Reality TV shows such as American Idol and the Bachelorette are amongst the top rated shows which attract the youth. The reason of appeal maybe accredited to the satisfaction consumers achieve by watching these shows as they relate and identify with these depictions. Marketers often use advertisements during these shows (such as the Coke can in the American Idol show) to promote their brands on a channel being highly viewed by the consumers. People engage in different behaviors when they are about to purchase a product and their consumption behavior is often affected by the advertisements, promotional deals, price, the packaging detail, quality and the experience of their friends and family. For this reason, consumer behavior includes all the activities related to the purchase, disposal and the use of goods and services. The concept also incorporates the consumer’s behavioral, mental and emotional response which governs these activities (Kardes F, 2010).
What is Consumer Behavior?
For Procter & Gamble, a consumer is the boss and his demands hold immense value to the company. Based on such beliefs and values, organizations come up with unique marketing designs to promote the use of their products (Kardes F, 2010). This is because of the fact that consumer purchase decisions can vary due to a number of factors. Purchase activities which is the series of efforts put in by the customer to buy a product is an important element to examine consumer behavior. This includes the work done to gather information about the product and the purchase method such as home delivery or in-store shopping also influences the purchase decisions. Following this, the use activities which is the idea as to when and where the product is used, and the disposal activity as to why and when the product is thrown away also act as essential determinants in understanding consumer behavior which is of dire importance for the marketers.
External Factors influencing Consumer Behavior
Consumer purchase decisions are influenced by several variables such as need, purpose, price, quality, use, attraction, status, and the review of others. In order to motivate consumer purchases and reduce their choices, many marketers focus upon incorporating a marketing strategy to strengthen their relationship with the customers to enhance marketing productivity. Apart from the personal influences, there are a number of external factors which influence consumer behavior. These factors are normally affected by the environment and the social trends.
The appearance of Sachin Tendulkar in the Palio car advertisement and the endorsement of the BPL brand by Amitabh Bachan are quite prominent branding strategies in the Indian market. The products being used by cricketers and actors are appealing to the masses. This technique is linked to the concept of a reference group; a collection of people with whom individuals identify and compare themselves in order to shape up their values, attitudes and behavior. For this reason, reference group is seen to be a powerful determinant in influencing the purchasing behavior of individuals (Kumar R, 2009).
There are different reference groups such as the aspirational group; individuals admire this group but are not its part. Another reference group is known as the associative group; individuals maybe a part of it and are in face-to-face contact with the group. This includes family, peers and clubs. This is known as the primary group and because of this feature, the marketers place greater emphasis on the associative group while building their branding campaign. Reference group act as a vital external factor which influences the consumer behavior as it often relates to the various ways in which an individual identifies with another (Kumar R, 2009).
With regard to the concept of reference group, the theory put forward by Bearden and Etzel (1982) revolves around the idea of consumer behavior on the basis of nuclear and extended family. As theorized, the greater number of individuals present in an extended family highly influences the consumption pattern of an individual. This is also directly linked with the culture playing as another external factor in governing the consumer behavior. Moreover, the product conspicuousness plays an important role in examining the influence of reference group in consumer buying trends. This result in the emergence of the following type of products: private luxuries, private necessities, public luxuries ad public necessities. Hence, according to Bearden and Etzel (1982), the way a reference group influences a consumer decision, is based upon the product as well as the brand level. The theorists found that public products as well as luxury items are greatly influenced by peers as compared to the purchase of private products and necessities which are often affected by the family experiences and opinions. Family is an important reference group as the trend of brand loyalty often passes from one generation to the other. The classification of a product therefore helps the marketer formulate his branding plan. For instance, if a product is publically owned luxury, then the marketer should not only focus upon the product but also its brand as the reference group would strongly influence the type as well as the brand of this public luxury. On the other hand, the brand of a private luxury would not be strongly influenced by the reference group since it is an item for personal use; for example a food processor or a video game (Bourne, 1957).
The impact of reference group on consumer behavior often varies from one culture to the other. There is a difference between the consumption patterns of individuals living in a collectivist culture as compared to those living in an individualist environment. In Thailand, the extended family tends to play a more influential role in the consumer buying decisions as compared to USA which is an example of an individualistic culture and where peers greatly influence an individual’s buying decision. The idea of culture acting as an external factor in influencing consumer behavior is also discussed by Kacen, J. & Lee, J. (2002), which further extends the idea proposed by Childers & Rao, (1992) as it examines the impulsive buying behavior of individuals with respect to their culture. The study reveals that unlike individualist cultures, collectivists such as the East Asian countries are proponents of maintaining group harmony and lay their belief on share values and attitudes. Therefore, they tend to avoid impulsive shopping as they usually analyze the consequences attached with their purchase. This is not found in America and Britain where people are more free and independent.
There are a number of different cultural elements which govern the consumer behavior. These dimensions are given by Hofstede (2001) which could be examined to study the consumer behavior. One of these elements is the power distance; a concept of an unequal power distribution. Studies reveal that the amount spent on leisure activities is negatively related to the power distance of the country. This can be attributed to the fact that people tend to spend free time with their families in countries with large power distance as compared to the small power distance countries. The study also found that collectivist cultures tend to spend more on food items because they allot more time in preparing and arranging food for each and every member and guests because of the underlying group values and social norms. Another cultural element proposed by Hofstede (2001) is the idea of uncertainty avoidance whereby which people tend to avoid the threat of ambiguity in their society. Strong uncertainty avoidance cultures are better groomed as it is a way to deal with the threats of the world depicted by their high consumption of such grooming products.
Traditional theories of promotional activities have focused upon a number of ways in which a product is advertised. This takes the form of television and newspaper/magazine ads, billboards and through the word of mouth. Today, the advancement in technology and the arrival of gadgets has opened a new realm of marketing strategies which were previously undiscovered; the platform of social media.
Social media acts as a hybrid for promotion mix mainly because of its two way role; it magnifies the way consumers communicate to each other and it also enables managers to communicate with their customers. Social media takes the form of user as well company sponsored blogs and forums, social networking websites like Facebook, Twitter and MySpace, podcasts, delivery websites, photo/video/music sharing websites, business websites and more. This medium serves as a place where reviews are read, experiences are shared and opinions are valued. This might reflect the traditional technique of word of mouth, but the social media has the power to magnify this approach where one consumer has the ability to share his feedback about a product with numerous people across the globe. For this reason, companies often view social media with an eye of discontent as they believe that the traditional marketing campaigns gave them power to control the message that was delivered to the masses. Social media has now given this power to every other individual. In contrast, the social media can also be used to promote brands, increase sales and enhance profits. This side of social media is taken under consideration by many organizations; Pepsi engages its customers by its online program of customer loyalty where they can redeem points for different electronics, CDs and apparels. In addition, the website of Procter and Gamble has a separate query section known as ‘ask Julia’ where customers can obtain detailed information about the specifics of the desired products. Hence, social media provides the marketers with a greater edge to engage its customers where many companies do not only offer online promotional deals, but also provide blogs and forums where they encourage and acknowledge constructive criticism, feedback and opinion.
Thus, consumer behavior is the activities of purchase, use and disposal of products which are affected by personal needs, the institutional role along with the environmental influence. Regardless of the way these determinant affect the purchasing decision of an individual, the marketing strategies play an essential role shaping up the consumer buying decision. Apart from the personal needs, consumer behavior is greatly affected by the influence of reference groups such as peers and family and it also fluctuates on the basis of cultural differences and the type of product being consumed. As a matter of fact, in the modern world of today, the internet and especially the power of social media also plays a major role in the purchasing decision. Hence, marketers must be aware of the strength of each external factor and thereby design its marketing campaign in a corresponding manner in order to attract more consumers and achieve a name, a good customer relationship and higher profitability.
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