CONSUMER BEHAVIOUR

Knowing your customer

Table of Contents
Introduction..................................................................................................................................2
1. Market Analysis....................................................................................................................2
1.1 PESTEL Analysis................................................................................................................3
1.1.1 Political.........................................................................................................................3
1.1.2 Economic Factors.........................................................................................................3
1.1.3 Social – Cultural Factors.............................................................................................3
1.1.4 Technological Factors..................................................................................................4
1.1.5 Legal Factors................................................................................................................4
2. Application of Perception theory for managing consumption habits towards public
transport........................................................................................................................................5
2.1 Exposure..............................................................................................................................5
2.2 Attention..............................................................................................................................6
2.3 Interpretation......................................................................................................................7
3. Strategies for changing the attitude of local customers towards public transport...........9
3.1 Increase investments on transportation............................................................................9
3.2 Using a network approach for public transport planning.............................................10
3.3 Governance of informal transport systems.....................................................................10
3.4 Providing high-frequency, reliable services....................................................................10
3.5 Adopting new technologies and introducing mobile apps..............................................11
4. Application of classical conditioning theory for developing promotional strategies for
public transport in Sri Lanka....................................................................................................12
4.1 Classical conditioning theory...........................................................................................12
4.2 Giving an attractive identity for the public transportation systems.............................13
4.3 User Experience................................................................................................................13
4.4 Social Media Campaigns..................................................................................................14
Conclusion...................................................................................................................................15
References...................................................................................................................................16

1
Introduction
Micro Cars is a Sri Lankan based automobile company that expecting to shift into the
new scope by launching a service facility for luxury buses in Sri Lanka. The report is
started by a market analysis to get an idea about the transportation industry in Sri Lanka.

The second section discusses about the application of perception theory in managing the
consumption habits towards the public transportation. Next, strategies are suggested to
change the attitude of the local customers towards the public transportation. Finally,
classical conditioning theory is discussed on how it can be used develop promotional
strategies.

2
1. Market Analysis
Sri Lanka is currently possessing an 8.1 million vehicles that are regarded to be moving
over 35 billion vehicle km yearly (Transport.gov.lk, 2021). The transport activities have
increased by 5% annually with a 4% increase in per capita mobility. The road
transportation is accounting for 93% of passenger travel with 98% of freight travel. Out
of that buses are responsible for 61% of the passengers while the paratransit in terms of
three wheelers and taxies are 6%. Transportation in Colombo is most dominant, and it is
estimated that 220,000 of vehicles are entering the city carrying about 1 million
passengers daily. Out of the 1 million passengers, 68% are using buses, 5% is using
railways and 26% is using private transport (Transport.gov.lk, 2021).

Overall, the growth of the passenger travel is keeping a positive correlation with the per
capita income. This currently reflects an average per capita mobility of 4000 passengers
with a vehicle use of 1,000km per person yearly. As per the international norms, this
accounts for 3 times personal mobility of the countries that are within the income range
(Kumarage, 2018).

1.1 PESTEL Analysis

1.1.1 Political
The political aspect of Sri Lanka has always known to be unstable leading to instabilities
in rules and regulations. Therefore, it is important for Micro company to be extra cautious
about the changes that are coursing changes in policies and laws.

Beside from that, we can identify that the public sector transport service is in loss to the
political influences. The public transportation authorities have become a hub for
recruiting the people who are supporting to the political parties in power. Due to this
politicalizing, problems concerning to over staffing, unskilled management and
leadership has occurred. The departments are running on losses due to these concerns.

Moreover, recent government policies over restricting vehicle imports to the country has
led to a major rise in the vehicle prices limiting the private vehicle purchases.

1.1.2 Economic Factors

Currently, the rise in inflation and depreciation of rupee against the dollar, purchasing
power of the Sri Lankan people have decreased. The economic growth is a negative value

3
due to the contraction of tourism and manufacturing. This led to increase in
unemployment, decrease in per capita income and heavy increase of foreign debts.

On the other hand, devaluation of rupee has created problems in buying important
imports like fuel that are necessary for the transportation. This has led to an increase in
the fuel prices whereas increases in the fuel price will be encouraging the passengers to
switch into more affordable public transportation modes. Similarly, government policies
over restraining the vehicle imports has created a scarcity of vehicles in the country
leading to higher unrealistic price.

1.1.3 Social – Cultural Factors

From the societal end, nowadays people are more concerned towards the environmental
impact and they are more becoming conscious towards greener solutions. They prefer to
consume goods and services that can have a lesser impact on the environment. In that
aspect, vehicles running through fuel is often criticized for carbon emission to the
environment. Hence there is a sector of people who are preferring to use option like
walking and cycling. This is also a result originated towards the concern for health and
fitness.

The issues like overcrowdings in cities like Colombo has created heavy traffic jams,
difficulties and driving and parking issues. This has led some of the passengers towards
switching to the public transport.

1.1.4 Technological Factors

The transportation industry from the international levels has undergone through a lot of
technological advancements. The services like path navigators, wireless communication
facilities electronic payment cards and so on. Sri Lanka is lagging when its coming to
new technological adoptions.

Sri Lanka’s public transportation is often operated with the age-old technologies whereas
creating lot of inconveniences for the passengers.

1.1.5 Legal Factors

The ministry of transportation is the governing body for transportation in Sri Lanka. They
are responsible for determine the transportation fees for the public transports. There are

4
other laws in place in terms of traffic laws and all the vehicles on the road should be
tested upon carbon emissions (Zhu, 2019)

2. Application of Perception theory for managing

consumption habits towards public transport
Perception can be defined as a process of selection, organization, and interpretations of
sensations by the humans. It can also be described as the immediate response to the
sensory receptors (eyes, ears, skin, mouth, nose) (Rothschild, 1981). A stimulus is
activated through a sensory receptor. The studies on perception are centered upon the
idea that what is being added on the raw sensation for giving a meaning (Taylor, 2006).

Basically, perception is categorized into 3 aspects as exposure, attention, and

interpretation (Fajen, 2003). The following section is aimed at critically evaluating these
3 aspects of perception theory in management of consumptions habits towards the public
transport.

2.1 Exposure
Exposure is resulted through an arrival of a stimulus to sensory receptors of a person.
This can be a sight, touch, or a smell. Consumers are more likely to be concerned over
one specific stimulus while being completely off another. This was they can go ahead
without ignoring certain messages in the process (Khuong, 2015).

Smell – A smell can be good, or bad (aroma/odor) A smell can stir up emotions or calm
down the people. Smell can also evoke memories within the people to act as a mind
relaxer.

The Micro company can incorporate mind relaxing aromas in their luxury buses whereas
the passengers would feel comfortable and will be getting that sense of relaxation when
traveling. When compared to TATA buses that are commonly seen the Sri Lanka that are
often not scented, this can create a different impact on the mindsets of the people.

Sound – The send of sound is interrelated with the emotional of the people whereas it has
an impact over brand interpretations.

5
Micro can incorporate sounds that are not disturbing the passengers when traveling.
Disturbing noises that are coming when traveling on the vehicles create a disturbance to
the people. Hence, the busses should be efficiently assembled in a way that disturbing
noises will not be occurring.

On the other hand, planting radios and sound systems can help the passengers obtain a
relaxing traveling experience. However, should be mindful that the volumes can be
controlled, and the music will not be disturbing to the ears.

Taste - Taste is the sensory receptors through the tongue which in this scenario can not
be applicable.

Touch – Individuals are also stimulus to touch whereas touch is an important regard in
consumer behavior. When it comes to the Micro buses, the seat arrangements can be
designed in a comfortable manner whereas the people will feel comfortable and cozy to
travel in those.

Vision – Vision is stimulus occurred through what is seen by an individual (Gibson,

2014). Vision is a hot element in advertising, designing, and packaging. The marketers
can communicate the meaning of the products through visual channels such as color, size,
and fashion.

Vision is an important aspect when it comes to the public transport. It is identified that
colors evoke specific emotions within people whereas for transportation vehicles colors
like red, yellow, and blue can draw a special attention as those colors represent energy,
vibrancy and calmness.

2.2 Attention
Attention can be referred as the extend to which a processing activity is devoted by a
specific stimulus. This is dependent upon the characteristics of the stimulus as well as the
recipient. Often the consumers are found in a state of sensory overload whereas they are
exposed to a lot of information that are hard for them to process (Guerreiro, 2015). For
instance, when it comes to marketing, we are always bombarded with marketing stimulus
that are in a competition to get our attention. In this scenario, as explained through the

6
exposure aspects we have to find the correct approach to get the attention of the
customers through the stimulus that were generating in the exposure stage.

Ways to get attention are mostly the size, color, position, placement, and shock.
Therefore, through using these aspects the attentions should be drawn towards the public
transportation.

2.3 Interpretation
Interpretation can be described as the meaning that we are assigning towards the sensory
stimuli. The ways of perceiving stimulus are different to everyone. Therefore, meanings
assigned to each stimulus are different from people to people. Two people who are
hearing the same sound, can interpret it in different ways (Niosi, 2021.). The meanings
that are assigned to the stimulus are depended upon the beliefs that we have assigned to
it. Thus, the identification of the correct belief is crucial from marketing decisions as it
determined the criteria that is used by the consumers to evaluate the product, design
package or the perceived message (Rory, 2021).

In addition to the mindset of receiver, the characteristic of the stimulus also plays an
important role in regarding to notified or ignored. It is mandatory for the marketers to
understand these factors for creating a better chance for cutting through the clutter and
deliver the correct message

▲ Novelty— Stimuli that occur in unusual ways or places tend to catch our attention.
One option is to position advertisements in unusual areas where there is less rivalry for
attention.

One solution is to put adds in conventional places like memes in social media with
underlying messages to promote the need for public transport. The idea is clearly
communicated, and people often will not expect to see ads on public transport especially
through memes.

▲ Position— Stimuli that are in areas where are more inclined to look have a greater
probability of being noticed. This is can be the opposite to novelty whereas placing
messages in the expected place.

7
In the contexts of public transport, posters and billboards can be displayed on highways,
beside roads. Especially when people are stacked on traffic jams seeing a message on the
road that promotes the idea of conveniency of public transport can give the correct
message at the correct position.

▲ Size— The magnitude of the stimulus in comparison to the competition aids in

determining whether it will attract attention.

▲ Color— Color can be regarded as powerful way of drawing the attention towards a
product or service. Marketers use various colors to draw the attention of people whereas
the colors are capable of interpreting of the brands.

Red and yellow is often used to communicate speedy and energy whereas the public
transport modes can be colored with those colors and the adverts displayed can also
include those colors in their messages. Also, the redesigning of the logos can be done in a
way that giving the intended impressions.

8
3. Strategies for changing the attitude of local customers
towards public transport
As per the projections, 87.1% of the vehicles on the road and private owned vehicles. Out
of the about 5.7% if vehicles are owned by the public transport with the majority being
buses. The number of private vehicles on the road is surpassing the minimum vehicle
request to be in roads for a smooth flow of traffic (Kumarage, 2018).

On the other hand, this increase in the private vehicle proportion has many implications
over the environment. As a result of this a boost of air, sound and water pollution has
been created within the country. Therefore, it is mandatory to shift into the public
transportation structure that will limit the number of vehicles on the road.

The following strategies can be used to change the customer attitude towards the public
transport.

3.1 Increase investments on transportation.

It is essential to conduct investments concerning to the infrastructure facilities and public
transportation within the country whereas leading people to choose public transportation
options.

In that case building bus lanes and increasing bus service frequency can be implemented
with relatively low investment and lesser time. On the other hand, developing the road
systems and developing bus stations, railway stations and with all underlying facilities
can motivate the people towards selecting the public transportation options. The bus
stations railways stations can be consisted with shopping centers and located in accessible
places whereas people will find it convenient.

3.2 Using a network approach for public transport planning

Encouraging network approach for transportation planning, fares and operations includes:

9
Physical planning – Passengers must be able to quickly switch from one transportation
mode to another mode reach their destinations. Thus, mass transit lines, including
walking and cycling facilities, should be designed to intersect.

Integrated fares – Payment systems should be designed in a way that the passengers will
have to pay only once for the journeys that are having multiple transits. A smart ticketing
system can be introduced whereas fare can be charged as per the specific journey and the
travel frequency of the passenger.

Integrated operations – The public transportation should be centralized under one

government department or outsourced to the private agency. It will facilitate the seamless
integrations of timetables, smart ticketing, maintaining the standards and helps in finding
the information.

3.3 Governance of informal transport systems

In Sri Lanka buses on the road are operated by the government as well as the private
sector. When it comes to the private sector, it is prominently seen that the service is
solely aimed at increasing the profits and not concerned about the passengers. For
example, most of the private buses are not properly maintained, overcrowded, not
adhering to traffic guidelines, and filled with uncomfortable noises. These
inconveniences have led to decrease the interest of people towards the public transport
whereas they start seeking the comfort of their own private vehicles.

The government can introduce necessary actions and laws that are required to give the
adversities created through these private bus services. My implementing rules like
number of maximum passengers allowed, heavy fines for traffic violations and so on the
trust within the people can be win towards the public transport.

3.4 Providing high-frequency, reliable services.

The bus system is separated into main roads and local roads, each with a distinct
frequency. Bus service on major metropolitan thoroughfares and long-distance highways
will be required to be frequent, at least for every 10 to15 minutes. This will help the
travelers the reduce the waiting time and be able to turnup for the buses without referring
the schedule.

10
3.5 Adopting new technologies and introducing mobile apps
The public transportation authorities can use the advantages of new technology such as
introducing mobile application to make service more accessible and convenient. It can
also help to collect data for decision making, feedbacks, reduce operational customers
and win the over more younger crowds.

The mobile applications can be used for various purposes like viewing the schedules,
booking tickets, doing the payments, doing the inquiries. In a more advance way these
apps can used by the passengers to locate their buses and knowing the arrival times.

11
4. Application of classical conditioning theory for
developing promotional strategies for public
transport in Sri Lanka.
Psychology and the study of consumer behavior can be regarded as one of the most
influential tools in branding and advertising (Mullen, 2013). When they are employed in
an ethical and respectful banner, the brands can attract the right sent of audience and
compel them to purchase products and services. Also, it helps to build meaningful and
mutually beneficial interrelations with the brand and customers. The consumers decisions
are influenced by thousands of things. One of the most influential—and elusive—
influencers is that we have been accustomed to respond to, be drawn to, and crave certain
brands, goods, and services over time. The customers have learned how to respond to
those things. Particularly the behaviors that influence the purchasing decisions (Foxall,
1994).

4.1 Classical conditioning theory

Classical conditioning theory was brough forward by the Russian physiologist called Ivan
Pavlov. He trained his dog to associate the ringing of a bell along with food. After
sometimes, he noticed that the dogs were salivating when hearing the bell even with no
food around (Allen, 1985)

The classical conditioning theory is centered upon the idea of learning through repetitions
(Olson, 2001). The goal of the theory is to create a spontaneous response towards a
specific situation by repetitively exposing the consumer to a particular stimulus (brand,
product, service). The conditioning theory can be applied when developing the
promotional strategies for public transport as follows.

4.2 Giving an attractive identity for the public transportation systems.

When it comes to the public transport in Sri Lanka, it is very rare that anyone would be
talking about it with a pleasant mind. Complains and customer dissatisfaction involved
with the public transportation is very higher.

12
The first thing to do is to take actions to change this negative mindset that is built around
public transport over the years. In addition to that, there is a common belief in the society
that the public transportation is for the people from the lower income classes, and it is not
fashionable to use public transportation.

Thereby, the intelligent public relations should be created aiming to improve the public
image over the society. The marketing campaigns should be highlighting the ideas one
convenience of public transport, environmental concerns, positive stories from
individuals who are using public transport.

The advertising can be created by highlighting the concerns like how the traffic would be
minimized when travelling together instead of traveling along.

4.3 User Experience

The user experience is a determining factor in decisions to use the public transportation.
The experience is reliant upon the convenience, safety, Comfortability, affordability, and
accessibility specially to the vulnerable groups. For instance, the government of Delhi has
made public transport is free women with the aim of encouraging women to use the buses
which will in turn increase the number of women increasing the safety for them
(Mudghaa, 2021).

13
In a similar context, the taking initiative towards increasing the user experience will give
the customers a hands-on user experience motivating them to use it repeatedly.

4.4 Social Media Campaigns

Gustavo Petro, a former mayor from Bogota has stated that “A developed country is not a
place where the poor people are having cars but a place where the rich people are using
the public transport”

A social media campaign can be followed with the above-mentioned idea which can
create an influential impact over the youth generation especially the millennials and Gen-
Z generations as they are more susceptible such ideologies.

Such that way, contents should be created incorporating some strong messages that create
the perception among the people that how public transportation can bring out solutions to
many underlying problems like traffic, environmental concerns and so on. Once the idea
is planted that way people can start to look at the public transportation in that aspect
without seeing it as an inconvenient transportation mode that is not fashionable. Instead,
public transportation will become the new fashion for people.

14
Conclusion
The management of the Micro car is considering expanding into a new scope through
launching luxury buses in Sri Lanka. Therefore, a market analysis was carried out to
understand the transportation industry in Sri Lanka. Then the three aspects the of the
perception theory was discussed to manage the consumption habits towards the public
transport.

Strategies were suggested to change the attitude of the local customers towards public
transportation. Finally, classical conditioning theory was used to propose promotional
strategies for public transportation industry in Sri Lanka.

References

15
Allen, C. a. M. T., 1985. A closer look at classical conditioning.. Journal of consumer research,,
pp. 12(3), pp.301-315.
Fajen, B. R. a. T. M. T., 2003. ‘Perception, Categories, and Possibilities for Action’,. Adaptive
Behavior,, pp. 11(4), pp. 276–278.
Foxall, G., 1994. Behavior analysis and consumer psychology.. Journal of Economic Psychology,
pp. 15(1), pp.5-91.
Gibson, J., 2014. The ecological approach to visual perception: classic edition.. In:
s.l.:Psychology Press.
Guerreiro, J. R. P. a. T. D. .., 2015. Attention, emotions and cause-related marketing
effectiveness.. European Journal of marketing.
Khuong, M. a. T. V., 2015. The effects of emotional marketing on consumer product perception,
brand awareness and purchase decision—A study in ho chi Minh City, Vietnam.. Journal of
Economics, Business and Management, pp. 3(5), pp.524-530.
Kumarage, 2018. .files.wordpress.com. 2021. [online] [Accessed 16 September 2021].. [Online]
Available at: Available at: <https://kumarage.files.wordpress.com/2015/03/2010-r-02-tp-
kumarage-a-s-review-of-sri-lanka-transport-sector-world-bank-319pp.pdf>
[Accessed 13 September 2021].
Limbad, S., 2013. The application of classical conditioning theory in advertisements..
International Journals of Marketing and Technology, pp. 3(4), pp.197-20.
Mudghaa, 2021. The Economic Times. DTC Free for Ladies: Free bus ride scheme for women
begins in Delhi.. [Online]
Available at: [online] Available at: <https://economictimes.indiatimes.com/news/politics-and-
nation/delhi-free-rides-for-women-in-dtc-cluster-buses-from-today/articleshow/718
[Accessed 17 September 2021].
Mullen, B. a. J. C., 2013. The psychology of consumer behavior. Psychology Press..
Niosi, A., 2021.. The Perceptual Process. [Online]
Available at: <https://kpu.pressbooks.pub/introconsumerbehaviour/chapter/the-perceptual-
process/>
[Accessed 17 September 2021].
Olson, M. a. F. R., 2001. Implicit attitude formation through classical conditioning. Psychological
science,. pp. 12(5), pp.413-417..
Rory, 2021. Definition of Perception in Marketing. [Online]
Available at: http://kolibri.teacherinabox.org.au/modules/en-boundless/www.boundless.com/
marketing/definition/perception/index.html
[Accessed 17 September 2021].
Rothschild, M. a. G. W., 1981. Behavioral learning theory: Its relevance to marketing and
promotions. Journal of marketing, pp. 45(2), pp.70-78.
Taylor, C. F. G. a. B. H., 2006. Use and effectiveness of billboards: Perspectives from selective-
perception theory and retail-gravity models. Journal of advertising, pp. 35(4), pp.21-34.

16
Transport.gov.lk, 2021. Ministry of Transport.. [Online]
Available at: [online] Available at: <https://www.transport.gov.lk/web/index.php?
option=com_content&view=article&id=26&Itemid=146&lang=en#vehicle-population>
[Accessed 17 September 2021].
Transport.gov.lk, 2021. Ministry of Transport.. [Online]
Available at: [online] Available at: <https://www.transport.gov.lk/web/index.php?lang=en#>
[Accessed 13 September 2021].
Zhu, C. a. G. D., 2019. A research on the factors influencing carbon emission of transportation
industry in “the Belt and Road Initiative” countries based on panel data. Energies,. pp. 12(12),
p.2405.

17