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Understanding Consumer Behaviour

Importance of Understanding Consumer Behaviour

Adnan Latif (Updated: 10.02.2017)






1. Consumer Behaviour:

There are many scholars and experts, who attempted to explain the consumer behaviour. The Consumer behaviour is defined as, “Study of the process involved when individual or groups select, purchase, use or dispose-of products, services, brands, ideas or experiences to satisfy their needs and wants” (Solomon et al., 2006).

2. Importance of Understanding Consumer Behaviour:

And there are several reasons for understanding the consumer behavior from marketer and also customer point of view (S M, 2008). From a marketer’s point of view, the understanding of consumer very important. Previously, the objective of marketing is to sell more products to customers, having more money for making more profit. But, now Customers are having more knowledge, information and they have more choices and also demographics has been changed, so it’s up to marketers to make them loyalty through identifying what they want, how they select and what makes them satisfied.

In addition, the understanding of consumer is not important for marketers but it also make sense from customer point of view as well. In fact; (a) the customer belongs to highly advance and developed societies, (b) the customer has varieties and range of attributes in products, (c) the customer has choices of payment and costs in prices, (d) the customer has facility of getting products at them home and (e) the customer has been getting a lot of marketing offers through commercials, banners, phone calls. So, understanding of consumer behaviour makes sense.

The above marketing concepts show the importance of consumer behavior for marketers, which shows that purpose of understanding consumer behavior, is attracting and keeping customers (S M, 2008). In the view of above arguments, the marketers have to understand the consumer behavior, we can say, the business environment has been changed as compared to previous century. Another reason for understanding the consumer behavior is about indicates towards the “Consumer loyalty”, which shows the frequency of consumer’s shopping of any product. The marketers want to observe the behavior of customers, from their frequency of shopping of particular product, to identify, which customers are profitable and which are less profitable. Here are following concepts about loyalty marketing strategies, Relationship Marketing (Novo, 2011), 80/20 Rule (Hudson,Ink, 2011), Life Time Value (LTV) of Customer (Digital River, 2009), Cost of Acquisition (Skok, 2009). Further, the consumer behavior is also affected by types of decision making process(Oxford, 2006).

The purpose of consumer behavior study is to collect knowledge about consumer needs and behavior, which are helpful in developing marketing strategies and understanding the market / consumer trend. But marketers find it very difficult for analyzing and track the consumer behavior due to following factors(S M, 2008), (KnowThis.Com, 2010),(Marketing Teacher Ltd, 2010).

Consumer Behavior is critical and challenging, because success of organizational objectives is based upon consumer behavior and marketing strategy and marketers has to understand, analyze and integrate the consumer behavior with developing effective marketing strategy, which creates difficulty for them.

The Study of consumer behavior is interdisciplinary, which is based upon theories, concepts and psychology of people, presented by scholars and philosophers covering the fields of economics, cultural anthropology, social psychology, sociology and psychology along with business environment (Marketing, management, finance and IT etc.).

The strategic marketing planning also requires from marketers to fulfill market needs along with improving standard of living of target society.

The consumer behavior is dynamic, once it has been identifies, it requires the continuous motivation to retain or keep loyal with brand.

There are several factors in daily life, which affect heavily in changing consumer behavior like change of demographics, reference groups, marketing campaigns from competitors and even company’s own marketing strategies.

The consumer behavior is uncertain, based upon complex variables and even some variables are not easily understandable, but affect the consumer behavior in terms of their relationships, impact and relevancy.

Each person is different in this world and Human mind is involving complex continuous activities which giving tough time to marketers.

The theory of consumer behavior is also evolving, as previously the theory was different in terms of focus, tools and application, but now it is much complex and requires hard time from marketers, as they cannot use the traditional measure and effect the consumer behavior.

Markets are containing lot of diversity of customers.

The prediction of consume behavior is also difficult due to different situation, like festivals, disasters, events, tour & journey and so on.

3. Using Consumer Behaviour Knowledge in Marketing Strategy:

The development of marketing strategies are heavily depends upon the consumer behavior because the objectives of organizational success is achieved through two factors, one, collecting information about consumer behavior, second, develop effective marketing strategy according to consumer behavior(S M, 2008). In simple words, the marketing strategy must be designed according to the consumer behavior, which involves the several implications for markers to develop the marketing strategies accordingly (lalitkhungar, 2011), (S M, 2008).

Integrate the consumer behavior and marketing strategy.

Identify the consumer needs and want according to dynamics of lifestyle, culture and sub-cultural and make adjustment.

Marketer should critically evaluate the cultural, lifestyle and other social influences on consumer behavior before going towards creation of effective and targeted marketing message for their campaigns.

Marketers must integrate well the information, collected from primary and secondary sources with Marketing Strategy Requirement and also compare with Internal Capabilities of Company to check feasibility.

For observing the consumer loyalty commitments, marketer must analyze their post purchase behavior like satisfaction or dissatisfaction.

Mainly, marketers must put their efforts in analyzing the decision making process of consumers in problem (need) identification, evaluation of alternatives and how they select and purchase the products to satisfy their need or problem.

Marketer should observe the emotions, personality and motivational drivers and their influence on consumer behavior.

Marketer must evaluate all the strategies, used for addressing pre-purchase and post-purchase behavior along with the other decision of target segment like sources of information, outlet selection and mode of transportation and etc.

Markers should use their collection of results to select best target market, develop, implement and control the effective marketing planning In order to achieve marketing and organizational objectives.






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