Consumer Behavior and Purchase Decisions
Consumer’s interest to purchase a product or service always depends on the willingness to buy and at the same time ability to pay for the product. Though they are willingness and ability to pay then also the consumers change their buying decisions because of the influence of various factors such as psychological factors, personal factors, cultural factors, social factors, the influence of family members, economic factors and social media, etc.
An individual who purchases products or services for the purpose of using for himself/herself is known as an end user or consumer or the end user of the product or services is termed as a consumer. Consumer buying behavior always reflects why do consumers buy products with an interest? What are the factors influencing them? How do they take purchase decisions? Why should marketers know about status of consumption and impact of external environment on buyer’s decision, etc
Many studies proved that purchase decisions always depend on the perception levels of the consumers. The perception levels vary from one individual to another which may depend on need, influence, motivation, and finally how do they perceive things to take decisions. Consumer’s beliefs and attitudes show influence on the buying decisions, so the marketers should know that individuals thinking is unique.
Why not all the consumers buy same products or services? Another important factor it involves personal factors, occupation, age, gender, lifestyle, income levels and personality traits, etc show major influence on the buyer’s behavior. Here all the demographic factors can show a clear path to take various decisions to the marketers. If the marketers start observing consumer’s behavior then they know more and more about them. The age and gender of the consumers decide half of the market demand. Some people may give preference to brand image because of the nature of the society they live. Personality traits such as characteristics, interests, beliefs, and attitudes make a person to take the decision of purchase or not.
Culture refers to the set of values, beliefs, and ideologies of the society or group, where an individual learn from the family and society and follows. The way of dressing, wearing ornaments and eating habits, etc of a community is the result of cultural factors. These factors show influence on the markets, for example, the majority of combined families or nuclear families of a community is the result of culture, it decides the quantity buying.
Various social factors show influence on the consumer behavior, every individual follow the culture and trends of the society and they may be influenced by the various factors such as status, role in the society and reference groups. Purchase decisions of the consumers belong to various income levels and status shows an impact on the sales of a particular product or service. Reference groups include family members, friends, peers and relatives who can influence the buyer behavior and consumer purchase decisions.
Economic status of the individual and country rules the purchase decisions of the customers. If per capita income of individuals is less than a country’s economic condition becomes poor. Then the high-end products and services may not become successful in such economic conditions. So the wealth and income levels show maximum influence on the buyer’s purchase decisions.
Buyer’s decision-making process
Though there are many factors influencing the buyer’s decisions the final result of purchase may be the result of a single factor or due to all factors; consumer’s decision-making process involves recognizing the need, search for information, evaluation of alternative, purchase decision, and post-purchase behavior. So the decisions can be made before purchase, during the purchase of a product or a service and after purchase. Buyers respond to the need arise and they differentiate the needs as immediate needs and future needs, then they start gathering information for the immediate and future needs which are to be fulfilled. During this stage, buyers may be influenced by the reference groups, advertisements, social media and their own beliefs and perceptions. In the next stage, consumers develop various alternatives and evaluate properly and come to the purchase decision. Buyers can change their decisions at the last minute also, due to the internal and external influences. Through a series of steps, consumers come to a decision and buy a product or service, here the next challenge to the marketers is about the post-purchase behavior of the consumers.
The importance of knowing consumer behavior
Before launching a product, organizations have to consider the consumer buying behavior, various factors influencing them, tastes and preferences of the consumers. It makes them become successful in the market and it enables them to face the uncertainty also. So the behavior of consumers can act as a powerful tool to develop strategies for achieving objectives of the organization.
To design products or services
By knowing the tastes and preferences of the customers, marketers can design products to fulfill unmet needs of the buyers and proper market research enables organizations to know what to produce and how to produce. After internationalization, drastic changes occur in the tastes and preferences, which always encourages new products and services with better and innovative features. So the marketers should pay attention to know the needs of the customers.
For taking pricing decisions
Though there is a willingness to buy a product, then also consumers change their decisions because of the difference in the prices. The quality of the product may convince some consumers, but the income levels of the other consumers may not let them buy that product. Here the difference in purchase decisions is due to the monetary and price related issues. So while launching and fixing prices, marketers should follow various pricing strategies like penetration prices and skimming prices etc to maximize the sales and revenues.
To frame best promotional methods
Creating awareness is the best part of creating sales, so the organizations should study the markets and promote their products with various advertisement strategies. Though the quality of the product or service is good with better prices also, the sales may be less because of the customer’s unawareness about the product. Various promotional methods and advertisement campaigns can create awareness and helps in maximizing sales. Studying consumer’s behavior enables the marketers to frame the best marketing strategies like online marketing, offline marketing, and buzz marketing etc.
To decide where to launch a product or service
Sales of a particular product may not be similar in all geographic areas, it varies depending on the per capita income of the individuals, and economic status of the country and culture, etc. in the case of launching a new product marketer follow various factors of those particular geographic regions. For example, the demand for Sarees in India may not be same in other countries; likewise, the demand for various products varies with the areas where they are launched.
To create buzz
Marketers use psychological factors of the customers to create a brand image. By providing suitable products to a particular geographic segment, producing quality products, innovative products, and best-priced products can create value for the consumer’s money, fulfills the needs, tastes and preferences of the consumers. Marketers always try to make this happen because of which customer retention is possible and at the same time the consumer communicates to others through word of mouth, it creates buzz and memorable.