organs. The mind gets the information through the five sense
organs, i.e., eyes, nose, ears, tongue, and skin.

The stimulation comes to the organs through action, written messages, oral communication,
taste, touch, etc. The perception starts with the awareness of these stimuli. Recognising these
stimuli takes place only after paying attention to them. These message are then translated into
action.

Following are the elements of perception (subprocesses or components):

Stimuli: The receipt of information is the stimulus which results in sensation. Knowledge and
behaviour depend on senses and their stimulation. These senses are influenced by a larger
number of stimuli. The family, social and the economic environment are important stimuli for
the people. The physiological and psychological functions are impact of these stimuli. The
intensive and extensive forms of stimuli have a greater impact on the sensory organs. The
physical work environment, socio-cultural environment and other factors have certain stimuli to
influence the employee's perception.

In organisational settings, the supervisor may form the stimulus situation for the worker's
perceptual process.

Attention: The stimuli that are paid attention depend purely on the people's selection capacity
and the intensity of stimuli. Educated employees pay more attention to any stimuli, for example,
announcement of bonus, appeal for efficiency, training, and motivation. The management has to
find out suitable stimuli, which can appeal to the employees at the maximum level. An
organisation should be aware of all those factors, which affect the attention of the employees.
During the attention process, sensory and neural mechanisms are affected and the message
receiver becomes involved in understanding the stimuli. Taking employees to the attention stage
is essential in an organisation for making them behave in a systematic and required order.

Recognition: The messages or incoming stimuli are recognised before they are transmitted into
behaviour. Perception is a two-phase activity, i.e., receiving stimuli and translating the stimuli
into action. The recognition process is dependent on mental acceptability. For example, if a car
driver suddenly sees a child in front of his running car, he stops the car. He recongises the
stimuli, i.e., the life of the child is in danger. His mental process recognises the danger after
paying attention to the stimuli. If he does not attention to the stimuli, he cannot recognise the
danger. After recognising the stimuli, he translates the massage into behaviour.

Translation: The management in an organisation has to consider the various processes of

translating the message into action. The employees should be assisted to translate the stimuli into
action. For example, the announcement of bonus should be recognised as a stimulus for
 79

increasing production. The employee should translate it into appropriate behaviour. In other
words, they should be motivated by the management to increase productivity.

Behaviour: Behaviour is the outcome of the cognitive process. It is a response to change in

sensory inputs, i.e., stimuli. Perceptual behaviour is not influenced be reality, but is a result of
the perception process of the individual, his learning and personality, environmental factors and
other internal and external factors at the workplace. The psychological feedback that may
influence the perception of an employee may be superior behaviour, his eye movement, raising
of an eyebrow, the tone of voice, etc. The behaviour of employees depends on perception, which
is visible in the form of action, reaction or other behaviour. The behavioral termination of
perception may be overt or covert. The perception behaviour is the result of the cognitive process
of the stimulus which may be a message or an action situation of management function.
Perception is reflected in behaviour, which is visible in different forms of employees' action and
motivation.

Performance: Proper behaviour learns to higher performance. High performers become a source
of stimuli and motivation to other employees. A performance-reward relationship is established
to motivate people.

Satisfaction High performance gives more satisfaction. The level of satisfaction is calculated
with the difference in performance and expectation. If the performance is more than the
expectation, people are delighted, but when performance is equal to expectation, it results in
satisfaction. On the other hand, if performance is less than the expectation, people become
frustrated and this requires a more appealing form of stimulus of developing proper employee
work behaviour and high performance. It is essential to understand the factors that influence the
perception process and mould employees' behaviour towards the corporate objectives and self-
satisfaction.
 80

13)DISCUSS THE FACTORS THAT AFFECT PERCEPTION OF A

CONSUMER

Although a consumer's perception of a product or service is at least partially based on his

actual experience with the good, a significant amount of market research suggests that a
consumer's view of a product is also conditioned by a variety of other factors. From very
concrete factors of price and quality to less tangible factors such a consumer's view of the
manufacturer's reputation, experience with service and the quality of packaging and branding,
a number of complex and interrelated psychological factors determine a consumer's perception
of goods and services.

Price

Price has a complex effect on consumer perception. On the one hand, consumers appreciate a
bargain and are often likely to favor an economically-priced item. On the other, consumers
often perceive very inexpensive items as cheap and discardable, ultimately damaging a
consumer's view of a product even if the product remains the same and the consumer is
benefited from a price reduction. Especially sophisticated or skeptical consumers are even
prone to distrust a product that is considerably cheaper than the alternatives. As a result, price
should be part of a comprehensive marketing plan, where even inexpensive products are
depicted as favorable alternatives with similar levels of quality to the competition, with a price
that is somewhat lower but still comparable with other possibilities.

Quality

Of course, the actual quality of a product is a vital part of a consumer's perception of a good or
service. Quality can describe any attribute in a set of characteristics that satisfy or disappoint a
consumer, including usability, reliability and durability. Marketing can influence a consumer's
perception of quality, but, in the end, and particularly with non-durable goods, a consumer's
actual experience with a product will determine his perception of quality. Outside the realm of
mass communication, word of mouth regarding quality also travels very quickly.

Service Quality

Even in the case of goods that exhibit numerous flaws, excellent service quality can often
overshadow a negative experience with the product itself. If a consumer feels that he receives
exceptional attention when encountering a problem with a product, that consumer is somewhat
 81

more likely to trust the brand or product knowing that the manufacturer or retailer provides a
prompt and effective response to problems. Humans are social animals and their consumer
behavior is often determined by the social relationships that surround a product, including
interactions with customer service representatives.

Packaging and Branding

Packaging and branding have a huge effect on consumer perceptions, particularly at the point
of purchase. Especially when a consumers are purchasing a type of product for the first time,
the way the product is presented can wholly determine their perception of the item. Packaging
and branding, of course, cover everything from the attractiveness and display quality of an
item to the attributes of a product the manufacturer chooses to highlight. Depending on the
type of product and market, different branding messages from tough and reliable to fine and
luxurious can be appropriate and effective.

Reputation

A product's reputation is built up over time and is usually a combination of actual experience
with the product, word-of-mouth recommendations and marketing campaigns that attempt to
establish a status or shared view of the product or brand. A consumer's perception of a
product's reputation, moreover, is not only determined by the product's brand identity and
manufacturer but by the whole chain of distribution. Even if a consumer trusts a product's
manufacturer, for example, that consumer may change his mind about the product upon seeing
it available in a retailer he associates with cheap, defective products.
 82

14)EXPLAIN THE INFLUENCE OF CONSUMER LEARNING ON

CONSUMER BEHAVIOUR

The process by which individuals acquire the purchase and consumption knowledge and
experience that they apply to future related behavior
Marketers must teach consumers:
where to buy
how to use
how to maintain
how to dispose of products

Learning Theories
Behavioral Theories: behavioral theory is based on observable behaviors (responses) that occur
as the result of exposure to stimuli.
Cognitive Theories : Learning is based on mental information processing, it is also often in
response to problem solving.

Since the days of the psychologist Johan Hall learning has been defined as response changes of

consumers arising from experience. Modern theorists have defined learning in a number of ways

but the basic of all definitions is impact of learning / or experience on the behaviour of a

consumer. Domjan and Burkhard defined learning in 1986 “as enduring change in the
mechanism of behaviour that results from expertise with environmental events”.

Holyoak, Koh and Nibsett see learning as a process of adaptation where by an individual alters
goal directed behaviour in response to changing environmental conditions.

According to Hoch and Deighton in the market learning occurs when consumers adopt their

beliefs to make sense of new data. It should be remembered that learning is a psychological

attribute. It includes the learning of attitudes of consumers. The learning as defined by Engel,

Blackwell, Mineral, Hawkins, Best, Coney, Ray, Wilkie has two major types of learning called
(1) cognitive orientation and (2) stimulus response i.e. behavioural orientation.

Congenial orientation is deeply associated with consumer information and his behaviour. This is
very important for marketer because it studies consumer response to information where by the
 83

forms his opinion about alternatives, offer acquiring the information and integrating it with the
information already in store with the consumer.

For instance, a consumer is using ‘X’ brand razor blades. He learns that better or cheaper blades

have been introduced by another company. When he collects information about it, integrates it

with his existing knowledge and whether alternative should be used or not it is called cognitive

learning. The manufacturer and marketer make all possible efforts through advertisements and

other methods that information reaches the consumers and they may be compelled to consider
alternatives.

When conclusions are drawn between environmental events it is called associative learning. “It

does not depend wholly on advertisement of marketer but also on other factors through research
that smoking causes cancer, and heart diseases, it is associative learning.

ADVERTISEMENTS:

Similarly, when it is found by environmentalists that synthetic fibre are harmful to skin or when

it were found that vegetables and fruits having insecticides or pesticides it is associative learning.

In such cases either consumer themselves may think to educate public In spite of various
definitions of learning there is one acceptable definition.

However from marketer point of view consumer learning “is the process by which individuals

acquire the purchase and consumption knowledge and experience they apply to future related
behaviour”.
 84

15)WHAT ARE THE PRINCIPLE ELEMENTS OF CONSUMER

LEARNING?DISCUSS ION DETAIL
Elements of Consumer Learning
• MOTIVATION:
“It is the processes that lead people to behave as they do”.
It occurs when a need arises that a consumer wishes to satisfy. Motivation is based on needs and
goals. It acts as a spur of learning. Uncovering consumer motives is one of the prime tasks of
marketers, who then try to teach motivated consumer segments why and how their products will
fulfill the consumer’s needs.

• CUES:
“It is a stimulus that suggests a specific way to satisfy a silent motive”.
If motives serve to stimulate learning, cues are the stimuli that give direction to these motives. In
the marketplace, price, styling, packaging, advertising and store displays all serve as cues to help
consumers fulfill their needs in product-specific ways. Cues serve to direct consumer drives
when they are consistent with consumer expectations. Marketers must be careful to provide cues
that do not upset those expectations.

• RESPONSE:
“Response means how individuals react to a drive or cue or how they behave”.
Learning can occur even when responses are not overt. The automobile manufacturer that
provides consistent cues to a consumer may not always succeed in stimulating a purchase. A
response is not tied to a need in a one-to-one fashion. If the manufacturer succeeds in forming a
favorable image of a particular automobile model in the consumer’s mind, when the consumer is
ready to buy, it is likely that he or she will consider that make or model.
• REINFORCEMENT:
“A positive or negative outcome that influences the likelihood that a specific behavior will be
repeated in the future in response to a particular cue or stimulus”.
It increases the likelihood that a specific response will occur in the future as the result of
particular cues or stimuli. Through positive reinforcement, learning has taken place.
BEHAVIORAL LEARNING THEORIES:
Behavioral learning theories are sometimes referred to as stimulus-response theories because they
are based on the premise that observable responses to specific external stimuli signal that
learning has taken place.

CLASSICAL CONDITIONING:
“A behavioral learning theory according to which a stimulus is paired with another stimulus
that elicits a known response that serves to produce the same response when used alone”.
Early classical conditioning theorists regarded all organisms as relatively entities that could
be taught certain behaviors through repetition or conditioning. The word conditioning mean a
kind of “knee-jerk” or automatic response to a situation built up through repeated exposure. E.g.,
If you get a headache every time you think of visiting a doctor. Pavlov’s demonstration of
conditioned learning in his studies with dogs is also a good example of it.
 85

An unconditioned stimulus might consists of a well-known brand symbol (such as

Neutrogena name) that implies demonstration of dermatologists’ endorsement and pure. This
previously acquired consumer perception of Neutrogena is the unconditioned response.
Conditioned stimuli might consist of new products bearing the well-known symbol (such as
the items depicted in new products bearing the well-known symbol and the conditioned response
would be trying these products because of the belief that they embody the same attributes with
which the Neutrogena name is associated.

•
Ivan Pavlov’s Dogs Experiment:
– Unconditioned stimulus (UCS) – Naturally capable of causing a response.
– Conditioned stimulus (CS) – Does not initially cause a response
– Conditioned response (CR) – Response generated by repeated paired exposures to UCS and
CS. Eventually, through learned association and repetition, the CS will cause the CR.
• Examples:
– Pairing a likeable celebrity with a new product in advertising or associating a likeable song
with a particular product.
– Pairing product purchase with the use of a credit card.
Researcher’s Argumentation:
Researchers have argued that the examples given are really nothing more than mood encoding,
and that the positive affect tag is the effective mechanism.
 86

16)DISCUSS THE COGNITIVE LERARNING AND INVOLVEMENT THEORY OF

1CONSUMER LEARNING

Cognitive Associative Learning:

“Classical conditioning is viewed as the learning of associations among events that allows
the organism to anticipate and represent its environment”.
From this viewpoint, classical conditioning is not reflexive action, but rather the acquisition
of new knowledge.
Contemporary behavioral scientist view classical conditioning as the learning associations
among events that allow the organisms to anticipate and represent its environment. According to
this view, the relationship or contiguity between the conditioned stimulus and the unconditioned
stimulus influence expectations, which in turn influence their behavior.

Neo-Pavolvian Theory:
Optimal conditioning-is the creation of a strong association between the conditioned stimulus
(CS) and the unconditioned stimulus (US)-requires:
1) Forward Conditioning (i.e., the CS should precede the US);
2) Repeated pairings of the CS and the US;
3) A CS and US that logically belong together;
4) A CS that is novel and unfamiliar;
5) A US that is biologically or symbolically salient.
This model is known as NEO-PAVLOVIAN CONDITIONING.
Under NEO-PAVLOVIAN theory, the consumer can be viewed as an information seeker
who uses logical and perceptual relations among events, along with his or her own
preconceptions, to form a sophisticated representation of the world.

STRATEGIC APPLICATIONS OF CLASSICAL CONDITIONING:

The three basic concepts derive from classical conditioning are:
1) Repetition
2) Stimulus Generalization
3) Stimulus Discrimination

1) REPETITION:
“Repetition increases strength of associations and slows forgetting but over time may result
in advertising wear out”. Cosmetic variations reduce satiation.
Research suggests that there is a limit to the amount of repetition that will aid retention. Although
some over learning (i.e., repetition beyond what is necessary for learning) aids retention, at some
point, an individual can become satisfied with numerous exposures, and both attention and
retention will decline.

Substantive Variations:
“These are changes in advertising content across different versions of an advertisement”. For
Example, Stressing two different attributes of the same product.

Three Hit Theory:

 87

• Repetition is the basis for the idea that three exposures to an ad are necessary for the ad to be
effective.
• Some marketers just focus on three exposures of advertisement. 1) Product Awareness 2)
Showing of Relevance of the product 3) Remainder of products’ benefits.
• Other marketers focus on at least 11 to 12 repetitions to increase the likelihood that consumer
will actually receive the three exposures basic to the so-called Three hit theory.
• The effectiveness of repetition is somewhat dependent upon the amount of competitive
advertising to which the consumer is exposed.

2) STIMULUS GENERALIZATION:
“It is the inability to perceive differences between slightly dissimilar stimuli”.
It is defined as making of same response with slightly different stimuli-not much learning takes
place. Stimulus generalization explains why some “me too” products succeed in the marketplace.
Consumer confuse them with the original product they have been advertised. It also explains
why manufacturers of private-label brands try to make their packaging closely resemble the
national brand leaders.

Product Line, Form, and Category Extensions:

Marketers to product line, form, and category extensions apply the principle of stimulus
generalization. Marketers also offer product category extensions that generally target new market
segments. If the image of the parent brand is one of quality and the new item is logically linked
to the brand, consumers are more likely to bring positive associations to the new offerings
introduced as product line, form, or category extensions.

Family Branding:
The practice of a whole line of company products under the same brand name-is another strategy
that capitalizes on the consumer’s ability to generalize favorable brand associations from one
product to others.

Licensing:
Allowing a well-known brand name to be affixed to products of another manufacturer-is a
marketing strategy that operates on the principle of stimulus generalization. The names of
designers, manufacturers, celebrities, corporations and even cartoon characters are attached for a
fee (i.e., “rented”) to a variety of products, enabling the licensees to achieve instant recognition
and implied quality for the licensed products. E.g. Calvin Kline or McDonalds.
3) STIMULUS DISCRIMINATION:
“The ability to select a specific stimulus from among similar stimuli because of perceived
differences”.
Stimulus discrimination is the opposite of stimulus generalization and results in the selection of a
specified stimulus from among similar stimuli. The consumer’s ability to discriminate among
similar stimuli is the basis of positioning strategy that seeks to establish a unique image for a
brand in the consumer’s mind.

Positioning:
The image or position that a product or service holds in the mind of the consumer is critical to its
success. When a product or service holds in the mind of the consumer is critical to its success.
 88

When a marketer targets consumers with a strong communication program that stresses the
unique ways in which its product will satisfy the consumer’s needs, it wants the consumer to
differentiate its product will satisfy the consumer’s needs, it wants the consumer to differentiate
its product from among competitive products on the shelf.

Product Differentiation:
Most product differentiation strategies are designed to distinguish a product or brand from that of
competitors based on an attribute that is relevant, meaningful, and valuable to consumers. Many
marketers successfully differentiate their brands on an attribute that may actually be irrelevant to
creating the implied benefit, such as a noncontributing ingredient or a color. It is often difficult
for a marketer to unseat a brand once stimulus discrimination has occurred.
One explanation is that leader usually the first in the market and had to teach customer for a
longer period to associate with the brand name.

INSTRUMENTAL (OPERANT) CONDITIONING:

“A behavioral theory of learning based on a trial-and-error process, with habits forced as the
result of positive experiences (reinforcement) resulting from certain responses or behaviors”.
It requires a link between a stimulus and a response. In Instrumental Conditioning, the stimulus
that results in the most satisfactory response is the one that is learned. In consumer behavior
terms, it suggests that consumers learn by trial and error process in which some purchase
behaviors results in more favorable outcomes (i.e., rewards) than other purchase behaviors. A
favorable experience is “instrumental” in teaching the individual to repeat a specific behavior.
• Occurs as the individual learns to perform behaviors that produce positive outcomes and
avoid behaviors that yield negative outcomes.
• This learning process is most closely associated with psychologist B.F. Skinner, who
demonstrated the effects of instrumental conditioning by training pigeons to dance and play
Ping-Pong.
• Operant conditioning is the process in which the frequency of occurrence of a behavior is
modified by the consequences of the behavior. That is, the consequences of a purchase will
affect the probability of a re-purchase.

Reinforcement of a behavior:

Positive Reinforcement:
“Positive outcomes that strengthen the likelihood of a specific response”.
Negative Reinforcement:
“Unpleasant or negative outcomes that serve to encourage a specific behavior”.

Skinner distinguished two types of reinforcement (or reward) that influence the likelihood that a
response will be repeated. The first type, positive reinforcement, consists of events that
strengthen the likelihood of a specific response. E.g., using a shampoo that leaves your hairs,
feeling silky and clean is likely to result in a repeated purchase of the shampoo. Negative
reinforcement is an unpleasant or negative outcome that also serves to encourage a specific
behavior. E.g., buying of an antivirus software for you computer. Fear appeals in ad messages
 89

are examples of negative reinforcement such as life insurance commercials rely on negative
reinforcement to encourage consumers to encourage the purchase.

Punishment:
“Choose reinforcement rather than punishment”.

Forgetting and Extinction:

- Forgetting “Combat with repetition”.
- Extinction “Combat with consumer satisfaction”.

Factors Involving Forgetting:

Time: Forgetting is rapid at first and then levels off
Interference Old information in memory interferes with learning similar, new material.

When a learned response is no longer reinforced, it diminishes to the point of extinction, that is,
to the point at which the link between the stimulus and the expected reward is eliminated. If a
consumer is no longer satisfied with the service a retail store provides, the link between the
stimulus (the store) and the response (expected satisfaction) is no longer reinforced, it is
“unlearned”. There is a difference, however, between extinction and forgetting. Forgetting is
often related to the passage of time; this is known as the process of decay. Marketers can
overcome forgetting through repetition and can combat extinction through the deliberate
enhancement of consumer satisfaction.

Strategic/Marketing applications of instrumental conditioning:

Marketers effectively utilize the concepts of consumer instrumental learning when they provide
positive reinforcement by assuring customer instrumental learning when they provide positive
reinforcement by assuring customer satisfaction with the product, the service, and the total
buying experience.

Customer Satisfaction (Reinforcement):

The objective of all marketing efforts should be to maximize customer satisfaction. Marketers
must be certain to provide the best possible product for the money and to avoid raising consumer
expectations for product (or services) performance beyond what the product can deliver. Aside
from the experience of using the product itself, consumers can receive reinforcement from other
elements in the purchase situation, such as the environment in which the transaction or service
takes place, the attention and service provided by employees, and the amenities provided. E.g.:
most frequent shopper programs are based on enhancing positive reinforcement and encouraging
continued patronage. The more a consumer uses the service, the greater the rewards.

Relationship Marketing:
Relationship marketing develops a closed personalized relationship with customers-is another
form of non product reinforcement. Knowing that she will be advised of a forthcoming sale that
selected merchandise will be advised of a forthcoming sale, or that selected merchandise will be
set aside for her next visit cements the loyalty that a consumer may have for a retail store.
 90

Reinforcement Schedules:
Marketers have found that product quality must be consistently high and provide customer
satisfaction with each use for desired consumer rewards do not have to be offered each time the
transaction takes place; even an occasional reward provides reinforcement and encourages
consumer patronage. The promise of possibly receiving a reward provides positive reinforcement
and encourages consumer patronage. Marketers have identified three types of reinforcement
schedules:

1) Total or Continuous Reinforcement:

An example of total or continuous reinforcement schedule is the free after-dinner drink or fruit
plate always served to patrons at certain restaurants. The basic product or service rendered is
expected to provide total satisfaction (reinforcement) each time it is used.

2) Systematic (Fixed Ratio) Reinforcement:

A fixed ratio reinforcement schedule provides reinforcement every nth time the product or
service is purchased. (Say every third time). For example, a retailer may send a credit voucher to
account holders every three months based on a percentage of the previous quarter’s purchases.

3) Random or Variable Ratio Reinforcement:

This schedule rewards consumers on a random basis or an average frequency basis (such as
every third or tenth transaction). Variable ratios tend to engender high rates of desired behavior
and are somewhat resistant to extinction-perhaps because, for many consumers, hope springs
eternal. Other examples of variable ratio require certain consumer behaviors for eligibility.

- Shaping:
“It is the reinforcement for incremental steps toward the desired behavior. This is the same
principle that underlies animal training”.
Reinforcement performed before the desired consumer behavior actually takes place is called
shaping. Shaping increases the probabilities, that certain desired consumer behavior will occur.
Many retailers provide some form of preliminary reinforcement (shaping) to encourage
consumers to visit only their store. For example, some retailers offer loss leaders-popular
products at several discounted prices-to the first hundred or so customer to arrive, since those
customers are likely to stay to do so much of their shopping.

Massed versus Distributed Learning:

Timing has an important influence on consumer learning. Should a learning schedule be spread
out over a period of time (distributed learning), or should it be “bunched up” all at once (massed
learning)? The question is important for advertisers planning a media schedule, because massed
advertising produces more initial learning, whereas a distributed schedule usually results in
learning that persists longer. When advertisers want an immediate impact (e.g., to introduce a
new product or to counter a competitor’s blitz campaign), they generally use a massed schedule
to hasten consumer learning. When the goal is long-term repeat buying on a regular basis, a
distributed schedule is preferable.

Other Strategies:
 91

Frequent flyer miles:

Rewarding consumers with frequent flyer miles is an effective way to reinforce them and build
brand loyalty.
Brand loyalty
Slot machines
‘Sales’

MODELING OR OBSERVATIONAL LEARNING:

“It is a process by which individuals observe the behavior of others, and consequences of such
behavior. It is also known as modeling or vicarious learning”.
Occurs when people watch the actions of others and note reinforcements received for their
behaviors. Learning occurs as a result of vicarious, rather than direct, experience.
Learning theorists have noted that a considerable amount of learning takes place in the absence of
direct reinforcement, either positive or negative, through a process called by psychologists
modeling or observational learning (also called vicarious learning).

Modeling:
It is the process through which individuals learn behavior by observing the behavior of others and
the consequences of such behavior. Their role models are usually people they admire because of
such traits as appearance, accomplishments, skill, and even social class.
Consumer models with which the target audience can identify are shown achieving positive
outcomes to common problem situations through the use of the advertised product.
 92

17)WHAT ARE THE FUNCTIONS OF ATTITUDE?DISCUSS THE INFLUENCE OF

ATTITUDE ON CONSUMER BEHAVIOUR

Consumer attitude may be defined as a feeling of favorableness or unfavorableness that an

individual has towards an object. As we, all know that an individual with a positive attitude is
more likely to buy a product and this results in the possibility of liking or disliking a product.
Consumer attitude basically comprises of beliefs towards, feelings towards and behavioral
intentions towards some objects.

Belief plays a vital role for consumers because, it can be either positive or negative towards an
object. For example, some may say tea is good and relieves tension, others may say too much of
tea is not good for health. Human beliefs are not accurate and can change according to
situations.
Consumers have certain specific feelings towards some products or brands. Sometimes these
feelings are based on certain beliefs and sometimes they are not. For example, an individual
feels uneasy when he thinks about cheese burst pizza, because of the tremendous amount of
cheese or fat it has.
Behavioral intentions show the plans of consumers with respect to the products. This is
sometimes a logical result of beliefs or feelings, but not always. For example, an individual
personally might not like a restaurant, but may visit it because it is the hangout place for his
friends.

Functions of Attitudes
The following are the functions of attitudes
 Adjustment Function − Attitudes helps people to adjust to different situations and
circumstances.
 Ego Defensive Function − Attitudes are formed to protect the ego. We all are bothered
about our self-esteem and image so the product boosting our ego is the target of such a
kind of attitude.
 93

 Value Expression Function − Attitudes usually represent the values the individual
posses. We gain values, though our upbringing and training. Our value system
encourages or discourages us to buy certain products. For example, our value system
allows or disallows us to purchase products such as cigarettes, alcohol, drugs, etc.
 Knowledge Function − Individuals’ continuously seeks knowledge and information.
When an individual gets information about a particular product, he creates and modifies
his attitude towards that product.
 94

18)DISCUSS THE MODELS OF ATTITUDEFORMATION IN DETAIL

To understand the relationships between attitudes and consumer behavior, psychologists have
tried to develop models that capture the underlying dimensions of attitude. To serve this purpose,
the focus has been on specifying the composition of an attitude to better explain or
predict behavior. The following section describes some important attitude models like
tricomponent attitude model, the multiattribute models, the trying to consume model, and the
attitude-toward-the-ad model. All the above-mentioned models present different perspectives on
the number of component parts of an attitude and how these parts are arranged or interrelated.

1. Tricomponent Attitude Model

According to the tricomponent attitude model, attitude consists of three major components, viz.,
a cognitive component, an affective component, and a conative component.

1. The cognitive component: The cognitive component consists of a person’s cognitions, i.e.,
knowledge and perceptions (about an object). This knowledge and resulting perceptions
commonly take the form of beliefs, images, and long-term memories. A utility
function representing the weighted product of attributes and criteria would be used to develop the
final ranking and thus choice. This model represents the process used by individuals with a
strong Thinking Cognitive Style.
2. The affective component: The affective component of an attitude comprises of the consumers
emotions or feelings (toward an object). These emotions or feelings are frequently treated by
consumer researchers as primarily evaluative in nature; i.e., they capture an individual’s direct or
global assessment of the attitude-object, which might be positive, negative, or mixed reaction
consisting of our feelings about an object. Buying of any product or service would be
accomplished on the basis of how each product/service makes the decision maker feel. The
product that evokes the greatest positive (pleasurable) affective response would thus be ranked
first. The affective response may be derived through association (i.e, category attributes)
or directly attributed to the interaction between the product or service and the decision maker. It
is believed that the manner in which the product/service affirms or disaffirms the self concept of
the decision maker has a strong impact to the decision maker’s affect response to the
candidate. This model represents the process used by individuals with a strong Feeling Cognitive
Style. Ordering of the three job candidates would be accomplished on the basis of how each
candidate makes the decision maker feel. The candidate that evokes the greatest positive
(pleasurable) affective response would thus be ranked first. The affective response may be
derived through association (i.e, category attributes) or directly attributed to the interaction
between the candidate and the decision maker. It is believed that the manner in which the
candidate affirms or disaffirms the self concept of the decision maker has a strong impact to the
decision maker’s affect response to the candidate.
3. The conative component: The conative component is concerned with the likelihood or tendency
of certain behavior with regard to the attitude object. It would also mean the predisposition or
tendency to act in a certain manner toward an object.
 95

2. Multiattribute Attitude Models

Multiattribute attitude models portray consumers’ attitudes with regard to an attitude “object” as
a function of consumers perceptions and assessment of the key attributes or beliefs held with
regard to the particular attitude “object”. The three models, which are very popular, are: the
attitude-toward-object model, the attitude-toward-behavior model, and the theory of- reasoned-
action model.

1. Attitude toward object model: The attitude-toward object model is suitable for measuring
attitudes towards a product or service category or specific brands. This model says that the
consumer’s attitude toward a product or specific brands of a product is a function of the presence
or absence and evaluation of certain product-specific beliefs or attributes. In other words,
consumers generally have favorable attitudes toward those brands that they believe have an
adequate level of attributes that they evaluate as positive, and they have unfavorable attitudes
towards those brands they feel do not have an adequate level of desired attributes or have too
many negative or undesired attributes. For instance, you may like BMW cars.
2. Attitude toward behavior model: This model is the individual’s attitude toward the object itself.
The crux of the attitude-towards-behavior model is that it seems to correspond somewhat more
closely to actual behavior than does the attitude-toward-object model. So taking on from liking a
BMW, we may say you are not ready to buy/drive one because you believe that you are too
young/old to do so.
3. Theory of reasoned-action-model: This model represents a comprehensive integration of
attitude components into a structure that is designed to lead to both better explanations and better
predictions of behavior. Similar to the basic tricomponent attitude model, the theory-of-
reasoned-action model incorporates a cognitive component, an affective component, and a
conative component; however these are arranged in a pattern different from that of the
tricomponent model.

3. Theory of Trying to Consume

The theory of trying to consume has been designed to account for the many cases where the
action or outcome is not certain, but instead reflects the consumer’s attempts to consume
or purchase. In such cases there are often personal impediments and/or environmental
impediments that might prevent the desired action or outcome from occurring. Here again, the
key point is that in these cases of trying, the outcome is not, and cannot be assumed to be certain.
The focus here is the “trying” or seeking part, rather than the outcome (consumption).

4. Attitude-toward-the-ad Models

The Attitude-toward-the-Ad Model lays emphasis on the impact of an advertisement, either in

print or in audio-visual on the formation of consumer attitudes towards product and service
 96

offerings and or brands. The theory behind the model states that consumers form judgments and
feelings as a result of exposure to an advertisement. Not only does a consumer form attitudes
towards the advertisement, he or she also forms an opinion towards the brand. The gist of this
model can be explained by the following:

1. Normally, if you like an ad, you are more likely to purchase the advertised brand.
2. For a new product/brand, an ad has a stronger impact on brand attitude and purchase intention.