Whenever we buy anything our final decision, as a consumer will definitely be affected by certain factors. Some of these major factors are as given below:
1. Cultural
2. Social
3. Personal
4. Psychological
The first stage of understanding buyer behaviour is to focus on the factors that determine he “buyer characteristics” in the “blackbox”. These can be summarised as follows:
Factors affecting Buyer behaviour
Each of these factors is discussed in more detail in our other revision notes on buyer behaviour.
The marketer must be aware of these factors in order to develop an appropriate marketing mix for its target market.
Now lets take a brief look at the various factors that we have mentioned above.
1 Cultural Factors
Culture is the most fundamental determinant of a person’s want and behaviour. The growing child acquires a set of values; perceptions, preferences and behaviour through a process of socialization involving the family and other key institutions.
Cultural factors have a significant impact on customer behaviour. Marketing are always trying to spot “cultural shifts” which might point to new products that might be wanted by customers or to increased demand.
For example, today there seems to be a cultural shift towards greater concern about health and fitness and that has created opportunities, now even industries, servicing customers who wish to buy products like:
· Health foods
· Fitness club memberships
· Exercise equipment
· Activity or health-related holidays etc.
Similarly our increased desire for “leisure time” has resulted in increased demand for convenience products and services such as microwave ovens, washing machines, ready-to-eat meals and direct marketing service businesses such as telephone banking and insurance.
Each culture contains “sub-cultures” – groups of people, which share values. Sub-cultures can include nationalities, religions, racial groups, or groups of people sharing the same geographical location. Sometimes a sub-culture will create a substantial and distinctive market segment of its own.
For example, the “youth culture” or “club culture” has quite distinct values and buying characteristics from the much older “grey generation” Similarly, differences in social class can create customer groups. In fact, the social classes are widely used to profile and predict different customer behaviour. Social class is not just determined by income. It is measured as a combination of occupation, income, education, wealth and other variables. Social Classes are relatively homogeneous and enduring divisions in a society which are hierarchically ordered and whose members have similar values, interests and behaviour.
A customer’s buying behaviour is also influenced by social factors, such as the groups to which the customer belongs and social status. In a group, several individuals may interact to influence the purchase decision. The typical roles in such a group decision can be summarised as follows:
Initiator
The person who first suggests or thinks of the idea of buying a particular product or service
Influencer
A person whose view or advice influences the buying decision
Decider
The individual with the power and/or financial authority to make the ultimate choice regarding which product to buy
Buyer
The person who concludes the transaction
User
The one who actually uses the product or service.
The family unit is usually considered to be the most important “buying” organisation in society. It has been researched extensively. Marketers are particularly interested in the roles and relative influence of the husband, wife and children on the purchase of a large variety of products and services.
There is evidence that the traditional husband-wife buying roles are changing. Almost everywhere in the world, the wife is traditionally the main buyer for the family, especially in the areas of food, household products and clothing. However, with increasing numbers of women in full-time work and many men
becoming “home workers” (or “telecommuting”) the traditional roles are reversing.
The challenge for a marketer is to understand how this might affect demand for products and services and how the promotional mix needs to be changed to attract male rather than female buyers.
Consumer wants, learning, motives etc. are influenced by opinion leaders, person’s family, reference groups, social class and culture.
3. Personal
Personal factors are those factors, which are unique to a particular person including demographic factors, Sex, Race, and Age etc. Personal factors also include who in the family is responsible for
the decision-making.
4. Psychological Factors
Psychological factors include:
· Motives—A motive is an internal energizing force that orients a person’s activities toward satisfying a need or achieving a goal. Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a marketing mix.
MASLOW hierarchy of needs is the theory, which explains concept of motivation through unfulfilled needs which could be any of the following:
· Physiological
· Safety
· Love and Belonging
· Esteem
· Self Actualization
· Need to determine what level of the hierarchy the consumers are at to determine what motivates their purchases.
· Perception
What do you see??
Perception is the process of selecting, organizing and interpreting information inputs to produce meaning. This means we chose what info we pay attention to, organize it and interpret it. Information inputs are the sensations received through sight, taste, hearing, smell and touch.
Selective Exposure- This means we tend to select inputs to be exposed to our awareness. This is more likely if it is linked to an event, and/or satisfies current needs.
Selective Distortion- This happens when we change or twist current received information, which is inconsistent with our beliefs.
Selective Retention- In this case we remember only those inputs that support our beliefs, and forget those that don’t.
For instance, an average supermarket shopper is exposed to 17,000 products in a shopping visit lasting 30 minutes-60% of purchases are unplanned and is also exposed to 1,500 advertisement per day. Hence they cannot be expected to be aware of all these inputs, and certainly will not retain many.
Interpreting information is based on what is already familiar, on knowledge that is stored in the memory.
· Ability and Knowledge
Learning can be said to be changes in a person’s behavior caused by information and experience. Therefore to change consumers’ behavior about your product, you need to give them new information regarding the product like free sample etc.
When making buying decisions, buyers must process information. Knowledge is the familiarity with the product and expertise. Inexperience buyers often use prices as an indicator of quality more than those who have knowledge of a product.
Non-alcoholic Beer example: consumers chose the most expensive six-pack, because they assume that the greater price indicates greater quality.Learning is the process through which a relatively permanent change in behavior results from the consequences of past behavior.
· Attitudes
we can say that attitudes are knowledge and positive and negative feelings about an object or activity. It maybe tangible or intangible, and living or non living. Generally it seen that attitudes drive perceptions We learn attitudes through experience and interaction with other people. Consumer attitudes toward a firm and its products greatly influence the success or failure of the firm’s marketing strategy.
For instance, Honda says, “You meet the nicest people on a Honda”, dispelling the unsavory image of a motorbike rider, in the late 1950s. Changing market of the 1990s, baby boomers aging, and Hondas market returning to hard core. To change this they have a new slogan “Come ride with us”. Attitudes and attitude change are influenced by consumer’s personality and lifestyle. Again, we tend to screen information that conflicts with their attitudes and distort information to make it consistent and selectively retain information that reinforces our attitudes. But, bear in mind that there is a difference between attitude and intention to buy i.e., ability to buy.
· Personality
One way of explaining personality is all those internal traits and behaviors that make a person unique, keeping in mind the fact that uniqueness arrives from a person’s heredity and personal experience. Examples include:
· Workaholism
· Compulsiveness
· Self confidence
· Friendliness
· Adaptability
· Ambitiousness
· Dogmatism
· Authoritarianism
· Introversion
· Extroversion
· Aggressiveness
· Competitiveness.
Traits affect the way people behave. Marketers try to match the store image to the perceived image of their customers.
· Lifestyles
You may have observed that recently trends in lifestyles are shifting towards personal independence and individualism and a preference for a healthy, natural lifestyle.
Lifestyles are the consistent patterns people follow in their lives. For Example you buy healthy foods to maintain a healthy lifestyle.
· Opinion Leaders
Opinion leaders basically play the role of spokesperson etc. Marketers try to attract opinion leaders...they actually use (pay) spokespeople to market their products. Say, for example Sachin Tendulkar (Pepsi, Visa , Biscuit, Adidas etc.)
· Roles and Family Influences
Roles are things you should do based on the expectations of you from your position within a group. People have many roles. Husband, father, employer/ee. Individuals role are continuing to change therefore marketers must continue to update information.
Family is the most basic group a person belongs to. Marketers must understand:
· that many family decisions are made by the family unit
· consumer behavior starts in the family unit
· family roles and preferences are the model for children’s future family (can reject/alter/etc)
· family buying decisions are a mixture of family interactions and individual decision making
· family acts an interpreter of social and cultural values for the individual.
The Family life cycle: families go through stages, each stage creates different consumer demands:
· bachelor stage
· newly married, young, no children...me
· full nest I, youngest child under 6
· full nest II, youngest child 6 or over
· full nest III, older married couples with dependant children
· empty nest I, older married couples with no children living with them, head in labor force
· empty nest II, older married couples, no children living at home, head retired
· solitary survivor, in labor force
· solitary survivor, retired
· Modernized life cycle includes divorced and no children
· Reference Groups
Individual identifies with the group to the extent that he takes on many of the values, attitudes or behaviors of the group members. Families, friends, sororities, civic and professional organizations. Any group that has a positive or negative influence on a person’s attitude and behavior.
Membership groups (belong to)
Affinity marketing is focused on the desires of consumers that belong to reference groups. Marketers get the groups to approve the product and communicate that approval to its members. Credit Cards etc.!!
Aspiration groups (want to belong to)
Disassociate groups (do not want to belong to) Honda, tries to disassociate from the “biker” group. The degree to which a reference group will affect a purchase decision depends on an individuals susceptibility to reference group influence and the strength of his/her involvement with the group.
· Social Class
An open group of individuals who have similar social rank. US is not a classless society. US criteria; occupation, education, income, wealth, race, ethnic groups and possessions. Social class determines to some extent, the types, quality, quantity of products that a person buys or uses. Lower class people tend to stay close to home when shopping, do not engage in much prepurchase information gathering. Stores project definite class images. Family, reference groups and social classes are all social influences on consumer behavior. All operate within a larger culture.
· Culture and Sub-culture
Culture refers to the set of values, ideas, and attitudes that are accepted by a homogenous group of people and transmitted to the next generation. Culture also determines what is acceptable with product advertising. Culture determines what people wear, eat, reside and travel. Cultural values in India are good health, education, individualism and freedom. In today’s culture time scarcity is a growing problem. So as a result there is a change in meals. Different society, different levels of needs, different cultural values.
Culture can be divided into subcultures:
· Geographic regions
· Human characteristics such as age and ethnic background.
Culture effects what people buy, how they buy and when they buy.of a conservative frame of mind, he feels emotionally attached to his original grocery business and continues to operate it with enthusiasm. His business place has even come to be associated with a meeting venue for people of his generation to meet. His children are grown up and the eldest one, Rajesh, has just returned from abroad after completing his management education there. Ambitious by nature, Rajesh would like to expand his business fast. He feels that he needs to be ‘professional’ in his approach. In his option, his father’s way of dealing with people is outdated. Many a times, he feels irritated when his father’s old friends drop in at the shops and spend time talking with him. Rajesh feels that this type of casual come together is a waste of time. He would prefer to be more
‘business’ like. He would to deal with them as customers only, serving them with precision and in a methodical manner. He expects that his customer should appreciate this ‘modern’ way of doing business. He has, however, broached his inner feelings only in an indirect way to his father, and he found that this father believes in maintaining close personal links with his customers. Some of the customers have, anyhow, started noticing the change in the way in which Rajesh deals with them. They feel that the old ‘warmth’ of their relationship with the senior Panjwani is somehow missing and they are now less welcome at the shops.
