Consumer Behavior

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Understanding the consumer behavior is a must for any business. We can be define consumer behavior as the act of the consumers to obtain economic goods and services, using them and dispose it after use, along with the decision process that went into before and after each action.

Buyers are generally swayed by a complex set of factors which is difficult to explain or analyse. Behavior springs from directly held values and beliefs.

In this MBA presentation, we try to answer the following questions using consumer behavior model

  • Who buy?
  • How do they buy?
  • When do they buy?
  • Where do they buy?
  • Why do they buy?

What Influences Consumer Behavior?

Major factors that impact consumer behavior are
  • Cultural Factors
  • Social Factors
  • Personal Factors
Cultural Factors

A persons needs and behaviors are fundamentally defined by his culture which is acquired through interactions with family and members outside his/her family. Subcultures that impact consumer behavior are nationality of the person, religion of the consumer, racial group to which he is belonging to and the geographical location of the consumer.

Social Factors

A society is generally divided into Rich, Upper class, Upper middle class, Middle class, Working class, Lower class and poor. General characteristics of these Social Classes are

  • Within a class, people tend to behave alike
  • Social class of an individual conveys perceptions of inferior or superior position
  • We can identify a class using a set of variables such as occupation, income etc.
  • Class designation is mobile over time

Social factors that impact a consumers behaviors are Reference groups(Membership, Aspirational and Dissociative groups), Family, Social roles and Status in the society.

Personal Factors

The major personal attributes that impacts the behavior are Age, Life cycle stage, Occupation, Wealth, Personality, Self-Concept, Lifestyle and moral values.

Brand Personality

To make a brand successful and sustainable, the brand should be sincere about the job they do. Management should be able to create excitement amount the future consumers, Ex. Apple. Other traits that a brand should exhibit are Competence, Sophistication and Ruggedness.

Model of Consumer Behavior


Market StimuliOther Stimuli
Product Economic
Price Cultural
Place Technological
Promotion Political

Consumer Psychology

Consumer characteristicsConsumer Psychology
Cultural Motivation
Social Perception
Personal learning

Decision Process

Buying decision ProcessPurchase Decision
Problem recognition Product Choice
Information Search Brand Choice
Evaluation of alternatives Dealer Choice
Purchase decision Purchase Amount
Post purchase behavior Purchase Timing
  Post Purchase Behavior

Key Psychological Processes

  • Motivation
  • Perception
  • Learning
  • Memory


According to Freud’s Theory, a consumer behavior is guided by subconscious motivations. But as per Maslow’s Hierarchy of Needs(Physiological, Safety, Social, Esteem, self development), behavior is driven by the lowest, unmet need. Herzberg’s Two-Factor Theory states that the behavior is guided by motivating and hygiene factors


  • Selective Attention
  • Selective Retention
  • Selective Distortion
  • Subliminal Perception

Rural Consumer Behavior

Rural consumers are more brand loyal, but there will be restrictions on consumption. They exhibit a collective consumption behavior, for family rather than individual. Consumption tends to change from season to season, based on seasonality of agricultural production/income etc. Rural customers tends to show specific patterns in the five-stage buying decision process.

Other Theories of Consumer Decision Making


  • Elaboration Likelihood Model
  • Low-involvement marketing strategies
  • Variety-seeking buying behavior

Decision Heuristics

  • Availability
  • Representativeness
  • Anchoring and adjustment

Mental Accounting

Consumers tend to segregate gains, integrate losses, Integrate smaller losses with larger gains and Segregate small gains from large losses.

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