Part- I

Consumer Behavoiur and Its Applications

Chapter- 1

By:
Dr. Ajay Kumar
Prof. Kamal Singh

Consumer Behaviour & Marketing

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Part- I
Chapter- 1 About
Consumer theandBook
Behavoiur Its Applications
The book is divided into two parts. PART I describes the
psychological aspects of consumer behaviour with various
theories, models and principles of consumer behaviour and
PART II describes the field of marketing communication and the
institutions through advertising and various tools of sales
promotion.
This book is an attempt to introduce the subject ‘Consumer
Behaviour and Marketing Communication – An Indian
Perspective’. Here an attempt is made to explain each concept
with a lot of illustrations in Indian context. In this book, authors
have tried to explain the consumer behaviour as a science which
is derived from various disciplines like, economics, social
science, anthropology, etc.
Besides that at the end of the book, various cases and articles
are given which help the readers to explain more about this
discipline.
Consumer Behaviour & Marketing
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Part- I
Chapter- 1 About
Consumer theand
Behavoiur Author
Its Applications
Dr. Ajay Kumar is a senior professor of
management and marketing as well as Director at
BLS Institute of Technology Management, affiliated
to GGSIP University, New Delhi.
Dr. Ajay Kumar (b-1963) completed Master in Business
Administration from Birla Institute of Technology, Ranchi in
1987. He had his Ph.D. with U.G.C. fellowship on Strategic
Marketing from Patna University in 1993. With a professional
and academic career of more than 25 years, he is a leading
expert and highly respected teacher in the field of Strategic
Marketing Management, Branding and Consumer Behaviour. Dr.
Ajay Kumar has been recognized as an Honoured Member of
Cambridge WHO’S WHO 2011-2012 Edition for five consecutive
years for his contribution in the field of management, IT and
Mass Communication education. He has also been declared as
Man of the Year, 2012 by American Biographies.
Consumer Behaviour & Marketing
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Part- I
Chapter- 1 About
Consumer theand
Behavoiur Author
Its Applications
Prof. Kamal Singh is presently associated with
BLS group of institutions. Before plunging into
academics, he served with leading corporate
houses in retail sector for eight years, including
the Videocon group.
He did his Masters in Business Administration (MBA) in
Marketing/International Business from Guru Gobind Singh
Indraprastha University, Delhi. He is M.Phil in Management and
has been pursuing his Ph.D in management from NIMS
University, Jaipur. He also worked as faculty at Sriram Institute
of Management and Technology, Greater Noida (affiliated to
M.T.U). He also a visiting faculty of IMT – Center of Distance
Learning, and All India Management Association(AIMA), New
Delhi. He prepared study material on B2B Marketing for Pearson
Education. He has also written several articles and research
papers for reputed national and international journals.
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Part- I
Part- I
Chapter- 1 Contents
Consumer Behavoiur and Its Applications

CHAPTER 1
Consumer Behaviour and Its Application
CHAPTER 2
Consumer Behaviour and Market Segmentation
CHAPTER 3
Environment Influence on Consumer Behaviour
CHAPTER 4
Individual Determinants of Consumer Behaviour
CHAPTER 5
Consumer Decision Making

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Part- I
Part- I
Chapter- 1 Contents
Consumer Behavoiur and Its Applications

CHAPTER 6
Behavioural Based Safety Management
CHAPTER 7
Consumer Protection ACT, 1986
CHAPTER 8
Retail Consumer & Outlet Section Behaviour
Pattern
CHAPTER 9
Customer Relationship Management (CRM)
CHAPTER 10
Misbehaviour of Customer & Marketing Activities
CHAPTER 11
Consumer Loyalties Repeat Purchase Behaviour

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Part- I
Part- I
Chapter- 1 Contents
Consumer Behavoiur and Its Applications

CHAPTER 12
Introduction to Marketing Communication Mgmt.
CHAPTER 13
Advertising and Campaign Planning
CHAPTER 14
Integrated Marketing Communication
CHAPTER 15
E-Commerce an Effective Tool of Marketing Comm.
CHAPTER 16
Rural Buying

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Part- I
Part- II
Chapter- 1 Contents
Consumer Behavoiur and Its Applications

CASES AND ARTICLES

Cases

Articles

Bibliography

Index

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Consumer Behavoiur and Its Applications
Chapter- 1

Part- I
Chapter
1
Consumer Behaviour and
Its Applications

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Part- I
Consumer Behavoiur and Its Applications
Chapter- 1

Introduction
The field of consumer behaviour is the study of individuals,
groups, or organizations, the process they use to select,
secure, dispose of products and services, experience, or
ideas to satisfy needs and the impact of these processes
on the consumer and society. In other words, consumer is
defined as that consumer’s who shows interest in
searching for purchasing, using, evaluating, and disposing
of products and services that they expect will satisfy their
needs. Consumer is more than just how a person buys
products. It is dynamic, complex and multi-dimensional
process that reflects the totality of consumer’s decision
with respect to consumption, acquisition or utilization of
disposable products and services.
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Consumer Behavoiur and Its Applications
Chapter- 1

The discipline of consumer has borrowed heavily from

various other concepts such as: psychology, sociology,
social psychology, cultural anthropology and economics.

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Consumer: An Overview
Consumer is also defined as the dynamic interaction of
affect and cognition, and the environment by which human
beings conduct the interchange aspects of their life. In
simple words, it means that the buying of a consumers are
greatly affected by their thought process and the past
experience (cognitive). Buying of a customer is very much
influence by various factors such as- marketing stimuli,
opinion of others designing and packaging of the product
and its appeal or appearance.

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Definitions of Consumer
According to Solomon, “Consumer is the process of involved
when individuals or groups select, purchase, use, or dispose of
products and services, ideas or experiences to satisfy the needs
and wants.”

According to the American Marketing Association, “The

dynamics interaction of affect and cognition, and the
environment by which human beings conduct the exchange
aspects of their lives.”

According to Belch and Belch, “Consumer is the process and

the activities in which people engage in, when searching for,
selecting, purchasing, using, evaluating and disposing of
products and services so as to satisfy their needs.”
. Consumer Behaviour & Marketing
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Focus of an Organization’s Marketing Functions

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The 7 O’s Framework

The field of consumer studies how consumers (individuals
and groups) select, buy, use, and dispose of goods,
services, ideas to satisfy their needs.

To understand the consumers in the target market,

marketing managers rely on the 7 O’s framework of
consumer research.

7 O’s: Occupants, Objects, Objectives, Organizations,

Operations,
Occasions, and Outlets.

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Identification of potential customer needs and wants in order to produce
goods or services as per his/her desire.

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Characteristics of Consumer
1. Consumer is basically social in nature.

2. Buyer is complex and dynamic.

3. Buyer often behaves emotionally rather than

emotionally.

4. An individual is influenced by the internal and external

factors.

5. Consumer is an outcome of psychological and social

process.

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Elements/Factors that Influence Consumer

 Cultural Factors

 Personal Factors

 Social Factors

 Psychological Factors

 Innovation and Inventions

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Consumer Behavoiur and Its Applications
Chapter- 1
Importance of Study of Consumer Behaviour
The need of consumer holds a great interest not only for
the marketers but for other professionals also such as
consumers, doctors, students, decision makers or strategy
makers.

 Importance for Consumers

 Importance for Marketers

 Importance for the Students of Human Psychology

 Application to Decision-maker

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Consumer Approaches
Managerial Approach

It is more micro and cognitive in nature. It is micro in

emphasizing the individual consumer as regards to his
attitude, perceptions and lifestyle and demographic
characteristics. It also attempts to study the environmental
effects like references group, the family and culture and
their influence on the individual consumer. It is cognitive,
that is it emphasizes the thought process of individual
consumers and the factors that go into influencing their
decisions.

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A Holistic Approach

It is more macro in nature. It focuses on consumption

experience which is a culturally derived context of
consumption. Consumption is both symbolic as well as
functional.

Limitation of Holistic Approach: A holistic approach has its

own limitations. Firstly, many citicize it as being non-
actionable. Secondly, it overemphasizes on post-purchase
at the cost of pre-purchase. Thirdly, it is imperative to note
that all decisions are made through a process of
systematic processing. Hence a cognitive approach is also
important.
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Consumer Behavoiur and Its Applications
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Application of Consumer Principles in
Marketing
Consumer principles are applied in many areas of marketing
as discussed below:
Consumer and Marketing Management
Effective business managers realize the importance of
marketing to the success of their firm.

Marketing may be defined as,”the process of planning and

executing the concept of pricing, promotion and distribution
of ideas, goods and services to create exchanges that satisfy
individuals and organizational objectives”. A sound
understanding of consumer is essential for the long-run
success of any marketing program.
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Selecting Target Market

A review of market opportunities often helps in identifying

distinct consumer segments with very distinct and unique
wants and needs. Identifying these groups, learning how
they behave and how they make purchase decisions enable
the marketer to design and market products and services
particularly suited to their wants and needs.

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Consumer Behaviour and Marketing

Strategy
Understanding of consumer behaviour is very much
essential for influencing product decisions. Therefore it is
necessary for a marketer to collect information about the
target customers who are involved in decision making
while purchasing any product or services. As mentioned
above consumer behaviour is a complex, multidimensional
process. Marketers must have sufficient knowledge of
consumer behaviour in order to provide guidance to their
distributers, sales team and other channel partners to
improving their performance in their segment.

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Marketing Strategy and Consumer Behaviour

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Marketing Mix Determinations/Marketing

Mix Decisions
After understanding of unsatisfied needs and wants the marketer
has to determine the right mix of product, price, place and
promotion. Here study of consumer is helpful in answering a
number of questions about consumer needs and wants.
a. Product: The nature of physical product and service features
are concern here, among decisions that influenced by
consumer.
 What size, shape, and features should the product have?
 How should it be packed?
 What aspects of service are most important to consumer?
 What type of warranties and services program should be
provided?

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b. Price: The Second important factor is price. Marketer must

decide what price to be charge for the product or services.
These decisions will influence the flow of revenue to the
company. Should the marketer charge the same, higher, or
lower in comparison to competitors?

c. Place: Marketer must make decision that involves the

consideration of where and how to offer products and
services for sale. Decisions influenced by consumers
include:
 What type of retail outlet should sell the firm’s offering?
 Where should they be located, and how many should there
be?

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Consumer Behavoiur and Its Applications
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Use of Consumer Studies in Social and

Non-profit Marketing
Consumer studies are useful to design marketing
strategies by social, governmental and non-for-profit
organisations to make their programmes more effective
such as family planning, awareness about AIDS, crime
against women, safe driving, environmental concerns and
others UNICEF (greeting cards), Red Cross and CRY etc.
make use of consumer understanding. So the knowledge
about the consumer can serve as data for the development
of educational programs and other market related activities
by which strategic decision can be taken by the practising
managers.

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Chapter- 1

End
of Chapter

Thanks
Consumer Behaviour & Marketing
29 PPT’s By: A. Alam