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While teaching the Elective Papers of Marketing Management in some Business Schools, the
author came across several problems faced by the management students, in studying &
preparing for the examinations. Usually, the students need to study one main text, and a few
other supplementary books. There are many good text books and reference books available for
study. But no single book gives a complete or comprehensive material for study or the
examinations for the students. This is because either the syllabus is not matching with the
contents & style of the text books or the treatment is too short or too lengthy for their relative
importance. All these have to be covered within a short & stipulated period of teaching sessions
² normally one semester or trimester. Even the difference in style & approach of the treatment
of concept presented in various text books sometimes gives rise to conflicting views in
understanding the underlying concept and principles. So if a complete and comprehensive
study material is available, both the students & the teachers can benefit out of this.??
On the basis of varied and long experience in industry and teaching, the author perceives that
the teaching or study of management subjects is the best in the following way :?

? General meaning & evolution of the terms, terminology & concepts,?

? Their interpretations in the context of the particular subject & circumstances,?

? Detailed descriptions and explanations, and?

? Finally, the application of this concept in real life situations.?
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The author understands that the two critical steps among these are no.s (2) Interpretations,
and (4) Applications. In these work the author tries to help solve one of them in particular,
namely Interpretations. The other one, namely Applications is kept out of the present objective
for two reasons :?

? The scenario of marketing, markets & consumer has become so complex and varied, that a
single application uses not one but several of the marketing concepts & strategies
simultaneously, where the present endeavour may not be sufficient to describe their different
effects.?

? The study material of case studies and applications are available for both global & domestic
companies in plenty.?
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In this maiden work, the author sincerely tries to compile an easy flowing study material so
that the first three points of the above steps become easy for the students so as to have a quick
grasp over the subject matter. In other words, the author tries to make the whole process of
studying easier for the students, as well as the teachers. ??
The author, thanks sincerely one and all who have inspired, guided and helped him in any way
whatsoever, and he invites with an open mind all constructive suggestions & comments from
anybody who is related to this stream of knowledge & study.??
There shall be a series of Articles on the subject of Consumer Behaviour. The Presentation
Style of the whole set of Articles shall be in the following Format & Style :?

? Language ² Mostly in English (UK) or British English?

? Length ² The length of one article varies approximately between One & Two Sessions ( 60 to
120 minutes), if presented or discussed (approx 2000-3500 words).?

? The main target readers are business school students & others who have an interest in the
study of business management or marketing management.?

? Suggestions regarding improvement & enhancement of contents are invited from readers via
email : hisema@gmail.com, hisema@yahoo.co.in, hisema@zoho.com?
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? Why Study Consumer Behaviour ??

? Introduction to Consumer Behaviour?

? The Consumer Behaviour Theory?

 
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In the highly specialised study of ´BUSINESS MANAGEMENTµ, ´BUSINESS ADMINISTRATIONµ
or just ´MANAGEMENTµ today, ´MARKETING MANAGEMENTµ function plays a very critical
role. This is because this functional area of management (1) ´EARNSµ the revenue, & (2)
´WORKSµ in the close proximity with the public or persons outside the organisation.
Controlling these two attributes to have the desired benefits are the most difficult part of the
management, because none of these two are within the direct control of the marketers. This
doesn·t mean that the other functional areas are not useful, but they are not ´DIRECTLYµ
involved in the activities mentioned above.??
Similarly, within the study of Marketing Management, the ´Consumersµ or the ´Customersµ
play a very critical role as these are the people who finally BUY the goods & services of the
organisation, and the firm is always on the move to make them buy so as to earn revenue. It·s
crucial from both the points of view as given below :?

? From the customers· point of view : Customers today are in a tough spot. Today, in the highly
developed & technologically advanced society, the customers have a great deal of choices &
options (and often very close & competing) to decide on.?

? They have the products of an extreme range of attributes (the 1st P - Product),?

? they have a wide range of cost and payment choices (the 2nd P - Price),?

? they can order them to be supplied to their door step or anywhere else (the 3rd P - Place),?

? and finally they are bombarded with more communications from more channels than ever
before (the 4th P - Promotion).?
How can they possibly decide where to spend their time and money, and where they should
give their loyalty ??
1.? From the marketers· point of view : ´The purpose of marketing is to sell more stuff to more
people more often for more money in order to make more profitµ. This is the basic principle of
requirement for the marketers in earlier days where aggressive selling was the aim. Now it can·t
be achieved by force, aggression or plain alluring. For the customers are today more informed,
more knowledgeable, more demanding, more discerning. And above all there is no dearth of
marketers to buy from. The marketers have to earn them or win them over.
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The global marketplace is a study in diversity, diversity among consumers, producers,
marketers, retailers, advertising media, cultures, and customs and of course the individual or
psychological behaviour. However, despite prevailing diversity, there also are many similarities.
The object of the study of consumer behaviour is to provide conceptual and technical tools to
enable the marketer to apply them to marketing practice, both profit & non-profit.??
The study of consumer behaviour (CB) is very important to the marketers because it enables
them to understand and predict buying behaviour of consumers in the marketplace; it is
concerned not only with what consumers buy, but also with why they buy it, when and where
and how they buy it, and how often they buy it, and also how they consume it & dispose it.
 Consumer research is the methodology used to study consumer behaviour; it takes place at
every phase of the consumption process: before the purchase, during the purchase, and after
the purchase. Research shows that two different buyers buying the same product may have
done it for different reasons, paid different prices, used in different ways, have different
emotional attachments towards the things and so on.??
According to Professor Theodore Levitt of the Harvard Business School, the study of Consumer
Behaviour is one of the most important in business education, because the purpose of a
business is to create and keep customers. Customers are created and maintained through
marketing strategies. And the quality of marketing strategies depends on knowing, serving, and
influencing consumers. In other words, the success of a business is to achieve organisational
objectives, which can be done by the above two methods. This suggests that the knowledge &
information about consumers is critical for developing successful marketing strategies because
it challenges the marketers to think about and analyse the relationship between the consumers
& marketers, and the consumer behaviour & the marketing strategy.??
Consumer behaviour is interdisciplinary; that is, it is based on concepts and theories about
people that have been developed by scientists, philosophers & researchers in such diverse
disciplines as psychology, sociology, social psychology, cultural anthropology, and economics.
The main objective of the study of consumer behaviour is to provide marketers with the
knowledge and skills, that are necessary to carry out detailed consumer analyses which could
be used for understanding markets and developing marketing strategies. Thus, consumer
behaviour researchers with their skills for the naturalistic settings of the market are trying to
make a major contribution to our understanding of human thinking in general.??
The study of consumer behaviour helps management understand consumers· needs so as to
recognise the potential for the trend of development of change in consumer requirements and
new technology. And also to articulate the new thing in terms of the consumers· needs so that
it will be accepted in the market well.??
The following are a few examples of the benefits of the study of consumer behaviour derived by
the different categories of people :?

? A marketing manager would like to know how consumer behaviour will help him to design
better marketing plans to get those plans accepted within the company.?

? In a non-profit service organisation, such as a hospital, an individual in the marketing
department would like to know the patients· needs and how best to serve those needs.?

? Universities & Colleges now recognise that they need to know about consumer behaviour to aid
in recruiting students. ´Marketing Admissionsµ has become an accepted term to mean
marketing to potential students.?
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Consumer behaviour has become an integral part of strategic market planning. It is also the
basis of the approach to the concept of Holistic Marketing. (See the article on ´HOLISTIC
MARKETING µ written by the author). The belief that ethics and social responsibility should
also be integral components of every marketing decision is embodied in a revised marketing
concept ² the societal marketing concept ² which calls on marketers to fulfil the needs of their
target markets in ways that improve society as a whole.?
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The study of Consumer Behaviour is quite complex, because of many variables involved and
their tendency to interact with & influence each other. These variables are divided into three
 major sections that have been identified as the most important general influences on
Consumer Behaviour. Imagine three concentric circles, one at the outer most, one in the
middle & one at the inner most, and they represent the following :?

? External Environmental Variables Influencing Behaviour : These are the factors controlled by
external environments like the following form the basis of external influences over the mind of
a customer (outer circle) :?

? Culture, and Sub-culture,?

? Social Class, and Social Group,?

? Family, and Inter-Personal Influences,?

? Other Influences (which are not categorised by any of the above six, like geographical, political,
economical, religious environment, etc.).?

? Individual Determinants of Behaviour : Major individual determinants of Consumer Behaviour
are portrayed in the middle ring. These are the human mind and its attributes. These variables
are personal in nature and they are influenced by the above set of external factors and in turn
influence the way consumers proceed thro· a decision making process regarding products &
services. They are :?

? Personality & Self-concept,?

? Motivation & Involvement,?

? Perception & Information Processing,?

? Learning & Memory,?

? Attitudes.?

? The Consumer Decision Making Process : The buying decision comes as a product of the
complex interaction of the external factors and the personal attributes. The inner most circle
denotes the consumer decision making process regarding products & services, whose major
steps are :?

? Problem Recognition,?

? Information Search,?

? Evaluation of Application,?

? Purchase Decision,?

? Post-Purchase Behaviour.?
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Marketers are frequently uncertain about the variables that are at play influencing & affecting
consumers. Sometimes this occurs because they don·t clearly understand the extent of
variables that might be having an influence. The details of all external, internal, environmental,
economical etc. are discussed above. Sometimes some variables are not directly observable.
Other times variables are known to the marketers but their exact nature & relative strength of
influence is not apparent. In these circumstances, it is useful to understand the above
mentioned concepts and how the consumers behave, so that their decision making process can
be predicted to a reasonable extent. The human mind being as complex as it is, the
understanding of the buying behaviour of the consumers becomes a continuous activity of
application of various theories & concepts by the marketers.?
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An understanding of how the theory of consumer behaviour and its application tools evolved
over the years will enable us to appreciate the validity of the theory and give us a guidance in
its practical application. Consumer behaviour, like all human behaviour is very complex. But
the consumer behaviour theory, like all theories is a simplified & abstract representation of
reality. The more simplified picture of consumers provided by the theory helps us enormously
to understand the consumers. It not only helps us to think about consumers, but also provides
 us with a language to talk about them. This language is very useful, because to be effective in
an organisation ² for profit or non-profit ² one has to persuade others to accept his ideas. And
in fact, lack of this language has been one of the greatest drawback of the modern marketers.??
Market Research or Marketing Research (MR) has been developing since ´MARKETINGµ which
brings together all customer elements, grew out of the concept of ´SALESµ in the early fifties.
The theory of consumer behaviour draws heavily upon the famous psychologist Sigmund
Freud, particularly with respect to the emotional, psychological, mental, subjective or non-
utilitarian aspects of buying decision or behaviour of a consumer. The theory represents the
hidden order in this very complex activity, which we call consumer behaviour. On the surface,
this highly complex & varied display of behaviour by consumers seems essentially unexplained.
But slowly as the theory develops, the hidden pattern emerges, describing the order we
suddenly see, and explaining why the behaviour pattern takes place.??
Now, what is the magic stuff called consumer behaviour theory that does all these wonderful
things. It·s not just a theory, as explained earlier, but more than that. It helps us to make
better marketing decisions for profit & non-profit organisations. Thus we can examine the
characteristics of a theory that enables us to do so. Researchers G Zaltman and M Wallendorf
have came out with the most important attributes of a good & sound theory, after very close
and careful thought. These are the following :?

? A theory which does both : explains how consumers buy & predicts what consumers will buy.?

? It unifies previously unrelated areas of knowledge, for example, it relates to information that
consumers get from advertising so as to decide what brands they buy.?

? The theory is simple. If not, it can be so complex that we can·t understand well enough to apply
it to our practical problems.?

? It is testable so that we can verify whether the theory is valid and therefore dependable.?

? Implied in the previous characteristic, it is supported by the facts. This means, to lay the
theory up against data describing how consumers buy in the market and thereby determine if
the facts confirm the theory. If they don·t, then either the theory should be modified till the
facts do verify it or abandon the theory.?

? The theory is general, which means that it can be applied to a wide range of products &
services. If it is not, then it won·t be very useful.?

? It has heuristic value, meaning that it poses new questions for us that had not been previously
asked. While trying to answer these questions, new knowledge is created and that becomes the
part of the theory.?

? It is internally consistent. This means that the theory is internally free from logical
incongruencies or else the prediction will be doubtful & flawed. Lack of this quality will make
the theory a dangerous tool.?

? It is original. If not, it adds little to the existing knowledge.?


? It is plausible. If not, it can·t be seen by others as making any sense, and hence, they will not
likely to accept the theory and so it won·t be useful.?

? And if all the above ten points are in order, then it can be applied to designing marketing
strategy and marketing plans.?
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Consumer Behaviour (or Buyer Behaviour) is broadly defined by various scholars & researchers
as :?

? It·s the behaviour displayed by the consumers during the acquisition, consumption and
disposition of products, services, time and ideas by decision making units.?

? It is the body of knowledge which studies various aspects of purchase and consumption of
products and services by individuals with various social and psychological variables at play.?

? The behaviour that the consumers display in searching for, purchasing, using, evaluating and
disposing of products and services that they expect will satisfy their needs.?

? The process and activities people engage in when searching for, selecting, purchasing, using,
evaluating, and disposing of products and services so as to satisfy their needs and desires.?

? The activities directly involved in obtaining, consuming, and disposing of products and
services, including the decision processes that precede and follow these actions.?

? The American Marketing Association (AMA) defines consumer behaviour as ´The dynamic
interaction of cognition, behaviour & environmental events by which human beings conduct
the exchange aspect of their lives.?
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The study of consumer behaviour involves search, evaluation, purchase, consumption and post
purchase behaviour of the consumers and includes the disposal of purchased products keeping
environment and personal characteristics in mind.?
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