By - Charles Phan

What You Need To Know About Consumer Behaviour

image of shoppers

Why Consumer Behavior?

When you want to make a new product or create a marketing campaign, the most important thing you’ll be considering is consumer behaviour. Their behaviour and habits as well as their decision making process is what defines your next steps.

So, consumer behaviour is something that you really need to understand well, in order to sell your products or services.

Here are just some of the essentials on consumer behaviour that you have to understand.

What Is Consumer Behaviour?

Consumer behaviour represents the study of how individuals behave as they select products and services as well as how they make those decisions. This mainly revolves around individual psychology, personal motivations and their behaviors.

Understanding customer behaviour is important to businesses because they need to understand how their customers think so that they can figure out what they need, what their pain points are and how to best represent the product or service.

This research and study involves:

  • How marketing campaigns can influence consumers
  • How the environment affects the user
  • How  customers behave when making decisions and researching purchases
  • How consumers make choices
  • How they feel about some alternatives

By understanding how consumers interact with the product and  the market, you can fill the gap and see what is needed as well as how to present those products.

Which Factors Affect Consumer Behaviour?

Customers are affected by three main factors which encompass different events and situations in consumers’ lives.

1. Personal factors

Personal factors involve choices, interests, demographic data, preferences, dislikes and so on. These personal factors determine what the consumers will buy. For instance, most people need a car and eventually they will buy one. However, not everyone will buy the same car. Some people like sedan cars, some people like hatchback cars, some people like vehicles that can go off the road and so on. This will also depend on their demographics – age for instance, or their needs. People will also choose the colour, individual characteristics and so on based on their preferences, needs and other personal factors.

Of course, certain groups will choose similar products and services because they share similar personal characteristics.

2. Psychological factors

People often have  different perceptions of a problem or a product. This can be influenced by the situation, perception of needs and problems, as well as processing of the information and consumer’s attitude.

It’s the marketer’s job to take these psychological factors into account – how users perceive various products or services. People are often more heavily influenced by psychological motivations than the rational benefits they claim attracted them to the product. This is because we are not fully aware of our psychological motivations.

For example, branding is one of the ways to influence how the users perceive your products. Familiar brands will do better than those with no branding because of the mere exposure effect.

3. Socio-cultural factors

Socio-cultural factors include peer groups as well as social class, education, income and so on.

For one, peer groups affect how consumers see our products and how they make decisions. Someone’s mother or another family member could have a bad experience with a product or simply a bad perception of the product. If the consumer becomes aware of this experience or perception of a family member this can make them less likely to purchase that product themselves.

The same goes for friends or any other peer group.

Social class has a lot to do with how people see products as well. For instance, poor people  see things like smartphones or travel as a luxury while people in higher classes would take it for granted and may see it as essential. Education is another factor that creates a need for different products or services. For instance, an entrepreneur with high educational achievement is more likely to buy expensive software than a plumber with high-school education.

Income obviously affects which products consumers buy. Someone with lower income would buy a cheaper phone while someone with higher income will easily afford a high-end, new phone.

The Decision Making Process

Understanding how users make their decisions is essential for marketing campaigns and manufacturers. What makes them buy one product over the other? What affects their process of making that decision?

The crucial part here is to use this information to affect their decision making process through marketing campaigns and various marketing techniques.

1. Recognizing the need

The decision making process starts by recognizing the need. For instance, you recognize that you are hungry. However, it goes far beyond our primal needs. Marketers nowadays create needs. They place ads and other marketing material near places where a customer might feel a need. For instance, placing a coffee shop outside a train station may encourage commuters to buy a drink on their way to the office.

Customer then feels the need – they didn’t have it before but now they do. You could, for example, see the marketing material for a movie which you’ve heard about before but never felt the need to watch. However, after that marketing material you may want to see it. You need to see it.

2. Doing research

The next step in the decision making process is doing research. This partly depends on how much the customer desires the product. For instance, you want a phone – if you care about this product and you  want an attractive looking phone, you will invest time and effort into finding the perfect one. If you don’t, you’ll just get the first phone out there.

This is another place where marketers can insert their techniques. Creating material which clearly describes the benefits of their product can help users make a decision. Placing your product in the user’s mind during the research phase is much easier nowadays because of social media and online advertising.

3. Evaluating the product

This is the phase where users evaluate various criteria of the product. For instance, you need a good camera, nice speakers and good looks in your smartphone. You can then  compare all the phones you found during your research to those criteria.

Again, marketers can affect people in this part of the research. They can suggest criteria that the users might not have thought about during their search – in this case, it could be the customization options. This extra criteria is usually their value proposition.

4. Product choice and purchase

This is when a consumer makes a decision and buys a product. However, the job of a marketer isn’t done yet – they have a chance to offer complementary products. In the case of a smartphone, that might be a headset, a phone case, a memory card and so on.

“Offering complimentary products is really widespread now. I mean, a company could recognize by your behaviour that you have a new product in your hands and then offer you their products which would go well with what they already have. It’s smart marketing – it never stops,” says Micah Bellin,  a regular contributor to Draftbeyond.

5. Use of product and evaluation

Of course, after buyers get the product, they start using it. This is the phase where they can either be happy about their purchase or feel buyer’s remorse. Buyer’s remorse means that the buyer feels bad about purchasing a product. They might return it, make a complaint, never buy from the company again or spread the bad word.

This is where marketers have to take measures to prevent that. Smaller items often come with a money-back guarantee while bigger products get a warranty. Companies also have customer support that customers could call, live chat options, manuals for usage of products and so on.  It’s important that you make it easy for customers to find the right person to contact if they are dissatisfied in someway as other wise they may tell other people about their negative experience.

6. Disposal of the product

While product disposal didn’t use to be a big deal in any industry, customers and companies alike are striving for a more eco-friendly disposal. But some companies are boosting their sales by making their product more disposable more often. Microsoft Word, for instance, needs updates if you want to user the latest features and fix bugs that have been identified by users.

“Why do you think companies are always upgrading their products? If you buy a phone today, in a few months you’ll want a brand new one because it has a feature that you want or need. They are creating needs by disposing of old versions – not technically, because you can still use them, but by making the old versions seem less amazing than the new ones,” says Sally Weinstein, author at Researchpapersuk.

Some Behavioral Secrets You Should Know

Here are some amazing behavioural secrets that you should know about:

  • People make purchasing decisions based on emotions and then they rationalize it later.
  • People need to interact with the product before they buy it, but in an emotional way in order to store it in their long-term memory. This is the basis of a relationship.
  • People commonly lie to researchers. Not intentionally, but because they want to look better on paper. For instance, lying about alcohol consumption.
  • Branding is important because it signals to the subconscious mind which makes 95% of all purchase decisions.
  • Most customers aren’t buying the products for any tangible criteria but for the experience.
  • Most consumers are willing to pay 20-25% price premium of their favorite brand before they would switch to a competitor
  • The longer you communicate with the consumer, the more likely they will be to purchase.

Understanding of the Customer behaviour is essential knowledge if you want your marketing campaigns to work. Hopefully, these tips will help you in your marketing.

Image of Charles Phan

About the author: Charles Phan works as a content writer at Gum Essays. Chris has a degree in Marketing and enjoys writing about business strategies, entrepreneurship and startup companies.

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