★ Maslow’s Hierarchy

Physiological needs​ - these are biological requirements for human survival, e.g. air, food, drink,
shelter, clothing, warmth, sleep. If these needs are not satisfied the human body cannot function
optimally. Maslow considered physiological needs the most important as all the other needs become
secondary until these needs are met.

Safety needs​ - Once an individual’s physiological needs are satisfied, the needs for security and
safety become salient. People want to experience order, predictability and control in their lives. These
needs can be fulfilled by the family and society (e.g. police, schools, business and medical care). For
example, emotional security, financial security (e.g. employment, social welfare), law and order,
freedom from fear, social stability, property, health and wellbeing (e.g. safety against accidents and
injury).

Love and belongingness needs​ - after physiological and safety needs have been fulfilled, the third
level of human needs is social and involves feelings of belongingness. The need for interpersonal
relationships motivates behavior. Examples include friendship, intimacy, trust, and acceptance,
receiving and giving affection and love. Affiliating, being part of a group (family, friends, work).

Esteem needs​ are the fourth level in Maslow’s hierarchy - which Maslow classified into two
categories: (i) esteem for oneself (dignity, achievement, mastery, independence) and (ii) the desire
for reputation or respect from others (e.g., status, prestige). Maslow indicated that the need for
respect or reputation is most important for children and adolescents and precedes real self-esteem or
dignity.
Self-actualization needs​ are the highest level in Maslow's hierarchy, and refer to the realization of a
person's potential, self-fulfillment, seeking personal growth and peak experiences. Maslow describes
this level as the desire to accomplish everything that one can, to become the most that one can be.
Individuals may perceive or focus on this need very specifically. For example, one individual may
have a strong desire to become an ideal parent. In another, the desire may be expressed
economically, academically or athletically. For others, it may be expressed creatively, in paintings,
pictures, or inventions.

★ 7 P’s

Product-​ ​Product refers to what you are selling, including all of the features, advantages and benefits
that your customers can enjoy from buying your goods or services. When marketing your product,
you need to think about the key features and benefits your customers want or need, including (but not
limited to) styling, quality, repairs, and accessories. You can use ​research and development​ to inform
the development of new products in your business.

Price-​ ​This refers to your pricing strategy for your products and services and how it will affect your
customers. You should identify how much your customers are prepared to pay, how much mark-up
you need to cater for overheads, your profit margins and payment methods, and other costs. To
attract customers and retain ​your competitive advantage​, you may also wish to consider the
possibility of discounts and seasonal pricing.

Promotion-​ ​These are the promotional activities you use to make your customers aware of your
products and services, including advertising, sales tactics, promotions and direct marketing.
Generally these are referred to as marketing tactics.
 Place- ​Place is where your products and services are seen, made, sold or distributed. Access for
customers to your products is key and it is important to ensure that customers can find you. You can
set yourself apart from your competition through the ​design of your retail space​ and by using effective
visual merchandising techniques​. If you are not a retail business, place is still an important part of
your marketing. Your customers may need a quick delivery turnaround, or want to buy locally
manufactured products.

People​- ​People refer to the staff and salespeople who work for your business, including yourself.
When you provide excellent ​customer service​, you create a positive experience for your customers,
and in doing so ​market your brand​ to them. In turn, existing customers may spread the word about
your excellent service and you can win referrals. Give your business a competitive advantage by
recruiting the right people​, ​training your staff​ to develop their skills, and retaining good staff.

Process​- ​Process refers to the processes involved in delivering your products and services to the
customer. It is also about being 'easy to do business with'.
Having good process in place ensures that you:

● repeatedly deliver the same standard of service to your customers

Physical evidence- ​Physical evidence refers to everything your customers see when interacting with
your business. This includes:
● the physical environment where you provide the product or service
● the layout or interior design
● your packaging
● your branding.
★ Consumer Buying Decision

Problem/need recognition-​ ​This is often identified as the first and most important step in the
customer’s decision process. A purchase cannot take place without the recognition of the need. The
need may have been triggered by internal stimuli (such as hunger or thirst) or external stimuli (such
as advertising or word of mouth).

Information search-​ Having recognised a problem or need, the next step a customer may take is the
information search stage, in order to find out what they feel is the best solution. This is the buyer’s
effort to search internal and external business environments, in order to identify and evaluate
information sources related to the central buying decision. Your customer may rely on print, visual,
online media or word of mouth for obtaining information.

Evaluation of alternatives- ​As you might expect, individuals will evaluate different products or
brands at this stage on the basis of alternative product attributes – those which have the ability to
deliver the benefits the customer is seeking. A factor that heavily influences this stage is the
customer’s attitude. Involvement is another factor that influences the evaluation process. For
example, if the customer’s attitude is positive and involvement is high, then they will evaluate a
number of companies or brands; but if it is low, only one company or brand will be evaluated.
 Purchase decision- ​The penultimate stage is where the purchase takes place. Philip Kotler states
that the final purchase decision may be ‘disrupted’ by two factors: negative feedback from other
customers and the level of motivation to accept the feedback. For example, having gone through the
previous three stages, a customer chooses to buy a new telescope. However, because his very good
friend, a keen astronomer, gives him negative feedback, he will then be bound to change his
preference. Furthermore, the decision may be disrupted due to unforeseen situations such as a
sudden job loss or relocation.

Post-purchase behaviour-​ In brief, customers will compare products with their previous
expectations and will be either satisfied or dissatisfied. Therefore, these stages are critical in retaining
customers. This can greatly affect the decision process for similar purchases from the same company
in the future, having a knock-on effect at the information search stage and evaluation of alternatives
stage. If your customer is satisfied, this will result in brand loyalty, and the Information search and
Evaluation of alternative stages will often be fast-tracked or skipped altogether.
On the basis of being either satisfied or dissatisfied, it is common for customers to distribute their
positive or negative feedback about the product. This may be through reviews on websites, social
media networks or word of mouth. Companies should be very careful to create positive post-purchase
communication, in order to engage customers and make the process as efficient as possible.

★ Factors affecting Consumer Behaviour with Examples

Psychological Factors-​ ​Human psychology is a major determinant of consumer behavior. These

Social Factors-​ ​Humans are social beings and they live around many people who influence their
buying behavior. Humans try to imitate other humans and also wish to be socially accepted in society.
Hence their buying behavior is influenced by other people around them. These factors are considered
as social factors. Some of the social factors examples are reference groups, family, roles and status

Cultural factors-​ ​A group of people are associated with a set of values and ideologies that belong to
a particular community. When a person comes from a particular community, his/her behavior is highly
influenced by the culture relating to that particular community. Some of the cultural factors examples
are culture, subculture, social class system

Personal Factors- ​Factors that are personal to the consumers influence their buying behavior.
These personal factors differ from person to person, thereby producing different perceptions and
consumer behavior. Some of the personal factors examples are age and life-cycle stage, occupation,
economic circumstances, lifestyle, personality and self concept

Economic Factors-​ ​The consumer buying habits and decisions greatly depend on the economic
situation of a country or a market. When a nation is prosperous, the economy is strong, which leads
to the greater money supply in the market and higher purchasing power for consumers. When
consumers experience a positive economic environment, they are more confident to spend on buying
products. Whereas, a weak economy reflects a struggling market that is impacted by unemployment
and lower purchasing power.