Individual Consumers And Their Behaviour example essay topic

Importance of understanding customer motives The task of marketing is to identify consumers' needs and wants accurately, then to develop products and services that will satisfy them. For marketing to be successful, it is not sufficient to merely discover what customers require, but to find out why it is required. Only by gaining a deep and comprehensive understanding of buyer behaviour can marketing's goals be realised. Such an understanding of buyer behaviour works to the mutual advantage of the consumer and marketer, allowing the marketer to become better equipped to satisfy the consumer's needs efficiently and establish a loyal group of customers with positive attitudes towards the company's products.

Consumer behaviour can be formally defined as: the acts of individuals directly involved in obtaining and using economic goods and services, including the decision processes that precede and determine these acts. The underlying concepts of this chapter form a system in which the individual consumer is the core, surrounded by an immediate and a wider environment that influences his or her goals. These goals are ultimately satisfied by passing through a number of problem-solving stages leading to purchase decisions. The study and practice of marketing draws on a great many sources that contribute theory, information, inspiration and advice. In the past, the main input to the theory of consumer behaviour has come from psychology. More recently, the interdisciplinary importance of consumer behaviour has increased such that sociology, anthropology, economics and mathematics also contribute to the science relating to this subject.

2 Social and cultural influences Culture is 'learned' behaviour that has been passed down over time, reinforced in our daily lives through the family unit and through educational and religious institutions. Cultural influences, therefore, are powerful ones and if a company does not understand the culture in which a particular market operates, it cannot hope to develop products and market them successfully in that market. It is important to recognise that culture, although immensely powerful, is not fixed forever. Changes in culture tend to be slow and are not fully assimilated until a generation or more has passed. An example of this is the custom of marriage, which has been openly challenged in the UK over the past twenty years.

When couples first began to set up home together and raise families outside marriage, society, for the most part, adopted an attitude of condemnation, whereas today there is a much more relaxed attitude to those who choose to ignore the convention. The twentieth century has witnessed significant cultural changes, for example, changing attitudes towards work and pleasure. It is no longer accepted that work should be difficult or injurious to mind or body, and many employers make great efforts to ensure that the work-place is as pleasant an environment as possible, realising that this probably increases productivity. Employees now more frequently regard work as a means to earn the money to spend on goods or services that give them pleasure, and not just to pay for the necessities of life. The shortened working week, paid holidays and labour-saving devices in the home have all led to increased leisure time that influences how, when and what the consumer buys. Another major cultural change in this century is the changing role of women in society.

Increased independence and economic power have not only changed the lives of women, but have also influenced society's and women's own perception of their socio-economic role. In most Western societies today, when considering culture, we must also consider subcultures. Immigrant communities have become large enough in many countries to form a significant proportion of the population of that country, and marketers must consider them because of their interactive influence on society and because, in some cases, they constitute individual market segments for certain product areas. Subcultures can also exist within the same racial groups sharing common nationality.

Their bases may be geographical, religious or linguistic differences and marketers must recognise these differences and should regard them as providing opportunities rather than posing problems. 3 Specific social influences 3.1 Social class This is the most prominent social influence. Traditionally, one of the chief determinants of social class was income. Since pay structures have altered a great deal in terms of the lower C 2, D and E categories moving more towards levels previously enjoyed by the higher A, B and C 1 categories over the past thirty years or so, classification of consumers on the basis of 'life style' is becoming more meaningful today.

Income aside, social class is an indicator of life style and its existence exerts a strong influence on individual consumers and their behaviour. There is evidence to suggest that whatever income level a consumer reaches during his or her lifetime, basic attitudes and preferences do not change radically. As consumers, we usually identify with a particular class or group, but often it is not the actual social class that is revealing, but that which the consumer aspires to. Income and / or education allows young people to 'cross's ocial class barriers and adopt life styles which are different from those of their parents.

They will tend to absorb the influences of the group to which they aspire and gradually reject the life styles of their parents and relations. It can thus be seen that occupation is a strong determinant towards an individual's behaviour al patterns, which includes buyer behaviour. When studying social class, the marketer should make decisions on the basis of information revealed by objectively designed research, without any preconceptions or associations with inferiority or superiority in 'lower' or 'higher's ocial groupings. This is the only way that changes in behaviour can be identified.

3.2 Reference groups This can be described as group of people whose standards of conduct mould an individual's dispositions, beliefs and values. This group can be small or large. Reference groups can range from the immediate family to the place of work. They can also be found in a person's social life. An individual is unlikely to deviate too far from the behaviour al norms laid down by the members of a club or hobby group. Reference group theory does not state that individualism cannot exist within a group, but it does suggest that even rigid independent thinkers will at least be aware of what is considered 'normal' within a group.

In a small group like the family the advice and opinions of those who are regarded as knowledgeable will be highly regarded. Such people are termed 'opinion leaders'. Extraneous to groups influences might also be at work in opinion forming, and here there is the existence of opinion leaders who are outside of the immediate group. Their opinions are taken up by 'opinion followers'. In the case of a number of products, a deliberate direct appeal is made to the so-called 'snob appeal'. This is done by using a marketing strategy of making a company's products acceptable to opinion leaders, or famous personalities (who are paid for their endorsement) in the hope that other sectors of the population will follow them.

The family is perhaps the strongest reference group for most people because of its intimacy and relative permanence. Strong associations means that individuals within this group will influence each other. The family life cycle traditionally contains six stages, although more recently different divisions have been quoted. These divisions are: 1. Unmarried Here, financial commitments and family responsibilities tend to be low, with disposable income being high. These younger unmarried consumers tend to be more leisure-orientated and more fashion conscious.

This segment thus comprises a very important market for many new and innovative products. 2. Young newly married couples - no children This group focuses its expenditure on those items considered necessary for setting up home. 3. Young married couples with children Outlay here is children-orientated, and there is little surplus cash for luxury items. Although they are receptive to new product ideas, this group sees economy as being the over-riding factor when making purchases.

4. Older married couples still with children at home Disposable income will probably have increased, often with both parents working and children being relatively independent. In some cases children may be working and the parents are able to engage increasingly in leisure activities often in the form of more than the 'standard' annual holiday. Consumer durables, including major items of furniture, are often replaced at this stage. Such purchases are often made with different motivations to the original motivations of strict functionality and economy that was necessary at an earlier life cycle stage.

5. Older married couples with no children living in the home Here, disposable income can be quite high. However, tastes are likely to be firmly rooted reflected in unchanging purchasing patterns. Thus marketers will have difficulty when attempting to change predispositions, so the best policy will be through attempts to refine and add value rather than to introduce new concepts and ideas. 6. Older retired couples and single people At this stage, most consumer durables have been purchased although occasional replacements will be required.

Purchasing is low and patterns of purchasing are conservative and predictable. This group of consumers is increasing rapidly. Such people tend to be less reliant solely on the 'State pension', many having subscribed to occupational pensions from former employers, which boosts the State pension. This allows this group to lead more active lives and the tourist industry now actively targets this particular market segment. In the past the tendency was for clearer demarcations of purchasing responsibility in terms which partner was responsible for which purchases. Nowadays, this distinction is far less clear cut as family roles have tended to merge in terms of women taking on traditionally viewed male roles and vice versa.

Marketers should, therefore, engage in research before determining whom to target for their marketing efforts. 3.3 Individual buyer behaviour As well as being influenced by the outside environment, people also have their own individual beliefs. It is important that we should know what these are in order that we can better understand how individuals respond to marketing efforts. Individuals are different in terms of how they look, their education, their feelings and their responses to marketing efforts.

Some will behave predictably and others less predictably according to an individual's personality. The individual consumer absorbs information and develops attitudes and perceptions. In marketing terms, this will affect an individual's needs as well as determining how to satisfy them. The task of marketing is to identify patterns of behaviour which are predictable under given conditions, which will increase the marketer's ability to satisfy customer needs, which is at the very base of marketing. In order to more fully understand this concept we shall concentrate on five psychological concepts which are recognised as being very important when attempting to understand buyer behaviour: o personality and self concept This means how we think other people see us, and how we see ourselves. As individuals we might wish to create a picture of ourselves that is acceptable to our reference group.

This is communicated to the outside world by our individual behaviour. Marketers are interested in this behaviour as it relates to our purchase and consumption of goods. The sum of this behaviour is an individual self-statement and is a non-verbal form of communication. This self image is expressed in a way which relates to our inner selves and this promotes acceptance within a group. Direct advertising appeals to the self image are now being made through behaviour al segmentation. 'Self' is influenced by social interaction and people make purchases that are consistent with their self concept in order to protect and enhance it.

The constant process of re-evaluating and modifying the self concept results from a changing environment and changing personal situations. Personality is the principal component of the self concept. It has a strong effect upon buyer behaviour. Many purchase decisions are likely to reflect personality, and marketers must consider personality when making marketing appeals. Psychological theory suggests that we are born with instinctive desires which cannot be satisfied in a socially acceptable manner and are thus repressed. The task of marketing in this context is to appeal to inner needs, whilst, at the same time, providing products which enable them to be satisfied in a socially acceptable way. o Motivation An early thinker insofar as motivation is concerned was the psychologist, Sigmund Freud who lived between 1856 and 1939.

His theories have been criticised since, but as a theorist, his theories are of fundamental value. He was responsible for identifying three levels of consciousness: o The conscious which includes all sensations and experiences of which we are aware; o The pre-conscious which includes the memories and thoughts which we have stored from our experiences and we can bring to mind when we wish; o The unconscious that is the major driving force behind our behaviour and this includes our wishes and desires of which we are not always aware. Within these levels of consciousness there are mental forces at work attempting to reconcile our instincts with the social world in which we live and these are not always in accord so we experience emotional difficulties. Freud's term for these are: o The 'Id' which is the reservoir for all our physiological and sensual instincts. It is selfish and seeks instant gratification regardless of social consequences; o The 'superego' which develops as we grow and learn from family, friends, teachers and other influences. It functions as our internal representation of the values and morals of the society in which we have grown up.

It is a potent force and comes into conflict with the demands made by our id for the gratification of what might be anti-social desires; o The 'ego' which attempts to resolve the conflict between the id and the superego and tries to redirect our id impulses into socially and morally acceptable modes of expression. Marketers are interested in motivation when it relates to purchasing behaviour. This behaviour relates to the motive for wishing to possess the goods or services in question, and it has been termed 'goal-related behaviour'. For a motive to exist there must be a corresponding need.

Motives like hunger, thirst, warmth and shelter are physiological. Others, like approval, success and prestige are psychological. Motives like staying alive are instinctive whilst motives like cleanliness, tidiness and proficiency are motives that are learned during life. We can also discern between rational and emotional motives. Most purchasing decisions are a composite of such motives, quite often a deciding factor might be price which is of course more of an economic restriction than a motive.

It can, therefore, be seen that a number of motives might be at play when making a purchasing decision - some motives stronger than others - and the final decision might be a compromise solution. In 1954 the psychologist Abraham Maslow put forward his classic 'hierarchy of needs' which is shown in Figure 1. This hierarchy is now central to much thinking in buyer behaviour. Self actual is- at ion Achievement qualifications Respect and self- esteem Social needs - recognition and belonging Safety needs - protection and security Physiological needs - hunger, thirst and shelter Figure 1 Hierarchy of needs (from A.H. Maslow) Physiological needs are concerned with self preservation and these are the basic needs of life involving those elements required to sustain and advance the human race. Safety needs relate to protection against danger and deprivation. Once the more basic needs have been satisfied behaviour is influenced by the need for belonging, association and acceptance by others.

In many texts the next two needs are put together, but here we have separated respect and self esteem in terms of confidence, competence and knowledge and have then placed achievement in terms of qualifications and recognition above this. The final need is what Maslow termed 'self actualization' which means self-fulfilment in terms of becoming all that one is capable of being and one has reached the pinnacle of personal potential. It is argued that when more basic needs like hunger ant thirst have been satisfied, then individuals will move towards satisfying higher order needs towards the apex of the pyramid and look increasingly for satisfactions that will increase status and social acceptability. When the apex of the pyramid has been reached and other satisfactions have been achieved the prime motivation is then one of acquiring products and accomplishing activities that allow self expression.

This can be in the form of hobbies, particularly collecting, which may have been desired for a long time, but have been neglected until the lower order needs have been satisfied. It is of course not possible to formulate marketing strategies on the hierarchy theory on its own. Its real value is that it suggests that marketers should understand and direct their effort at the specific needs of their customers, wherever the goods one is attempting to promote is in the hierarchy.