An Introduction

to Consumer
Behaviour
Topic 1
 Agenda
CB - Defined
CB - Some Aspects
CB - Importance
Basic Marketing Concepts
Summary
 Consumer Behaviour -
Definition

What is Consumer
Behavior?
Can Anyone Define it, at
least loosely?
 Consumer Behaviour -
Definition
Individuals or groups acquiring, using and
disposing of products and services
Arnould, Price and Zinkhan
Behaviour displayed by consumers in
searching for, purchasing, using,
evaluating and disposing of products and
services
Schiffman, Kanuk and Kumar
What are the steps involved in CB, from
the consumers angle?
 Consumer Behaviour -
Definition
Thus, CB involves the entire gamut
of activities - from need recognition
to post-purchase processes like
word-of-mouth and disposal
Please read the following handout
 Comments on Handout
Do you have any comments?
How does this relate to CB?
Can this be the case in India too?
 Comments on Handout
The handout reflects Peggys
lifestyle, which affects choice of
products and brands
For example, Peggys choice of
brands
It reflects her family life cycle stage -
if she were single, or without kids,
she would act different
It reflects her Motivation - what
makes her buy certain things?
 Comments on Handout

It reflects her attitudes - for

instance, her attitude towards
cooking, Toyota Sienna
It reflects her self-concept - the car,
for instance
It reflects her learning - for instance,
her cooking habits
 Comments on Handout
And so on
In general, it reflects how she
searches for, acquires and uses
products
 CB - Importance
Why Study CB at all?
What is the importance of CB?
What are some reasons why we
should study CB?
 Concepts in Marketing
Marketing Concept: Determine
Consumer Needs/Wants and fill them
better than anyone else, at a profit
The Consumer is thus the starting
point
Marketing starts with consumer
needs
Hence, marketers have to be
consumer focused always, consumer
obsessed, in fact
 Concepts in Marketing
Societal Marketing: Fill consumer needs,
at the same time, harm him/her & society
as little as possible
Thus, McDonalds faces lawsuits
Eco-friendliness is in vogue - CFC free
fridges the norm
Even Pepsi says it wants to be water
neutral
Thus, currently, the last two concepts hold
sway
Hence, CB is critical
 CB - Importance
Marketing starts with the consumer;
hence, CB is important
If Marketers knew what makes
consumers tick, they have it made
If a marketer can predict CB, it
would be wonderful for him
CB is useful from a public policy
standpoint as well; how?
 CB - Importance
If Govt knows what messages
consumers react to, can change their
negative behaviour
For instance, to reduce smoking,
prostitution, prevent AIDS, get
people to use condoms and so on
 CB - Importance
From a Sellers market to a Buyers
market
Bajaj used to make consumers wait
for years to get a scooter, now they
call you at home
Consumers are becoming more
powerful; rights have increased, -ve
WOM very powerful thanks to Net
 CB - Importance
Consumers are irrational agree?
Examples?
 CB - Importance
Dettol Vs. Savlon for e.g.
Consumers are maddening at times
Consumers wear specs easily, but not hearing
aids!
Consumers want 1 mm kitchen sink
Pears says transparent soap why should
anyone care?
Nestle Polo Mint With a Hole?!!
Craze for Apple products, Rajnikanth in TN
We love watches but do not care for time,
ours or others who said this?
 CB - Importance
Do fairness creams work?
Does Iodex or Amrutanjan work?
Why do women (and now
increasingly men) use cosmetics?
 CB - Importance
A number of example show
consumers are irrational
So what?
Why as a manager should I worry?
 CB - Importance
Because this irrationality is not
random
Can be modeled
Can be predicted to a large extent
Why do consumers behave the way they
do?
We will answer this in this course
 CB - Importance
CB can also be influenced
Key point
Not merely react to consumer wants
and motives
Can change them
We will see plenty of examples in this
class
 CB - Importance
Ice-cream market what is the shift
now?
 CB - Importance
The market is shifting from vanilla to
chocolate flavours
No one knows why maybe price
differential has come down
Hence constant watch of consumer
pulse necessary
Bajaj missed the scooter-to-bike trend
Now reverse is happening?
 CB - Importance
What campaign is NSE Nifty running
now?
Why?
Can they replace the Sensex as the
most popular brand?
 CB - Importance
For consumers, psychology plays a big
role
Act on perception, mistaken beliefs
How many of you keep your watches fast?
Sensex is high, everyone buys
Expecting it to go higher still
Low, everyone sells
More than high interest rates, hope of
lower rates impacts us harder
Jagdish Khattar
 CB - Importance
CB is the starting point of marketing
strategy
Assume you your product is Rs. 120
Want to reduce price to Rs. 60
Rs. 60 off or 50% off?
Should you be early mover/late mover?
And so on
Thus, CB is crucial
 A Note
Organisational consumers are also
consumers
However, this is B2B marketing
We focus on individual/non-
organisational consumers in this
course
 Summary
CB involves lots of activities
CB is very important and has its
genesis in the marketing concept
Lots of marketing decisions need to be
taken after understanding CB
We focus just on the individual
consumer