Consumer Behaviour:

Schiffman &Kanuk (1997: 648) define consumer behaviour as: "The behaviour
that consumers display in searching for, purchasing, using, evaluating, and
disposing of products, services, and ideas." Schiffman & Kanuk (1997: 6-7)
elaborate on the definition by explaining that consumer behaviour is,
therefore, the study of how individuals make decisions to spend their available
resources(time, money, effort) on consumption-related items. It includes the
study of what,why, when, where and how often they purchase and how they
use the purchasedproduct. In addition, it encompasses all the behaviours that
consumers display insearching for, purchasing, using, evaluating and
disposing of products andservices that they expect will satisfy their needs.

According to Schiffman &Kanuk (1997: 6-7), two different types of

consumerscan be distinguished, namely personal and organisational
consumers. Personal consumers purchase products and services for personal
or household use or as a gift to someone else. Personal consumers,
therefore, purchase for final consumption. Organisational consumers on the
other hand purchase products and services to run an organisation, including
profitable and non-profitable organisations, government organisations and
institutions.

Need for Study of Consumer Behaviour

The study of consumer behaviour helps everybody as all are consumers. It is

essential for marketers to understand consumers to survive and succeed in this
competitive marketing environment. The following reasons highlight the
importance of studying consumer behaviour as a discipline.

Importance and Scope of Consumer Behaviour:

The purpose of studying a discipline is to help oneself to better appreciate its

contributions. The reason to study consumer behaviour is because of the role it
plays in the lives of humans. Most of the free time is spent in the market place,
shopping or engaging in other activities. The extra time is usually passed in
knowing and thinking about products and services, discussing with friends about
them, and watching advertisements related to them. The usage of them
significantly reveals our life styles. All these reasons suggest the need for study.
However, the purpose may be to attend immediate and tangible reasons.

Pertinence to Decision Making

Consumer behaviour is said to be an applied discipline as some decisions are
significantly affected by their behaviour or expected actions. The two
perspectives that seek application of its knowledge are micro and societal
perspectives.
The micro perspectives involve understanding consumer for the purpose of
helping a firm or organization to achieve its objectives. The people involved in
this field try to understand consumers in order to be more effective at their tasks.
Whereas the societal or macro perspective applies knowledge of consumers to
aggregate- level faced by mass or society as a whole. The behaviour of
consumer has significant influence on the quality and level of the standard of
living.

The Marshallian economic model

According to the Marshallian economic model, individual buyers will spend

their income on goods that will offer the greatest satisfaction, depending on
their taste and the relative prices of goods.The antecedents for the
Marshallian theory can be traced back to both AdamSmith and Jeremy
Bentham. In accordance with a doctrine of economic growth developed by
Smith, man is said to be motivated in all his actions by self-interest.
Marshall's methods and assumptions have been refined to the Modern Utility
theory, where the economic man maximises his utility and does this by carefully
calculating the ''felicific'' consequences of any purchase. Runyon & Stewart
(1987: 695) add to the discussion by stating that Marshall used money as the
common denominator of psychological needs, where the value of satisfying a
specific need could be equated and compared with other needs in terms of cost.
The Marshallian model provides a number of useful behavioural hypotheses.
The first hypothesis offered is that the lower the price of a product, the greater the
sales will be for that product. A second hypothesis is that the lower the price of a
substitute product is than that of a specific product, the greater the sales of the
substitute product will be.
Third, the sales of a product will be higher, provided it is not an inferior product, if
the real income is higher. The last hypothesis states that greater volumes of
sales will follow as promotional expenditure is increased.
As a final comment to the Marshallian model, it can be concluded that economic
factors alone cannot explain all variations in the sales and buying process and
also that the fundamentals of how brand and product preferences are formed are
ignored in this theory. The model offers a useful frame of reference for analysing
only a small portion of the consumer's psyche.

The Veblenian social-psychological model

The Veblenian social-psychological model of human behaviour is based on the

findings of Thorsten Veblen, who received his training as an orthodox economist
and evolved as a social thinker through the influence of the science of
socialanthropology.

According to this model, man is perceived to be a so-called "social animal",where

man conforms to norms of its larger culture and to more specific standardsof
subcultures and face-to-face groups in which humans operate (Kotler, in
Gould; 1979: 41). In essence this implies that human behaviour and needs are
moulded by present group memberships.
Based on the theory of the model, Veblen hypothesised that, for the so-called
leisure class, a great portion of economic consumption is influenced and
motivated by prestige seeking and not on needs or satisfaction. Veblen placed
specific emphasis on emulative factors that would influence people when
purchasing conspicuous products, for example cars and houses or even less
expensive items, such as clothes.

The model is criticised as it is perceived by more modern perspectives to be

overstated. For example, not all people consider the leisure class to be a frame of
reference and many people aspire to the social class immediately above their
current social class. In addition to the above, more affluent people of the society
would rather under spend than overspend on conspicuous items since they would
rather "fit in" than "stand out".

Marketing applications of the Veblenian model

The importance of the Veblenian model, according to Kotler (in Gould, 1979:
42), to the marketer is that, in order to determine the demand for products, the
most important social influences impacting on such product demands should
be determined. Important for the marketer to consider is the impact of different
social influences, which include social class, subculture, reference groups and
face-to-face groups.

The Freudian psychoanalytical model

The well-known Freudian model of human behaviour, according to Kotler (in

Gould, 1979: 39), is regarded to have a profound impact on 20th century
thought,although it is labelled as being the latest in a series of philosophical
"blows" to which man has been exposed in the past 500 years. Freud attacked
the idea that man reigned over his own psyche, whereas preceding philosophical
views by Copernicus and Darwin respectively destroyed the view that man was at
the centre of the universe and opposed the idea that man was considered a
special creation.
Kotler (2000: 172) summarises the theory by stating that Freud assumed that the
psychological forces shaping people's behaviour are largely unconscious,
resulting in people not being able to fully understand their own motivations.
Kotler (in Gould, 1979: 39) provides more detail on Freudian theory by explaining
that, according to the theory, the child enters the world driven by instinctual
needs that cannot be satisfied by itself. The child quickly and painfully realises its
detachment from the world and at the same time its dependence on it.
Through blatant means, including supplication and intimidation, the child attempts
to use others to satisfy its needs.
In conclusion, it should be noted that the philosophical divergences, as
mentioned above, greatly enriched and extended the interpretative value of
the Freudian model to a wide range of behavioural phenomena.
Marketing applications of the Freudian model

Kotler (in Gould, 1979: 40) suggests that the most important marketing
implication of the Freudian model that marketers should note, is that
consumers are motivated by both symbolic and economic-functional product
concerns. For example, the change of a bar of soap from a square to a round
shape has probably more a sensual (sexual) than functional connotation. A
more practical example may show that an advertisement for a cake mix,
depicting little effort and labour involved, may alienate housewives since the
easy life may cause a sense of guilt.
A final benefit to marketing researchers is that motivational research can offer
beneficial insights and inspiration in terms of advertising and packaging. Belch &
Belch (2001: 112) support this view by stating that insights gained from
motivational research can often be used as a basis for advertising messages
aimed at deeply rooted feelings, hopes, aspirations and fears of consumers.
Such emotional appeals are often more effective than rationally based appeals.

The Howard-Sheth model

The Howard-Sheth model of buying behaviour, according to Foxall (1990: 10),

presents a sophisticated integration of the psychological and various social
and marketing influences on consumer choice, into a coherent sequence of
information processing. Runyon & Stewart (1987: 704) and Foxall (1990: 10)
add respectively that the model attempts to explain rational brand choice
behaviour within the constraints of incomplete information and limited
individual capacities, and also that it provides an empirically testable
description of behaviour in terms of cognitive functioning together with its
outcomes.
Schiffman &Kanuk (1987: 654) explain the Howard-Sheth model (depicted in
Figure 2.4) a model that explicitly distinguishes between three different stages
or levels of decision-making, also referred to as levels of learning, namely
extensive, limited and routinized problem-solving.
Extensive problem-solving: implies that the consumer has very little or no
knowledge and beliefs about brands. The consumer actively seeks information
on a number of alternatives at this point due to the lack of a brand preference.
Foxall (1990: 12) adds that in order to reduce brand ambiguity, the consumer
is involved in a decision process and undertakes prolonged deliberation
contemplating which brand to purchase or whether to buy at all.

Limited problem-solving: occurs when the consumer cannot fully assess the
brand differences to arrive at a preference, since knowledge and beliefs
aboutthe brands are only partially established. According to Foxall (1990: 12).
Other factors to be considered in limited problem-solving are that consumers
have formed choice criteria, know a few brands well and favour them equally
because they have already tried several brands at this stage.
Variables of Howard Sheth Model
Beginning with the stage of extensive problem solving, the buyer slowly converts
into a regular customer of the organization, at the routinized response behaviour
level.
This whole process of buyer’s decision-making functions on four pillars of this
model or the four essential elements of this model. These variables are
elaborated below:
Input Variables

The stimulus inputs refer to the idea or information clue about the brand and its
product in terms of product quality, distinctiveness, price, service offered and
availability.

These can be further classified as follows:

Significant Stimuli: The significant stimuli are the physical traits of the product
and the brand. It includes the product’s price, quality, availability, distinctive
characteristics and service.
Symbolic Stimuli: The marketing strategies like advertisement and
publicity creates a psychological impact on the buyer’s perception of a product’s
rhetorical and visible features.
Social Stimuli: The social stimuli comprises of the various environmental factors
which are considered as a source of information for the buyers. It includes family,
social class and reference groups.
Hypothetical Constructs
The hypothetical constructs depict the central part of the model. It includes all
those psychological variables which play a vital role in the buyer’s decision-
making process.
It can be further bifurcated into the following two categories:
Perceptual Constructs
These components define the consumer’s procurement and perception of the
information provided at the input stage.
It is an essential element since it drives the buyer’s brand selection and
purchases, which includes:
Sensitivity to Information: The buyer’s level of understanding or openness
towards the information received by him/her.
Perceptual Bias: On the grounds of individual perception of each brand, the
buyer is partial towards a particular brand.
Search for Information: The buyer also seeks for more information to ensure the
right decision-making.
Learning Constructs
The learning constructs define the buyer’s knowledge, opinion, attitude and end
decision on product or brand selection.
Following are the various learning constructs of a buyer:
Motive: The specific goal or purpose for which the product purchase is carried
out.
Choice Criteria: The set of principles or benchmarks defined for product
selection.
Brand Comprehension: The information about the product or brand pertained
by the buyer.
Attitude: The buyer’s perspective and willingness to purchase a product of a
particular brand defines his/her attitude.
Confidence: The trust or faith of the buyer in a specific brand and its products
builds his/her confidence.
Intention: The buyer’s purchase motive, preference criteria, brand
comprehension, consumer attitude and confidence, results in the selection of a
particular brand.
Satisfaction: After-purchase, the buyer evaluates his/her level of contentment, to
find out whether the product has fulfilled the expectations or not.
Output Variables
The output or as we say, the result of the buyer’s decision-making can be seen in
the form of his/her response towards the input variables.
It consists of five major components which are arranged systematically below:
Attention: The buyer’s level of concentration and alertness with which he/she
understands the information provided, is termed as attention.
Brand Comprehension: The awareness of the buyer regarding a particular brand
and its products is known as brand comprehension.
Attitude: The buyer’s evaluation of a brand in terms of individual likes and
dislikes, determines his/her behaviour, interest and awareness towards it.
Intention: The aim or objective of the buyer for purchasing a product can be
seen as the buying intention.
Purchase Behaviour: All the above elements result in the actual purchase of a
product by the buyer.
Exogenous Variable
There are certain other external factors which influence the buying behaviour of
an individual or a firm by hampering the product purchase of a preferred brand.
The exogenous variables are the environmental forces or components of this
model. These are as follows:
Importance of Purchase: If the buyer perceives the product to be less crucial,
involving a low cost, then there is a little brand preference.
Personality Variables: Personal traits like ego, self-esteem, anxiety, dominance,
authoritarian, etc. influences a buyer’s decision-making while purchasing a
product.
Social Class: A buyer’s social group, including the family, friends and other
reference groups impact the selection or rejection of a particular brand.
Culture: The buyer’s values, beliefs and ideas frame his/her purchase motive and
inhibitors.
Organization: The buyer’s interaction with the social groups define their
authority, status and power. The hypothetical constructs of a buyer are affected
by such formal or informal communications.
Time Pressure: The buyer, at times, is under the pressure of taking a timely
decision, which makes him/her look for alternatives if the product of the preferred
brand is unavailable at the moment.
Financial Status:The buyer’s inability to purchase a product or unaffordability
restricts him/her from buying it.

Consumer Decision Making Process:

The most important environment in which firms operate is their customer

environment because the basic belief of marketing oriented company – that the
customer is the centre around which the business revolves. Therefore, marketing
people need to understand the processes that their customers go through when
making decision.
The consumer decision making process involves series of related and sequential
stages of activities. The process begins with the discovery and recognition of an
unsatisfied need or want. It becomes a drive. Consumer begins search for
information. This search gives rise to various alternatives and finally the purchase
decision is made. Then buyer evaluates the post purchase behaviour to know the
level of satisfaction. The process is explained below with the help of diagram.

1. Need Recognition
When a person has an unsatisfied need, the buying process begins to satisfy the
needs. The need may be activated by internal or external factors. The intensity of
the want will indicate the speed with which a person will move to fulfil the want.
On the basis of need and its urgency, the order of priority is decided. Marketers
should provide required information of selling points.
2. Information Search
Identified needs can be satisfied only when desired product is known and also
easily available. Different products are available in the market, but consumer
must know which product or brand gives him maximum satisfaction. And the
person has to search out for relevant information of the product, brand or
location. Consumers can use many sources e.g., neighbours, friends and family.
Marketers also provide relevant information through advertisements, retailers,
dealers, packaging and sales promotion, and window displaying. Mass media like
news papers, radio, and television provide information. Nowadays internet has
become an important and reliable source of information. Marketers are expected
to provide latest, reliable and adequate information.

3. Evaluation of Alternatives
This is a critical stage in the process of buying. Following are important elements
in the process of alternatives evaluation
a. A product is viewed as a bundle of attributes. These attributes or features are
used for evaluating products or brands. For example, in washing machine
consumer considers price, capacity, technology, quality, model and size.
b. Factors like company, brand image, country, and distribution network and
after-sales service also become critical in evaluation.
c. Marketers should understand the importance of these factors with regards to
the consumers while manufacturing and marketing their products.
4. Purchase Decision
Outcome of the evaluation develops likes and dislikes about alternative products
or brands in consumers. This attitude towards the brand influences a decision as
to buy or not to buy. Thus the prospective buyer heads towards final selection. In
addition to all the above factors, situational factors like finance options, dealer
terms, falling prices etc., are also considered.
5. Post- Purchase Behaviour
Post-purchase behaviour of consumer is more important as far as marketer is
concerned. Consumer gets brand preference only when that brand lives up to his
expectation. This brand preference naturally repeats sales of marketer. A
satisfied buyer is a silent advertisement. But, if the used brand does not yield
desired satisfaction, negative feeling will occur and that will lead to the formation
of negative attitude towards brand. This phenomenon is called cognitive
dissonance. Marketers try to use this phenomenon to attract users of other
brands to their brands. Different promotional-mix elements can help marketers to
retain his customers as well as to attract new customers.