1.1 Consumer behaviour is the study of how people make decision about what they buy, want, need or act in regard to a product, service or company.

Consumer behaviour is the process involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and wants.

Consumer behaviour can be defined as the decision-making process and physical activity involved acquiring, evaluating, using and disposing of goods and services.

1.1.1 Concepts of consumer behaviour

Consumer behaviour is the social, economic and psychological behaviour of consumers as they become aware of, evaluate, purchase, consume and make up the ideas about the goods and services. Consumer behaviour specifically comprises of three basic activities-acquiring, consuming, and disposing.

Consumer behaviour is the study of following concepts:

• Why does a consumer buy a product?
• Why isn’t a consumer buying a product?
• How a consumer buys a product?
• When does a consumer buy a product?
• When does a consumer not buy a product?

1.1.2Nature of consumer behaviour

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.

The following are the 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:

• Influenced by various factors: Consumer behaviour is influenced by several factors. The factors that influence consumers include marketing, personal, psychological, situational, social and cultural etc.
• Different for different customers: All consumers do not behave in the same manner. Different consumers behave differently. The difference in consumer behaviour is due to individual factors such as nature of the consumer’s lifestyle, culture etc.

Example: Roy is an NRI he always purchases foreign brand t-shirts, without considering price. Rayan is a Non NRI who purchases t-shirt based on price.

• 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.

Example: Nora a housewife always purchases groceries in a bulk quantity. Whereas her friend Kate a working woman who purchase grocery as per need.

• Vary across regions: The consumer behaviour varies 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.

Example: In some countries Burger and pizza are consumed mostly whereas rice and wheat in other countries.

1.1.3 Scope of consumer behaviour

Everyone without exception is a consumer. So, the applicability of consumer behaviour science is indeed universal. The increase in population and the ever-expanding choices and freedom make the study of consumer behaviour a must for any marketing function. The scope of consumer behaviour lies in:

• Demand forecasting: Estimating the demand for products and services.

• Marketing: Understanding the needs, expectations, problems of consumers, formulating marketing mix strategies.

• Advertising: Understanding human behaviour towards different advertising appeals and message, selecting the type of media.

• Human behaviour: Understanding the various motives that influence behaviour of a consumer.

• Operations: Formulating production, pricing and distribution policies.

1.1.4Benefits of understanding consumer behaviour

Consumer behaviour helps businesses to understand what their consumers value and enables to craft their messaging based on what is most important to the subset of the market they are targeting. The way a business communicates with their prospects and customers is a vital part of their success.

Major benefits of understanding consumer behaviour are as follows:

• Analysing market opportunity: Understanding consumer behaviour helps in identifying the needs and wants of consumers. The study of consumer behaviour also helps the marketers not only to understand what consumer’s purchase but helps to understand why they purchase it.

Example: We can analyse through evaluating feedback form filled by customers purchasing from shops.

• Selecting target market: Review of market opportunities helps in identifying distinct and unique wants and needs. Identifying these groups, behave and how they make purchase decisions helps the marketer to design their product.

Example: Online site concentrating only for women fashion accessories.

• Marketing-mix decisions: Once unsatisfied needs and wants are identified, the marketer has to determine the right mix of product, price, distribution and promotion. If a company is providing a service rather than a product, there may be three additional P’s to consider: physical environment, process, and people. The factors of marketing mix decisions are: Products, place, promotions, price.

• 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 and awareness about AIDS.

Example: Water is life – capturing a trending hash tag.

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