CU-BCOM-SEM-III-Consumer Behavior-Second Draft

BACHELOR OF COMMERCE SEMESTER III CONSUMER BEHAVIOR

First Published in 2021 All rights reserved. No Part of this book may be reproduced or transmitted, in any form or by any means, without permission in writing from Chandigarh University. Any person who does any unauthorized act in relation to this book may be liable to criminal prosecution and civil claims for damages. This book is meant for educational and learning purpose. The authors of the book has/have taken all reasonable care to ensure that the contents of the book do not violate any existing copyright or other intellectual property rights of any person in any manner whatsoever. In the event the Authors has/ have been unable to track any source and if any copyright has been inadvertently infringed, please notify the publisher in writing for corrective action. 2 CU IDOL SELF LEARNING MATERIAL (SLM)

CONTENTS Unit - 1: Introduction To Consumer Behavior ....................................................................... 4 Unit - 2: Models Of Consumer Behavior ............................................................................. 23 Unit - 3: Information Search Alternative Evaluation............................................................ 35 Unit - 4: Post Purchase Behaviour ....................................................................................... 46 Unit - 5: Types Of Buying Behaviour .................................................................................. 68 Unit - 6: Factors Of Consumer Behaviour ........................................................................... 84 Unit - 7: Motivation ............................................................................................................ 96 Unit - 8: Personality .......................................................................................................... 132 Unit - 9: Consumer Attitude .............................................................................................. 146 Unit – 10: Values And Lifestyle ........................................................................................ 161 Unit - 11: Factors Of Consumer Behaviour I ..................................................................... 169 Unit - 12: Factors Of Consumer Behaviour II .................................................................... 194 Unit - 13: Models Of Consumer Behavior ......................................................................... 207 Unit - 14: Online Consumer Behavior ............................................................................... 224 3 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 1: INTRODUCTION TO CONSUMER BEHAVIOR STRUCTURE 1.0 Learning Objectives 1.1 Introduction to consumer behaviour 1.2 Nature of consumer behaviour 1.3 Scope of consumer Behaviour 1.4 Factors influencing consumer behaviour 1.5 Significance of consumer behaviour 1.6 Basic components of consumer behaviour 1.7 Importance of Consumer Behaviour to market 1.8 Types of consumer behaviour 1.9 Summary 1.10 Key words 1.11 Learning Activity 1.12 Unit End Questions 1.13 References 1.0 LEARNING OBJECTIVES After studying this unit, you will be able to:  Explain about consumer behavior  Discuss the nature of consumer behaviour  Explain the scope of consumer behavior  Discuss the factors influencing consumer behavior  State the importance of consumer behavior 1.1INTRODUCTION TO CONSUMER BEHAVIOUR Consumer behaviour is defined as “the dynamic interaction of affect and cognition, behaviour and the environment by human beings conduct the exchange aspects of lives”. It means that the buying habits of the consumer behaviour are greatly affected by their thought process and

their actions by various factors like opinion of others, marketing stimuli like product, advertising, packaging and product appearance.Consumer behaviour is the study of how individual customers, groups or organizations select, buy, use, and dispose ideas, goods, and services to satisfy their needs and wants. It refers to the actions of the consumers in the marketplace and the underlying motives for those actions. Definition: According to Engel, Blackwell, and Mansard, ‘Consumer behaviour is the actions and decision processes of people who purchase goods and services for personal consumption’. Consumer Behaviour may be defined as “the interplay of forces that takes place during a consumption process, within a consumers’ self and his environment.This interaction takes place between three elements viz. knowledge, affect and behavior. It continues through pre- purchase activity to the post purchase experience. It includes the stages of evaluating, acquiring, using and disposing of goods and services”. 1.2 NATURE OF CONSUMER BEHAVIOUR The subject deals with issues related to cognition, affect and behaviours in consumption behaviours, against the backdrop of individual and environmental determinants. The individual determinants pertain to an individual’s internal self and include psychological components like personal motivation and involvement, perception, learning and memory, attitudes, self-concept and personality, and, decision making. The environmental determinants pertain to external influences surrounding an individual and include sociological, anthropological and economic components like the family, social groups, reference groups, social class, culture, sub-culture, cross-culture, and national and regional influences.The subject can be studied at micro or macro levels depending upon whether it is analysed at the individual level or at the group level. The subject is interdisciplinary. It has borrowed heavily from psychology (the study of the individual: individual determinants in buying behaviours), sociology (the study of groups: group dynamics in buying behaviour), social psychology (the study of how an individual operates in group/groups and its effects on buying behaviour), anthropology (the influence of society on the individual: cultural and cross-cultural issues in buying behaviour), and economics (income and purchasing power). Consumer behaviour is dynamic and interacting in nature. The three components of cognition, affect and behaviour of individuals alone or in groups keeps on changing; so does the environment. There is a continuous interplay or interaction between the three components themselves and with the environment. This impacts consumption pattern and behaviour and it keeps on evolving and it is highly dynamic.Consumerbehaviour involves the process of exchange between the buyer and the seller, mutually beneficial for both. 5 CU IDOL SELF LEARNING MATERIAL (SLM)

As a field of study it is descriptive and also analytical/ interpretive. It is descriptive as it explains consumer decision making and behaviour in the context of individual determinants and environmental influences. It is analytical/ interpretive, as against a backdrop of theories borrowed from psychology, sociology, social psychology, anthropology and economics, the study analyses consumption behaviour of individuals alone and in groups. It makes use of qualitative and quantitative tools and techniques for research and analysis, with the objective is to understand and predict consumption behaviour. It is a science as well as an art. It uses both, theories borrowed from social sciences to understand consumption behaviour, and quantitative and qualitative tools and techniques to predict consumer behaviour. 1.3 SCOPE OF CONSUMER BEHAVIOUR The study of consumer behaviour deals with understanding consumption patterns and behaviour. It includes within its ambit the answers to the following: ‘What’ the consumers buy: goods and services ‘Why’ they buy it: need and want ‘When’ do they buy it: time: day, week, month, year, occasions etc. ‘Where’ they buy it: place ‘How often they buy’ it: time interval ‘How often they use’ it: frequency of use The scope of Consumer Behaviour includes; 1) Consumer behaviour and marketing management: Effective business managers realise the importance of marketing to the success of their firm. A sound understanding of consumer behaviour is essential to the long run success of any marketing program. In fact, it is seen as a comer’s tone of the Marketing concept, an important orientation of philosophy of many marketing managers. The essence of the Marketing conceptis captured in three interrelated orientations consumers’ needs and wants, company integrated strategy. 2) Consumer behaviour and non profit and social marketing: In today's world even the non-profit organisations like government agencies, religious sects, universities and charitable institutions have to market their services for ideas to the \"target group of consumers or institution.\" At other times these groups are required to appeal to the general public for support of certain causes or ideas. Also they make their contribution towards eradication of the problems of the society. Thus a clear understanding of the consumer behaviour and decision making process will assist these efforts. 3) Consumer behaviour and government decision making: 6 CU IDOL SELF LEARNING MATERIAL (SLM)

In recent years the relevance of consumer behaviour principles to government decision making. There are two major areas of activities which have been affected: i) Government services: It is increasingly and that government provision of public services can benefit significantly from an understanding of the consumers, or users, of these services. ii) Consumer protection: Many Agencies at all levels of government are involved with regulating business practices for the purpose of protecting consumers welfare. 4) Consumer behaviour and de-marketing: It has become increasingly clear that consumers are entering an era of scarcity in terms of some natural gas and water. These scarcities have led to promotions stressing conservation rather than consumption. In other circumstances, consumers have been encouraged to decrease or stop their use of particular goods believed to have harmful effects. Programs designed to reduce drug abuse, gambling, and similar types of conception examples. These actions have been undertaken by government agencies non profitorganisations, and other private groups. The term \"demarketing\" refers to all such efforts to encourage consumers to reduce their consumption of a particular product or services. 5) Consumer behaviour and consumer education: Consumer also stands to benefit directly from orderly investigations of their own behaviour. This can occur on an individual basis or as part of more formal educational programs. For example, when consumers learn that a large proportion of the billions spend annually on grocery products is used for impulse purchases and not spend according to pre planned shopping list, consumers may be more willing to plan effort to save money. In general, as marketers that can influence consumers' purchases, consumers have the opportunity to understand better how they affect their own behaviour. The scope of consumer behaviour includes not only the actual buyer but also the various roles played by him/ different individuals. The study of consumer behaviour also helps a business firm in the following aspects; 1. Demand Forecasting: Marketers can estimate the demand of their product if they know how would a consumer behave and react after seeing their product. 2. Marketing: Consumer Behaviour helps to identify the need, expectations and problems of the consumers. Therefore, they can easily build the product having those functions which the consumers exactly want. 3. Advertising: Different consumers may have different opinions and reactions on certain form of advertisement. Therefore, Marketers can target the customers with most prominent form of advertisement as per their behaviour. 7 CU IDOL SELF LEARNING MATERIAL (SLM)

4. Human Behaviour: If marketers are aware about the human behaviour of their consumers and which factors influence their behaviour, and then they can make their product 100% compatible with the requirement of consumer. 1.2 FACTORS INFLUENCING CONSUMER BEHAVIOUR Many distinct aspects influence consumer behaviour. A marketer should endeavour to comprehend the influences on consumer behaviour. Here are five significant influences on customer behaviour:  Psychological Factors  Social Factors  Cultural Factors  Personal Factors  Economic Factors 1. Psychological Factors Consumer behaviour is heavily influenced by human psychology. These influences are difficult to quantify, but they have enough clout to affect a purchase choice. The following are some of the most important psychological factors: i. Inspiration When a person is sufficiently motivated, it has an impact on their purchasing behaviour. A person's fundamental requirements, social needs, security needs, esteem needs, and self- actualization needs are only a few. Basic requirements and security demands take precedence over all other needs. As a result, fundamental requirements and security demands might drive a consumer to purchase goods and services. ii. Observation Consumer perception is a significant determinant of consumer behaviour. Consumer perception is the process by which a customer gathers and analyses information about a product in order to construct a meaningful image of that thing.A customer's impression of a product is formed when they see commercials, promotions, customer reviews, social media feedback, and so on. As a result, customer perception has a significant impact on consumer purchasing decisions. iii. Education When a person purchases a product, he or she gains access to additional information on the product. Learning occurs over time as a result of experience. Skills and knowledge play a role in a consumer's learning. While practise might help you improve your skills, only experience 8 CU IDOL SELF LEARNING MATERIAL (SLM)

can help you develop knowledge.Learning can be conditional or cognitive in nature. Consumers are repeatedly exposed to a circumstance through conditional learning, causing them to build a response to it.In cognitive learning, the consumer will apply his knowledge and skills to the thing he purchases in order to find happiness and a solution. iv. Beliefs and Attitudes Consumers have specific attitudes and ideas that influence their purchasing decisions. The consumer acts in a certain way toward a product based on this mentality. This mind set is very important in determining a product's brand image. As a result, marketers work hard to understand consumer attitudes while creating marketing efforts. 2. Social Factors Humans are social beings who are surrounded by a large number of others who impact their purchasing decisions. Humans want to copy other humans in order to fit in with society, and they also want to be socially accepted. As a result, their purchasing decisions are impacted by those around them. These are referred to as social factors. The following are some of the social factors: i. The family A person's buying behaviour is heavily influenced by his or her family. A person's preferences are formed by observing his family buy things as a youngster, and he or she continues to buy the same products as an adult. ii. Reference Groups A reference group is a collection of persons with whom a person identifies. In general, everyone in the reference group has similar buying habits and influences one another. iii. Positions and titles The role that a person plays in society has an impact on him. If a person is in a prominent position, his purchasing decisions are heavily influenced by his status. A Chief Executive Officer of a company will buy according to his status, whereas a staff or employee of the same company will buy in a different way. 3. Cultural factors A collection of ideas and ideologies that belong to a specific community are connected with a group of people. When a person originates from a certain community, the culture associated with that community has a strong influence on his or her conduct. The following are some cultural aspects to consider: i. The Arts Consumer buying behaviour is heavily influenced by cultural factors. The basic values, needs, wants, preferences, perceptions, and behaviours that a consumer observes and learns 9 CU IDOL SELF LEARNING MATERIAL (SLM)

from their close family members and other important individuals around them are referred to as cultural factors. ii. A subculture is a group of people who share a common interest There are many subcultures within a cultural group. These subcultural groupings have similar values and ideas. People of many religions, castes, regions, and ethnicities can form subcultures. These subcultures constitute a client segment in and of themselves. iii. Social Standing Every society on the planet has some type of social class. Income is only one component that determines social class; other ones include work, family background, education, and housing area. The importance of social class in predicting consumer behaviour cannot be overstated. 4. Personal Factors Consumers' purchasing decisions are influenced by personal factors. These personal characteristics vary from person to person, resulting in a wide range of perceptions and purchasing behaviour. The following are some of the personal factors to consider: i. Age The influence of age on purchasing behaviour is significant. Young people's purchasing preferences differ from those of middle-aged people. Elderly people shop in a very different way than younger people. Teenagers will be more interested in purchasing brightly coloured clothing and cosmetics. Middle-aged people are concerned about their family's home, property, and automobile. ii. Salary A person's purchasing behaviour might be influenced by their income. Consumers with more money have more purchasing power. When a consumer has more discretionary income, he or she has more opportunities to spend on high-end items. Consumers in the low- and middle- income groups, on the other hand, spend the majority of their income on necessities such as groceries and clothing. iii. Profession The consumer's occupation has an impact on their purchasing decisions. A person is more likely to purchase items that are related to his or her work. A doctor, for example, would dress appropriately for his vocation, whereas a professor would dress differently. iv. Personality A person's lifestyle is both an attitude and a way of life in society. The consumer's lifestyle has a significant impact on their purchasing habits. When a customer follows a healthy lifestyle, for example, the things he purchases will be healthy alternatives to bad food. 10 CU IDOL SELF LEARNING MATERIAL (SLM)

5. Economic Factors Consumer purchasing habits and decisions are heavily influenced by a country's or market's economic state. When a country is rich, its economy is strong, resulting in a larger money supply in the market and more consumer spending power. When consumers are in a good financial situation, they are more willing to spend money on goods. A weak economy, on the other hand, depicts a market that is struggling due to unemployment and decreasing purchasing power.Consumer purchasing decisions are heavily influenced by economic reasons. The following are some of the most important economic factors: i. Personal Income When a person's disposable income rises, his or her purchasing power rises with it. The money left over after a person's fundamental necessities have been met is referred to as disposable income. When one's disposable income rises, one's spending on numerous products rises as well. However, as disposable income decreases, expenditure on numerous products decreases as well. ii. Family Earnings The total income of all family members is referred to as family income. When more members of the family work, there is more money available for essential requirements and luxuries. People in a family with a higher income are more likely to buy more. When a family has extra money, it's natural to want to acquire additional luxury products that they might not have been able to afford otherwise. iii. Consumer Credit When a consumer is given cheap credit to buy things, it encourages them to spend more. Credit cards, simple payments, bank loans, hire buy, and a variety of other credit options are being made available to consumers by sellers. When consumers have more credit available to them, they are more likely to buy comfort and luxury things. iv. Liquid Assets Consumers with liquid funds are more likely to spend on comfort and pleasures. The term \"liquid assets\" refers to assets that can be quickly transformed into cash. Liquid assets include cash on hand, bank savings, and securities, to name a few. A consumer's confidence in purchasing luxury products increases when he has more liquid funds. v. Investments The amount of savings a consumer intends to set aside from his salary has a significant impact on his purchasing decisions. If a consumer decides to save more, his purchasing expenditure decreases. If a consumer wants to save more money, the majority of his income will go toward purchasing goods. 11 CU IDOL SELF LEARNING MATERIAL (SLM)

1.3 SIGNIFICANCE OF CONSUMER BEHAVIOUR 1. Implementation of the marketing concept: Consumer behaviour helps to implement the modern marketing concept. The Modern marketing concept is customer driven which focuses on solving the problems of customers and satisfying their needs. Consumer behaviour identifies the same problems and needs and hence, helps is developing the product as per customer requirement. 2. Planning product differentiation and Market Segmentation: After identification of consumer behaviour, the product developed will the only one of its kind, because it has been developed through proper research and consumer behavior analysis, so the product will automatically be different from all the products available in the market while satisfying the consumer needs. Again, to divide the target market into different segments to focus better on different consumers, proper study of consumer behaviour is necessary. 3. Selection of distribution channels: Consumer Behavior Analysis not only tells what consumers want to buy but also from where they prefer to buy. There may be different categories of consumers. First category only shops online, Second category only wants products from prestigious offline stores and the third category may settle for the ordinary stores. Therefore, consumer behaviour also informs us how much we should focus on a certain distribution channel. 4. Designing promotional techniques: Promotional techniques include advertisement messages, media, direct selling, online selling etc. Proper study of consumer behaviour will show the psychology of consumer towards different promotional formats. It will tell how many a consumers is influenced from a certain form of advertisement and promotion. 1.5 BASIC COMPONENTS OF CONSUMER BEHAVIOUR i) Decision making (Cognitive and Affect): This includes the stages of decision making: Need recognition, Information search, Evaluation of alternatives, Purchase activity, and Post purchase behaviour. ii) Actual purchase (Behaviour): This includes the visible physical activity of buying of goods and/or service. It is the result of the interplay of many individual and environmental determinants which are invisible. iii) Individual determinants and environmental influences: The environmental factors affect the decision process indirectly, through way of affecting individual determinants. iv) Buying roles: 12 CU IDOL SELF LEARNING MATERIAL (SLM)

There are five buying roles, viz., Initiator, Influencer, Decider, User, and Buyer. The initiator is the person who identifies that there exists a need or want; the influencer is the one who influences the purchase decision, the actual purchase activity and/or the use of the product or service; the decider is the one who decides whether to buy, what to buy, when to buy, from where to buy, and how to buy; the buyer is theone who makes the actual purchase; and, the user is the person(s) who use the product or service. These five roles may be played by one person or by different persons. A person may assume one or more of these roles. This would depend on the product or service in question. Example: 1.Initiator: The individual who determines that some need or want is not being met and authorises a purchase to rectify the situation. 2. Influencer: a person who by some intentional or unintentional word or action influences the purchase decision, then actual purchase or the use of the product/service. 3.Buyer: the individual who actually makes the purchase transaction. 4. User: The person most directly involved in the consumption or use of the purchase. v) Buyers and Sellers: They are the key elements in consumer behaviour. They have needs and wants and go through a complex buying process, so as to be able to satisfy the need through purchase of the good or service offering. They enter into an exchange process with the seller, which leaves both the parties (buyer and seller) better off than before. In fact the exchange process is value enhancing in nature, leading to satisfaction of both the parties. 1.7IMPORTANCE OF CONSUMER BEHAVIOUR TO MARKETERS It is important for marketers to study consumer behaviour. It is important for them to know consumers as individual or groups opt for, purchase, consumer or dispose products and services and how they share their experience to satisfy their wants or needs. This helps marketers to investigate and understand the way in which consumers behave so that they can position their products to specific group of people or targeted individuals.In regard to the marketer’s view point, they assume that the basic purpose of marketing is to sell goods and services to more people so that more profit could be made. This principle of making profits is heavily applied by almost all marketers. Earlier, the marketers were successful in accomplishing their purpose. However, today, as the consumers are more aware about the use of product and other information of the product, it is not easy to sell or attract customer to buy the product. Thus, in order to sell a product or service or to convince consumers to buy product, the marketers have to undergo through proper research to win them over. The following are some of the points that explains the value to marketers of understanding and applying consumer behaviour concepts and theories. 1. To understand Buying Behaviour of consumers 13 CU IDOL SELF LEARNING MATERIAL (SLM)

The study of consumer behaviour helps marketers to recognize and forecast the purchase behaviour of the consumers while they are purchasing a product. The study of consumer behaviour helps the marketers not only to understand what consumer’s purchase, but helps to understand why they purchase it. Moreover, other questions like how, where and when they purchase it are also answered. The consumption and the reasons behind disposition of that particular product or services help marketers to be fully aware of the product that is marketed. The consumer behaviour studies also help marketers to understand the post purchase behaviour of the consumers. Thus, the marketers become fully aware about every phase of consumption process i.e., pre-purchase behaviour, behaviour during purchase and post purchase behaviour. Many studies in the past shows that each consumer behaves differently for a product i.e., they buy the product for different reasons, pays different prices, used the product differently and have different emotional attachments with the product. 2. To create and retain customers though online stores Professor Theodore Levitt says that consumer behaviour is of most importance to marketers in business studies as the main aim is to create and retain customers. If the consumers are satisfied with the product, he or she will buy the same product again. Therefore, the product should be marketed by markers in such a way that convince customer to buy the product. Thus, creating customer and the retaining those customers are important. These can be done through understanding and paying close attention towards the consumer’s behaviour while making purchase decision or buying a product in market place. Moreover, the information published on the websites largely influence the customer’s buying behaviour. Such information on published sources arouse consumer to buy a product or service. Moreover, updating such information will help the consumer to retain to a product or re try the product if the product has dissatisfied them. 3. To understand the factors influencing Consumer’s buying Behaviour It is important for marketers to consider the factors that affect the buying behaviour of consumer before entering the market. There are many factors that can influence the purchase decision of consumers such as social influence, cultural influences, psychological factors and personal factors. Understanding these factors helps marketers to market the product on right time to the right consumers. For example, if marketer is marketing a product which is Halal. The marketers first consider all the factors that can influence consumers to buy Halal products, where they can target specific areas where Halal food is more sold. The marketers need to pay attention to cultural influences such as religion, values and norms of the people or societies targeted and lifestyle of the targeted consumers. The marketers can propose different strategies that convince the targeted consumers to buy marketed products or services.Moreover, the marketers should be ascertain the factors that influence and affects purchase decision of consumers. If the marketers failed to understand the factors that might influence consumers, they will fail to convince the consumer to purchase that product or will 14 CU IDOL SELF LEARNING MATERIAL (SLM)

fail to meet the demands of consumers. Some variables cannot be directly observed. In such case, thorough understanding of concepts and theories of consumer behaviour helps marketers to predict the consumer’s buying behaviour to a reasonable extent. Thus, understanding consumer’s behaviour to buy a product is complex and requires marketers to continuously understand and apply various concepts and theories for successful marketing. 4. To increase the knowledge of sales person influence consumer to buy product All the products and services marketed revolve around the behaviour of consumers that how they will respond to them. Effective marketing of a product by sales people may help to deliver right product to right people. Consumer behaviour deals with the knowledge of what the consumers need and want to buy and what goods and services are available to satisfy their needs. Thus, consumer behaviour deals with particularly with the behaviour of people i.e., consumers. It is important for sales person to be fully aware of the customer’s requirement so that he or she could clearly communicate the benefits of the product to the customers. Moreover, the sales person by understanding consumer’s demand and need for a product can sell goods that are most closely related to their requirement. Besides understanding consumer behaviour, the sales person should also have command over their spoken language. This is because any miscommunication could harm brand reputation. Moreover, if the consumers have more knowledge about the product than the sales person, the sales might fail to meet their targets. Thus, analysing consumer’s behaviour and knowledge for effective marketing of products by sales people are important. The sales people must be fully aware of the consumer’s behaviour in different situations so that they could help them in meeting their demands and satisfaction. 5. To understand the consumer’s decision to dispose a product or services Disposal of product involves throwing away of products by the consumers (Solomon, 2009). This behaviour of consumer is very complex and requires more importance by the marketers. Understanding the consumer’s behaviour about how and when consumers dispose a product, the marketers or the companies can position themselves so that this behaviour could be limited If the product or services that have failed to deliver required or expected satisfaction by the consumers, the product is disposed by the customers. For this, some marketers track the follow up from the consumers so that they can gauge the reason behind failure of the product. Moreover, in order to retain customers, some marketers or organizations offer customers with services like exchange of product, money back guarantee etc. Although, these tools are helpful to influence post purchase behaviour of consumers to some extent. The method of disposition varies transversely from product to product. Some of the factors that lead to consumer’s behaviour to dispose a product include psychological characteristics, situational factors or the intrinsic factors of product. The psychological characteristics include attitude, mood, emotion, social class, social conscience, perception etc. The situational factors such as urgency, functional use, fashion change etc. and intrinsic factors such as 15 CU IDOL SELF LEARNING MATERIAL (SLM)

product style, durability, reliability, adaptability, replacement cost, colour, size etc. can lead to consumer’s decision to dispose a product. For example, the personal computers sold previously were largely demanded by consumers. However, due to change in size, advancing technology, affordability, convenience; most people have switched to laptops and mobiles with operating systems have disposed personal computers to a greater extent. 6. To help marketers to optimize sale of product and create focused marketing strategies The theories and concepts of Consumer behaviour help marketers to optimize their sales and to create efficient marketing strategies. Moreover, these theories provides marketers with information on the consumer’s behaviour to spend money, likely causes that incline them to spend more money on a product, and these two information help to plan strategies that should be practiced by the marketers for successful marketing of a product. Studying different consumer behaviour theories helps to understand the different choices that consumers make to buy a product. There are some factors that need to be carefully analysed by the marketers which help them to increase their sales and develop effective marketing strategies. 7. Consumer’s rational behaviour It is foremost important for a marketer to understand the situations where consumers behave rationally. Many consumer behaviour theories suggest that the consumers want to get maximum benefit and satisfaction from the product by spending minimum amount of money. This shows that consumers do not spend all their money to buy a product and keeps a certain amount of money as their savings. However, on the other hand, the consumers having limited money spend all their money on purchase of their basic needs such as shelter, food and clothing. Thus, the marketer must carefully analyse these two situations of consumers before marketing a product or services. 8. Consumer’s taste and preferences Understanding consumer taste and preferences helps marketers to revamp their product so that they could meet customer satisfaction. These factors may change from time to time. The change in consumer’s behaviour affecting by these factors should be carefully monitored. The marketers need carefully understand the consumer’s interest in the products by breaking down the targeted consumers into demographics, like age, occupation and location as they contribute investigating information about consumer preferences. 9. Price of Products Prices of products are a widely discussed factor in consumer behaviour theories. The theories suggest that marketers should keep their prices low without affecting the quality to attract consumers. This is because consumers go mostly for products that are of low price but satisfies their demand. 10. Features of Product 16 CU IDOL SELF LEARNING MATERIAL (SLM)

Increased number of features offered by the product tends to increase the price of products. In such case, consumers go for added features in a product at affordable price. Therefore, the markers design their products in such a way that the product gives maximum value or features to consumers at affordable price. 11. Consumer’s knowledge about a product The marketer must know to what extent the consumers have knowledge about a product. Mostly, consumers select products with which they are familiar with. For example, if the consumers are aware of the health effects of eating high fat food or fast food, marketing of such a product to health conscious consumer will end up in failure. 1.8TYPES OF CONSUMER BEHAVIOUR The four types of consumer behaviour are: (1) Complex Buying Behaviour When a customer is deeply invested in a purchase and is aware of major distinctions between brands, they engage in sophisticated buying behaviour. When a product is pricey and purchased infrequently, consumers become very invested in it. It's high-risk and high-cost. In most cases, the consumer is unfamiliar with the product category and has a lot to learn. A person buying a computer, for example, may not even know what features to search for. A cognitive learning process will be undertaken by this buyer. The marketer of high- involvement products must understand the information-gathering and evaluation behaviour of high-involvement consumers, which is characterised by first developing beliefs about the product, then moving toward attitudes toward the product, and finally making a deliberate purchase choice. He must devise tactics to aid the customer in learning about the product class's features, their relative relevance, and his brand's superior position on the more important traits. He needs to distinguish his brand's features and seek the help of salespeople and a buyer buddy to influence the ultimate brand choice. (2) Buying Behaviour Reducing Dissonance: When a customer is emotionally invested in a product, they may notice little difference across brands. His high level of commitment stems from the fact that the transaction is costly, infrequent, and potentially dangerous. The buyer will search around to see what's available, but because brand distinctions aren't significant, he'll make a rapid decision. He may be primarily motivated by a low price or the convenience of purchasing at a specific time or location. For example, carpet purchasing is a complex decision because it is costly and involves self-identification, but most carpeting in a certain price range is likely to be the same. Due to perceiving some unsettling qualities of the carpet or hearing positive things about carpets, the consumer may feel prior purchase dissonance. He or she begins to study more 17 CU IDOL SELF LEARNING MATERIAL (SLM)

and tries to rationalise their decision to decrease the dissonance. He goes through a stage of behaviour, gains some fresh rewards, and eventually comes to a positive conclusion about his decision. Pricing, location, and effective sales personnel are all factors that impact brand selection in this situation. The primary function of market communication is to provide beliefs and assessments that assist the customer feel good about his or her purchase after it has been made. (3) Buying Habits as a Basis for Behaviour: Many products are acquired in the absence of substantial brand differences and with little consumer input. For instance, in the buy category. They go to the store and reach for the brand, despite the fact that they have no strong brand loyalty. They have a limited level of interaction with the majority of low-cost, often purchased items. In these circumstances, their behaviour follows the regular belief/attitude/behavior patterns. They don't look up a lot of information on the brands. They compare their features and make a critical decision about which one to purchase. As they watch television or read a newspaper ad, they are passive recipients of information. Brand familiarity, not brand belief, is the result of ad repetition. Consumers do not acquire an opinion on a brand; instead, they choose it because it is familiar. Because they are not associated with the goods, they may not evaluate it after purchase. So, during the buying process, passive learning shapes brand beliefs, which are then followed by purchase behaviour, which may or may not be followed by evaluation. Because customers are not deeply devoted to any brand, marketers with minimal brand variations find it effective to use price and sales promotions as an incentive to product testing in the case of low involvement products. When advertising a low-involvement product, there are a few things to keep in mind. Only a few crucial things should be highlighted in the ad copy. The importance of the visual symbol and integer is that they are easily recalled and identified with the brand. High repetition with short-duration messaging should be the goal of ad campaigns. Print media is less effective than television. It's a low-effort medium that's ideal for passive learning. (4) Variety-Seeking Buying Behaviour: Consumer input is negligible in some buying situations, although there are considerable brand disparities. Consumers have been spotted swapping brands frequently. For example, while buying cookies, the buyer holds certain beliefs, selects a cookie brand without much thought, then analyses it thereafter. Out of boredom or a desire to try something new, the consumer may choose another brand in the future. Instead of unhappiness, brand switching occurs here for the sake of variety. The market leader will try to encourage habitual buying behaviour by dominating shelf space, avoiding out-of-stock conditions, and sponsoring frequent reminder advertising in this 18 CU IDOL SELF LEARNING MATERIAL (SLM)

product category and for minor brands. On the other hand, challenging firms will encourage variety by offering lower prices, deals, coupons, free samples, and advertising. 1.9SUMMARY  Consumer behaviour is the study of how individual customers, groups or organizations select, buy, use, and dispose ideas, goods, and services to satisfy their needs and wants.  Consumer behaviour explains the reasons and logic that underlie purchasing decisions and consumption patterns; it explains the processes through which buyers make decisions.  There is a continuous interplay or interaction between the three components themselves and with the environment.  It is increasingly and that government provision of public services can benefit significantly from an understanding of the consumers, or users, of these services.  Consumer also stands to benefit directly from orderly investigations of their own behaviour.  Promotional techniques include advertisement messages, media, direct selling, online selling etc.  The marketers need to pay attention to cultural influences such as religion, values and norms of the people or societies targeted and lifestyle of the targeted consumers. 1.10KEYWORDS  Consumer behaviour:Consumer behaviouris the actions and decision processes of people who purchase goods and services for personal consumption.  Cognition:It includes the mental processes involved in processing of information, thinking and interpretation of stimuli.  Affect: Itincludes the favourable or unfavourable feelings and corresponding emotions towards stimuli.  Demand Forecasting: Marketers can estimate the demand of their product if they know how would a consumer behave and react after seeing their product.  Features of Product: Increased number of features offered by the product tends to increase the price of products. In such case, consumers go for added features in a product at affordable price. 19 CU IDOL SELF LEARNING MATERIAL (SLM)

1.11LEARNING ACTIVITY 1. Imagine you are a marketing manager for Starbucks. You need consumer research to support future decisions about additional menu items and promotions. Which research methods would you use and why? ___________________________________________________________________________ _____________________________________________________________________ 2. Given the geographical characteristics of Indian consumer market, analyse five important implications that will be faced by an all-India distribution company dealing in consumer durables such as refrigerators, televisions and music systems: ___________________________________________________________________________ _____________________________________________________________________ 1.12 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Define consumer behavior 2. State some of the important psychological factors. 3. Explain about cultural factors 4. Discuss the nature of consumer behaviour 5. List out the types of consumer behavior Long Questions 1. Explain the scope of consumer behaviour 2. Discuss the significance of consumer behaviour 3. Describe the different factors that impact consumer behaviour. 4. Explain the basic components of consumer behaviour 5. Why should marketers be interested in consumer behaviour? Discuss 6. Classify the types of consumer behaviour B. Multiple Choice Questions 1. Which of the following is the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires? a. Lifestyle marketing 20 CU IDOL SELF LEARNING MATERIAL (SLM)

b. Role theory c. Consumer behavior d. Marketing research 2. Which of the following is not considered an example of consumer behavior? a. Janice prefers to buy non- brand pain relievers like Tylenol and Advil, rather than the store brand. b. Javier generally gets gas on Monday mornings on his way to work. c. Jessica prefers to buy her produce from the farmer's market instead of the grocery store. d. Jeremy generally recycles his old newspapers and cardboard boxes. 3. A(n) ________ is a person who identifies a need or desire, makes a purchase, and thendisposes of a product. a. Marketer b. Consumer c. Influencer d. Content generator 4. During historical periods when demand exceeded supply, businesses adopted the ________concept. a. Marketing b. Technology c. Societal d. Production 5. The ________ concept in business assumes that consumers are mostly interested in product availability at low prices. a. Marketing b. Finance c. Technology 21 CU IDOL SELF LEARNING MATERIAL (SLM)

d. Production Answers 1 – c, 2 – a, 3 – b, 4 – d, 5 – d 1.13 REFERENCES References books  Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago.  Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi.  Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books  Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India.  Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc.  Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 22 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 2: MODELS OF CONSUMER BEHAVIOR STRUCTURE 2.0 Learning Objectives 2.1 Basic models of consumer behaviour 2.2 Stages of consumer decision making process 2.3 Types of consumer decision making process 2.4 Summary 2.5 Key words 2.6 Learning Activity 2.7 Unit End Questions 2.8 References 2.0 LEARNING OBJECTIVES After studying this unit, you will be able to:  Explain themodels of consumer behaviour  Discuss how the consumer decides while purchasing the product/service.  Identify the process of consumer decision making  Identify the participants in the buying process  Discuss about habitual decision making 2.1BASIC MODELS OF CONSUMER BEHAVIOUR 1. Traditional Models: Economists established early or traditional models to better understand economic systems. Economics can help you understand how limited resources are distributed across a wide range of goals and requirements. In terms of the Economic model, Learning model, Psychoanalytic model, and Sociological model, the first four models provide a broad overview. i. Economic Model: In economics, man is supposed to be a rational human being who will weigh all of the options in terms of cost and value obtained and choose the product/service that will provide him/her with the most satisfaction (utility). On the basis of the law of declining marginal utility, consumers are assumed to follow the maxim maximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximma ximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaximmaxi

mmaximmaximmaximmaximmaxim With limited purchasing power and a set of requirements and interests, it is anticipated that a customer will spread his or her spending among a variety of products at varying costs in order to maximise utility. He can get maximum utility from restricted purchasing power thanks to the law of equi marginal utility. Consumer behaviour is modelled in a one-dimensional economic model. This suggests that a person's purchasing decisions are guided by the concept of utility. As a rational person, he will make purchasing decisions with the goal of maximising utility and rewards. The economic model is built on specific assumptions about consumer behaviour. i. Price effect — The lower the product's price, the higher the quantity purchased. ii. Substitution effect — The lower the price of the alternative product, the less of the original product will be purchased. iii. Income effect — As one's purchasing power increases, so does the quantity of goods purchased. Behavioural scientists have called into question the idea that humans behave rationally. They believe that, while the predictions are important, the model simply describes how a consumer should behave and does not reveal how the consumer actually behaves. The economic model, according to behavioural scientists, is insufficient. They believe that economics assumes that the market is homogeneous, that all customers would think and act in the same way, and that it concentrates solely on one facet of the commodity, namely income. It has been stated that man is a complicated being, necessitating the use of a multidisciplinary approach to comprehending consumer behaviour. The model, on the other hand, has taken into account all important components such as perception, motivation, learning, attitude, personality, and socio-cultural factors. Furthermore, man now lives in a technologically evolved period where he is constantly exposed to marketing variables such as superior technologically advanced quality items (and services), efficient network distribution centres, highly interactive media exposure, and so on. In such conditions, man cannot be believed to be a rational being who makes his consumption decisions solely on the basis of 'price.' When analysing buyer behaviour, behaviour scientists believe that larger views should be used. So, in addition to economics, wants, reasons, personality, self-concept, and socio- cultural aspects must be examined in order to comprehend buyer responses to various stimuli, which may impact their purchasing behaviour. ii. Learning Model: Classical psychologists, unlike economists, have been interested in the establishment and satisfaction of needs and tastes. They claimed that both innate needs such as hunger, thirst, sex, and shelter, as well as learned needs such as fear and shame, influenced 24 CU IDOL SELF LEARNING MATERIAL (SLM)

living beings. A motive is a drive (internal stimulation) that is directed towards a drive- reducing object. Different products or services will work as triggers to satisfy distinct urges. A hungry individual, for example, will be drawn to food, which, once consumed, will alleviate the hunger and offer contentment. This pleasure (feeling) response, according to learning theorists, maintains the link between drive and the drive-reducing stimulus object, as well as the accompanying cues. Furthermore, once customers learn to equate stimulus with response, it becomes a habit. Certain cognitive theorists argue that humans not only learn to link stimulus with response (S-R), but also about the establishment of other cognitive processes like attitudes, values, beliefs, and motivation. In the context of marketing, 'learning' will assist marketers in determining how customers would respond in new marketing situations, as well as how they have learnt and responded in comparable situations in the past. It is frequently noticed that a consumer's experience with one product from a company is likely to be generalised to the company's other items. Consumers, on the other hand, learn to distinguish, and this knowledge will be beneficial in developing marketing strategies. Simply put, this learning model will assist marketers in promoting product linkages with strong urges and cues as well as positive consumer reinforcement. iii. Psychoanalytical Model: This model is founded on the research of psychologists who studied personality. They believed that human needs and motives were manifested on both the conscious and subconscious levels. Sigmund Freud came up with this theory. Human behaviour (personality) is the result of (a) 'id' – the source of all psychic energy that drives to act, (b)'super ego' – the internal representation of what society approves, and (c) 'ego' – the conscious directing of 'id' impulses to achieve fulfilment in a socially acceptable manner. As a result, we can argue that human behaviour is guided by a complicated collection of underlying motivations. From a marketing standpoint, this suggests that symbolic variables will affect a buyer's decision to purchase a product. Motivational research has been used to investigate customer motivations in order to produce appropriate marketing implications. This method has been used by marketers to produce product development ideas, such as design, features, advertising, and other promotional approaches. iv. Sociological Model: In this model, the individual customer is a member of the social institution known as society. Because he lives in a society, he is influenced by it and, in turn, determines its development path. As a member of numerous formal and informal groups or organisations, such as a family member, a company employee, a member of a professional forum, and an active member of an informal cultural organisation, he plays many roles. Such interactions leave an impression on him and may have an impact on his purchasing decisions. 25 CU IDOL SELF LEARNING MATERIAL (SLM)

Intimate groupings of family, friends, and close colleagues can have a significant impact on an individual's lifestyle and purchasing decisions. The peer group is a powerful influencer, especially when it comes to adopting certain lifestyles and purchasing habits. In most groups, there is an unofficial opinion leader whose opinions are acknowledged by the rest of the group. This leader has the ability to affect the lifestyle and purchasing decisions of individual members. Similarly, each individual member is classified into a social class based on their income, occupation, and area of residence, among other factors. He may enjoy some status and reputation as a member of a particular social class. Furthermore, each social class has its own set of lifestyle and purchasing habits. As a result, each individual member will take the role that best fits his or her social class's style and behavioural pattern. Marketers can use market segmentation to determine the common buying patterns of a given class or group of purchasers and attempt to influence their purchasing behaviours. 2.Contemporary Models: As the field of consumer behaviour research has progressed, newer methodologies have been applied to better understand what impacts customer behaviour. These were supposed to be current models. These modern models or perspectives differed from prior models in that they focused on the decision-making process of consumers and borrowed principles from the field of behavioural sciences. Some of these models are described farther down. 2.2STAGES OF CONSUMER DECISION MAKING PROCESS Consumer decision making process involves the consumers to identify their needs, gather information, evaluate alternatives and then make their buying decision. The consumer behavior may be determined by economic and psychological factors and are influenced by environmental factors like social and cultural values. Decisions can be complex, comparing, evaluating, selecting as well as purchasing from a variety of products depending upon the opinion of a consumer over a particular product. This renders understanding and realizing the basic problem of the consumer decision making process for marketers to make their products and services different from others in the marketplace. The stages of decision making process are: 26 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 2.1Stages of decision making process Need Recognition Need recognition occurs when a consumer exactly determines their needs. Consumers may feel like they are missing out something and needs to address this issue so as to fill in the gap. When businesses are able to determine when their target market starts developing these needs or wants, they can avail the ideal opportunity to advertise their brands. An example who buys water or cold drink identifies their need as thirst. Here; howeSver, searching for information and evaluating alternatives is missing. These consumer decision making steps are considered to be important when an expensive brand is under buying consideration such as cars, laptops, mobile phones, etc. Information Search The information search stage in the buyer decision process tends to change continually as consumers require obtaining more and more information about products which can satisfy their needs. Information can also be obtained through recommendations from people having previous experiences with products. At this level, consumers tend to consider risk management and prepare a list of the features of a particular brand. This is done so because most people do not want to regret their buying decision. Information for products and services can be obtained through several sources like: 3. Commercial sources - The advertisements, promotional campaigns, sales people or packaging of a particular product. 4. Personal sources - The needs are discussed with family and friends who provided product recommendations. 27 CU IDOL SELF LEARNING MATERIAL (SLM)

5. Public sources - Radio, newspaper and magazines. 6. Experiential sources - The own experience of a customer of using a particular brand. Evaluation of Alternatives This step involves evaluating different alternatives that are available in the market along with the product lifecycle. Once it has been determined by the customer what can satisfy their need, they will start seeking out the best option available. This evaluation can be based upon different factors like quality, price or any other factor which are important for customers. They may compare prices or read reviews and then select a product which satisfies their parameters the most. Purchase Decision When all the above stages have been passed, the customer has now finally decided to make a purchasing decision. At this stage, the consumer has evaluated all facts and has arrived at a logical conclusion which is either based upon the influence from marketing campaigns or upon emotional connections or personal experiences or a combination of both. Post Purchase Behavior The purchase of the product is followed by post-purchase evaluation which refers to analyzing as to whether the product was useful for the consumer or not. If the product has matched the expectations of the customer, they will serve as a brand ambassador who can influence other potential consumers which will increase the customer base of that particular brand. The same is true for negative experiences; however, it can halt the journey of potential customers towards the product. 2.3TYPES OF CONSUMER DECISION MAKING PROCESS The buying process begins when customers recognize an unsatisfied need. Then they seek information about how to satisfy the need- what, products might be useful and how they can be bought. Customers evaluate the various alternative sources of merchandise such as stores, catalogues, and the Internet and choose a store or an Internet site to visit or a catalogue to review. Three types of customer decision-making processes are: 1. Extended problem solving, 2. Limited problem solving, and 3. Habitual decision making. 1. Extended Problem Solving: 28 CU IDOL SELF LEARNING MATERIAL (SLM)

Extended problem solving is a purchase decision process in which customers devotes considerable time and effort to analyzing alternatives. Customers typically engage in extended problem solving when the purchase decision involves a lot of risk and uncertainty. There are many types of risks.  Financial risks arise when customers purchase an expensive product.  Physical risks are important when customers feel a product may affect their health or safety.  Social risks arise when customers believe a product will affect how others view them. Consumers engage in extended problem solving when they are making a buying decision to satisfy an important need or when they have little knowledge about the product or service. Due to high risk and uncertainty in these situations, customers go beyond their personal knowledge to consult with friends, family members, or experts. They may visit several retailers before making a purchase decision. Retailers influence customers engaged in extended problem solving by providing the necessary information in a readily available and easily understood manner and by offering money-back guarantees. For example, retailers that sell merchandise involving extended problem solving provide brochures describing the merchandise and its specifications; have informational displays in the store (such as a sofa cut in half to show its construction); and use salespeople to make presentations and answer questions. 2. Limited Problem Solving: Limited problem solving is a purchase decision process involving a moderate amount of effort and time. Customers engage in this type of buying process when they have had some prior experience with the product or service and their risk is moderate.In these situations, customers tend to rely more on personal knowledge than on external information. They usually choose a retailer they have shopped at before and select merchandise they have bought in the past. The majority of customer decision making involves limited problem solving. Retailers attempt to reinforce this buying pattern when customers are buying merchandise from them. If customers are shopping elsewhere, however, retailers need to break this buying pattern by introducing new information or offering different merchandise or services.One common type of limited problem solving is impulse buying. Impulse buying is a buying decision made by customers on the spot after seeing the merchandise. Sania’s decision to buy the scarf was an impulse purchase. Retailers encourage impulse buying behaviour by using prominent displays to attract customer attention and stimulate a purchase decision based on little analysis. For example, sales of a grocery item are greatly increased when the item is featured in an end-aisle display, when a “BEST BUY” sign is placed on the shelf with the item, when the item is placed at eye 29 CU IDOL SELF LEARNING MATERIAL (SLM)

level (typically on the third shelf from the bottom), or when items are placed at the checkout counter so customers can see them as they wait in line. Supermarkets use these displays and prime locations for the profitable items that customers tend to buy on impulse, such as gourmet food, rather than commodities such as flour and sugar, which are usually planned purchases. Impulse purchases by electronic shoppers are stimulated by putting special merchandise on the retailer’s home page and by suggesting complementary merchandise. 3. Habitual Decision-Making: Habitual decision making is a purchase decision process involving little or no conscious effort. Today’s customers have many demands on their time. One way they cope with these time pressures is by simplifying their decision-making process.When a need arises, customers may automatically respond with, “I’ll buy the same thing bought last time from the same store.’ Typically, this habitual decision-making process is used when decisions aren’t very important to customers and involve familiar merchandise they have bought in the past. Brand loyalty and store loyalty are examples of habitual decision making. Brand loyalty means that customers like and consistently buy a specific brand in a product category. They are reluctant to switch to other brands if their favourite brand isn’t available. Thus, retailers can only satisfy these customers’ needs if they offer the specific brands desired. Brand loyalty creates both opportunities and problems for retailers. Customers are attracted to stores carrying popular brands. But since retailers must carry the high-loyalty brands, they may not be able to negotiate favourable terms with the supplier of the popular national brands. Store loyalty means that customers like and habitually visit the same store to purchase a type of merchandise.All retailers would like to increase their customers’ store loyalty. Some approaches for increasing store loyalty are selecting a convenient location, offering complete assortments and reducing the number of stockouts, rewarding customers for frequent purchases, and providing good customer service. Habitual decision making is sometimes referred to as “routine” decision making. This is because consumers do not seek information at all when a problem is recognized. Choice is often based on habit. Consumer generally have a specific brand in mind when they want to solve a problem because they believe that brand/product will deliver value. There are two main topics concerning habitual decision making:  Brand loyalty  Brand inertia. Brand Loyalty Brand Loyalty is a deeply held commitment to rebuy a product or service regardless of situational influences that could lead to switching behavior. Regardless of price or 30 CU IDOL SELF LEARNING MATERIAL (SLM)

convenience, consumers tend to stick with brands that they like. Consumers have a bond with these products and believe that the consumption activity delivers value. Brand loyalty can be enticed with rewards programs where companies reward customers for repeatedly choosing their products. Reward programs vary from earning stars from Starbucks, racking up enough points for a free sandwich at Jersey Mikes, or even getting frequent flier miles from airlines. In order for these programs to be successful, consumers must value both the product and the incentives being offered. For example: buying 9 smoothies and getting the 10th for free probably sounds better to most customers than buying 9 smoothies and being rewarded with a discount on auto parts. Brand Inertia Brand inertia is a term coined for when consumers buy a product repeatedly but without any real attachments to the brand. The lack of brand attachment is the key difference from brand loyalty, the latter which requires a true affection for the product. Strictly speaking a consumer is not considered loyal just because he or she buys the same product out of habit. Sometimes we do things habitually simply because it’s convenient or maybe there’s a lack of other options. 2.4 SUMMARY  Consumer decision making process involves the consumers to identify their needs, gather information, evaluate alternatives and then make their buying decision.  Decisions can be complex, comparing, evaluating, selecting as well as purchasing from a variety of products depending upon the opinion of a consumer over a particular product.  The consumer has evaluated all facts and has arrived at a logical conclusion which is either based upon the influence from marketing campaigns or upon emotional connections or personal experiences or a combination of both.  Customers evaluate the various alternative sources of merchandise such as stores, catalogues, and the Internet and choose a store or an Internet site to visit or a catalogue to review.  Retailers influence customers engaged in extended problem solving by providing the necessary information in a readily available and easily understood manner and by offering money-back guarantees. 2.5 KEYWORDS  Need recognition: It occurs when a consumer exactly determines their needs. Consumers may feel like they are missing out something and needs to address this issue so as to fill in the gap. 31 CU IDOL SELF LEARNING MATERIAL (SLM)

 Information Search: The information search stage in the buyer decision process tends to change continually as consumers require obtaining more and more information about products which can satisfy their needs.  Extended problem solving: is a purchase decision process in which customers devotes considerable time and effort to analyzing alternatives.  Physical risks: are important when customers feel a product may affect their health or safety.  Brand loyalty: means that customers like and consistently buy a specific brand in a product category. 2.6LEARNING ACTIVITY 1. You are a marketing intern at a publishing company. You have been given the task of developing a marketing plan for a new magazine targeted to a growing ethnic group in your country. How would you promote the new magazine? ___________________________________________________________________________ ___________________________________________________________________________ 2. Conduct a similar exercise for one of your close friends and compare his/her purchase behaviour with your own. Are there any differences? Identify the reasons for these differences. ___________________________________________________________________________ ___________________________________________________________________________ 2.7 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. List out the steps of decision making process 2. Write short note on need recognition with examples 3. List out the types of consumer decision making process 4. Mention the types of risks 5. State the meaning of brand loyalty Long Questions 1. Explain the stages of decision making process 2. Classify the types of consumer decision making process 32 CU IDOL SELF LEARNING MATERIAL (SLM)

3. Explain about the habitual decision making 4. “Information for products and services can be obtained through several sources”. Discuss 5. Write short note on: 1. Purchase decision 2. Post purchase behaviour B. Multiple Choice Questions 1. Any individual who purchases goods and services from the market for his/her end-use is called a_____________ a. Customer b. Purchaser c. Consumer d. Seller 2. _______is a branch which deals with the various stages a consumer goes through before purchasing products or services for his end use. a. Consumer behavior b. Consumer interest c. Consumer attitude d. Consumer perception 3. ________ is the action and decisions process or people who purchase goods and services for personal consumption. a. Consumer behavior b. Consumer skills c. Consumer needs d. Consumer interpretation. 4. The buying process starts when the buyer recognizes a _______ 33 a. Product or Service b. Shop or Market c. Need or Problem CU IDOL SELF LEARNING MATERIAL (SLM)

d. Money or Status 5. CDM stands for ________ a. Consumer Development Model b. Consumer Decision Mix c. Consumer Decision Making d. Consumer Development Matrix Answers 1 – a, 2 – a, 3 – a, 4 – c, 5 – c 2.8 REFERENCES References books  Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago.  Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi.  Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books  Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India.  Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc.  Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 34 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 3: INFORMATION SEARCH ALTERNATIVE EVALUATION STRUCTURE 3.0 Learning Objectives 3.1 Stages in consumer decision making process 3.2 Kinds of decision rules 3.3 Outlet selection and purchase 3.4 Summary 3.5 Keywords 3.6 Learning Activity 3.7 Unit End Questions 3.8 References 3.0 LEARNING OBJECTIVES After studying this unit, you will be able to:  Explain thestages of consumer decision making process  Discuss the pre purchase information search of the product/service.  Examine the decision rules and selection  Identify the outlet selection and purchases  Explain about retail scene 3.1STAGES IN CONSUMER DECISION MAKING PROCESS There are five stages in the consumer decision making process. These are: 1. Need recognition/Problem recognition 2. Pre-purchase information search 3. Evaluation of alternatives 4. Purchase decision 5. Post-purchase outcome and reactions Need Recognition

Need recognition occurs when a consumer exactly determines their needs. Consumers may feel like they are missing out something and needs to address this issue so as to fill in the gap. When businesses are able to determine when their target market starts developing these needs or wants, they can avail the ideal opportunity to advertise their brands. An example who buys water or cold drink identifies their need as thirst. Here; however, searching for information and evaluating alternatives is missing. These consumer decision making steps are considered to be important when an expensive brand is under buying consideration such as cars, laptops, mobile phones, etc. Pre-purchase information search After a need is recognized, the consumer goes for an information search, so as to be able to make the right purchase decision. He gathers information about the:  Product category and the variations  Various alternatives  Various brands. The amount of information a consumer will gather depends on the following:  The consumer: demographics (age, gender, education), psychographics (learning, attitudes, involvement, personality type)  Product category: differentiation and alternative brands available, risk, price, social visibility and acceptance of the product.  Situation: time available at hand, first time purchase, quantity of information required, availability of information. The information search activity may be of various types, viz, specific, ongoing and incidental. (i)Specific: This type of search activity is specific to the problem and/ immediate purchase; it is spurred as the need arises, and the consumer actively seeks information. Example: student enters college and needs to buy a laptop so that he can work on his assignments. (ii)Ongoing: Here the search activity is a gradual process that could span over time. Example: the same student, has been thinking of purchasing the laptop since the past five years, and over these past 5-6 years, he has been gathering information specific to the laptop as a product category and also about the various brands available. (iii)Incidental: This is a byproduct of another search activity or experiences. Consumers absorb information from their day to day routine activities and experiences. Example: the student goes to a mall; he has gone there to help his mother buy a microwave oven; there in the store, he attends a demonstration of a new laptop that is being launched. Information Sources: 36 CU IDOL SELF LEARNING MATERIAL (SLM)

The information sources are of two types: i) Internal sources This includes the consumer and his self. He recalls information that is stored in his memory (comprising information gathered and stored, as well as his experiences, direct and indirect). Internal sources seem sufficient when:  It is a routine purchase  The product is of low involvement ii) External sources Here the consumer seeks information from the external environment. External sources of information include:  Interpersonal communication (family, friends, work peers, opinion leaders etc.)  Marketing communication or commercial information (advertisements, salespeople, company websites, magazines etc External sources are resorted to in cases where:  Past knowledge and experience is insufficient.  The product is of high involvement and the risk of making a wrong decision is high. Major information sources to which consumers will turn fall into four groups:  Personal: Family, friends, neighbors, acquaitances  Commercial: Advertising, websites, emails, salespersons, dealers, packaging, displays.  Public: Mass media, social media, consumer-rating organizations  Experiential: Handling, examining, using the product Evaluation of alternatives:  Some basic concepts will help us understand consumer evaluation process.  The consumer is trying to satisfy a need.  The consumer is looking for certain benefits from the product solution  The consumer sees each product as a bundle of attributes with varying abilities to deliver the benefits.  The attributes of interest to buyers vary by product. Once the consumer has gathered information and identified the alternatives, he compares the different alternatives available on certain criteria. 37 CU IDOL SELF LEARNING MATERIAL (SLM)

This involves: i) Generation of choice alternatives: While generation of alternatives, a consumer moves from an evoked set towards the choice set. - Evoked set/Consideration set: This is the set of alternatives that he actively considers while making a purchase decision; these exist either in his memory or feature prominently in the environment. The consumer perceives them to be acceptable. These are those alternatives from the evoked set that the consumer excludes from further consideration, as he perceives them to be inferior and unacceptable. These are those alternatives from the evoked set that the consumer excludes from further consideration, as he is indifferent towards them and perceives them as ones without much advantages or benefits ii)Identification of Evaluative Criteria: These are objective and subjective parameters of the brand that the consumer regards as important, and uses as standards to discriminate among the various alternatives. The consumer evaluates the different alternatives on one or few or many of these features and then makes a final choice. They are features that a consumer considers in choosing among alternatives; these could be functional/utilitarian in nature (benefits, attributes, features), or subjective/emotional/hedonic (emotions, prestige etc.). The major evaluative criteria are:  Economic: Price, Value (Product Attributes, Brand image, Evaluation of Quality, Price, & Features).  Behavioural: Need/motivation, Personality, self-concept and self-image, Lifestyle etc.  Social influences: Group influences, environmental issues etc. iii) Application of Decision Rules to make a final choice amongst alternatives: The consumer uses certain decision rules. The decision rules help a consumer simplify the decision process; the various evaluative criteria are structured and integrated so as to simplify the evaluation process. 3.2KINDS OF DECISION RULES There can be two kinds of decision rules:  Compensatory rules and  Non-compensatory rules. 1.Compensatory rules: Under compensatory rules, the various evaluative criteria are listed as attributes. These attributes are scored and rated for the various alternative brands. A lower rating on an attribute may be offset by a higher rating on another; i.e. a higher rating on one attribute would compensate for a lower rating on another. Based on the final scores, the brands are ranked; the one with the highest score, being regarded as the best. The consumer 38 CU IDOL SELF LEARNING MATERIAL (SLM)

would then select the brand that scores the highest among the various alternatives that have been evaluated. The attributes are rated for each brand and the scores are totaled. - Weighted: The attributes are first given weights relatively based on the level of importance; thereafter, the attributes are rated and finally scored after multiplication with the weights. The weighted scores are then totaled. 2.Non-Compensatory rules: Here, a negative evaluation of any one attribute eliminates the brand from consideration. A lower rating on an attribute cannot be offset by a higher rating on another; i.e. a higher rating on one attribute would not compensate for a lower rating on another. The consumer would then select the brand that scores the highest among the various alternatives that have been evaluated. Non-compensatory rules could assume three forms: conjunctive, disjunctive and lexicographic.  Conjunctive rule: A minimally acceptable cut off point is established for each attribute. The brands are evaluated, and, the brand that falls below the minimally acceptable limit on any of the attributes is eliminated/rejected.  Disjunctive rule: a minimally acceptable cut off point is established for each attribute. The brands are evaluated, and, the brand that falls above the cut off point on any of the attributes is selected.  Lexicographic rule: The various attributes are ranked in terms of perceived importance. First, the brands are evaluated on the attribute that is considered the most important. If a brand ranks considerably high than the others on this attribute, it is selected. In case the scores are competitive, the process may be repeated with the attribute considered next in importance. Intervening factors: Even if consumers from brand evaluations, two general factors can intervene between the purchase intention and the purchase decision. The first factor is attitude of others. The influence on us of another persons attitude depends on two things:  The intensity of the other persons negative attitude toward our preferred alternative  Our motivation to comply with the other persons wishes. 3.3OUTLET SELECTION AND PURCHASE Outlet selection is important to managers of retail firms. There are three basic alternative sequences a consumer can follow when making a purchase decision: Brand (or item) first, retail outlet second Retail outlet first, brand second 39 CU IDOL SELF LEARNING MATERIAL (SLM)

Brand and retail outlet simultaneously. The decision-making model suggest that brands are selected first and then, secondly, the specific retail outlet to buy them from. This situation may arise frequently. For example, a person can read about mobile phones in catalogues and talk with knowledgeable individuals about them. Based on this information, the consumer can select a brand and purchase it from the store with the lowest price (or best location, image, service or other relevant attributes). But for many individuals and for many product categories, stores rather than brands form the evoked set. One study found that two-thirds of brand decisions for supermarket items were made in the store. In the mobile phone example, a consumer might be familiar with one store that sells mobile phones (for example, Allphones). The consumer may then decide to visit that store and select from the brands available there. A third strategy is for the consumer to compare the brands in his or her evoked set at the stores in that evoked set. The decision would involve a simultaneous evaluation of both store and product attributes. Therefore, the consumer might choose between the second-preferred television at a store with friendly staff and excellent service facilities, and the favourite television at an impersonal outlet with no service facilities. The retail scene A retail outlet refers to any source of goods or services for consumers. Consumers see or hear descriptions of products in catalogues, in direct mail, in the various print media, on the internet or on television or radio, and acquire products through mail, telephone or internet orders. Many major department, grocery and variety stores have also developed an online presence.  Traditional store-based retailing is thus experiencing a rejuvenation.The retail shopping environment in both Australia and New Zealand can be described as increasingly complex, challenging and exciting for both consumers and marketers.  Many retailers need the ‘wow’ factor‘that special something that makes a customer's jaw drop when he or she enters the store, and keep dropping as he or she walks around.  If all other things are approximately equal, the consumer will generally select the closest store.  Location has been found to be generally more important than other factors such as price and product range.  Likewise, the size of an outlet is an important factor in store choice.  Unless a customer is particularly interested in fast service or convenience, larger outlets are preferred over smaller outlets, all other things being equal. 40 CU IDOL SELF LEARNING MATERIAL (SLM)

Individuals go shopping for more complex reasons than simply to acquire a product or set of products.  Diversion from routine activities, exercise, sensory stimulation, social interactions, learning about new trends and even acquiring interpersonal power (‘bossing around’ sales staff) have been reported as non-purchase reasons for shopping.  The perception of risk differs among consumers, based in part on their past experiences and lifestyles. Like product categories, retail outlets are perceived as having varying degrees of risk.  Traditional outlets are perceived as low in risk, whereas non-traditional outlets, such as direct mail or the internet, are viewed as higher in risk.  Non-traditional outlets need to minimise the perceived risk of shopping if they sell items with either a high financial or a high social risk. Online firms can help to reduce perceived risk by stressing credit card encryption for transaction security, free shipment, availability of 24-hour customer-service telephone lines with trained staff and a 100% satisfaction Once the brand and the store have been selected, the consumer must complete the transaction. This involves what is normally called purchasing the product. Credit plays a major role in consumer purchases in Australia and New Zealand. Without credit, a great many purchases simply could not be made.  Of course, credit is not only a means to purchase a product; it is a product itself.  The decision to purchase a relatively expensive item may trigger problem recognition for credit.  Since a variety of forms of credit are available, the decision process may need to be repeated for this problem. Purchase: Once the brand and the store has been selected the consumer must complete the transaction. This involves what is normally called purchasing the product.Credit plays a major role in consumer purchases. Without credit great many purchases simply could not be made.  Ofcourse , credit is not only a means to purchase the product, it is a product itself.  The decision to purchase a relatively expensive item may trigger problem recognition for credit. Since a variety of forms of credit are available, the decision process may need to be repeated for this problem.Based on all these a product is purchased by a consumer. 41 CU IDOL SELF LEARNING MATERIAL (SLM)

3.4 SUMMARY  After a need is recognized, the consumer goes for an information search, so as to be able to make the right purchase decision.  Consumers absorb information from their day to day routine activities and experiences.  Once the consumer has gathered information and identified the alternatives, he compares the different alternatives available on certain criteria.  These are objective and subjective parameters of the brand that the consumer regards as important, and uses as standards to discriminate among the various alternatives.  Under compensatory rules, the various evaluative criteria are listed as attributes. These attributes are scored and rated for the various alternative brands.  Non-compensatory rules could assume three forms: conjunctive, disjunctive and lexicographic. 3.5 KEYWORDS  Situation: time available at hand, first time purchase, quantity of information required, availability of information  Specific: This type of search activity is specific to the problem and/ immediate purchase; it is spurred as the need arises, and the consumer actively seeks information.  Personal: Family, friends, neighbours, acquaintances  Commercial: Advertising, websites, emails, salespersons, dealers, packaging, displays.  Public: Mass media, social media, consumer-rating organizations  Experiential: Handling, examining, using the product 3.6LEARNING ACTIVITY 1. Locate two different websites that sell similar products, one that targets the upper class and one that targets the lower class. How do these websites differ in appearance and in their offerings? Do they differ in any other ways? ___________________________________________________________________________ _____________________________________________________________________ 2. Assume that you have just been hired as a customer relations expert by Johnson & Johnson to answer a growing number of complaints that JNJ products are over-priced and 42 CU IDOL SELF LEARNING MATERIAL (SLM)

have lost their sense of value for the consumer. The complainants cite lower priced private labels and store brands as illustrations of frustrations with JNJ. As one consumer states, “A band aid is just a band aid after all!” What would be your response? ___________________________________________________________________________ _____________________________________________________________________ 3.7 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Explain about pre-purchase information search? 2. List out the types of information search 3. Mention the types of information sources 4. What is an internal source? 5. List out the kinds of decision rules. Long Questions 1. Explain the steps in consumer decision making process. 2. Classify the types of information search 3. Classify the types of information sources 4. Discuss the basic concepts of evaluation of alternatives 5. Explain the kinds of decision rules 6. Explain outlet selection and purchase B. Multiple Choice Questions 1. First stage in the basic model of Consumer Decision Making is ______ a. Purchase b. Information Search c. Need d. Evaluation of alternatives 2. Second stage in the Consumer Decision Making model is ______ 43 a. Need b. Information Search CU IDOL SELF LEARNING MATERIAL (SLM)

c. Post-purchase d. Purchase 3. The final stage in the Consumer Decision Making model is ______ a. Pre-purchase b. Post-purchase c. Evaluation of alternatives d. Purchase 4. The customer or consumer is __________when actual performance exceeds the expected performance of the product. a. Happy b. Satisfied c. Disatisfied d. Delighted 5.The perception of risk differs among_______, based in part on their past experiences and lifestyles. a. Consumers b. Customers c. Manufacturers d. Dealers Answers 1 – c, 2 – b, 3 – b, 4 – d, 5 – a 3.8 REFERENCES References books  Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago. 44 CU IDOL SELF LEARNING MATERIAL (SLM)

 Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi.  Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books  Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India.  Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc.  Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 45 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 4: POST PURCHASE BEHAVIOUR STRUCTURE 4.0 Learning Objectives 4.1 Post purchase behaviour 4.2 Levels of consumer decision making 4.3 Views of decision making 4.4 Post purchase action 4.5 Post purchase satisfaction 4.6 Purchase evaluation and customer satisfaction 4.7 Role of involvement 4.8 Nature of consumer involvement 4.9 Causes of consumer involvement 4.10 Types of consumer involvement 4.11 Effects of consumer involvement 4.12 Models of consumer involvement 4.13 Role of a marketer 4.14 Summary 4.15 Key words 4.16 Learning Activity 4.17 Unit End Questions 4.18 References 4.0 LEARNING OBJECTIVES After studying this unit, you will be able to:  Explain the steps in consumer decision making process  Identify the levels of consumer decision making  Explain the views of consumer decision making  Discuss about cognitive dissonance  Explain the role of a marketer

4.1 POST PURCHASE BEHAVIOUR Consumer Decision Making Process The consumer decision-making process can seem mysterious, but all consumers go through basic steps when making a purchase to determine what products and services will best fit their needs. Steps in consumer decision making process 1. Problem recognition The first step of the consumer decision-making process is recognizing the need for a service or product. Need recognition, whether prompted internally or externally, results in the same response a want. Once consumers recognize a want, they need to gather information to understand how they can fulfill that want. 2. Information search When researching their options, consumers again rely on internal and external factors, as well as past interactions with a product or brand, both positive and negative. In the information stage, they may browse through options at a physical location or consult online resources, such as Google or customer reviews. 3. Alternatives evaluation At this point in the consumer decision-making process, prospective buyers have developed criteria for what they want in a product. Now they weigh their prospective choices against comparable alternatives. Alternatives may present themselves in the form of lower prices, additional product benefits, product availability, or something as personal as colour or style options. Your marketing material should be geared towards convincing consumers that your product is superior to other alternatives 4. Purchase decision This is the moment the consumer has been waiting for: the actual purchase. Once they have gathered all the facts, including feedback from previous customers, consumers should arrive at a logical conclusion on the product or service to purchase. 5. Post-purchase evaluation The best marketers know that the process doesn’t end at the purchase step in fact, that’s only the beginningof a customer’s value for your company. Once acquisition is out of the way, your new goal is to create long-term relationships between consumer and company, ensuring that you get the most value out of your customers, and they get the most value out of your products 47 CU IDOL SELF LEARNING MATERIAL (SLM)

4.2LEVELS OF CONSUMER DECISION MAKING Three levels of consumer decision-making Extensive problem-solving  Consumers have not yet established a criteria for evaluating the product  They haven’t narrowed the number of brands to be considered Limited problem-solving  Consumers have established a basic criteria for product evaluation  They haven’t fully established brand preferences Routinised-response behaviour  Consumers have some experience with the product category  They have a well established set of criteria for product evaluation  They may search for a small amount of information or may purchase out of habit 4.3VIEWS OF CONSUMER DECISION MAKING Four views of consumer decision-making i. An economic view: world of perfect competition, the consumer has often been characterised as making rational decisions. ii. A passive view: depicts the consumer as basically submissive (“onderdanig”) to the self- serving interests and promotional efforts of marketers. iii. An emotional view: associate deep feelings or emotions, such as joy, fear, love, hope, sexuality, fantasy and even a little ‘magic’, with certain purchases or possessions. These feelings or emotions are likely to be highly involving. iv. A cognitive view: within this framework, consumers are frequently pictured as either receptive to or actively searching for products and services that fulfil their needs and enrich their lives. Pre-Purchase Behaviour When a consumer realizes the needs, he goes for an information search. He does the same, so that he can make the right decision. He gathers the information about the following:  Product Brands  Product Variations 48 CU IDOL SELF LEARNING MATERIAL (SLM)

 Product Quality  Product Alternatives The consumer can gather information about a product depending on his age, gender, education and product’s price, risk and acceptance. Post-Purchase Behavior All the activities and experiences that follow purchase are included in the post purchase behavior. Usually, after making a purchase, consumers experience post-purchase dissonance. They sometimes regret their decisions made. It mainly occurs due to a large number of alternatives available, good performance of alternatives or attractiveness of alternatives, etc. The marketers sometimes need to assure the consumer that the choice made by them is the right one. The seller can mention or even highlight the important features or attributes and benefits of the product to address and solve their concerns if any. A high level of post- purchase dissonance is negatively related to the level of satisfaction which the consumer draws out of product usage. To reduce post-purchase dissonance, consumers may sometimes even return or exchange the product. Post-purchase behavior is the reaction of the consumer, it gives an idea of his likes and dislikes, preferences and attitudes and satisfaction towards the product. It indicates whether or not the purchase motives have been achieved.Purchase is the means, and post purchase is the end. Post purchase behavior indicates whether or not repeat purchases will be made. Whether the customer will recommend the product to others or not. It indicates whether long- term profits can or cannot be expected. All this can be found out by the post-purchase behavior of the customers. Post-purchase behavior is the reaction of the consumer, it gives an idea of his likes and dislikes, preferences and attitudes and satisfaction towards the product. It indicates whether or not the purchase motives have been achieved. Purchase is the means, and post purchase is the end. Post purchase behavior indicates whether or not repeat purchases will be made. Whether the customer will recommend the product to others or not. It indicates whether long-term profits can or cannot be expected. All this can be found out by the post-purchase behavior of the customers.Post-purchase behaviour describes the way a customer thinks, feels, and acts after they have bought something.This is when a customer is assessing whether or not they are happy with their purchase. How they feel will affect whether they make further purchases from your brand. Post purchase is also a time when the customer can affect whether others buy from you. It’s human nature to rave (or rant) about a recent purchase, whether that’s on social media or face-to-face.Sometimes customers feel anxious after they’ve bought something. They’ve just splashed their cash, so it’s natural for them to question if this was well spent. Purchase is the means, and post purchase is the end. Post purchase behavior indicates whether or not repeat purchases will be made. Whether the customer will recommend the product to 49 CU IDOL SELF LEARNING MATERIAL (SLM)

others or not. It indicates whether long-term profits can or cannot be expected. All this can be found out by the post-purchase behavior of the customers. Post purchase is the last phase in the decision-making process. The customer while making a decision goes through various phases: After purchasing a product, a customer is either satisfied or dissatisfied and his satisfaction or dissatisfaction depends on his expectation and the difference between the performance. Expectation gives the degree of customer’s satisfaction/dissatisfaction with the product. This is shown in Figure below. Figure 4.1 Expectation gives the degree of customer’s satisfaction/dissatisfaction If the performance is below expectations the customer is dissatisfied. However, there can be a match between the two, i.e., performance is in line with expectation. In another position is the product which surpasses the expectancy level, and performs much better than expected. This is a source of satisfaction and delight to the consumer. 50 CU IDOL SELF LEARNING MATERIAL (SLM)