CONSUMER BEHAVIOUR

UNIT – I

Consumer Behaviour and Marketing Action: An overview – Consumer involvement, decision-

making processes and purchase se behaviour and marketing implications –Consumer Behaviour

Consumer Behaviour and Marketing Action: An overview

Consumer behaviour is the study of how individuals and groups of consumers make decisions and
use resources to satisfy their needs and wants. It is a critical aspect of marketing as understanding
consumer behaviour enables businesses to create effective marketing strategies and tailor their
products and services to meet customer demands. In this overview, we'll explore the key concepts
of consumer behaviour and how it influences marketing actions.

Factors Influencing Consumer Behaviour:

Consumer behaviour is influenced by various internal and external factors:

a. Internal Factors: These include personal characteristics and individual preferences that impact
consumer decision-making. Internal factors may include demographics (age, gender, income,
education), lifestyle, personality, motivations, beliefs, and attitudes.

b. External Factors: External factors are elements outside of an individual's control that influence
their behaviour. These factors encompass cultural, social, economic, and situational aspects.
Cultural factors involve societal norms, values, and customs. Social factors refer to the influence of
family, friends, peers, and other reference groups. Economic factors include income, employment,
and overall economic conditions. Situational factors are specific to a particular situation, such as the
time of purchase or the physical environment.

Consumer Decision-Making Process:

The consumer decision-making process consists of several stages that consumers go through before
making a purchase. These stages are:

a. Problem Recognition: The consumer identifies a need or problem that requires a solution.
This recognition can be triggered by internal stimuli (e.g., hunger) or external stimuli (e.g.,
advertisements).

b. Information Search: Once the need is recognized, consumers seek information about potential
solutions. They may gather information from various sources, such as personal experiences, friends
and family, online reviews, advertisements, and other marketing communications.

c. Evaluation of Alternatives: Consumers compare different options to determine which one

best meets their needs and preferences. This evaluation involves assessing the attributes, benefits,
and drawbacks of each alternative.

d. Purchase Decision: After evaluating the alternatives, consumers make a decision to purchase
a particular product or service.

e. Post-Purchase Evaluation: After the purchase, consumers evaluate their decision. If they are
satisfied, they are more likely to become repeat customers and advocate for the product. If not,
they may experience buyer's remorse or dissatisfaction.

Influence of Marketing Actions on Consumer Behaviour:

Marketing actions play a significant role in influencing consumer behaviour. Marketers use various
strategies to attract and persuade consumers:

a. Advertising and Promotion: Engaging and persuasive advertising can create awareness,
inform consumers about product benefits, and influence their perceptions.

b. Product Design and Packaging: The design and packaging of a product can impact
consumers' perceptions of its quality and desirability.
c. Pricing: Price is a crucial factor in consumer decision-making. Marketers can use pricing
strategies such as discounts, bundling, or premium pricing to influence consumer choices.

d. Brand Image: Strong brands evoke trust and loyalty among consumers, leading to repeat
purchases and positive word-of-mouth.

e. Consumer Research: Understanding consumer preferences through market research helps

marketers tailor their offerings to better match consumer needs and wants.

f. social media and Online Reviews: In the digital age, social media and online reviews have a
significant impact on consumer behaviour. Positive or negative reviews can influence purchase
decisions.

Consumer Behaviour and Segmentation:

Segmentation involves dividing the market into distinct groups based on shared characteristics or
behaviours. By understanding consumer behaviour within different segments, marketers can target
specific groups more effectively and tailor marketing strategies to resonate with each segment.

Ethical Considerations:

Influence over consumer behaviour comes with ethical responsibilities. Marketers should avoid
deceptive practices, provide accurate information, and respect consumer privacy and consent.

In conclusion, understanding consumer behaviour is essential for marketers to design effective

marketing strategies, create products that meet consumer needs, and build long-term relationships
with customers. By analysing the factors influencing consumer decisions and employing appropriate
marketing actions, businesses can gain a competitive edge in the marketplace.
– Consumer involvement

Consumer involvement refers to the level of interest, engagement, and personal significance that a
consumer attaches to a particular product, service, or purchase decision. It is a crucial concept in
consumer behaviour because the degree of involvement influences how consumers process
information, make decisions, and interact with brands. Understanding consumer involvement helps
marketers design more effective marketing strategies and communication tactics. Let's delve into
the concept of consumer involvement in detail:

Types of Consumer Involvement:

Consumer involvement can be categorized into two main types:

a. High Involvement: High involvement occurs when a consumer perceives a product or purchase
decision as significant, risky, or personally relevant. Products or services that are expensive,
complex, have long-term consequences, or fulfil important needs tend to evoke high involvement.
Examples include buying a car, choosing a university for higher education, or purchasing a house.

b. Low Involvement: Low involvement, on the other hand, is when a consumer perceives a
product or purchase decision as less significant or routine. These products are generally
inexpensive, frequently purchased, and have minimal consequences if the decision turns out to be
less than ideal. Examples include buying daily groceries, choosing a shampoo, or buying a pack of
pens.

Factors Affecting Consumer Involvement:

Several factors influence the level of consumer involvement:

a. Personal Relevance: The more personally relevant a product or decision is to a consumer, the
higher the involvement. For example, health-related products, luxury items, and products that are
linked to self-identity tend to evoke higher involvement.
b. Perceived Risk: Consumers may perceive higher involvement when they believe there are
potential risks associated with a purchase. These risks can be financial, functional, social,
psychological, or even physical.

c. Experience and Knowledge: Consumers with more experience or knowledge about a product
category are likely to have higher involvement as they can better evaluate alternatives and make
informed decisions.

d. Social Significance: The social significance of a purchase, such as its impact on one's social
status or relationships, can also influence involvement. For example, buying a gift for a loved one
may evoke higher involvement.

e. Time Pressure: Time constraints can impact involvement. In situations where consumers have
limited time to make a decision, they may exhibit lower involvement and rely on quick, habitual
choices.

Effects of Consumer Involvement:

The level of consumer involvement can have several effects on consumer behaviour:

a. Information Processing: High-involvement decisions usually trigger extensive information

processing. Consumers actively seek and evaluate information to make a well-informed decision. In
contrast, low-involvement decisions involve minimal information processing, and consumers often
rely on heuristics or brand familiarity.

b. Brand Loyalty: In high-involvement situations, consumers are more likely to exhibit brand
loyalty. They invest time and effort in evaluating alternatives and are less willing to switch brands
easily.

c. Decision-Making: In high-involvement decisions, consumers may experience cognitive

dissonance after making a purchase. They may seek post-purchase reassurance or justify their
decision to reduce discomfort.
d. Word-of-Mouth: High-involvement decisions are more likely to lead to word-of-mouth
communication. Consumers tend to discuss significant purchases with friends, family, or online
communities, which can influence others' decisions.

Marketing Implications of Consumer Involvement:

Understanding consumer involvement is vital for marketers to tailor their strategies effectively:

a. High-Involvement Products: For high-involvement products, marketers should provide

detailed information, emphasize product features and benefits, offer demonstrations or free trials,
and use emotional appeals to create a strong brand connection.

b. Low-Involvement Products: For low-involvement products, marketers should focus on

creating brand familiarity, offering convenience, and implementing point-of-purchase promotions
to influence impulse buying.

c. Involvement and Advertising: The level of involvement also affects the way advertising
messages should be crafted. High-involvement products may require more informative and
persuasive advertisements, while low-involvement products can benefit from simple and attention-
grabbing messages.

d. Interactive Marketing: Interactive marketing techniques, such as personalized content,

quizzes, and user-generated content, can increase involvement and engagement with consumers.

In conclusion, consumer involvement plays a significant role in shaping consumer behaviour and
decision-making. Recognizing the factors that influence involvement and tailoring marketing
strategies accordingly can lead to more successful and impactful marketing campaigns.
Decision Making Processes

Decision-making processes refer to the series of steps that individuals or groups go through when
faced with a choice or problem and need to make a selection among various alternatives. In the
context of consumer behaviour and marketing, understanding decision-making processes is crucial
for businesses to develop effective marketing strategies and better meet the needs and preferences
of their target customers. Let's explore the different stages involved in decision-making processes:

Recognition of Need or Problem:

The decision-making process often begins with the recognition of a need or problem. This occurs
when individuals perceive a discrepancy between their current state (what they have) and their
desired state (what they want). The need can be triggered by internal factors, such as hunger or
thirst, or external factors, such as advertising or a friend's recommendation.

Information Search:

Once a need or problem is recognized, individuals start seeking information to identify potential
solutions. Information search can be internal (drawing from memory and past experiences) or
external (gathering information from various sources). Consumers may use personal experiences,
seek advice from friends and family, read online reviews, visit stores, or consult expert opinions to
gather information.

Evaluation of Alternatives:

After gathering information, consumers evaluate the available alternatives to make a decision. They
compare different products, brands, or services based on various attributes such as price, quality,
features, and benefits. The evaluation process aims to identify the best option that can effectively
satisfy the identified need or problem.

Purchase Decision:

Following the evaluation of alternatives, consumers make a purchase decision by selecting the
product or service that they believe best meets their needs and preferences. At this stage, other
factors such as availability, price, and promotions may influence the final decision.
Post-Purchase Evaluation:

After making the purchase, consumers evaluate the satisfaction and performance of the chosen
product or service. If the product meets or exceeds their expectations, they are likely to experience
post-purchase satisfaction. Conversely, if the product falls short of expectations, consumers may
feel disappointed or experience buyer's remorse.

Consumer Behaviour Models:

Several models explain the decision-making processes, shedding light on the factors that influence
consumer choices:

a. The Consumer Decision-Making Model (CDM): This model outlines the five stages
mentioned above: need recognition, information search, evaluation of alternatives, purchase
decision, and post-purchase evaluation.

b. Maslow's Hierarchy of Needs: This psychological theory categorizes human needs into a
hierarchical structure, with basic physiological needs (e.g., food, water) at the bottom, followed by
safety, love and belonging, esteem, and self-actualization needs. According to this model,
individuals are motivated to satisfy the most basic needs first before moving up the hierarchy.

c. Howard-Sheth Model: This model incorporates multiple factors, including psychological,

social, and marketing influences, to understand consumer decision-making. It considers the role of
motivation, perception, learning, attitudes, and external influences in shaping consumer choices.

Factors Influencing Decision-Making:

Several factors influence the decision-making process:

a. Individual Factors: These include personal characteristics such as age, gender, lifestyle,
personality, and psychological traits that influence how individuals perceive and evaluate
alternatives.
b. Social Factors: Social influences, such as family, friends, culture, reference groups, and social
norms, play a significant role in shaping consumer decisions. People often seek approval and
validation from their social circles before making choices.

c. Marketing and External Factors: Marketing efforts, including advertising, branding,

packaging, pricing, and promotions, can impact consumers' perception of products and influence
their decision-making process.

d. Situational Factors: The context in which the decision is made, such as time constraints,
physical environment, and situational needs, can influence the decision-making process.

In conclusion, decision-making processes are complex and dynamic, influenced by a combination of

internal and external factors. Understanding these processes is vital for marketers to design
effective marketing strategies and connect with consumers at various stages of their decision-
making journey. Additionally, consumer behaviour research and the use of consumer behaviour
models can help businesses gain insights into customer preferences and behaviours, leading to
improved product development, better customer experiences, and increased customer loyalty.

PURCHASE BEHAVIOUR

Purchase behaviour, also known as buying behaviour or consumer purchasing behaviour, refers to
the process and patterns of how consumers make buying decisions and acquire products or services.
It involves the various stages individuals go through from recognizing a need to making the final
purchase, and it is influenced by a range of internal and external factors. Understanding purchase
behaviour is crucial for businesses as it helps them create effective marketing strategies, optimize
product offerings, and enhance customer satisfaction. Let's delve into the details of purchase
behaviour:

Stages of Purchase Behaviour:

a. Need Recognition: The process begins with consumers recognizing a need or want for a
particular product or service. This could be triggered by internal factors (e.g., hunger, thirst) or
external factors (e.g., advertisements, recommendations).
b. Information Search: Once a need is identified, consumers start gathering information about
potential solutions. They may seek information from various sources, including personal
experiences, online reviews, advertising, social media, and recommendations from friends and
family.

c. Evaluation of Alternatives: After collecting information, consumers evaluate the available

alternatives to satisfy their need. They compare different products or services based on attributes
such as price, quality, features, and benefits.

d. Purchase Decision: Once consumers have evaluated the alternatives, they make a decision to
purchase a specific product or service. The decision is influenced by factors such as price, availability,
brand reputation, and past experiences.

e. Post-Purchase Evaluation: After the purchase, consumers assess their satisfaction with the
product or service. If the purchase meets or exceeds their expectations, they are likely to be
satisfied. If it falls short, they may experience buyer's remorse or dissatisfaction.

Factors Influencing Purchase Behaviour:

Several factors influence consumers' purchase behaviour:

a. Personal Factors: Individual characteristics, such as age, gender, lifestyle, personality, and
preferences, influence what consumers buy and their brand choices.

b. Social Factors: Social influences, including family, friends, culture, reference groups, and social
norms, play a significant role in shaping purchase decisions. Word-of-mouth and peer
recommendations can heavily impact buying behaviour.

c. Psychological Factors: Psychological factors, such as perception, motivation, learning,

attitudes, and beliefs, also influence consumer purchase behaviour. For example, how a product is
perceived, the level of consumer motivation, and past experiences with a brand can impact
purchase decisions.
d. Economic Factors: Economic factors, such as income, price, and overall economic conditions,
influence what consumers can afford and how much they are willing to spend on products or
services.

e. Marketing and Advertising: Marketing efforts, including advertising, branding, packaging,

promotions, and sales tactics, can significantly impact consumers' perception of products and
influence their purchase decisions.

f. Cultural and Environmental Factors: Cultural norms, values, and traditions can shape
consumer behaviour. Additionally, environmental factors, such as physical store layout and online
shopping experience, can influence purchasing decisions.

Types of Purchase Behaviour:

Consumer purchase behaviour can be classified into different types based on the frequency and
involvement level of purchases:

a. Routine Buying Behaviour: In routine buying behaviour, consumers frequently purchase low-
cost, low-involvement products that require little decision-making effort. Examples include daily
groceries, toiletries, and household items.

b. Limited Buying Behaviour: Limited buying behaviour occurs when consumers make
occasional purchases that involve moderate decision-making efforts. Consumers may spend more
time comparing options and seeking information for moderately-priced products like clothing or
electronics.

c. Complex Buying Behaviour: Complex buying behaviour is associated with high-cost and high-
involvement products or services. Consumers engage in extensive research, evaluation, and
comparison before making a purchase. Examples include buying a car, a house, or choosing a
college.
ONLINE PURCHASE BEHAVIOR:

The rise of e-commerce has significantly influenced consumer purchase behaviour. Online purchase
behaviour involves consumers making purchases through various digital channels, such as websites,
mobile apps, and social media platforms. Online shopping offers convenience, a wide range of
choices, and the ability to compare prices easily.

a. Factors Influencing Online Purchase Behaviour: Factors that impact online purchase
behaviour include website usability, security, product information, online reviews, customer service,
and the ease of the checkout process.

b. Impulse Buying Online: Online shopping can lead to impulse buying, where consumers make
unplanned purchases influenced by online advertisements, limited-time offers, or personalized
product recommendations.

MARKETING IMPLICATIONS

Marketing implications refer to the actionable insights and strategic considerations derived from
the analysis of market data, consumer behaviour, and other relevant factors. These implications
help guide marketers in making informed decisions to achieve their marketing objectives and drive
business success. Let's explore some key marketing implications in detail:

Target Market Segmentation:

Understanding consumer behaviour and preferences allows marketers to segment the market
effectively. By dividing the market into distinct groups based on shared characteristics, such as
demographics, lifestyle, or buying behaviour, marketers can tailor their marketing strategies to
resonate with each segment. This enables more targeted messaging, product offerings, and
promotional efforts, leading to improved customer engagement and higher conversion rates.
Product Development and Positioning:

Consumer insights play a critical role in product development and positioning. By analysing
consumer needs and preferences, marketers can identify gaps in the market and develop products
that fulfil unmet needs. Additionally, understanding how consumers perceive a product and its
benefits helps in positioning the product effectively in the minds of the target audience. Clear and
compelling positioning statements can differentiate the product from competitors and create a
strong brand identity.

Pricing Strategies:

Consumer behaviour analysis helps marketers set appropriate pricing strategies. Understanding
how price sensitivity varies across different consumer segments allows businesses to adopt dynamic
pricing or implement price discrimination tactics. Moreover, consumer perceptions of price in
relation to product quality and value can influence pricing decisions, allowing marketers to optimize
pricing for maximum profitability.

Promotional Campaigns:

Insights into consumer behaviour aid in developing effective promotional campaigns. By knowing
which channels consumers prefer, marketers can allocate their resources strategically, whether it's
digital marketing, traditional advertising, or experiential marketing. Additionally, understanding the
factors that influence consumer decision-making allows for the creation of persuasive messaging
and calls-to-action that drive desired consumer responses.

Customer Experience Enhancement:

Consumer behaviour analysis helps identify pain points and areas for improvement in the customer
experience. By understanding the customer journey and touchpoints, marketers can optimize the
customer experience at each stage, leading to increased customer satisfaction and loyalty. This may
involve improving website usability, streamlining the purchase process, or providing excellent post-
purchase support.
Brand Building and Equity:

Consumer behaviour insights contribute to effective brand building. Understanding consumer

perceptions, attitudes, and emotional connections to the brand helps in developing a compelling
brand identity and brand positioning. Consistent and authentic brand messaging across all channels
builds brand equity, leading to increased brand loyalty and positive word-of-mouth.

Innovation and Trends:

By monitoring consumer behaviour and preferences, marketers can spot emerging trends and
consumer demands. This enables businesses to adapt and innovate, ensuring they stay relevant in
a rapidly changing market. Anticipating and capitalizing on new trends can give companies a
competitive advantage and open up new market opportunities.

Customer Relationship Management (CRM):

Consumer behaviour insights are valuable for effective CRM strategies. By understanding customer
preferences, purchase history, and interactions, businesses can personalize their communication
and offers, strengthening customer relationships and encouraging repeat purchases.

Ethical Considerations:

Understanding consumer values and ethical concerns is crucial for responsible marketing. Being
mindful of ethical implications helps marketers avoid controversial or deceptive practices and
ensures that their marketing efforts align with consumers' values, promoting trust and loyalty.
CONSUMER BEHAVIOUR MODELS.

Consumer behaviour models are theoretical frameworks that attempt to explain and predict how
consumers make decisions and behave when purchasing products or services. These models draw
from various disciplines, including psychology, sociology, and economics, to provide insights into the
complex and dynamic nature of consumer behaviour. Here are some key consumer behaviour
models explained in detail:

The Consumer Decision-Making Model (CDM):

The Consumer Decision-Making Model is one of the foundational models in consumer behaviour. It
breaks down the consumer decision-making process into several stages:

a. Need Recognition: The process begins when consumers recognize a need or want for a product
or service.

b. Information Search: After identifying the need, consumers actively seek information about
potential solutions.

c. Evaluation of Alternatives: Consumers compare and evaluate different products or brands based
on various attributes and benefits.

d. Purchase Decision: Once the evaluation is complete, consumers make a decision to purchase a
specific product or service.

e. Post-Purchase Evaluation: After the purchase, consumers assess their satisfaction with the
product or service.

The CDM is a linear model, assuming that consumers move through these stages in a logical
sequence. However, in reality, consumer decision-making can be more iterative and dynamic.
Maslow's Hierarchy of Needs:

Maslow's Hierarchy of Needs, proposed by psychologist Abraham Maslow, is a widely known theory
in psychology. It suggests that human needs can be arranged in a hierarchical order, with basic
physiological needs at the bottom and higher-level needs at the top. The hierarchy includes five
levels:

a. Physiological Needs: These are the most fundamental needs for survival, such as food, water, and
shelter.

b. Safety Needs: Once physiological needs are met, individuals seek safety, security, and stability.

c. Social Needs: Social needs involve the desire for belongingness, friendship, and social acceptance.

d. Esteem Needs: Esteem needs refer to the desire for recognition, respect, and self-worth.

e. Self-Actualization: At the top of the hierarchy is the need for self-fulfilment and personal growth.

According to the theory, individuals are motivated to satisfy lower-level needs first before moving
up the hierarchy to fulfil higher-level needs.

Howard-Sheth Model:

The Howard-Sheth Model is a comprehensive model that considers multiple factors in consumer
decision-making. It identifies three key components:

a. Input Variables: These include external influences, such as marketing efforts, social influences,
and situational factors, as well as internal influences like perception, motivation, learning, and
attitudes.

b. Process Variables: The process variables represent how consumers process and evaluate
information to make decisions. This includes problem recognition, information search, evaluation
of alternatives, and the decision-making process.

c. Output Variables: These variables represent the outcomes of the decision-making process, such
as the purchase decision, post-purchase evaluation, and behavioural intentions.
The Howard-Sheth Model acknowledges that consumer behaviour is influenced by a combination
of factors, both internal and external, and is a result of a complex decision-making process.

The Theory of Planned Behaviour (TPB):

The Theory of Planned Behaviour, developed by Icek Ajzen, is a model that aims to explain and
predict human behaviour in general, including consumer behaviour. The TPB proposes that
behavioural intentions are influenced by three factors:

a. Attitude toward the Behaviour: This refers to the individual's positive or negative evaluation of
engaging in a particular behaviour, such as purchasing a product.

b. Subjective Norms: Subjective norms reflect the perceived social pressure or influence from
others, such as family, friends, or colleagues, to engage in a specific behaviour.

c. Perceived Behavioural Control: This factor relates to the individual's perception of their ability to
perform the behaviour. If they feel they have control over the behaviour, they are more likely to
intend to do it.

The TPB suggests that stronger intentions to perform a behaviour are more likely to result in actual
behaviour.

The Diffusion of Innovations Theory:

The Diffusion of Innovations Theory, developed by Everett Rogers, focuses on how innovations (new
products, services, or ideas) are adopted and spread within a society. It classifies consumers into
five categories based on their adoption behaviour:

a. Innovators: The first to adopt new innovations.

b. Early Adopters: Those who adopt innovations shortly after innovators.

c. Early Majority: The group that adopts the innovation before the average member of society.

d. Late Majority: Consumers who adopt innovations after the average member of society
e. Laggards: The last group to adopt innovations.

The theory suggests that the rate of adoption is influenced by factors such as the perceived benefits
of the innovation, social influence, and the level of complexity or risk associated with the innovation.

These consumer behaviour models provide valuable frameworks for understanding how consumers
make decisions and behave in the marketplace. While no single model can capture all aspects of
consumer behaviour, a combination of these models can offer a more comprehensive
understanding of consumer motivations, preferences, and decision-making processes. Marketers
can leverage insights from these models to develop effective marketing strategies, create targeted
messaging, and optimize product offerings to meet consumer needs and preferences.

explain consumer behaviour also explain its aim nature objectives types
process characteristics scope features advantages disadvantages

Consumer behaviour is the study of how individuals, groups, or organizations make decisions and
engage in activities to satisfy their needs and wants through the consumption of goods, services,
and ideas. It involves understanding the psychological, social, and economic factors that influence
consumers' decision-making processes and behaviours in the marketplace.

Aim of Consumer Behaviour:

The aim of studying consumer behaviour is to gain insights into why and how consumers make
specific choices, how they perceive products and brands, what motivates their purchase decisions,
and how they respond to marketing stimuli. Understanding consumer behaviour helps businesses
design effective marketing strategies, improve products and services, and build stronger
relationships with their target customers.

Nature of Consumer Behaviour:

The nature of consumer behaviour is multidisciplinary, as it draws on concepts from psychology,

sociology, economics, anthropology, and marketing. It is dynamic and influenced by various internal
and external factors, making it complex to predict and understand fully.
Objectives of Consumer Behaviour:

1. Understanding consumer needs and wants.

2. Identifying factors influencing consumer decision-making.
3. Predicting consumer responses to marketing efforts.
4. Segmenting and targeting specific consumer groups.
5. Evaluating the effectiveness of marketing strategies.

Types of Consumer Behaviour:

High Involvement vs. Low Involvement: Based on the level of interest and personal significance,
consumers may exhibit high or low involvement in decision-making.

Routine Buying vs. Complex Buying: Routine buying involves frequently purchased, low-
involvement products, while complex buying refers to high-involvement and less frequent
purchases.

Impulse Buying: Impulse buying occurs when consumers make unplanned purchases driven by
emotional responses or situational factors.

Characteristics of Consumer Behaviour:

1. Heterogeneous: Consumers have diverse needs, preferences, and motivations, making their
behaviour varied and difficult to predict uniformly.
2. Dynamic: Consumer behaviour evolves over time due to changes in lifestyle, societal norms,
and economic conditions.
3. Cultural and Social Influence: Culture, social groups, and reference groups play a significant
role in shaping consumer behaviour.
4. Perception and Attitudes: Consumers' perceptions and attitudes towards products and
brands influence their purchasing decisions.
5. Emotional and Rational Aspects: Consumer behaviour can be driven by both emotional
responses and rational evaluations.
6. Decision-Making Complexity: The complexity of consumer decision-making can vary based
on factors like product cost, involvement, and information availability.
Scope of Consumer Behaviour:

1. Consumer Motivation: Understanding what drives consumers to act and make purchase
decisions.
2. Consumer Perception: Examining how consumers interpret and perceive information about
products and brands.
3. Consumer Learning: Investigating how consumers acquire and retain knowledge about
products and their features.
4. Consumer Attitudes and Beliefs: Studying consumers' beliefs and attitudes toward products,
brands, and marketing messages.
5. Consumer Decision-Making Process: Analysing the steps consumers go through when
making purchasing decisions.
6. Market Segmentation: Dividing the market into distinct groups based on shared
characteristics and behaviour.

Features of Consumer Behaviour:

1. Influence of External Factors: Consumer behaviour is influenced by various external factors

such as culture, social groups, marketing stimuli, and situational factors.
2. Individual Differences: Consumers have unique personalities, preferences, and lifestyles that
influence their behaviour.
3. Post-Purchase Behaviour: Consumers' satisfaction or dissatisfaction after a purchase affects
their future behaviour and brand loyalty.
4. Psychological and Emotional Aspects: Consumer behaviour is influenced by emotions,
perceptions, attitudes, and learning processes.
5. Market Research: Consumer behaviour research involves the use of data collection and
analysis to understand consumer preferences and behaviours.
Advantages of Studying Consumer Behaviour:

1. Effective Marketing Strategies: Understanding consumer behaviour helps in designing

targeted and persuasive marketing campaigns.
2. Improved Product Development: Consumer insights aid in developing products that align
with consumer needs and preferences.
3. Customer Retention: Knowing consumer preferences and post-purchase behaviour helps in
building customer loyalty and repeat business.
4. Market Segmentation: Consumer behaviour analysis allows businesses to identify and target
specific consumer segments effectively.

Disadvantages of Studying Consumer Behaviour:

1. Complexity: Consumer behaviour is influenced by numerous factors, making it difficult to

isolate and predict individual responses.
2. Subjectivity: Consumer behaviour research may involve self-reported data, which can be
subjective and biased.
3. Changing Dynamics: Consumer behaviour is constantly evolving, making it challenging to
keep up with changing trends and preferences.

In conclusion, consumer behaviour is a vital field of study for businesses and marketers as it provides
insights into consumers' decision-making processes, motivations, and responses to marketing
efforts. Understanding consumer behaviour allows companies to design more effective marketing
strategies, improve product offerings, and build stronger connections with their target audience.
Models.
 UNIT – II
Environmental influences on consumer behaviour – Cultural influences – Social class, reference
groups and family influences - Opinion leadership and the diffusion of innovations – Marketing
implications of the above influences.

Environmental influences on consumer behaviour

Environmental influences on consumer behaviour refer to the external factors that impact
individuals' purchasing decisions and consumption patterns. These influences can be broadly
categorized into cultural, social, psychological, and situational factors. Understanding these
influences is crucial for businesses and marketers to develop effective marketing strategies and
tailor their products and services to meet consumer needs and desires. Let's explore each category
in detail:

Cultural Influences:

Cultural factors play a significant role in shaping consumer behaviour. Culture refers to the shared
beliefs, values, norms, customs, and behaviours of a particular group of people. It encompasses
both national and subculture elements. Some key cultural factors include:

a. Subcultures: Within a larger culture, there are subcultures with distinct characteristics and
preferences. These can be based on ethnicity, religion, age, gender, occupation, or hobbies.
Subcultures may have their own consumption patterns, which influence purchasing decisions.

b. Social Class: Social class refers to the hierarchical stratification of society based on income,
education, occupation, and other factors. Different social classes have unique consumption habits
and preferences. For instance, luxury products may be more appealing to individuals from higher
social classes.

c. Cultural Symbols and Rituals: Symbols and rituals, such as holidays, festivals, and traditions, can
influence consumer behaviour. Marketers often use cultural symbols to create marketing campaigns
that resonate with consumers on a cultural level.
Social Influences:

Social factors are the external influences that arise from interactions with family, friends, peers, and
reference groups. Social influences on consumer behaviour include:

a. Family: Family is a primary source of influence on consumer behaviour. Family members often
share common values and preferences, affecting the products and brands they choose.

b. Reference Groups: Reference groups are the groups to which individuals compare themselves
and use as a basis for decision-making. They can be aspirational (groups individuals want to belong
to) or associative (groups individuals already belong to). Consumers are often influenced by the
opinions and behaviours of these reference groups.

c. social media: With the widespread use of social media, individuals are exposed to opinions,
reviews, and endorsements from their social networks. Social media platforms have become
powerful influencers of consumer behaviour.

Psychological Influences:

Psychological factors refer to the internal mental processes that influence consumer behaviour. Key
psychological influences include:

a. Perception: How consumers perceive products, brands, and marketing messages can significantly
impact their buying decisions. Marketers use various techniques to shape consumer perceptions
positively.

b. Motivation: Consumer behaviour is often driven by needs and wants. Understanding consumers'
motivations helps marketers design products and marketing strategies that satisfy those needs.

c. Attitudes and Beliefs: Attitudes and beliefs towards products and brands influence purchase
decisions. Positive attitudes and strong beliefs can lead to brand loyalty.

d. Learning and Memory: Past experiences with products and brands influence current and future
purchase decisions. Effective marketing can create positive associations and memories to drive
repeat purchases.
Situational Influences:

Situational factors relate to the specific circumstances in which consumers find themselves when
making purchasing decisions. Some key situational influences include:

a. Time: The time available to make a purchase can affect decision-making. Time-sensitive
promotions and limited-time offers can influence consumer behaviour.

b. Place: The physical location where a consumer makes a purchase can influence their choices. For
instance, the layout and ambiance of a store can impact the buying experience.

c. Social and Physical Surroundings: The presence of other people and the physical environment can
influence consumer behaviour. Crowded places, music, and lighting can affect the perception of
products.

d. Purchase Purpose: The reason behind the purchase, such as gifting, self-indulgence, or necessity,
can influence what and how consumers buy.

Cultural influences – Social class, reference groups and family

influences

Cultural influences on consumer behaviour encompass various factors, including social class,
reference groups, and family influences. These elements are significant in shaping individuals'
purchasing decisions and consumption patterns based on shared values, norms, and behaviours
within a particular culture. Let's explore each of these cultural influences in detail:

Social Class:

Social class refers to the hierarchical stratification of society based on factors like income, education,
occupation, and lifestyle. It plays a crucial role in consumer behaviour because individuals from
different social classes often have distinct preferences, needs, and buying habits. Here's how social
class impacts consumer behaviour:
a. Consumption Patterns: People from different social classes tend to consume products and
services differently. For example, individuals from higher social classes might prefer luxury brands,
while those from lower classes may prioritize affordability and practicality.

b. Status Symbol: Certain products or brands may act as status symbols within specific social classes.
Owning these products can convey a sense of prestige and social standing, which motivates
consumers to make specific choices.

c. Aspiration and Imitation: Consumers from lower social classes may aspire to emulate the
consumption patterns of those from higher classes. Marketers often use aspirational marketing
strategies to appeal to these desires.

d. Social Mobility: Social class can influence how consumers perceive themselves and their
aspirations for upward mobility. For example, products or experiences that cater to upward social
mobility may resonate with individuals seeking improvement in their social status.

Reference Groups:

Reference groups are the groups or individuals that consumers look to for guidance and comparison
when making purchasing decisions. These groups can be either aspirational (one’s consumers aim
to join) or associative (ones they already belong to). Reference groups significantly impact consumer
behaviour in the following ways:

a. Social Identity: Consumers often associate themselves with specific reference groups, and their
choices may reflect that affiliation. Aligning with a reference group's preferences can help
individuals strengthen their social identity.

b. Opinion and Advice: Consumers seek opinions and advice from their reference groups before
making buying decisions. Positive recommendations from reference groups can influence brand
choice and loyalty.

c. Conformity and Nonconformity: Consumers may conform to their reference groups' preferences
or choose to differentiate themselves by rejecting certain products or brands endorsed by the
group.
d. Aspirational Influence: Aspirational reference groups, such as celebrities or successful individuals,
can significantly impact consumer behaviour. Consumers may be motivated to emulate their
lifestyles and choices.

Family Influences:

Family is a primary and enduring social institution that significantly influences consumer behaviour.
Family members share values, beliefs, and consumption habits, and these shared characteristics
shape their purchasing decisions. Family influences on consumer behaviour include:

a. Role Allocation: Different family members often have specific roles in the decision-making
process. For example, parents may have the final say in major purchases, while children may
influence choices related to toys or snacks.

b. Socialization: Family plays a critical role in socializing individuals into certain consumption
patterns and preferences. Early exposure to specific brands or products can lead to long-term brand
loyalty.

c. Financial Resources: Family income and financial resources affect the types of products and
services a household can afford. Economic factors can significantly impact the family's consumption
choices.

d. Gift-Giving: Family occasions and celebrations prompt gift-giving, which influences consumers'
purchase decisions. Gifts may reflect the recipient's preferences or aspirations, affecting brand
choices.

e. Family Life Cycle: Consumers' life stages, such as marriage, having children, and retirement,
influence their consumption patterns and needs. Marketers often target specific life stages with
tailored marketing strategies.

Opinion leadership and the diffusion of innovations

Opinion leadership and the diffusion of innovations are two important concepts in the field of
marketing and sociology that help explain how ideas, products, and innovations spread through a
society. Let's delve into each of these concepts in detail:

Opinion leadership refers to the process by which certain individuals or groups within a society exert
influence over others' attitudes, beliefs, and behaviours. These opinion leaders are considered
knowledgeable, credible, and influential in specific domains, and their opinions carry weight among
their followers or peers. Opinion leaders can be formal (e.g., experts, celebrities, industry
influencers) or informal (e.g., friends, family members, colleagues).

Characteristics of Opinion Leaders:

1. Expertise: Opinion leaders are perceived as experts or highly knowledgeable in particular

areas of interest, such as fashion, technology, health, or entertainment.
2. Credibility: They have a track record of making sound judgments and reliable
recommendations, making others trust their opinions.
3. Social Connectivity: Opinion leaders have extensive social networks and connections,
allowing them to disseminate information to a wide audience.
4. Innovativeness: Opinion leaders are often early adopters of new products, ideas, or trends,
making them influential in the adoption process.

Role of Opinion Leaders in Marketing and Diffusion:

Opinion leaders play a crucial role in the diffusion of innovations and the success of marketing
campaigns. Marketers often identify and target opinion leaders to leverage their influence in
spreading information about new products or services. By persuading opinion leaders to adopt and
endorse their offerings, marketers can create a ripple effect as their followers and peers are more
likely to follow suit. This process is known as the "two-step flow of communication," where
information spreads from opinion leaders to their followers and then to others in their social circles.

Diffusion of Innovations:

The diffusion of innovations theory, formulated by Everett Rogers in 1962, explains how new ideas,
products, or technologies are adopted and spread through a social system over time. According to
this theory, the adoption process follows a bell-shaped curve, and different groups within society
adopt innovations at different rates. The diffusion of innovations theory identifies five categories of
adopters:

a. Innovators: These individuals are venturesome, risk-taking, and open to trying new ideas or
products early in the innovation's life cycle. They represent a small percentage of the population
but play a critical role in initial adoption.

b. Early Adopters: Early adopters are opinion leaders who tend to adopt innovations after the
innovators but before the majority of the population. They are influential in spreading the
innovation to the early majority.

c. Early Majority: The early majority consists of pragmatists who adopt innovations after a period of
deliberation and observation. They represent a substantial portion of the population and are crucial
for the innovation's widespread acceptance.

d. Late Majority: The late majority comprises sceptics who adopt innovations only when they have
become well-established and socially accepted. They are influenced by the actions of the early
majority.

e. Laggards: Laggards are resistant to change and adopt innovations very late in the diffusion
process, often when the innovation is becoming obsolete or replaced.

Factors Affecting Diffusion of Innovations:

Several factors influence the rate and extent of innovation adoption, including:

Relative Advantage: The innovation's perceived superiority over existing alternatives.

Compatibility: The degree to which the innovation fits with the values, experiences, and needs of
potential adopters.

Complexity: The ease of understanding and using the innovation.

Trialability: The extent to which the innovation can be experimented with on a limited basis before
full adoption.

Observability: The visibility of the benefits of the innovation to others.

Understanding the diffusion of innovations helps marketers tailor their strategies for different stages
of the adoption process. Early marketing efforts often target innovators and early adopters to create
momentum, while later stages focus on the majority groups to achieve broader market penetration.

– MARKETING IMPLICATIONS OF THE ABOVE INFLUENCES.

The cultural influences, such as social class, reference groups, and family, and the concepts of
opinion leadership and the diffusion of innovations have significant marketing implications for
businesses. Understanding these influences allows marketers to develop targeted and effective
marketing strategies to connect with their target audience, influence consumer behaviour, and
successfully launch and promote their products or services. Let's explore the marketing implications
in detail:

Segmenting the Market:

Recognizing the impact of social class on consumer behaviour allows marketers to segment their
target market based on socioeconomic factors. Different social classes may have varying needs,
preferences, and purchasing power. By tailoring marketing messages and product offerings to
specific social classes, businesses can better resonate with their target consumers and create more
personalized experiences.

Influencer Marketing:

Opinion leaders, especially those identified as early adopters or influential reference group
members, can significantly impact consumer behaviour. Leveraging influencer marketing strategies
enables businesses to collaborate with these opinion leaders to endorse their products or services.
The credibility and reach of opinion leaders can create a positive association and increase brand
awareness, leading to higher adoption rates among their followers.

Word-of-Mouth Marketing:

Understanding the two-step flow of communication, where information spreads from opinion
leaders to their followers and then to others in their social circles, highlights the importance of
word-of-mouth marketing. Positive word-of-mouth recommendations from opinion leaders and
satisfied customers can have a profound impact on consumer perceptions and purchasing decisions.
Businesses can encourage and incentivize satisfied customers to share their experiences, leading to
organic brand advocacy.

Tailored Advertising and Brand Positioning:

Cultural influences, including family dynamics and reference groups, can shape consumers'
perceptions and attitudes toward brands. Marketers can tailor advertising and brand positioning to
align with the values, beliefs, and aspirations of these cultural groups. Brands that understand the
needs and preferences of specific cultural segments can create more meaningful and relevant
messages that resonate with their target audience.

Product Innovation and Adoption Strategies:

The diffusion of innovations theory guides marketers in developing product adoption strategies.
Innovators and early adopters are the initial target audience for new products, as they are more
willing to try novel offerings. Focusing marketing efforts on this influential group can create buzz
and generate interest among the early majority. Later stages of the adoption process should
emphasize product benefits, ease of use, and social proof to appeal to the majority and late majority
segments.

Cultural Sensitivity and Inclusivity:

In a diverse and multicultural marketplace, businesses must be culturally sensitive and inclusive in
their marketing efforts. Being aware of cultural nuances and avoiding stereotypes helps prevent
potential backlash and allows brands to connect with consumers from various cultural backgrounds
authentically. Brands that embrace diversity and inclusivity in their marketing campaigns can foster
positive brand perceptions and build stronger relationships with a broader consumer base.

Product Customization and Localization:

Cultural influences often result in different preferences and requirements among consumers from
various regions and subcultures. Businesses can adapt their products or marketing strategies to suit
the specific needs and preferences of different cultural groups. This may involve customizing
product features, packaging, and messaging to cater to local tastes and values, leading to higher
acceptance and adoption rates in specific markets.

Influencing Perception and Social Identity:

Opinion leaders and reference groups can shape consumer perceptions of products and brands.
Marketers can use this knowledge to position their products as symbols of status, affiliation, or
belonging to specific social groups. By aligning their offerings with the values and lifestyles of target
consumers, businesses can enhance the perceived social identity associated with their products,
thus driving consumer loyalty and advocacy.

In conclusion, the cultural influences of social class, reference groups, and family, combined with
the concepts of opinion leadership and the diffusion of innovations, provide valuable insights for
marketers. By leveraging these influences, businesses can develop effective marketing strategies,
foster positive consumer attitudes, and drive product adoption. Tailoring marketing efforts to align
with the values and aspirations of target consumers can lead to greater brand engagement,
customer satisfaction, and long-term success in the marketplace.
 UNIT – III
The individual consumer and buying behaviour and marketing implications – Consumer perceptions,
learning, attitudes, motivation and personality – psychographics, values and lifestyles.

THE INDIVIDUAL CONSUMER AND BUYING

BEHAVIOUR AND MARKETING IMPLICATIONS
Consumer buying behaviour refers to the process and actions individuals undertake when
purchasing goods or services for personal use. Understanding consumer behaviour is essential for
marketers as it helps them tailor their marketing strategies to meet consumers' needs and
preferences effectively. There are several key factors that influence consumer buying behaviour, and
each has its implications for marketing. Let's explore them in detail:

Personal Factors:

Demographics: Age, gender, income, education, occupation, and family size are some of the key
demographic factors that influence buying behaviour. For instance, a marketer targeting luxury
products would focus on high-income consumers, while products aimed at teenagers may cater to
their unique preferences.

Psychographics: Consumers' lifestyles, personality traits, values, beliefs, and attitudes play a crucial
role in determining their purchase decisions. Marketers can segment their target audience based
on psychographics to create personalized marketing messages that resonate with specific consumer
groups.

Social Factors:

Culture: Culture significantly impacts consumer behaviour. People from different cultural
backgrounds have varying values, customs, and preferences. Marketers must be culturally sensitive
and adapt their marketing strategies accordingly.
Social Class: Consumers from different social classes have distinct purchasing behaviours. Higher
social class individuals might seek status symbols, while lower social class individuals may prioritize
value for money.

Reference Groups: People are influenced by their family, friends, colleagues, and social networks.
Marketers can use influencer marketing and word-of-mouth strategies to leverage these reference
groups' impact on consumer decision-making.

Psychological Factors:

Perception: Consumers interpret information differently, and their perception of a product can
influence their decision to buy. Marketers should ensure their products' positioning and branding
align with the target audience's perception.

Motivation: Understanding consumers' needs and desires is crucial for marketers. They can use
motivational strategies such as discounts, promotions, and rewards to encourage purchasing
behaviour.

Learning and Memory: Consumers' past experiences with a brand or product can shape their future
buying decisions. Positive experiences can lead to brand loyalty, while negative ones can drive
customers away.

Economic Factors:

Income and Price Sensitivity: The level of a consumer's income and their price sensitivity affects
their buying choices. Marketers can adjust pricing strategies, offer instalment plans, or introduce
budget-friendly options to cater to different income groups.

Economic Conditions: Economic factors, such as inflation, recession, or economic growth, can
impact consumer spending. During economic downturns, consumers may opt for essential items
over luxury goods.
BUYING DECISION PROCESS:

1. Problem Recognition: The buying process often starts with the recognition of a problem or
need. Marketers can trigger this stage through advertising that highlights a gap in the
consumer's current state and an ideal state.
2. Information Search: Consumers seek information about potential solutions to their needs.
Effective marketing involves providing relevant and easily accessible information through
various channels like websites, social media, and customer reviews.
3. Evaluation of Alternatives: Consumers compare different products or brands based on
specific criteria. Marketers should focus on highlighting their product's unique selling points
and advantages over competitors.
4. Purchase Decision: At this stage, consumers decide where and when to make the purchase.
Marketers can use promotions, limited-time offers, and convenient purchase options to
encourage consumers to take action.
5. Post-Purchase Evaluation: After purchasing a product, consumers assess their satisfaction.
Marketers should strive to deliver excellent post-purchase experiences, as positive feedback
and reviews can influence potential customers.

CONSUMER PERCEPTIONS, LEARNING, ATTITUDES, MOTIVATION

AND PERSONALITY

Consumer perceptions, learning, attitudes, motivation, and personality are crucial aspects of
consumer behaviour that significantly influence individuals' buying decisions and preferences. Let's
explore each of these factors in detail:

Perceptions:

Perceptions refer to how consumers interpret and make sense of the information they receive from
the external environment. It includes their sensory experiences, interpretation of stimuli, and the
resulting mental images. Perceptions are subjective and can differ from one individual to another.
Several key points related to perceptions are:
Selective Attention: Consumers tend to focus on certain stimuli while ignoring others. Marketers
can attract consumers' attention through creative and eye-catching advertisements.

Perceptual Filters: Individuals' past experiences, beliefs, and attitudes act as filters, shaping how
they perceive new information. Marketers must consider these filters to ensure their messages
resonate with their target audience.

Perceived Quality: Consumers' perception of a product's quality may be influenced by its packaging,
branding, or associations with other reputable brands.

Learning:

Learning is the process through which consumers acquire information and knowledge about
products, brands, and the marketplace. It plays a significant role in shaping consumer behaviour
over time. There are different types of learning:

Cognitive Learning: Involves acquiring knowledge and information through reasoning, thinking, and
problem-solving. Marketers can provide informative content and demonstrations to facilitate
cognitive learning.

Behavioural Learning: Involves learning from experiences, such as trial and error or
positive/negative reinforcement. Marketers can use rewards, discounts, and loyalty programs to
reinforce positive behaviours and encourage repeat purchases.

Attitudes:

Attitudes are a consumer's overall evaluation, positive or negative, towards a product, brand, or
service. They are formed based on consumers' beliefs, experiences, and emotional responses.
Understanding attitudes is crucial for marketers because they influence consumers' purchase
intentions. Key aspects of attitudes include:

Attitude Components: Attitudes have three components: cognitive (beliefs and thoughts), affective
(emotions and feelings), and behavioural (intentions and actions). Marketers can influence attitudes
by targeting these components through different communication strategies.

Attitude Change: Marketers can attempt to change consumers' attitudes through persuasive
communication, celebrity endorsements, testimonials, and social proof.
Motivation:

Motivation is the driving force that pushes individuals to take action, make choices, and fulfil their
needs or desires. Understanding consumers' motivations helps marketers design effective
marketing strategies and products. Some points to consider about motivation are:

Needs and Wants: Motivation is often rooted in consumers' needs and wants. Maslow's hierarchy
of needs (physiological, safety, belongingness, esteem, and self-actualization) is a useful framework
for understanding consumer motivations.

Influence on Decision Making: Consumers may be motivated by different factors, such as achieving
status, seeking pleasure, avoiding pain, or solving problems. Marketers can appeal to these
motivations through their advertising and promotional efforts.

Personality:

Personality refers to an individual's characteristic patterns of thoughts, emotions, and behaviours

that are relatively consistent over time. Consumer personality traits can influence their brand
choices and product preferences. Some important points related to personality are:

Brand Personality: Consumers often associate certain personality traits with brands. For instance,
some brands may be perceived as adventurous, sophisticated, or down-to-earth. Marketers can
shape brand personality through branding and marketing messages.

Self-Concept: Consumers' self-concept and self-image influence their brand choices. Marketers can
align their products with consumers' self-concept to create a sense of identity and connection.

In summary, consumer perceptions, learning, attitudes, motivation, and personality are

interconnected factors that influence how individuals perceive and interact with products, brands,
and marketing messages. Marketers need to understand these aspects of consumer behaviour to
design effective marketing strategies, communicate persuasively, and build lasting relationships
with their target audience. By tailoring their efforts to meet consumers' needs, desires, and
preferences, businesses can create a strong brand identity and foster customer loyalty.
– PSYCHOGRAPHICS, VALUES AND LIFESTYLES.

Psychographics, values, and lifestyles are three interconnected aspects of consumer behaviour that
play a significant role in understanding and segmenting target markets. Let's delve into each of these
concepts in detail:

Psychographics:

Psychographics involve studying consumers' psychological characteristics, including their attitudes,

interests, opinions, beliefs, and motivations. Unlike demographics, which focus on objective and
observable traits, psychographics delves into the underlying psychological factors that influence
consumer behaviour. Here's how psychographics is essential for understanding consumers:

segmentation: Psychographic segmentation allows marketers to group consumers based on shared

attitudes and lifestyles rather than just demographic characteristics. This segmentation approach
helps create more targeted and personalized marketing strategies.

Consumer Motivation: Understanding the underlying motivations of consumers helps marketers

identify the benefits and emotional appeals that will resonate with them. By appealing to
consumers' motivations, marketers can drive desire for their products or services.

Brand Personality: Psychographics play a crucial role in shaping brand personality. Brands can be
associated with certain values and traits, and consumers may align themselves with brands that
reflect their own values and self-concept.

Product Positioning: Psychographic insights can guide product positioning and messaging, ensuring
that marketing efforts resonate with the target audience's values and aspirations.

Values:

Values represent the core beliefs and principles that individuals hold dear and guide their attitudes
and behaviours. Values are deeply ingrained and are difficult to change, making them powerful
determinants of consumer decisions. Understanding consumer values is essential for marketers for
the following reasons:
Influence on Decision Making: Consumers' values significantly influence their purchasing decisions.
Brands and products that align with consumers' values are more likely to be favoured over
competitors.

Brand-Consumer Alignment: When a brand's values align with those of its target consumers, it
creates a strong emotional connection, leading to brand loyalty and advocacy.

Social Responsibility: Consumers are increasingly conscious of brands' ethical practices and
commitment to social and environmental issues. Brands that embody and communicate positive
values may attract socially conscious consumers.

Lifestyles:

Lifestyles encompass the way individuals live, including their activities, interests, opinions, and
consumption patterns. Lifestyles reflect how consumers spend their time, what they prioritize, and
how they make choices. Understanding consumer lifestyles is crucial for marketers for the following
reasons:

Product and Service Design: Lifestyles influence consumers' needs and preferences, guiding the
design of products and services that align with their daily routines and activities.

Media Consumption: Consumers' lifestyles determine their media consumption habits. Marketers
can use this information to choose the most effective channels to reach their target audience.

Purchase Behaviour: Lifestyles can influence the frequency and timing of purchases. For example,
consumers with active lifestyles may prefer on-the-go products.

In summary, psychographics, values, and lifestyles are vital components of consumer behaviour
analysis. By going beyond traditional demographic segmentation and understanding consumers'
psychological characteristics, beliefs, and behaviours, marketers can create more effective
marketing strategies, develop products that meet consumers' needs and desires, and build strong
and lasting relationships with their target audience. Identifying shared psychographic traits, values,
and lifestyle patterns allows marketers to tailor their messaging and positioning to connect with
consumers on a deeper emotional level, fostering brand loyalty and advocacy.
 UNIT – IV
Strategic marketing applications – Market segmentation strategies – Positioning strategies for
existing and new products, Re - positioning, perceptual mapping – Marketing communications –
Source, message and media effects. Store choice and shopping behaviour – In- Store stimuli, store
image and loyalty – Consumerism – Consumer r rights and Marketers ‘responsibilities.

STRATEGIC MARKETING APPLICATIONS

Strategic marketing is a comprehensive approach to planning and executing marketing initiatives to

achieve long-term organizational goals. It involves analysing the market, understanding customer
needs, and formulating strategies to position products or services effectively in the marketplace.
Strategic marketing applications are the various tools, techniques, and concepts used to implement
these strategies. Let's delve into some essential strategic marketing applications in detail:

Market Research and Analysis: Market research is the foundation of strategic marketing. It involves
gathering and analysing data about the target market, customers, competitors, and industry trends.
Through market research, companies can identify market opportunities, consumer preferences, and
potential threats. This information helps in developing marketing strategies that align with the
needs and desires of the target audience.

1. Segmentation, Targeting, and Positioning (STP): After conducting market research,

businesses can segment their target market into distinct groups based on shared
characteristics, preferences, and behaviours. Once segments are identified, the company
selects the most relevant segments as its target audience. This ensures that marketing
efforts are directed towards the right customers. Positioning involves creating a unique and
favourable perception of the product or service in the minds of the target customers,
differentiating it from competitors.
2. Product Development and Innovation: Strategic marketing entails understanding the needs
of customers and creating products or services that meet those needs effectively. By
continuously innovating and improving products, companies can stay ahead of the
competition and maintain a strong market position.

3. Branding and Brand Management: A strong brand identity helps a company differentiate
itself from competitors and build customer loyalty. Strategic marketing involves creating a
unique brand image, establishing brand values, and managing the brand's perception
through consistent communication and experiences.

4. Pricing Strategies: Pricing is a critical component of marketing strategy, as it directly impacts

revenue and profitability. Companies must carefully analyse costs, competitor pricing, and
customer perceptions to determine the optimal pricing strategy. Price adjustments may be
used strategically to achieve specific objectives, such as penetrating new markets or
increasing market share.

5. Promotional Mix: The promotional mix consists of various communication tools used to
promote products or services to the target audience. These tools include advertising, sales
promotions, public relations, direct marketing, and personal selling. Strategic marketing
involves choosing the right mix of promotional activities that align with the overall marketing
objectives and reach the target audience effectively.

6. Distribution and Channel Management: Efficient distribution channels are essential for
reaching customers and delivering products or services. Strategic marketing involves
selecting the most appropriate distribution channels, managing relationships with
intermediaries, and optimizing the supply chain to ensure smooth product availability and
delivery.
 7. Customer Relationship Management (CRM): Building and maintaining strong relationships
with customers is vital for long-term success. CRM tools and strategies help companies
collect and analyse customer data, understand their preferences, and personalize
interactions to enhance customer satisfaction and loyalty.

8. Digital Marketing and social media: As the digital landscape continues to grow, strategic
marketing applications increasingly involve leveraging online platforms for marketing
purposes. Digital marketing encompasses website optimization, content marketing, search
engine optimization (SEO), email marketing, social media marketing, and more.

9. Performance Measurement and Analytics: Strategic marketing requires ongoing monitoring

and evaluation of marketing efforts. Companies use key performance indicators (KPIs) and
marketing analytics to assess the effectiveness of their strategies and make data-driven
decisions for continuous improvement.

MARKET SEGMENTATION STRATEGIES

Market segmentation is the process of dividing a broad market into distinct groups of consumers
who have similar characteristics, needs, preferences, or behaviours. These groups, known as market
segments, share common traits that make them more likely to respond similarly to marketing
efforts. By adopting market segmentation strategies, businesses can better understand their
customers, tailor their marketing messages, and design products or services that meet specific
customer needs. Let's explore some common market segmentation strategies in detail:

1. Demographic Segmentation: This strategy involves dividing the market based on

demographic factors such as age, gender, income, education, family size, occupation, and
ethnicity. Demographics provide basic information about consumers and are often used as
a starting point for segmentation. For example, a company might target its luxury products
to high-income individuals or offer children's toys to parents with young children.
2. Psychographic Segmentation: Psychographic segmentation focuses on understanding
consumers' lifestyles, attitudes, values, interests, and personality traits. This strategy aims
to identify deeper motivations and psychological factors that influence consumer behaviour.
For instance, a company may target adventure-seeking travellers or environmentally
conscious consumers.

3. Behavioural Segmentation: Behavioural segmentation is based on customers' actions, usage

behaviour, brand loyalty, and purchasing habits. Companies use this strategy to understand
how customers interact with products or services, allowing them to tailor marketing efforts
accordingly. For instance, an airline may offer frequent flyer programs to reward loyal
customers.

4. Geographic Segmentation: Geographic segmentation divides the market based on the

physical location of customers. It considers factors such as country, region, city, climate, and
urban/rural distinctions. Geographic segmentation is particularly relevant for businesses
with location-specific products or services or those catering to regional preferences.

5. Benefit Segmentation: Benefit segmentation focuses on the specific benefits or solutions

sought by consumers. Customers with similar needs and desires are grouped together,
allowing companies to address those needs directly. For instance, a skincare brand may
target customers seeking anti-aging benefits separately from those looking for acne
treatment.

6. Occasion Segmentation: Occasion segmentation involves targeting consumers based on the

specific occasions or events when they are likely to make a purchase. For example,
companies may adjust their marketing strategies to capitalize on holiday shopping or
seasonal trends.
 7. Usage Rate Segmentation: This strategy segments customers based on their level of product
or service usage. Customers may be categorized as heavy users, moderate users, light users,
or non-users. It helps companies target their marketing efforts and loyalty programs to retain
high-value customers and encourage increased usage among others.

8. Loyalty Segmentation: Loyalty segmentation classifies customers based on their loyalty to

the brand or product. Customers may be categorized as brand loyalists, switchers, or those
with no brand loyalty. Companies can focus on retaining loyal customers while devising
strategies to convert switchers into loyal brand advocates.

9. Social Class Segmentation: Social class segmentation divides customers based on their social
standing, education, occupation, and lifestyle. This approach can be relevant for luxury
brands or products that cater to specific social classes.

10. Generation Segmentation: Generation-based segmentation targets consumers based on

their generation, such as Baby Boomers, Generation X, Millennials, or Generation Z. Each
generation has distinct characteristics and preferences that influence their purchasing
decisions.

– POSITIONING STRATEGIES FOR EXISTING AND NEW PRODUCTS

Positioning strategies are techniques used by businesses to create a distinct and favourable image
of their products or services in the minds of their target customers. Positioning involves how a
product or service is perceived relative to competitors and how it fulfils the needs and desires of
the target market. Both existing and new products can benefit from effective positioning strategies.
Let's explore some positioning strategies in detail:

Unique Selling Proposition (USP):

For Existing Products: If a product has been in the market for some time, it's essential to identify
and communicate its unique selling proposition. A USP highlights the specific features or benefits
that set the product apart from competitors. This could be superior quality, a special ingredient, a
unique design, or exceptional customer service. The goal is to showcase what makes the product
different and better than alternatives.

For New Products: When introducing a new product, identifying a strong USP is critical to
differentiate it from established competitors. The USP should address a specific customer need or
pain point and offer a compelling reason to choose the new product over existing options.

Target Market Focus:

For Existing Products: Over time, the target market's preferences and needs may change. Re-
positioning the product to address a different segment or a more refined target audience can
revitalize interest and drive sales. For instance, a product initially targeted at young adults could be
repositioned to appeal to families or seniors.

For New Products: Positioning a new product requires a thorough understanding of the target
market. Tailoring the product's attributes and marketing messages to address the specific needs and
desires of the target audience increases the likelihood of a successful launch.

Benefit Positioning:

For Existing Products: Emphasizing the primary benefits that the product provides can be a powerful
positioning strategy. This involves communicating how the product solves customer problems or
fulfils their desires better than competitors. Focusing on benefits can be especially effective for
products with complex features or technical specifications.

For New Products: Highlighting the unique benefits of the new product in comparison to existing
alternatives can attract early adopters and drive initial sales. Demonstrating the clear advantages of
the new offering over competitors is essential in the early stages.
Price Positioning:

For Existing Products: Positioning a product based on price can be effective, especially in
competitive markets. The product can be positioned as a premium option, emphasizing its higher
quality or added features, or as a budget-friendly alternative, appealing to cost-conscious
consumers.

For New Products: Pricing a new product competitively can create interest and encourage trial
among potential customers. Alternatively, positioning the product as a premium offering with added
value and features can appeal to a specific segment willing to pay a premium.

Product Attributes Positioning:

For Existing Products: Highlighting specific product attributes or features that are unique and
valuable to customers can strengthen its positioning. This approach is particularly effective when
these attributes align with the target audience's needs and preferences.

For New Products: Identifying and promoting the most relevant and appealing attributes of the new
product can help build its positioning. This requires understanding the target market's preferences
and selecting attributes that differentiate the product from competitors.

Competitor-Based Positioning:

For Existing Products: Analysing competitor positioning can help identify gaps or weaknesses that
the existing product can capitalize on. By positioning the product as superior or the preferred
alternative to competitors, a business can gain market share.

For New Products: Understanding competitors' positions in the market is essential for crafting a
positioning strategy that fills a gap or offers a unique value proposition. Identifying unmet needs or
untapped markets can guide the new product's positioning.

Emotional Positioning:
For Existing Products: Establishing an emotional connection with customers can enhance a
product's positioning. By appealing to customers' emotions and values, businesses can create a loyal
customer base that goes beyond rational considerations.

For New Products: Positioning a new product with a strong emotional appeal can help build brand
loyalty and attract early adopters who are passionate about the product's mission or values.

Problem-Solution Positioning:

For Existing Products: Re-positioning a product as a solution to a specific problem or pain point can
revitalize its market presence. By highlighting how the product addresses a pressing need,
businesses can reignite interest from both existing and new customers.

For New Products: Positioning a new product as a solution to an unmet need or a common problem
can attract a receptive audience eager for a viable solution.

Niche Positioning:

For Existing Products: Repositioning a product to target a specific niche market can be a viable
strategy if the product has a unique appeal to that segment. By focusing on a niche, businesses can
establish themselves as experts in that area and gain a competitive advantage.

For New Products: Introducing a new product with a niche positioning can be a way to gain a
foothold in the market and gradually expand to broader segments once brand recognition is
established.

Rebranding and Repositioning:

For Existing Products: When a product's market share is declining or its appeal is diminishing,
rebranding and repositioning can be a way to breathe new life into it. This may involve updating the
product's packaging, design, messaging, or targeting a new audience.

For New Products: If initial market feedback is not as expected, adjusting the product's positioning
based on customer feedback and preferences can help enhance its chances of success.
Effective positioning strategies require a deep understanding of the target market, competition, and
the unique strengths of the product or service. Additionally, businesses should continuously
monitor market dynamics and customer feedback to adjust their positioning strategies as needed,
ensuring they remain relevant and competitive in the ever-changing marketplace.

Re - positioning

Repositioning is a strategic marketing process wherein a company or brand changes its current
market positioning to alter how it is perceived by consumers. It involves modifying the brand's
image, value proposition, target market, or marketing mix to create a new and more favourable
perception among customers. Repositioning is often necessary when a product or brand is facing
declining sales, increased competition, changes in consumer preferences, or when there is a need
to tap into new market opportunities. Here's a detailed explanation of the repositioning process:

1. Market Analysis: The first step in repositioning is to conduct a thorough market analysis. This
involves studying the current market landscape, identifying emerging trends, and
understanding the competitive landscape. The goal is to gain insights into customer needs,
preferences, and perceptions regarding the brand or product.
2. SWOT Analysis: A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) helps in
identifying the brand's internal strengths and weaknesses and external opportunities and
threats. This analysis helps pinpoint areas that need improvement and areas where the
brand can capitalize.
3. Identifying the Need for Repositioning: The decision to reposition is typically triggered by
various factors, such as declining sales, loss of market share, negative customer feedback,
changes in the competitive landscape, or shifts in consumer behaviour. Recognizing these
signals is crucial in determining the need for repositioning.
4. Setting Objectives: Once the need for repositioning is established, clear objectives should be
set. The objectives could range from increasing market share and attracting new customer
segments to reinforcing the brand's relevance or shifting consumer perceptions.
5. Target Market Revaluation: The next step involves reassessing the target market. It may
involve identifying new segments that the brand can cater to or adjusting the positioning to
better resonate with the current target audience.
 6. Value Proposition and Messaging: Repositioning requires developing a new value
proposition that highlights the brand's unique selling points and benefits. This new value
proposition should be communicated effectively through messaging that addresses the
needs and desires of the target market.

7. Marketing Mix Adjustments: Repositioning often requires modifications to the marketing

mix, commonly known as the four Ps - product, price, promotion, and place.
8. Product: Changes to the product may involve improvements in quality, features, or
packaging to better align with the new positioning.
9. Price: Repositioning can affect pricing strategies. Brands may adjust prices to reflect changes
in perceived value or to target new market segments.
10. Promotion: The brand's messaging, advertising, and communication channels may need to
be updated to reflect the new positioning and appeal to the target market.
11. Place: Distribution channels and sales strategies might need adjustments to reach the
intended audience effectively.
12. Implementing the Repositioning Strategy: Once the repositioning strategy is developed, it
should be implemented across all marketing activities and customer touchpoints
consistently. This includes advertising campaigns, website content, social media, packaging,
and customer service.
13. Monitoring and Evaluation: After repositioning efforts are underway, it is essential to
monitor the results and gather feedback from customers and the market. Regular evaluation
allows the brand to measure the effectiveness of the repositioning strategy and make
necessary adjustments as needed.
14. Long-Term Commitment: Repositioning is not a one-time event; it requires a long-term
commitment. Successful repositioning involves consistent efforts to reinforce the new brand
image and deliver on the promises made to customers.

PERCEPTUAL MAPPING

Perceptual mapping is a visual representation technique used in marketing and market research to
understand how consumers perceive different brands, products, or services in relation to each
other. It helps businesses gain insights into the competitive landscape and identify market
positioning opportunities. Perceptual mapping is a valuable tool for understanding consumer
preferences, identifying gaps in the market, and formulating effective marketing strategies. Let's
explore the concept of perceptual mapping in detail:

1. Conceptual Basis: Perceptual mapping is based on the idea that consumers evaluate and
position brands or products in their minds based on specific attributes or characteristics.
These attributes could be tangible features, such as price, quality, or design, or intangible
factors like brand image, customer service, or sustainability. By plotting these attributes on
a graph, businesses can visualize the perceived relationships between various brands or
products.
2. Data Collection: The first step in creating a perceptual map is to collect data from consumers
through surveys or interviews. The data collected typically includes consumers' perceptions
or ratings of different brands or products on the chosen attributes. Respondents may be
asked to rate brands on a numerical scale (e.g., 1 to 7) or indicate their preferences through
rankings or comparisons.
3. Attribute Selection: Choosing the right attributes is crucial in perceptual mapping. The
selected attributes should be relevant to the market and represent factors that significantly
influence consumer decision-making. It's essential to strike a balance between including
enough attributes to be meaningful and not overwhelming respondents with too many
choices.
4. Dimension Reduction: Perceptual maps are typically two-dimensional, as it is easier to
visualize and interpret. However, when dealing with multiple attributes, dimension
reduction techniques, such as principal component analysis (PCA) or multidimensional
scaling (MDS), can be used to collapse the data into two dimensions while preserving the
most significant variance.
5. Plotting the Data: Once the data is collected and reduced to two dimensions, the brands or
products are plotted on the perceptual map based on their attribute scores. Brands that are
perceived to have similar attributes or characteristics will be placed close together, while
those with different characteristics will be farther apart.
6. Quadrants and Positioning: The perceptual map is divided into quadrants, and each
quadrant represents a distinct market segment. Brands or products positioned in the same
quadrant share similar attributes and target similar consumer preferences. Businesses can
use these insights to identify opportunities for positioning their products more effectively or
to differentiate themselves from competitors.
7. Competitive Analysis: Perceptual mapping allows businesses to understand their position
relative to competitors in the market. Brands that are closer to the ideal or preferred position
 in consumers' minds are better positioned for success. By analysing the map, businesses can
identify areas where they are strong or weak compared to competitors and devise strategies
to improve their market position.
8. Targeting and Positioning: Perceptual mapping helps businesses identify potential target
markets and refine their positioning strategies. By understanding where the gaps in the
market exist, businesses can develop products or services that cater to unmet consumer
needs or differentiate themselves from existing offerings.
9. Tracking Changes Over Time: Perceptual mapping is not a one-time exercise. Consumer
perceptions and preferences can change over time due to various factors like marketing
efforts, changes in competitors' strategies, or shifts in consumer trends. Therefore,
businesses should regularly update and track perceptual maps to stay informed about
evolving market dynamics.

Marketing communications – Source, message and media effects

Marketing communications, also known as integrated marketing communications (IMC), refers to

the coordinated efforts and strategies used by a company to communicate with its target audience
and promote its products or services. It involves the use of various communication channels,
messages, and creative elements to effectively reach and engage customers. Marketing
communications typically focus on three main components: source, message, and media effects.
Let's explore each of these components in detail:

Source:

The source in marketing communications refers to the sender or the entity delivering the message
to the target audience. It can be the company itself, a spokesperson, a brand ambassador, or any
other individual or entity representing the brand. The effectiveness of the source in influencing the
audience largely depends on credibility, trustworthiness, and expertise. Some key aspects related
to the source in marketing communications include:

1. Credibility: Consumers are more likely to pay attention to messages delivered by a credible
and trustworthy source. A credible source can be a well-known expert in the industry, a
satisfied customer sharing their experience, or a recognized industry association.
 2. Expertise: An authoritative and knowledgeable source can add weight to the message being
communicated. For example, a health expert endorsing a health product can significantly
impact consumers' perception and purchase decisions.
3. Likeability: Source likeability can influence how the audience perceives the message. If the
source is relatable, personable, or aligns with the target audience's values, the message is
more likely to be well-received.
4. Celebrities and Influencers: Brands often leverage celebrities and social media influencers
as sources to amplify their messages. These individuals have a substantial following and can
increase brand visibility and credibility among their fan base.

Message:

The message in marketing communications is the content or information that the sender wants to
convey to the target audience. Crafting an effective message is crucial to capturing the attention of
the audience, conveying the brand's value proposition, and motivating desired actions. Some key
considerations for creating impactful messages include:

1. Value Proposition: The message should clearly communicate the unique value and benefits
that the product or service offers to the target audience. It should answer the question,
"Why should the consumer choose this brand?"
2. Clarity and Simplicity: Messages should be clear, concise, and easy to understand. Avoiding
jargon or complex language ensures that the audience grasps the key points quickly.
3. Emotional Appeal: Emotions play a significant role in consumer decision-making. Messages
that evoke emotions such as happiness, fear, excitement, or empathy can resonate more
strongly with the audience
4. . Call to Action (CTA): A strong and compelling CTA motivates the audience to take the
desired action, such as making a purchase, signing up for a newsletter, or visiting a store.
5. Consistency: The messaging should be consistent across different marketing channels and
touchpoints to reinforce the brand identity and positioning.

Media Effects:

Media effects refer to how the choice of communication channels and media influences the
audience's perception and response to marketing communications. The media used to deliver the
message can significantly impact its reach, engagement, and effectiveness. Some important
considerations related to media effects include:

1. Media Selection: The choice of media channels should align with the target audience's
preferences and habits. Different demographics may respond differently to various media,
such as television, social media, print, radio, or outdoor advertising.
2. Reach and Frequency: The media strategy should aim for optimal reach (the number of
people exposed to the message) and frequency (how often they are exposed to it) to
reinforce the message and increase its memorability.
3. Context and Environment: The context in which the message is delivered can influence how
it is perceived. Placing ads in relevant and appropriate environments enhances their
effectiveness.
4. Interactivity: Interactive media, such as social media platforms, allow for two-way
communication with the audience, fostering engagement and building relationships.
5. Media Mix: An effective marketing communications strategy often involves a mix of different
media to reach a broader and more diverse audience. The media mix should be carefully
planned to complement and reinforce each other's impact.

Store choice and shopping behaviour – In- Store stimuli, store

image and loyalty

Store choice and shopping behaviour are essential aspects of consumer decision-making processes.
The in-store stimuli, store image, and loyalty play crucial roles in influencing consumer behaviour
and shaping their preferences and shopping habits. Let's explore each of these factors in detail:

In-Store Stimuli:

In-store stimuli refer to the various factors within a retail environment that influence consumers'
perceptions, attitudes, and purchase decisions. Retailers strategically design their stores to create a
pleasant and engaging shopping experience to attract and retain customers. Some key in-store
stimuli include:

1. Visual Merchandising: The way products are displayed, arranged, and presented can
significantly impact consumer attention and buying behaviour. Eye-catching displays, well-
organized shelves, and attractive packaging can all influence purchase decisions.
 2. Store Layout: The store layout determines the flow of customer traffic and affects how
consumers navigate through the store. An efficient and well-organized layout can make it
easier for shoppers to find what they need and encourage more extensive exploration of
products.
3. Music and Ambience: Background music and overall store ambience contribute to the
shopping experience. The right music and ambiance can influence shoppers' moods, create
a welcoming atmosphere, and encourage them to spend more time in the store.
4. Sensory Marketing: Retailers may use sensory marketing techniques, such as scent
marketing (using pleasant scents in the store) and tactile experiences (allowing customers
to touch and interact with products), to create emotional connections with the brand and
products.
5. In-Store Promotions: Special offers, discounts, and promotions can catch consumers'
attention and encourage impulse purchases.
6. Product Sampling and Demonstrations: Offering product samples or demonstrations can
lead to increased trial and purchase of new or unfamiliar products.
7. Interactive Technology: Retailers may use interactive displays, digital kiosks, or augmented
reality experiences to engage and entertain customers while providing product information.

Store Image:

Store image, also known as store reputation or store perception, refers to consumers' overall
perception of a retail store. It encompasses various factors such as the store's brand reputation, the
quality of products and services offered, customer service, store atmosphere, and the overall
shopping experience. Store image influences consumers' attitudes towards the store, their
willingness to shop there, and their likelihood of becoming loyal customers. A positive store image
can lead to higher customer satisfaction, repeat visits, and word-of-mouth referrals. Some key
elements that contribute to a store's image include

1. Brand Reputation: A strong and trusted brand name can positively impact the store's image
and create a sense of trust and reliability among consumers.
2. Product Quality: The perceived quality of products sold in the store is a crucial factor
influencing store image. Offering high-quality products can enhance the store's reputation
and attract more customers.
 3. Customer Service: Friendly and knowledgeable staff, efficient service, and a focus on
meeting customer needs can significantly contribute to a positive store image.
4. Store Atmosphere: The overall atmosphere and ambiance of the store, including cleanliness,
lighting, and aesthetics, can influence consumers' feelings and perceptions.
5. Price Perception: The perception of prices in relation to product quality and value for money
affects store image. Consistently offering fair pricing and value-added deals can build a
positive image.
6. Social Responsibility: Consumers often appreciate stores that demonstrate social
responsibility and contribute positively to the community or the environment.

Loyalty:

Customer loyalty is the measure of a consumer's inclination to repeatedly purchase products or

services from a particular store or brand. Building and maintaining customer loyalty are critical for
long-term business success. Loyal customers not only make repeat purchases but also act as brand
advocates, recommending the store to others. Key factors influencing customer loyalty include:

1. Customer Experience: A positive and personalized shopping experience, excellent customer

service, and hassle-free returns can foster loyalty.
2. Rewards and Loyalty Programs: Offering rewards, loyalty points, or exclusive discounts to
loyal customers can incentivize repeat purchases and reinforce loyalty.
3. Quality and Consistency: Consistently providing high-quality products and services builds
trust and confidence in the store.
4. Personalization: Understanding individual customer preferences and tailoring offers or
recommendations accordingly enhances the shopping experience and strengthens loyalty.
5. Communication: Regular communication with customers through personalized emails,
newsletters, or mobile apps can keep them engaged and informed about new products or
promotions.
6. Emotional Connection: Creating an emotional connection with customers through
storytelling, shared values, or brand experiences can strengthen loyalty.

In summary, store choice and shopping behaviour are influenced by a combination of in-store
stimuli, store image, and loyalty-building strategies. Retailers that effectively manage these factors
can attract and retain customers, drive sales, and build a strong and loyal customer base. Creating
a positive and engaging shopping experience, delivering on brand promises, and fostering an
emotional connection with customers are essential elements in achieving success in today's
competitive retail landscape.

CONSUMERISM

Consumerism is a social and economic ideology that emphasizes the importance of consumption
and the acquisition of goods and services as a means to achieve personal satisfaction, happiness,
and social status. It revolves around the idea that increased consumption leads to economic growth
and prosperity. Consumerism is a dominant force in modern societies, shaping individual behaviour,
business practices, and government policies. Let's delve into the concept of consumerism in detail:

Historical Context:

Consumerism emerged and gained prominence in Western societies during the 20th century,
particularly after World War II. The post-war period saw significant economic growth, increased
industrialization, and technological advancements, which led to a surge in the production and
availability of consumer goods. With rising incomes and increased access to credit, people were
encouraged to spend and consume more, leading to a shift from a production-oriented society to a
consumer-oriented one.

Consumption and Identity:

In consumerist societies, consumption is often linked to personal identity and self-expression.

People use products and brands to project their social status, values, and aspirations. Consumer
choices are influenced by marketing, advertising, and peer pressure, as individuals seek to belong
to specific social groups or emulate admired figures.
Impact on the Economy:

Consumerism plays a crucial role in driving economic growth. It fuels demand for goods and
services, prompting businesses to produce more, invest in innovation, and create jobs. In capitalist
economies, consumer spending constitutes a significant portion of Gross Domestic Product (GDP),
making it a key indicator of economic health.

Marketing and Advertising:

Consumerism is closely tied to marketing and advertising practices. Companies invest heavily in
advertising to create demand for their products and influence consumer behaviour. Marketing
techniques, such as brand storytelling, emotional appeals, and celebrity endorsements, are
employed to create positive associations with products and encourage consumer loyalty.

Materialism and Overconsumption:

One of the criticisms of consumerism is its association with materialism and overconsumption.
Critics argue that the pursuit of material possessions can lead to a focus on material wealth over
other aspects of life, such as relationships, personal growth, and environmental sustainability.
Overconsumption can strain natural resources, contribute to environmental degradation, and
create waste.

CONSUMER RIGHTS AND PROTECTION:

As consumerism grew, so did the need for consumer protection and advocacy. Governments and
consumer organizations work to establish regulations and laws that ensure product safety, truthful
advertising, and fair business practices. Consumer rights, such as the right to information, choice,
and redress, are recognized and protected in many countries.

Ethical Consumerism:

In response to concerns about the negative effects of consumerism, the concept of ethical
consumerism emerged. Ethical consumers consider factors such as product origin, production
practices, environmental impact, and labour conditions when making purchasing decisions. They
seek to support businesses that align with their values and promote sustainable and responsible
consumption.

Criticisms of Consumerism:

Consumerism faces several criticisms, including its role in perpetuating inequality, contributing to
resource depletion and environmental issues, and fostering a culture of materialism and waste.
Critics argue that consumerist societies prioritize individual consumption over communal well-being
and contribute to social and psychological problems, such as debt, stress, and dissatisfaction.

CONSUMER RIGHTS

Consumer rights are the set of principles and protections that ensure consumers are treated fairly
and have certain rights when purchasing goods and services. These rights are designed to safeguard
consumers from unfair practices, deception, and exploitation in the marketplace. Consumer rights
are recognized and protected by various laws and regulations in many countries. Let's explore the
key consumer rights in detail:

Right to Safety:

Consumers have the right to expect that the products and services they purchase are safe for use.
Manufacturers and sellers have a responsibility to ensure that their products meet safety standards
and do not pose any unreasonable risk to consumers. If a product is found to be defective or
hazardous, consumers have the right to seek compensation or a refund.

Right to Information:

Consumers have the right to access accurate and transparent information about products and
services before making a purchase. This includes details about the product's features, ingredients,
pricing, warranties, and any potential risks. Clear and truthful labelling and advertising are essential
to inform consumers adequately.

Right to Choose:

Consumers have the right to choose from a variety of products and services offered in the
marketplace. Anti-monopoly and anti-competitive laws exist to ensure that businesses do not
engage in practices that limit consumer choices or stifle competition.

Right to Be Heard:

Consumers have the right to voice their complaints and concerns about products or services and be
treated with respect and attentiveness by businesses and regulatory authorities. Companies should
have effective complaint resolution mechanisms in place to address customer grievances promptly.

Right to Redress:

When consumers purchase faulty or substandard products or receive unsatisfactory services, they
have the right to seek redress or compensation. This may involve repair, replacement, refund, or
compensation for any damages caused by the defective product or service.

Right to Privacy:

Consumers have the right to privacy and protection of their personal information. Businesses must
obtain consent before collecting, using, or sharing consumer data, and they must take measures to
safeguard this information from unauthorized access or misuse.

Right to Education and Awareness:

Consumers have the right to access education and information about their rights and
responsibilities as consumers. Governments and consumer organizations often provide resources
and campaigns to raise awareness and empower consumers to make informed decisions.

Right to Fair Representation:

Consumers have the right to be represented in decision-making processes that affect consumer
interests. Consumer organizations and advocacy groups work to ensure that consumer perspectives
are considered in policy-making and business practices.

Right to Environmental Sustainability:

Consumers have the right to access products and services that are produced and offered in a
manner that minimizes negative environmental impacts. Ethical consumerism promotes the
demand for eco-friendly and sustainable products.

Right to Consumer Education:

Governments and consumer organizations may implement initiatives to promote consumer

education and financial literacy, ensuring that consumers understand their rights and can make
responsible financial decisions.

Consumer rights are integral to maintaining a fair and balanced marketplace where consumers can
make informed choices without fear of exploitation or harm. These rights are upheld and enforced
by consumer protection laws and regulatory bodies to create a more equitable and consumer-
friendly environment. As consumers exercise their rights responsibly, they contribute to fostering a
competitive and ethical marketplace that benefits both businesses and consumers alike.

MARKETERS ‘RESPONSIBILITIES
Marketers have several important responsibilities in their roles as professionals who engage in
promoting products, services, or ideas to target audiences. These responsibilities are not only
ethical and legal but also play a crucial role in building trust, maintaining brand reputation, and
fostering positive relationships with consumers. Some of the key responsibilities of marketers
include:

Ethical Marketing Practices:

Marketers have a responsibility to conduct their activities in an ethical and honest manner. This
includes ensuring that all marketing claims are accurate and supported by evidence, avoiding
deceptive or misleading advertising, and respecting consumer privacy and data protection laws.

Consumer Protection:

Marketers must prioritize consumer protection and safeguard the interests of their target
audiences. This includes providing clear and transparent information about products and services,
addressing consumer complaints and concerns promptly, and adhering to all relevant consumer
protection laws and regulations.

Social Responsibility:

Marketers should consider the broader social and environmental impacts of their marketing
activities. Responsible marketing involves promoting products or services that are safe, sustainable,
and align with social values. Marketers should avoid promoting harmful products or engaging in
practices that contribute to negative social or environmental consequences.

Targeting and Segmentation:

Marketers should responsibly target their marketing efforts to the appropriate audience. This means
ensuring that marketing messages are relevant and appropriate for the intended recipients and
avoiding targeting vulnerable or sensitive groups.
Data Privacy and Security:

Marketers often handle sensitive consumer data, and they have a responsibility to protect this
information from unauthorized access or misuse. Adhering to data privacy laws and implementing
robust security measures is essential to maintaining consumer trust.

Transparency and Disclosure:

Marketers should be transparent about their affiliations, sponsorships, and any potential conflicts
of interest. Clear disclosures help consumers make informed decisions and build trust with the
brand.

Cultural Sensitivity:

In a globalized world, marketers should be aware of cultural differences and avoid campaigns or
messages that could be offensive or insensitive to certain cultural or social groups.

Continuous Learning and Improvement:

Marketers should stay updated with the latest marketing trends, best practices, and technological
advancements. Continuous learning and improvement ensure that marketers are equipped to adapt
to changes in consumer behaviour and market dynamics.

Accountability and Measurement:

Marketers should be accountable for the results of their marketing efforts. This involves tracking
and measuring the effectiveness of marketing campaigns and adjusting strategies as needed to
achieve desired outcomes.

Customer Engagement and Relationship Building:

Marketers play a crucial role in building positive relationships with customers. Engaging with
customers, listening to their feedback, and responding to their needs are essential for fostering
loyalty and long-term customer relationships.

In summary, marketers have a wide range of responsibilities that extend beyond simply promoting
products and services. Ethical practices, consumer protection, social responsibility, and
transparency are central to the role of marketers. By fulfilling these responsibilities, marketers can
contribute to building strong brands, loyal customer bases, and a positive impact on society as a
whole.
 UNIT – V
The Borderless Consumer Market and buying behaviour – Consumer buying habits and perceptions
of emerging non- store choices – Research and applications of consumer responses to direct
marketing approaches – Issues of privacy and ethics.

THE BORDERLESS CONSUMER MARKET AND BUYING BEHAVIOUR

The Borderless Consumer Market refers to the global marketplace where consumers have access to
products and services from different countries and regions without significant geographical or
regulatory barriers. Advances in technology, transportation, and communication have facilitated the
integration of economies, making it easier for businesses to operate and consumers to access goods
and services from around the world.

Buying behaviour, on the other hand, refers to the decision-making process consumers go through
when purchasing goods or services. It includes various factors, such as personal preferences,
cultural influences, social norms, economic considerations, and the influence of marketing and
advertising.

The Borderless Consumer Market:

a. Globalization: Globalization has played a significant role in creating a borderless consumer

market. It involves the integration of economies, industries, markets, and cultures, allowing
businesses to expand beyond their national borders and reach consumers in distant markets.

b. E-commerce: The rise of e-commerce has been a crucial driver of the borderless consumer
market. Online platforms and marketplaces have made it possible for businesses to offer their
products and services globally, while consumers can access a wide range of options from different
countries with just a few clicks.
c. Supply Chain Efficiency: Improvements in logistics and supply chain management have made it
easier and more cost-effective for businesses to transport goods across borders. This efficiency
benefits consumers, as they can enjoy a wider variety of products at competitive prices.

d. Cross-Border Payment Solutions: Advances in payment technologies have facilitated cross-border

transactions. Consumers can now easily make purchases from international sellers using various
payment methods, including credit cards, digital wallets, and cryptocurrencies.

e. Tariff Reductions and Trade Agreements: Governments' efforts to reduce trade barriers through
tariff reductions and trade agreements have further encouraged international trade and expanded
the borderless consumer market.

Buying Behaviour in the Borderless Consumer Market:

a. Cultural Influences: Consumer preferences are heavily influenced by cultural factors. Products
and services that align with the cultural norms and values of a specific region are more likely to be
successful. Therefore, businesses must adapt their offerings to cater to diverse cultural
backgrounds.

b. Consumer Trust: Trust is crucial in the borderless market, where consumers may be wary of
purchasing from unfamiliar brands or overseas sellers. Building trust through secure payment
methods, customer reviews, and reliable customer service is essential for success.

c. Online Reviews and Recommendations: With access to the internet, consumers can easily
research and read reviews and recommendations from other buyers before making a purchase.
Positive reviews and testimonials can significantly impact the buying decision

d. Price Sensitivity: The borderless market offers consumers the ability to compare prices from
various sellers worldwide. As a result, consumers tend to be more price-sensitive and will often
choose the most competitive option.

e. Ethical and Environmental Concerns: Increasingly, consumers are considering ethical and
environmental factors when making purchasing decisions. Businesses that align with sustainability
practices and social responsibility may gain a competitive advantage.
f. Brand Perception: Brand reputation and perception are crucial in the borderless market. A strong
brand image can influence consumers' willingness to pay a premium for a product or service.

g. Language and Localization: Language plays a significant role in consumer behaviour. Businesses
must communicate in the local language and tailor their marketing messages to suit the cultural
context of the target audience.

CONSUMER BUYING HABITS AND PERCEPTIONS OF EMERGING

NON- STORE CHOICES

Consumer buying habits and perceptions are constantly evolving, especially with the emergence of
new non-store choices in the retail landscape. Non-store choices refer to alternative ways
consumers can make purchases without physically visiting a traditional brick-and-mortar store.
These emerging options have been significantly influenced by technological advancements and
changing consumer preferences. Let's explore these factors in detail:

Technological Advancements:

a. E-commerce: Online shopping has revolutionized consumer buying habits. Consumers can browse
and purchase products and services from the comfort of their homes using computers,
smartphones, or other connected devices. E-commerce platforms offer convenience, a wide variety
of choices, and the ability to compare prices easily.

b. Mobile Shopping: The widespread adoption of smartphones has led to the rise of mobile
shopping. Consumers can now make purchases through dedicated mobile apps or mobile-optimized
websites, further enhancing the convenience and accessibility of online shopping.

c. Social Commerce: Social media platforms have evolved into shopping destinations. Consumers
can discover products, read reviews, and make purchases directly through social media channels,
blurring the lines between socializing and shopping.
CHANGING CONSUMER PREFERENCES:

a. Convenience: Consumers increasingly value convenience in their buying habits. Non-store choices
provide the convenience of 24/7 access to products and services, allowing them to shop whenever
and wherever they prefer.

. b. Time Constraints: Busy lifestyles and time constraints have led consumers to seek efficient ways
of shopping. Non-store choices eliminate the need to visit physical stores, saving time and effort.

c. Personalization: Emerging non-store choices leverage data and algorithms to offer personalized
product recommendations, creating a more tailored shopping experience for consumers.

d. Seamless Experience: Consumers expect a seamless shopping experience across different

channels and devices. Non-store choices that offer integrated and consistent experiences are more
likely to attract and retain customers.

Types of Emerging Non-Store Choices:

a. Online Marketplaces: E-commerce platforms like Amazon, Alibaba, and eBay provide a vast
selection of products from various sellers, offering consumers a one-stop shopping destination.

b. Direct-to-Consumer (D2C) Brands: D2C brands sell their products directly to consumers through
their websites or social media channels, bypassing traditional retail intermediaries.

c. Subscription Services: Subscription-based models offer convenience and predictability to

consumers by providing regularly scheduled deliveries of products or access to services for a fixed
fee.

d. Social Media Shopping: Social media platforms like Instagram, Facebook, and Pinterest enable
consumers to shop directly from posts and ads, blurring the line between social content and
commerce.

e. Mobile Wallets: Mobile payment solutions like Apple Pay, Google Pay, and digital wallets facilitate
secure and contactless transactions, making purchases convenient and safe.
PERCEPTIONS OF EMERGING NON-STORE CHOICES:

a. Trust and Security: Consumers' perception of security and trustworthiness plays a significant role
in their willingness to adopt non-store choices. Reputable platforms and secure payment methods
are crucial in building consumer confidence.

b. Product Information and Reviews: Access to detailed product information, customer reviews, and
ratings helps consumers make informed decisions when shopping through non-store choices.

c. Return Policies: Clear and convenient return policies are essential for consumers who may have
concerns about product quality or fit when purchasing online

. d. Delivery Speed and Cost: Fast and affordable delivery options are highly valued by consumers,
as they contribute to the overall shopping experience.

e. Social Proof and Influencers: Consumers may be influenced by social media influencers and peer
recommendations when considering non-store choices.

f. Brand Reputation: Established brands may enjoy an advantage in consumer perception, as their
reputation can instil confidence and trust.

– RESEARCH AND APPLICATIONS OF CONSUMER RESPONSES TO

DIRECT MARKETING APPROACHES

Consumer responses to direct marketing approaches have been a subject of extensive research in
the field of marketing and consumer behaviour. Direct marketing refers to the practice of reaching
out to individual consumers directly through various channels, such as email, direct mail,
telemarketing, SMS, and personalized advertising. Understanding how consumers respond to these
approaches is crucial for marketers to design effective strategies and maximize the impact of their
direct marketing efforts. Let's explore the research and applications of consumer responses to direct
marketing in detail:
Research on Consumer Responses to Direct Marketing Approaches:

a. Effectiveness of Personalization: Research has shown that personalized direct marketing

messages, tailored to individual preferences and needs, tend to yield higher response rates.
Personalization can range from addressing the recipient by name to customizing product
recommendations based on past purchase behaviour.

b. Influence of Timing: Studies have examined the impact of timing on consumer response rates.
For instance, the day of the week, time of day, and seasonality can all affect consumers'
receptiveness to direct marketing messages.

c. Message Content and Design: Research has investigated the role of message content and design
in eliciting consumer responses. Factors such as clarity, relevance, and visual appeal play a
significant role in capturing consumer attention and encouraging engagement.

d. Trust and Privacy Concerns: Consumers are increasingly concerned about privacy and data
security. Research has explored how the perception of trustworthiness and privacy safeguards in
direct marketing communications can influence consumers' willingness to respond.

e. Channel Preferences: Understanding consumers' channel preferences is crucial in selecting the

most effective direct marketing channels. Research has compared response rates across various
channels to identify which ones resonate best with different target segments.

f. Incentives and Offers: Studies have examined the impact of incentives and offers, such as
discounts, free trials, or exclusive deals, on consumer response rates. The type and attractiveness
of incentives can significantly influence consumer behaviour.

g. Multichannel Integration: Research has explored the effectiveness of integrating multiple

channels in direct marketing campaigns. Combining email, social media, and direct mail, for
example, can create a cohesive and synergistic customer experience.

h. Response Timing: Researchers have investigated the relationship between response timing and
conversion rates. Prompt follow-up and timely engagement with consumer inquiries can increase
the likelihood of conversion.
Applications of Consumer Responses to Direct Marketing
Approaches:

a. Targeted Marketing: Based on research insights, businesses can segment their audience and
create targeted direct marketing campaigns. Personalizing messages and offers to specific consumer
segments can enhance response rates and overall campaign success.

b. A/B Testing: A/B testing, also known as split testing, involves comparing different versions of
direct marketing messages to determine which performs better. By conducting A/B tests, marketers
can identify the most effective message content, design, or incentives for their target audience.

c. Data Analytics: Leveraging data analytics allows marketers to gain deeper insights into consumer
behaviour and preferences. Analysing response data can help refine future direct marketing efforts
and optimize return on investment (ROI).

d. Customer Relationship Management (CRM): Integrating consumer response data into CRM
systems enables businesses to maintain a comprehensive view of customer interactions. This
information can be used to build stronger customer relationships and inform future marketing
strategies.

e. Opt-In and Opt-Out Management: Respecting consumer preferences is essential in direct

marketing. Based on response data, businesses can manage opt-in and opt-out lists to ensure
compliance with privacy regulations and enhance customer satisfaction.

f. Customer Journey Mapping: Understanding how consumers respond to direct marketing at

various touchpoints can help map the customer journey. This insight allows businesses to identify
potential gaps or friction points in the buying process and address them for improved customer
experience.

In conclusion, research on consumer responses to direct marketing approaches provides valuable

insights into consumer behaviour and preferences. Applying these findings in marketing strategies
can lead to more effective and targeted direct marketing campaigns. By leveraging personalized
content, analysing response data, and respecting consumer preferences, businesses can build
stronger relationships with their customers and achieve higher conversion rates in their direct
marketing efforts.

– ISSUES OF PRIVACY AND ETHICS.

Issues of privacy and ethics have become increasingly prominent in today's digital age, where vast
amounts of personal data are collected, processed, and shared by companies and organizations.
The advancement of technology and the widespread use of the internet have raised concerns about
how personal information is handled and the ethical implications of data-driven practices. Let's
delve into the details of privacy and ethics issues:

Privacy Issues:

a. Data Collection: One of the primary concerns is the extensive data collection by companies,
governments, and other entities. This includes personal information such as names, addresses,
phone numbers, financial data, browsing history, and even biometric data. Consumers often have
limited control over how their data is collected and used.

b. Data Breaches and Security: With the growing volume of data being collected, the risk of data
breaches and unauthorized access to personal information has also increased. These breaches can
lead to identity theft, financial fraud, and other forms of cybercrime

. c. Lack of Consent: Privacy concerns arise when individuals' data is collected without their
knowledge or consent. Many consumers may unknowingly agree to lengthy terms and conditions
without fully understanding how their data will be used.

d. Profiling and Behavioural Tracking: Companies often use consumer data to create profiles and
track online behaviour. This can lead to targeted advertising and personalized content, but it can
also be seen as invasive and manipulative.

e. Surveillance and Government Monitoring: Government surveillance programs and the collection
of mass data raise significant privacy concerns, as citizens may feel their rights to privacy are being
violated.
Ethics Issues:

a. Informed Consent: Ethical concerns emerge when companies do not provide clear information to
consumers about how their data will be used. Transparent and informed consent is essential to
respect consumers' autonomy and empower them to make informed decisions.

b. Data Use and Purpose: The ethical use of data involves ensuring that the collected information is
used only for the purpose for which it was initially collected and not for any unrelated or undisclosed
purposes.

c. Data Minimization: Collecting and retaining only necessary data, known as data minimization, is
an ethical principle that helps reduce the risk of data breaches and potential harm to individuals.

d. Fairness and Discrimination: Algorithms and data-driven decision-making processes must be

designed to avoid perpetuating biases and discrimination. Ethical concerns arise when data-driven
systems lead to unfair or discriminatory outcomes for certain groups.

e. Data Ownership and Control: The ethical implications of data ownership involve clarifying who
owns the data and giving individuals greater control over their data. Consumers should have the
right to access, correct, and delete their personal information.

f. Accountability and Transparency: Companies should be accountable for the ethical use of data
and transparent in their data practices. This includes providing clear privacy policies and disclosing
data-sharing practices.

g. Cross-Border Data Transfer: The global nature of data flows raises ethical considerations about
transferring personal data across international borders, especially when data protection laws differ
between countries.

Solutions and Best Practices:

a. Privacy Regulations: Governments and regulatory bodies have introduced data protection laws
such as the General Data Protection Regulation (GDPR) in the EU and the California Consumer
Privacy Act (CCPA) in the United States. These regulations aim to enhance individuals' privacy rights
and impose stricter data handling requirements on organizations.
b. Privacy by Design: Companies can implement privacy by design principles, which involve
incorporating privacy considerations into the design and development of products and services
from the outset.

c. Data Encryption and Security: Employing strong data encryption and security measures helps
protect sensitive information from unauthorized access and data breaches.

d. Anonymization and Aggregation: To preserve privacy, companies can anonymize and aggregate
data, removing personally identifiable information before analysis.

e. Ethical AI and Algorithm Auditing: Ensuring the ethical use of artificial intelligence and algorithms
involves auditing and testing these systems for biases and discriminatory outcomes.

f. User Education: Raising awareness among consumers about data privacy risks and how to protect
their information can empower individuals to make informed choices and safeguard their privacy.

In conclusion, the issues of privacy and ethics in the digital era require careful consideration and
responsible practices by businesses, governments, and individuals alike. Protecting personal data,
respecting individual privacy rights, and ensuring ethical data use are crucial steps in building trust
and maintaining a fair and responsible digital environment. Striking the right balance between data-
driven innovation and individual privacy is essential for the sustainable development of technology
and its positive impact on society.