Consumer Behaviour

The study of decision  making models plays an integral role in analysing the level of rationality of customer decision making. Namely, the concept of four modes of consumer decision making  proposed by O’Guinn et al (2011). The concept divides consumer decision – making into four different modes according to the level of their involvement, as well as, the level of their personal experiences with the brand.     High Involvement Low Involvement Low Experience Extended problem solving Limited problem solving High Experience Brand loyalty Habit or variety seeking   Extended problem solving Extended problem solving customer decision – making mode relates to a situation where customers lack experience in a specific consumption setting, nevertheless, the setting is perceived by them as a highly involving. The products are usually of a high value and they also contribute to an individual’s social status, however, their purchase is often associated with significant amount of risk in terms of making improper purchase decision. Purchasing the first car or the first house can be mentioned as instances for extended problem solving.   Limited problem solving Customer decision – making mode of limited problem solving, relates to a situation where both, customer experience, as well as, the level of their involvement are low. Considered to be the most common mode of decision – making, it lacks systematic approach in terms of decision – making. Examples for this mode of decision – making might include searching for and purchasing products and services associated with pest control within private properties. In other words, as Perrey and Spillecke (2011) confirm, limited problem – solving customer decision – making mode relate to situations where customers are attempting to find appropriate solutions to their unpleasant issues. Retailers often attempt to attract such type of customers by employing a range of marketing…

Consumer behaviour can be defined as “the totality of consumers’ decisions with respect to the acquisition, consumption, and disposition of goods, services, time, and ideas by human decision – making units” (Hoyer and Macinnis, 2008, p.3) and it is an important point extensively explored by marketers. In other words, consumer behaviour is the study of decision – making process and all activities that relate to acquiring evaluating, using and disposing associated with products and services. Moreover, the study of consumer behaviour involves learning customer perception about the company’s products and products of its competitors, the pattern of usage of the product by customers, customer attitude towards brand and product advertisements etc. There are wide ranges of factors that impact upon consumer behaviour in direct and indirect ways. Specifically, these factors include marketing initiatives engaged by businesses, culture, values and group norms associated with customers, demographic characteristics of consumers, as well as, their social status, customer motives to making a purchase, the nature of their personalities, etc. At the same time, “values, shared beliefs or group norms internalised by individuals, are developed through the process of socialisation and acculturation” (Saxena, 2009, p.163). Accordingly, recognising this fact, retailers attempt to formulate their integrated marketing communication strategies addressing and accommodating values, shared beliefs, and cultural differences associated with their target customer segment.    References Hoyer, W.D. & Macinnis, D.J. (2008) “Consumer Behaviour”, 5th edition, Cengage Learning Saxena, R. (2009) “Marketing Management” 4th edition, Tata McGraw-Hill Education

In the present marketplace, the customers are more informed than ever as they can reach out for the best offers available in the market, identify different alternatives by different companies, therefore, it can be said that they are the reasons for the best values to be created in the marketplace (Lancaster, Massingham and Ashford, 2002). Kotler and Kelly (2006) stated that Customer Perceived Value is the difference between the prospective customer’s evaluation of all the benefits and all the costs of an offering and the perceived alternatives. Customer Perceived Value is based on the difference between what the customer gets and what he/she gives for different possible choice.   The creation of Customer Perceived Value The marketers usually create value increasing the value of the customer offering by some combination of raising functional or emotional benefits and/or reducing one or more various types of costs. Even if the same product is being offered by two different companies, if one of the companies provides better customer services, post sales service, training, on-time delivery and maintenance, the perceived value of the same product tends to increase because of the reliability of the selling company and their added values when selling the product. Moreover, the more perceived value is also given to the company with a better corporate image as it indicates that the company is reliable and trustworthy, as it is one of the key factors in deciding when purchasing a product. However, the companies also face complexities as consumers have varying degrees of loyalty to specific brands, stores and companies. As Kotler and Keller (2005) state that the key to generating to high customer loyalty is to deliver high customer values. Furthermore, high customer values can also be delivered by offering the customer more than just the basic product but also extra…

A variable can be defined as “something that can be changed, such as a characteristic or value” (Cherry, 2011, online). There are various types of variables, but for this paper marketing variables can be divided into two groups: psychological and market related. Baker and Hart (2007) inform that psychological variables are the type of variables that are related to a process such as perception, motivation, personality, attitude, lifestyle etc. Each of these variables are complex on their own and are utilised by marketing professionals in order to achieve a desired outcome that is naturally to make a sale. At the same time it has been stated that “behavioural psychology ignores the complex mechanisms of the mind by dumping all the psychological variables into a ‘black box’” (Smith, 2003, p.84) The integral components of motivation as a psychological variable, according to Klein (2007), are needs, wants, and drive. If this concept is applied to furniture business it can be understood that furniture manufacturing and selling companies first attempt to arise a need for their products in the minds of perspective customers. Then the ‘need’ can be transformed into ‘want’ through the application of various marketing techniques. Consequently, an appeal to the ‘drive’ will be made by marketers through specific techniques, for instance indicating to the affordability of their products by introducing monthly instalment payment plans. For instance, in Habitat furniture stores in UK occasionally a member of staff offers a free glass of Champaign to customers upon entry to the store. Coupled with calming music or song, and motivating shopping environment this strategy often motivates customers to make a purchase from the store. Kozami (2002) links motivation to the theory of Hierarchy of Needs introduced by Abraham Maslow. According to the theory, the need of an individual is divided into five…