Consumer Behavior

Contents
Introduction ................................................................................................................................................. 3

Consumer Behavior:..................................................................................................................................... 3

Model of Consumer Buying: ........................................................................................................................ 3

Marketing and other stimuli .................................................................................................................... 4

Customer understanding of Asda: .......................................................................................................... 4

Customer Understanding of Waitrose:................................................................................................... 4

Buyers Black box ..................................................................................................................................... 5

Buyer responses: ...................................................................................................................................... 7

Recommendation ........................................................................................................................................ 8

Social media has reinforced the power of reference group: .................................................................... 8

Recommendation and conclusion: ........................................................................................................... 10

References: ................................................................................................................................................ 10
Introduction
Consumer behavior is called the decision making process the behavior is associated with physical
activity which is relevant to acquiring, using and evaluating the goods and services. The definition
doesnt simply mean the buying process of goods and service. The process before the purchase.
And the before-purchase behavior of customer behavior is main concern of this report. I am a
marketing consultant am conducting a report which will be very informative for my clients Asda
and Waitrose and the clients will be able to understand the needs and demand of their customers
and can be able to make profitable business relationship with the customers.

Consumer Behavior:
Consumer behavior means a set of behavior the consumers likely follow. It is related with the
buyers of goods and service and the actual consumers of the goods and service. The question of
consumer behavior extends from how would we know what we want? Understanding consumer
behavior is very crucial and influential for any business organization which is related with the
manufacturing of product or in service. It helps the marketers to connect and communicate the
appropriate customers attracted to their offerings.

Model of Consumer Buying:

Consumer market is often termed as user market. It is also called business to consumer market or
B2C market. Consumers are the buyers who buy the products or services for personal use not for
the repeated sale. The process of decision making by consumer is different from the decision
making process of business organization and the industrials. There are mainly three components
in consumer decision making process. The three components are found by Kotler and Armstrong
(2007). These are Marketing and other stimuli, Buyer black box and buyer response.
Marketing and other stimuli
The consumer of products and services are confronted with various stimulus in the environment
around them. The environmental stimulus are two types. These are,

a) One stimuli is prepared by the marketer or presented through formulating is called

marketing mix, 4ps which are product, product, place, price, promotion.

Product: it includes Features, attributes, packaging and attributes. In Tesco plc. The products are
various types. In retailer shop the products are showed in rack.

Price: Price is associated with the value which is paid by the customers exchanging the product.
Which is called cost, value or esteem.

Place: Place is the location of product. The customers accessibility able the organization to make
sales. It is mainly the location of transaction.

Promotion: It is related with the accelerating the sales of the organization. Advertising, sales
promotion and direct marketing are the elements of promotions

b) The other factors are the environmental factors. The environmental stimulus are, political,
economic, technological and cultural.

Customer understanding of Asda:

Asda is a leading retailer and grocery shop in UK which is originally founded in 1965 but the
organization began to work with critical vision from 2010. The retailing industry of UK has
become very competitive and reactive from the previous years. So Asda needs greater insight in
customer needs to understand the changing needs of customers. The campaign which is named as
pulse of the nation has been launched in 2010 and Asda has got better invaluable visibility into the
customers. From the campaign the company has been able to refine the product lines, seasonal
promotions and broadly understanding the lifestyle of customers to make better business decision
(Fitzsimons, 2012).

Customer Understanding of Waitrose:

Waitrose is a chain of British luxury supermarket. Waitrose has unique selling and advertising
strategy which focuses on the selling point. The company is emphasizing on the quality of the
products. The production process efficiency is most important for the product quality. The
company has recently launched the program called E-CRM it is marketing tool. The purpose of
the program is to communicate with the customers with the database. The company has market
share 5%. The company shows a sign of strong growth in recent years including 8% rise in sales.

Buyers Black box

Buyers black box is a model which presents the customers dealt with the marketer and the
environment. There are two components of buyers black box. These are buyers characteristics
and buyers decision making process. The characteristics are composed with personal,
psychological and social (Kotler, 1998).

Personal:
Personal elements are age, life-cycle stage, occupation, economic situation, lifestyle, personality
and self-concept. Personality is termed as the set of traits these are psychological characteristics.
It has relatively consistent pattern toward the environment. Products or brand has some sort of
personality. The customers choose the brand which matches the personality of them. When we see
at Asda the retailer organization the brand shows trust and benefits through its appearance.

Psychological:

Psychological factors consist with motivation which expresses the urges to fulfill a goal or need.
Perception- sense about the environment which is the mechanism about the organization, selection
and interpretation of results. Fill (2007) states Learning is the process of permanent change in
behavior which is recognized for the change. The learning can be gained from the direct experience
or from the indirect experience from communicating with other such as to other users or with the
seller of the product. Beliefs are the basic subjective judgment of a person based on the feelings of
thought about something. Customers have phychological attachment with Waitrose because of
their convenient store location and comfortable shopping environment.

Cultural:

Culture is composed of knowledge, sum of total values, language, myths, beliefs, rituals and
customs. It exerts a greater influence of the customers mind. Clothing, eating pattern of people
are influenced by the cultural factors. There are some sub set of cultural effects which are valued
by different people of groups and the demographics. Social class is major factor of cultural
diversions. The behavior and the lifestyle of the customers largely depends on it. Income,
occupation, wealth, education are the major variables. Asda considers the cultural effects or
stimulus so that they have focused on the organic food strategy.

Social:

This one of the most influential factor which can largely affect the buyer decision making process.
Society is formed with family, institution, friends and relatives. People consumption priority
depends on the social factor. The group of people fall in same social class will respond to the
certain product in a same way. Groups are formed in a formal or in informal way. Reference group
of customers are considered as the direct membership groups and the inspirational group are the
indirect buyer (Smith and Fletcher, 2004).

The researcher have found the process of buyer decision making. There are five steps in buyer
decision making. The steps are given below:

Problem recognition
Information search
Evaluation and alternatives
Purchase decision
Post purchase behavior
Buyer responses:
The buyer of the product and services also takes decision which associates the brand, product,
timing, dealer and amount.

Model of industrial buying:

According to Castell and Thompson (2005) Business which buys the product for further
transformation, process and for the re-sale is called industrial buying. In industrial buying the
purchase decision is made for the sake of production. It is called business to business market of
B2B business. Business to business market is quite different in many aspect to the consumer
market. The transaction is high and the size of investment is huge.

Process of business or industrial buying is given below:

Kotler and Armstrong (2007) established the basic model of industrial buying. There are three
major components. The components are environment, buying organization and buyer response.
The working dynamics of business buying process is given below for better understanding.

The Environment:

According to Brown (2009) the environment around the business organization is consisted with
product, price, place and promotion. There are some other stimuli which are political, cultural,
technological and cultural environment. The environment also works as the opportunities and
strength of threats.

Environment has a great influence on the business of Waitrose. Recently The Company has the
training and development program for their first line managers to improve the efficiency.

Recommendation
ASDA and Waitrose need to be more efficient in understanding the customers demand
deep inside.
Traditional marketing strategy wouldnt be so useful in competitive business
environment.
The organizations can redesign and introduce new products and service considering the
market segments to keep the appeal of the organization.
Market research is very important for each business organization to get empirical data on
customers needs and demand.

Social media has reinforced the power of reference group:

The consumers are social and participating on various level of activities and the consumers are
involved in the social network and the communication of the customers are, media is open now.
Internet and online social work has made the virtual community. The way of communication of
the marketers and the consumer behavior is being changed by social media influence.
Informational society impacts on the decision making process and the product is evaluated. Social
media provides channel to the marketer to connect the appropriate customers and he customers
acquire product information through the communication.

Social media also influences other buyers the consumer has the power to influence other buyers
through giving their opinion and review on the product. There are other physiological
characteristics which shape the buying behavior of the consumer like purchase motivation,
company presentation and brand presence on various social networks and other demographic
variables.
For example Asda is looking for the emotional attribute on its own brand by adding the real social
media posts from the customers and communicating with them about the product packaging and
point of sale items.

According to Blythe (2006) Internet and the communities of transformed the societies and the
consumers to a wide access to the information the communication abilities have been increased
and social networks are defined as the website which links various types of uses from all over the
world. The interests of the consumers, their hobbies are shared through social networks, Blogs,
YouTube, Myspace etc. Facebook is a great example of social network site which is popular among
all level of customers. The user uses various form of communication. They share ideas about a
product, brand and about the features of the product. Immense popularity and unique appeal of
social media has broadened the practices of marketing in advertising and promotions. Social media
impact the consumers in acquisition of information and in post-purchase behavior. The statement
was given on product or on a company can be noticed by others.

The online marketers are slightly using the online spaces more carefully as the potential customer
backlash may happen. Recent marketing campaign of Waitrose has gone underway and backfired
some of the customers have twitted negatively.

The comments in twitter have impacted on the mind of the customers as the company is upper
class and expensive. The overarching strategy can increase the brand awareness but accidentally
confirmed the suspicions (Fitzsimons, 2012).

Business organization gets opportunity from the social media and the potential customers to
encourage the sense of intimacy with other customers. Keller (2010) mentioned it is important for
the business organization to make a potential relationship with the potential customers. The
organization needs to differentiate the brand image through which the consumers will be able to
differentiate the brand with its distinct look. The offers with distinctive advantages of the
organization should be communicated to the consumers. According to many marketers one
advantage should be communicated in social network to allow them to be attractive to the
prospective customers. Social media has higher level of efficiency in communicating with the
consumers than other traditional communication channel. Corporate presence is being increased
in social media and the granting likes are being included in the circles and the number of positive
and negative messages are found in a study. A study carried out in 2009 shows that top 100
companies in internet retailing had a profile on Facebook (79%). Another study shows that almost
62% consumers of USA generates online review and 98% are able to find the reviews which are
reliable (Malhotra, 2009).

Asda has launched the E-CRM program to strengthen the customer relationship. The customers
will be able deal with the company and will be able to get reviews and fix up the problems through
online (Fitzsimons, 2012).

Most of the consumers told that the reviews are very influential for the potential buyers and the
buying intentions are also affected by the reviews. Communication of brand image creates
favorable of less favorable image. The consumers consider them as information or purchase. The
interactivity of the social media plays a different role which depends on the message. When the
risk is perceived much it is wise to think more about the quality and the effectiveness of the product
as it will cost more money. A small amount of negative information about a product may have
substantial impact on consumer attitudes.

Malhotra (2009) Found social media communication allows the customers to connect their peers
and to networking with the friends which facilitates the communication and especially among the
groups. It exerts a noticeable influence on the behavior on consumer buying and influence the post
purchase decision of consumer. The social media websites gives the users their voice. The product
information can be provided which also facilitates the purchase decision of the consumer.

Recommendation and conclusion:

In this report various aspects of consumer behavior have been evaluated and analyzed under
various circumstances. Human behavior doesnt have a set of formats. There are various influential
factors in environment which can stimulate the purchase decision in different way. These stimulus
are driving force in purchase decision. Social media has a great influence in the mind of customers.
There are various factors in social media which enables the consumer to get perfect offer for them.
It enables the marketer to shape an appropriate offer for the consumers. Analyzing the consumer
behavior it can be said that the needs and demand of customers goes through in a continuous
changing situation.

References:
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Conference, Brighton.
4. Fill, C., 2007. Marketing Communications, Contexts, strategies and applications. 3rd ed. New
Jersey: Prentice Hall.
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