Consumer Behavior Prof.

Hemant Kombrabail

INTRODUCTION

All of us are consumers. We consume things of daily use. We also consume and buy these products
according to our needs, preferences and buying power. These can be consumable goods, durable
goods, speciality goods or, industrial goods.

What we buy, how we buy, where and when we buy, in how much quantity we buy depends on our
perception, self concept, social and cultural background and our age and family cycle, our attitudes,
beliefs values, motivation, personality, social class and many other factors that are both internal and
external to us. While buying, we also consider whether to buy or not to buy and, from which source or
seller to buy. In some societies there is a lot of affluence and, these societies can afford to buy in
greater quantities and at shorter intervals. In poor societies, the consumer can barely meet his barest
needs.

To know the buyer, his buying motives and buying habits, to understand not only his needs and
desires, but also his fancies, foibles and eccentricities, has throughout been a fundamental necessity for
the marketing man. But there is no unified, well defined, tested and universally established theory of
buyer behavior established. All researches and studies have contributed to a vast assortment of
information on buyer behavior.

The marketers therefore try to understand the needs of different consumers and having understood his
different behaviors, which require an in-depth study of their internal and external environment, they
formulate their plans for marketing.

Consumer behavior can be defined as the decision-making process and physical activity involved
in acquiring, evaluating, using and disposing of goods and services.

This definition clearly brings out that it is not just the buying of goods / services that receives attention
in consumer behavior, but the process starts much before the goods have been acquired or bought. A
process of buying starts in the minds of the consumer, which leads to the finding of alternatives
between products that can be acquired with their relative advantages and disadvantages. This leads to
internal and external research. Then follows a process of decision-making for purchase and using the
goods, and then the post purchase behavior which is also very important, because it gives a clue to the
marketers whether his product has been a success or not.

 What motivates the buyer?

 What induces him to buy?
 Why does he buy a specific brand from a particular shop?
 Why does he shift his preferences from one shop to another or from one brand to another?
 How does he react to a new product introduced in the market or a piece of information
addressed to him?
 What are the stages he travels through before he makes the decision to buy?
These are some of the questions that are of perennial interest to the marketing man. Though there are
no succinct and precise answers to these questions, or, rather around the answers to these questions that
the product strategies and promotion strategies of the marketing man ultimately revolve.

To understand the likes and dislikes of the consumer, extensive consumer research studies are being
conducted. These researches try to find out:
 What the consumer thinks of the company's products and those of its competitors?

 How can the product be improved in their opinion?

 How the customers use the product?

 What is the customer's attitude towards the product and it’s advertising?

 What is the role of the customer in his family?

Consumer behavior is a complex, dynamic, multidimensional process, and all marketing decisions are
based on assumptions about consumer behavior.

Marketing strategy is the game plan that the firms must adhere to, in order to outdo the competitor or
the plans to achieve the desired objective. In formulating the marketing strategy, to sell the product
effectively, cost-benefit analysis must be undertaken.

1
Consumer Behavior Prof. Hemant Kombrabail

There can be many benefits of a product, for example, for owning a motorbike one can be looking for
ease of transportation, status, pleasure, comfort and feeling of ownership. The cost is the amount of
money paid for the bike, the cost of maintenance, gasoline, parking, risk of injury in case of an
accident, pollution and frustration such as traffic jams. The difference between this total benefit and
total cost constitutes the customer value. The idea is to provide superior customer value and this
requires the formulation of a marketing strategy. The entire process consists of market analysis, which
leads to target market selection, and then to the formulation of strategy by juggling the product, price,
promotion and distribution, so that a total product (a set of entire characteristics) is offered. The total
product creates an image in the mind of the consumer, who undergoes a decision process that leads to
the outcome in terms of satisfaction or dissatisfaction, which reflects on the sales and image of the
product or brand.

Figure below gives in detail the shaping of consumer behavior, which leads a consumer to react in
certain ways and he makes a decision, keeping the situations in mind. The process of decision-making
varies with the value of the product, the involvement of the buyer and the risk that is involved in
deciding the product / service.

The figure shows the consumer life style in the center of the circle. The consumer and his life style are
influenced by a number of factors shown all around the consumer. These are culture, subculture,
values, demographic factors, social status, reference groups, household and also the internal make up
of the consumer, which are a consumers' emotions, personality motives of buying, perception and
learning. Consumer is also influenced by the marketing activities and efforts of the marketer. All these
factors lead to the formation of attitudes and needs of the consumer. Then follows the process of
decision-making, (as shown in the rectangle) which consists of the problem recognition, information
search (which is both internal and external) then the evaluation and selection procedure, and finally the
purchase. After the purchase and use of the product the customer may be satisfied or dissatisfied with
the product. This is known as post-purchase behavior. The existing situations also play an important
role in the decision-making process. The dotted lines show the feedback.

Simplified Framework For Studying Consumer Behavior

Advantages of Studying Consumer Behavior

1. Saves From Disaster
The failure rate of new products is surprisingly high not only in highly competitive economies of
USA, Europe and Japan etc but even in India. For instance Roohafza of Hamdard succeeded well
but when other companies tried like Dabur to produce similar products they could not succeed.
Dabur had to stop production of Sharbat, because consumers did not like its taste. Maggi became
very popular with consumers but when other companies tried they failed, some of them have

2
Consumer Behavior Prof. Hemant Kombrabail

become sick. There are many more such examples. If one tests the market before launching a new
product this type of disaster can be avoided or minimized.
2. Helps in Formulating The Right Marketing Strategy
If one studies well what factors will influence demand of a product accordingly production and
marketing strategies can be framed. Nirma in initial stages succedeed in its washing powder only on
account of its price. It gave tough competition to Hindustan Lever, Surf the market leader and today
Nirma has become a big producer.

In food items it is taste, which decides whether consumer will buy the product or not. Besides big
names even small producers have succeeded because of proper product. For instance, a small
producer of Sikanji (cold drink prepared by mixing syrup and lemon) at Modinagar has become a
name in the region and now he provides franchise to others. From a small pan shop he has become a
well-known name in the area of Delhi-Modinagar and made huge profits.

3. Helps in Sales Promotion

If through the study of consumer behavior one is able to know correctly the factors which influence
buying decision of the consumer one can promote sales of existing or new product The scheme of
buying back old items has helped a lot LML in pushing sales. Akai TV and number of other
companies like Bajaj Auto followed this strategy. Manufacturers of diesel generator sets,
refrigerators, electric iron, pressure cookers etc also adopted the strategy and benefited.

Similarly introduction of small packs of shampoos, washing powder and pan masala etc has helped
the companies to expand their market. "When producers found that even a poor person does not
mind trying a new costly product if it is available in affordable price pack many companies
introduced such packaging and when the product was liked they became regular customers.

4. Aids in Segmentation of Market

The study of consumer behavior suggested that every one does not buy on price consideration or
utility consideration only. For high-income groups high priced cloth, cars, etc have been produced.
In certain cases the price of such cloth is three to eight times of normal suiting price but some
section still buy it for prestige or show. The producers of such items make heavy profits, which
would not have been possible without study of consumer behavior because it is against basic
economic theory. Even some producers to cater different segments produce varieties of products
such as soaps, creams, toothpastes etc.

5. Enables Development of New Products

Before launching a new product proper study of consumer tastes i.e. behavior avoids later failure
and loss. This is particularly true for food items and daily consumption products. It is equally true
for fashion goods like garments, cosmetics, cigarettes and new flavors of existing products. In
certain cases if a product is reintroduced after a long gap this type of study helps. For instance Coca-
Cola was banned in India in 1977 and consumers by and large forget its taste and liking. Thumps up
and other drinks took its place. When Coca-Cola was reintroduced in 90's it could as yet not reach
the same supremacy. Life Bouy re-oriented its product and produced different items like Life Bouy
Gold, Life Bouy Plus to meet demand of different consumers.

6. Helps in Product Orientation

The study of consumer behavior helps to find out why consumers are drifting away from a product
or why they do not like it. For instance some of Indian toothpastes are being produced for long like
Neem but it could not capture the market. There are many other instances when a new product has
been developed or reoriented to again capture its old glorious position. Those who do it
scientifically succeed and others who do not study consumer behavior properly or do not orient
loose the market, merely by pretty faces or fancy claims he wants to be assured that what is claimed
is really true. Therefore based on consumer research new technique are used Hindustan Lever and
Procter & Gamble for Surf Ultra and Ariel has brought in producers of cloth Bombay Dyeing and
Reliance to testify claims of producers of these washing powders. This is not an isolated case but
this type of study had paid good results to others also.

7. Aids in Reorientation of Packaging

A great deal of importance is being given to packaging for quite sometime by marketing department
and market research. But whether a particular packaging is liked by consumers or not is a recent
phenomenon. Consumer if likes a packing helps in pushing sales. Producers of Vanaspati
(hydrogenated oil), milk, drinks items, etc have developed utility packaging so that once container
becomes empty they can be used for refilling. In certain cases this fact is advertised also. But in

3
Consumer Behavior Prof. Hemant Kombrabail

many cases this has been done without study of consumer behavior and his attraction or disliking of
a particular packaging. The fact however remains that proper study can help in pushing sales.

8. Helps Consumers to Study their Behavior

The consumers often are guided by their income, emotions, opinion of others and they do not
undertake study of their behavior whether it is scientific or not. The science however can help them
to study cost benefit of their buying decisions. The study can reveal to them whether buying an
expensive item is rational or not. Whether they should buy Rs. 2 ball pen or fancy pen costing Rs.
100 or more. Whether they should decide in favor of expensive cloth, car, consumer durables and
other fashion goods or should they buy on utility consideration. If there are competitive goods it can
help them to make consumer preference chart and then decide what to buy immediately and what to
postpone and what should be rejected.

Disadvantages of Studying Consumer Behavior

1. The marketers study the behavior of consumer to mould it in favor of their product and some
times make fancy claims and use objectionable techniques.
2. They also take the help to produce and market such products that have no utility. In many cases
consumers are exploited by sexy or otherwise attractive advertisements through the media. They
take full advantage of weaknesses of consumers to mould it in their favor whether it is scheme of
exchange, gifts, lotteries or otherwise. All over the world consumers have been exploited by sales
promotion schemes and campaigns. For instance producers certain producers claim that use of their
toothpaste will guard against germs and cavity. Producers of medicines claim cure of certain
diseases. Producers of hair oils claim that it will stop falling of hairs and/or new hairs will start
growing. Slim centers claim to reduce weight in magic speedy manner. Some one claims that
baldness can be cured by replanting of new hairs in short period. Some one claims regeneration of
vitality even in old person. Any number of examples can be given but such claims sometimes even
by big companies are only partially true.
3. Higher priced products are introduced to take advantage of consumers’ weakness just by
changing shape, packing etc.
4. Customers are as attracted by gifts, lotteries, exchange schemes, etc. In such cases often claims
are exaggerated and benefits in the form of sales promotion scheme is only to seller and not to
buyer.

The governments in most of the countries have found that though consumer is the king he is exploited.
Hence most of countries have framed and enacted many acts and regulations to safe guard the interest
of consumers In India also there are a large number of laws in this direction like Monopoly and
Restrictive Trade Practices Act (MRTP), Essential Commodities Act, Consumer Protection Act,
compulsory printing of maximum retail price on each packing, weights and Measures Act and Code of
Advertising For specific commodities there are special Union and state government laws like for drugs
and regulations of telephone rates. In addition there are public forums to protect consumers

Factors Influencing Consumer Behavior

The factors that influence consumer behavior can be classified into internal factors or (individual
determinants) and, external environmental factors. External factors do not affect the decision process
directly, but percolate or filter through the individual determinants, to influence the decision process as
shown in Figure below. The arrow shows how the external influences are filtered towards the
individual determinants to affect the decision process

The individual determinants that effect consumer behavior are:

 Motivation and involvement
 Attitudes
 Personality and self concept
 Learning and memory
 Information processing

The external influences or factors are:

 Cultural influences
 Sub-cultural influences
 Social class influences
 Group influences
 Family influences
4
Consumer Behavior Prof. Hemant Kombrabail

 Personal influences
 Other influences

A. Individual Determinants
1. Motivation and Involvement
In a society, different consumers exhibit different consumer behavior because they are unique and
have unique sets of needs. Motivation is that internal force that activates some needs and provides
direction of behavior towards fulfillment of these needs.

Involvement refers to the personal relevance or importance of a product or a service that a consumer
perceives in a given situation. Depending on the value and personal interest, a consumer can have a
high or low involvement. For a professional tennis player, the choice of a tennis racket is made with
great car. He sees the weight, size, grip and tension of the strings, etc. The racket is his most
important professional tool. Similarly, a professional photographer has to buy a camera with the
right specifications and attributes. For another person, a tennis racket may only be a means of
entertainment or in the case of a camera, the recording of family and other events by a camera,
which is convenient and handy.

2. Attitudes
These are our learned predispositions towards people, objects and events. Attitudes are responsible
for our responses and are not inborn but are learnt from people around us. They influence our
purchase decisions and consumer behavior. A person having a carefree attitude will buy an object
without much involvement. People, who want to play safe and avoid risk taking, will go for a safe

5
Consumer Behavior Prof. Hemant Kombrabail

investment. People who want convenience and are short of domestic help, will have positive
attitudes towards canned and frozen foods.

3. Personality and Self Concept

It is the sum total of our mental, physical and moral qualities and characteristics that makes us what
we are. Consumers try to buy the products that match their personality. People wanting to look-
manly will buy products with a macho appeal, which would enhance their image and personality.
People, who give emphasis on comfort and care, will purchase comfort products and so on. If one
wants to emulate a film star his choice will be different from others.

4. Learning and Memory

Every day we are exposed to a wide range of information, but retain only a small portion of it. We
tend to remember the information that we are interested in or, that is important to us. Different
members of the family are interested in different types of information, which they individually
retain. Mothers retain information regarding household items. Father retains information regarding
his interest in cars, motorcycles and other objects. Children are interested in objects of their interest
like amusement parks, joy rides, Barbie dolls, etc.

Our motives, attitudes, personality filters the information. Keeping only relevant information in our
minds and, keeping the others out. This is known as selective retention. We retain in our memory
only selective information that is of interest to us.

5. Information Processing
All consumers analyze and process the information they receive. These are activities that a
consumer engages in, while gathering, assimilating and evaluating information. Consumers
assimilate and evaluate selective information and this reflects on their motives, attitudes and
personality and self-concept. Different individuals can evaluate same information in a different
manner. The most common example is a glass half filled with a liquid. It can be interpreted as "half
empty" or half full. The first is a pessimistic view and the other is an optimistic view of processing
the information.

B. External Environmental
1. Cultural Influences
It is defined as a complex sum total of knowledge, belief, traditions, customs, art, moral law or any
other habit acquired by people as members of a society. Our consumer behavior, that is the things
we buy are influenced by our background or culture. Different emphasis is given by different
cultures for the buying, use, and disposing of products. People in South India have a certain style of
consumption of food, clothing, savings, etc. This differs from the people in the North of India.
Different cultures and habits are predominant in different parts of the world. Japanese have a
different culture from that of USA, England or Arabian countries. Therefore, in consumer behavior
culture plays a very important part.

2. Sub-Cultural Influences
Within a culture, there are many groups or segments of people with distinct customs, traditions and
behavior. In the Indian culture itself, we have many subcultures, the culture of the South, the North,
East and the West. Hindu culture, Muslim culture. Hindus of the South differ in culture from the
Hindus of the North and so on. Products are designed to suit a target group of customers that have
similar cultural backgrounds and are homogeneous in many respects.

3. Social Class
By social class we refer to the group of people who share equal positions in a society. Social class is
defined by parameters like income, education, occupation, etc. Within a social class, people share
the same values and beliefs and tend to purchase similar kinds of products. Their choice of
residence, type of holiday, entertainment, leisure all seem to be alike. The knowledge of social class
and their consumer behavior is of great value to a marketer.

4. Group Influences
A group is a collection of individuals who share some consumer relationship, attitudes and have the
same interest. Such groups are prevalent in societies. These groups could be primary where
interaction takes place frequently and, consists of family groups. These groups have a lot of
interaction amongst themselves and are well knit. Secondary groups are a collection of individuals
where relationship is more formal and less personal in nature. These could be political groups, work
group and study groups, service organizations like the Lions, Rotary, etc. Other member of the

6
Consumer Behavior Prof. Hemant Kombrabail

group influences the behavior of a group. An individual can be a member of various groups and can
have varied influences by different members of groups in his consumption behavior. An individual
can be an executive in a company and a member of a political party; he may be a member of a
service organization and of entertainment clubs and study circles. These exert different influences
on his consumption.

5. Family Influence
As has already been said, the family is the most important of the primary group and is the strongest
source of influence on consumer behavior. Children learn the family tradition and customs, and they
imbibe many behavioral patterns from their family members, both consciously and unconsciously.
These behavior patterns become a part of children's lives. In a joint family, many decision are
jointly made which also leave an impression on the members of the family.

These days the structure of the family is changing and people are going in more for nucleus
families, which consists of parent and dependent children. The other type of family is the joint
family where mother, father, grandparents and relatives are also living together.

6. Personal Influences
Each individual processes the information received in different ways and evaluates the products in
his own personal way. This is irrespective of the influence of the family, social class, cultural
heritage, etc. His own personality ultimately influences his decision. He can have his personal
reasons for likes, dislikes, price, convenience or status. Some individuals may lay greater emphasis
on price, others on quality, still others on status, symbol, convenience of the product, etc. Personal
influences go a long way in the purchase of a product.

7. Other Influences
Consumers are also influenced by national or regional events, which could be like the Asiad, the
Olympics, cricket test matches, World Cup, the war or a calamity. These leave permanent or
temporary impressions on the mind of the consumer and affect his behavior. In these events,
products are advertised and sometimes the use of a product like drugs, etc. is discouraged. People
are urged to adopt family planning methods. Situation variables such as product display, price
reduction, free gifts and attractive offers also influence consumer behavior.

External factors cannot affect the decision process directly but these are also instrumental and exert an
influence on consumer behavior.

Factors affecting consumers can also be studied by dividing the factors into four groups as shown
below. This can be done under four broad headings, which can have sub headings as shown

Factors influencing consumer behavior (Classification in four broad categories)

7
Consumer Behavior Prof. Hemant Kombrabail

Problems in Buyer Behaviour

1) The buyer-a riddle- Buyer is a highly complex entity. His needs and desires are innumerable and
they vary from security needs to aesthetic needs. The buyer has his own ways and means of meeting
these needs.
2) The buyer is exposed to a great deal of information -The buyer is exposed today to a world of
information-about new products, new services, new uses for existing products, new ideas and new
styles. Generally he accepts that information and retains it only what he would normally like to
perceive and retain.
3) The buyer is not bound by rigid rules while taking the buying decisions. -Sometimes the decisions
are taken on the spot while sometime he may decide after a long search, after evaluating the various
alternatives available and reassuring himself with the experience of those who have already purchased
the product. Buyer behaviour is a specific aspect of general human behaviour and it is only natural that
it is as complex as general human behaviour.

Uses of Consumer Behavior

Knowledge of consumer behaviour is useful for helping both to set and to implement marketing
strategies. For setting strategies, it helps in:
 Selecting and segmenting markets
 Planning marketing strategies.
 Evaluating strategies.
 Assessing consumer trends that will affect strategies in the future.
 Understanding fully the sources of any market-response problems.
 Gauging response to prospective product, price, promotion and distribution changes.
 Planning the marketing program.
 Evaluating the marketing program.

Consumer Behavior As An Interdisciplinary Science

Since the behavior of the consumer is dependent upon physiological, psychological, cultural, social,
economic, language, regional, religious, political and other factors, it is an interdisciplinary science. If
one wants to study properly and scientifically the behavior of consumers one is required to study
various facts of life about thinking of consumer, his decisions, perceptions and all factors which
influence his thinking and decision like his education, culture, income, climate, social status, society,
physiology, psychology, region to which he belongs, his religion, and the like. To under take research
one has to use research tools specially sampling, drafting of questionnaire, tabulation and arriving at
results and then interpret it properly and accurately so that the results may be utilized for strategic
policy decisions All this require use of statistics and econometrics, and proper understanding of
economics, and other factors so that one may reach at correct, meaningful, fruitful and useful results.

1. Psychology
Study of consumer psychology is most important part of consumer behavior research, because it helps
to know the attitude of consumers, his level of learning, knowledge, perceptions, personality, his
motivation of buying a particular product or service. It helps to understand psychology of different
types of consumers based on their age, sex, income level, education, their rural or urban buyace. For
instance a person living in Mumbai or Delhi thinks differently than person living in remote rural area
of Orissa, Bihar, Jharkhand, or Chatisgarh, their psychology is different, their thinking about product
and services are different and their needs and perceptions are different than urban elite. The study of
their psychology helps marketer to segment the market and produce goods according to their
requirement rather than thrusting same product on all. For instance psychology, of rural population of
older generation is to wear only dhoti, they will not buy trousers whatever efforts are made. Similarly
large percentage of them does not wear shoes or chappals.

Similarly they do not use toothpaste for cleaning their teeth. Many of them do not clean their teeth at
all while others depend largely on Neem or Babul stick (datun) for cleaning teeth and some use tooth
powder Why they have thinking and practice as they have can be understood only by studying their
psychology and there after draw a sales promotion or marketing strategy accordingly. If this is not
done marketing efforts will go waste and will not give results expected from advertisement and other
sales promotion efforts

The study of consumer psychology will make us to understand "how do we make the market place
work better so that consumers can make better decisions about what to buy" If for social purpose of
India has to reduce consumption of liquor one has to find out through research why people drink When
in our country number of states prohibited drinking from time to time it was utter failure because
8
Consumer Behavior Prof. Hemant Kombrabail

prohibition was imposed without studying the psychology of drinkers. However, in case of cigarettes
when it was told that smoking is injurious to health and can cause cancer, it had some impact and the
absolute consumption of cigarettes has started declining. If prohibition was implemented after studying
how often and what problems are faced by discontinuing drinking alcohol and what have been their
responses to their problems and their solutions might have been found, the result would have been
more encouraging.

Children arc psychologically vulnerable to specific advertisements but before making such
advertisements, their psychology will have to be studied first to market products and service needed by
them and secondly by the state to protect them against misuse of their psychology. Keeping the
vulnerability of children they are prohibited under the Factories Act to work in night hours In order to
protect them against the use of smoking and drinking sale of some of these products is prohibited to
minors

The psychology is formed through combination of region, religion, sex, education, culture, social
structure, beliefs, faiths etc. The study of psychology of consumers has become most important part of
study of consumer behavior and at one go one even study the needs, perceptions of consumers
Therefore it is most important tool for researcher and if one does not have resources to go in depth
research, study of consumer psychology can help to a great extent in arriving at fairly accurate
conclusions about marketing strategy For example the, psychology of rural masses in India is to like
bright colors specially red, black and yellow Therefore one will have to supply fabrics of these colors
and use labels of these colors on their products In rural India psychology is to like strong tea, hence in
these areas strong tea will have to be marketed

But at the same time psychology is to try a product which is advertised because TV has reached to
every corner of the country in remote villages too It seems that villagers are as much concerned for
commercials as urban dwellers Therefore in Northern India many milk vendors have purchased motor
bike for vending milk Farmers have adopted tractors for cultivation but as yet by and large they have
not adopted to life insurance Why not is a psychological question to be studied by researchers and
insurance marketers

2. Psychographics
Psychographics is another discipline which has to be used for study of consumer behavior
Psychographics research-studies life style of consumers to find out market for certain products like
items of personal health care, cosmetics, items of family consumption like TV, car, drawing room
furniture In psychographics research consumers are requested to tell their and their household reaction
about a particular product or service Since there is full separate chapter on the subject, the matter is
discussed very briefly below The psychographics research studies the life style of an individual or
family to find out how he spreads his time in working, recreation, games, vacations It also studies the
preferences of individual or household, his priorities and preferences on food, home, fashion, outing,
recreation, games and his opinions regarding various economic, social, political, cultural, educational
and other issues

In order to arrive conclusions through psychographics research individuals are asked their reactions
and questions are put to them and their family members They are given statements which they are
asked to evaluate as strongly agree, strongly disagree, agree, don't agree They may also be asked
degree of importance about a product or service like very important, unimportant, important, product
Specific questions are also asked whether he likes a product or service or not Sometimes opinion are
sought on political and social issues like whether after Tehelka revelation this government should
continue or not Opinions are also asked to find out which party they would like to vote which is the
basis of opinion poll and projection of election results

3. Physiological Factors
Physiological factors relate to the service of the properties and functions of living of being in normal
conditions Thus a physiologist studies the state of human being in its various phases like babies, child,
adults and elderly people, men and women There are special needs of pregnant women for
nourishment and after birth for self and newly born There are also handicap persons with deficiency in
hearing, eyesight, hands, legs, rib or other part of bodies The requirement of human being at different
stages of life and in different conditions have great impact on consumer behavior Therefore, they have
to be researched separately The requirement of small babies for body and health care are different than
for adults Therefore some companies like, Johnson have introduced baby soap, baby powder, baby oil
There are also many companies who are producing baby food though doctors advocate breast feeding
The manufacturers have produced many products for this class of population There are also separate
medical practitioners for them who specialize in treatment of tender children
9
Consumer Behavior Prof. Hemant Kombrabail

There are special products for handicapped like hearing aids for persons hard of hearing spectacles for
persons with weak eyesight Special aids for persons with handicapped legs or hands are made to meet
their requirements to help them to live less handicapped life
School going children require different products like school bags, school dress, books, note books,
pencils, socks and lot of other products This is separate segment of consumer, one has to study their
numbers and their consumption needs which again have to be divided according to age group and
market has to be developed and products have to be produced

The consumption requirement of adults differ widely from babies and school going children,
depending upon nature of their occupation, physical development, social status, consumer researcher
has to study this segment of the population separately to assess their needs and accordingly produce
goods and services Further, each class has to be again subdivided into various segments depending
upon their culture, level of income etc In countries like India where there are vast differences in
culture, income status, habits etc the number of sub-segment will be larger than in Europe. USA,
Canada, Japan or Australia

Then there are elderly persons who have special demand They have to be protected from danger of
adverse age They have to be protected from themselves and from predations according to various
studies in USA by Wodell, Phillips and Stermithal, Schiffman and many more The findings are that
they use lesser information, spend more time watching television, have decreased perpetual dis-
crimination and are likely to complain less about consumer problem However so far in India very little
research has been conducted by marketers or others on physiological aspects of consumer behavior In
developed countries special attention is paid to protect children, elderly and women consumers but in
India as yet there is no such separate legislation expect in case of labor laws for child and women labor
and in income tax, railway tickets for senior citizens They are being given concession in income tax
and railway fare

4. Demography
Demography "refers to the vital and measurable statistics of a population" It relates to total population
of a country, state, region, town or villages The distribution of population is done by age group, sex,
mental status, education, level of income, occupation Most of the countries collect information in their
census In India census is conducted every ten years, the latest of which relates to information as on 1st
March 2001 Indian census has collected information on all above aspects, the full data of which will be
available after quite sometime. The data is available on all aspects upto village level. It is an important,
very useful, effective and cheap source to get information from published records and from the office
of Census Commission. So far it is known that Indian population on 1st March 2001 was 102.7 crores
which is over 16% of world population. This was 181 million more than population of March 1991.
But the rate of growth declined by 2.5%. It is possible to project macro demand from this data. The
structure data of population is also available according to which size of market in various states can be
gauged and strategy for marketing can be made.

The sex ratio is in favor of males i.e. there are 933 females for every 1000 males, which is some
improvement over last one decade. With long series of data one can project long-term male female
ratio and can estimate demand and consumption of various products for males and females. As this
data is available not only statewise but also town and village wise it is possible to segment the
population according to sex at every level not only to estimate the demand but also to formulate
marketing strategy.

In consumer behavior the literacy and level of education plays an important role; it is very useful for
consumer researchers. This information is also available upto village level. During last decade the
percentage of literate population has increased and for the first time since independence the absolute
number of illiterates have shown a significant decline. This information is available age group wise at
the lowest level and is an important tool for consumer researcher to find out demand of products by
different segments of literate population. The data is also available about the level of education below
high school, higher secondary, graduate, post graduate, technical etc. All this is very important data for
consumer behavior study and research. The one who is interested to undertake research must consult
all this data. The demographic information is also available on marital status, level of income, housing,
occupation.

5. Geographic Segmentation
In a big country like India, China, USA etc. the location is very important factor in determining the
consumption. In countries like India or USA where climate differs widely from location to location this
factor becomes extremely important in deciding the consumer needs, motivation and behavior. For
instance, in India there are hilly areas of Jammu and Kashmir, Himachal Pradesh, North Eastern States,
10
Consumer Behavior Prof. Hemant Kombrabail

and Ladakh where temperature is much lower than states of Southern India like Kerala, Karnataka,
Tamil Nadu and Andhra Pradesh. While in northern states heavy woolens are needed in winter and
light woolens in rest part of the year in Southern states only light cotton clothes are needed through out
the year. There are areas of very heavy rains in places like Cheerapunji, the highest in the world and
very low rain in desert of Rajasthan. These climatic changes have made big regional differences in
consumption pattern. The vegetation crops also depend upon climate and so eating habits also differ. In
states like West Bengal, Orissa and Southern states where rice is major crop, population is basically
rice eater as against Northern States of Punjab, Haryana, Rajasthan, Madhya Pradesh, Uttar Pradesh
where wheat is main item of staple food. In states like Gujrat, Maharastra and Rajasthan where
groundnut is produced in substantial quantity the main oil used is groundnut oil. In Kerala, Tamil Nadu
and Karnataka and Andhra Pradesh where coconuts are produced in plenty coconut oil is main media
of cooking. In U.P, Punjab, Haryana and West Bengal mustard oil is preferred because of availability.
The differences in consumption are not only due to climate but also due to wide differences in
languages. Though as per Article 343 of Indian constitution the official language of India is Hindi in
Devnagari Script. But besides Hindi and English there are other 17 languages in Eighth Schedule that
are spoken in one or more states. Besides official languages there are local dialect. All these language
differences have impact on producers and advertisers. For instance the market of books has been
restricted according to the language used in schools, colleges, government offices and courts. Because
of language books of Bengali or Marathi or other language has market in the state where that language
is spoken and the behavior of consumers is not uniform for many things and this aspect has to be kept
in mind by marketers. The advertisement and labeling of packing has to be adjusted according to the
language of the region. The selection of words also require great care because sometimes the word in
one language has quite different meaning in the other language and in case of certain words the
meaning is so different that it can create disaster, this has happened in many cases and because of use
of wrong word from one language it is quite different sometime offensive in an other language. As a
result one can loose the entire market

6. Culture
The culture of different regions is different Bengali culture is quite different than that of Punjabi or
South Indian culture. There are difference not only in speech but also in dress, fashions, thinking,
expectations and behavior based on the region Many Bengali wear dhotis, on the festival of Durga,
Kali or Saraswati and the ladies prefer to wear cotton sarees and are conservative in their attitude
towards their daughters. The liking of music is also much different than in South or North. The festival
of Kerala, Tamil Nadu and other states are not same, nor their food preferences are similar Because of
language differences films are required to be produced and exhibited in local language. The taste of
people also differ widely from region to region Punjabis like gaudy, bright color clothes, milk and
lassi, maize bread and sarso ka sag and paratha South prefers tea and coffee, idli, dosa and bara.
Actually in India there are so many cultures, habits, preferences that without indepth study of them one
cannot optimize sales Therefore indepth study of regional differences is essential for research of
consumer behavior, within the state also a many times it is required to describe upon differences in
their behaviors

7. Religion
In a country of the size of India with different religions behavior differs according to his faith and
religion In India major religions are Hindus, Muslims, Christians, Sikhs, Buddhists and Jains besides
sub religions in many castes If Hindus do not eat cows meat Muslims do not eat pig meat. Mostly the
male Sikhs wear turban but it is not compulsory in any other religion In Jainism non vegetarian food is
strictly prohibited but Christians and Muslims have no inhibition In Hindus there are both veg and non-
veg population. Jains especially elderly people do not eat many vegetables specially those produced
underground. The dress for worship and articles used for worship have been prescribed in Jainism and
Hinduism, but Christians and Sikhs have not prescribed dresses for worship, but in most of the
religions head should be covered while worshiping by turban, dhoti, cap or handkerchief, dupatta.
Worship on festival occasions also have difference at the time of festival affecting consumption and
creating demand of certain products in festival times. For example during certain festivals demand of
fruits and vegetables goes up because during this period many devotees do not take food grains.
Similarly at the time of most festivals demand of sweets go up All these factors have impact on
consumer behavior and so on the demand of various products

8. Sociology
Social classes in India are based on two different criteria and there are two types of social class. First
based on level of income and the other on castes, religion and region etc

In India on the basis of income there are four classes First below the poverty line (BPL) who are not
able to consume minimum requirement and therefore they are not able to buy most of the things
11
Consumer Behavior Prof. Hemant Kombrabail

Second is low income group who are above the poverty line but are able to meet their minimum needs
Third is middle income group who besides basic needs can also consume certain other products like
television, coolers, refrigerators and ordinary furniture The last one is high income group In this group
there is further division of very high income group who account for nearly ten percent of country's
population and are able to consume anything they want The company who produces or provides
services must understand their needs, aspirations and expectations and should segment the market.
The second social class is based on community, castes, religion etc These groupings are not only in
places of their origin but also in places where they move A South Indian or Bengali in metropolitan
cities of Kolkatta, Delhi or Mumbai like to consume some food items for which they are accustomed
Even when they go abroad and become NRI they want food of their liking As a result there are exports
of Gujarati, Punjabi and South Indian food products to places of their concentration abroad The food
habits die very rarely and therefore these classes will have to be catered wherever they settle or cluster
Certain classes are also based on community basis and they like certain products or services The food
habits of Sikhs, Muslims, Jains, Hindus are well settled and for this purpose they are social class Not
only food habits but type of garments required differs specially on the occasion of marriages, festivals,
religious functions. Some social classes are also based on rural - urban base People of rural area even
in the same region and of same religion have different demands than their urban brothers Unless these
aspects are studied, the research on consumer behavior is incomplete and one cannot take full
advantage of market

9. Economics
Before the modern concept of consumer behavior was developed by marketer it was part of economics
Principle demand / price theory is based on consumer behavior that is as more quantity will be offered
the price will come down, the utility of additional unit will be less than the previous one and therefore
rate of increase in demand will fall with the satisfaction of demand The economic theory further states
that with the fall in price, demand should rise and with rise in prices demand should fall However,
marketer feels that with change in consumer behavior this is not always true If a product is for show,
prestige many people will buy high priced goods If a product is cheap it is considered to be of poor
quality and may not be in demand Even in country like India the demand of motor bikes which are
double the price of scooters, is rising faster than that of scooters because of change in consumer
preferences

According to economic theory with the rise in income the quantity demanded should go up but
marketers may change the preferences in favor of higher priced items and overall demand may not go
up. The consumer behavior studies by altering the consumer preferences can modify economic theories
but basic principles of economics of want, demand, prices, supplies, will have to be studied by a
marketer because it has important bearing on consumer behavior and thus they are inter dependent
upon each other. As economics has great bearing on consumer attitude, behavior, perceptions study of
economics is a must for researcher of consumer behavior.

10. Statistics / Econometrics

In order to study consumer behavior in various facets use of statistics and econometrics for drawing a
sample, carrying out surveys, processing the data and its interpretation. High-level statistics and
econometrics is required to be used for arriving at conclusions, making models for projections etc.
Thus for study of consumer behavior one is required to use many services which have to be
interdependent to arrive at any meaningful conclusions. If they are studied in isolation from each other
one may arrive at misleading conclusions. It is because human behavior is not independent, it is hybrid
of various factors described above and therefore all services are equally important and essential for the
study. Thus they are interdependent and the real research requires a team with knowledge of all facets
of life.

12