Introduction to Consumer Behaviour

Level:
Beginner

Course Designer/Co-Ordinator:
Dr. Samrat Bharadwaj
Course Instructor:
Dr. Samrat Bharadwaj
Title of the Course: Introduction to Consumer Behaviour

Level: Beginner

Course Outcomes
The students shall be able to:
• Understand the concept of Consumer Behaviour, its
relevance and role in business.
• Understand the concept of Involvement, Buying Decisions
and Decision-Making Process.
• Understand the relevance of Information Search Process
and Decision Rules
• Decipher the factors influencing consumer behaviour.
• Understand the various concepts and theories like
Buyer’s Black Box, Maslow’s Need Hierarchy Theory and
Freud’s Theory of Motivation.
• Implement the behavioural theories and concepts in real
life scenarios to implement rational purchase decisions.

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 Module 1
Introduction
Introduction:
Consumer behaviour is a field of study that examines the decision-making processes
and activities undertaken by individuals, groups, or organisations in relation to the acquisition,
utilisation, and disposal of products, services, experiences, or ideas within the marketplace.
The process entails comprehending the diverse elements that impact consumers' decision-
making and actions, encompassing psychological drivers as well as external aspects such as
cultural and social standards.
It refers to the study and analysis of individuals, groups, or organisations and the
processes they undergo when selecting, purchasing, using, and disposing of products, services,
ideas, or experiences to satisfy their needs Consumer behaviour refers to the systematic
examination, analysis, and projection of the decision-making process undertaken by
individuals or collectives when selecting products and services, with the various elements that
impact their decision-making process.
In this context, several examples of consumer behaviour may be identified. These
examples include:
1. Psychological Factors: Consider a consumer who exhibits a preference for purchasing
organic food goods based on the belief that such items offer enhanced health benefits and
contribute to environmental sustainability. The psychological aspect that influences
individuals' conduct is their motivation to make choices that accord with their beliefs regarding
health and sustainability.
2. Social Factors: Within specific cultural contexts, there may exist a pronounced emphasis
on the act of gift-giving during periods of celebration. This cultural convention has an impact
on consumers, compelling them to purchase gifts for their acquaintances and relatives, even in
cases when such purchases may not have been contemplated otherwise.
3. Situational Factors: In the context of a flash sale, a consumer may encounter a promotional
message highlighting a time-limited reduction in price for a product that has previously
captured their interest. The sense of urgency generated by the sales situation may potentially
drive individuals to expedite their purchasing decisions beyond their typical pace.
4. Personal Factors: Individuals with a higher wealth may want to purchase luxury brands as
a means of signalling their social position and achievements. One personal component that
motivates individuals' actions is their desire to conform to their self-perception and lifestyle.
5. Reference groups: Reference Groups have a significant role in influencing consumer
behaviour. For instance, adolescents may opt to don a particular brand of trainers due to the
endorsement of their beloved star. The consumer's choice is influenced by the reference group,
specifically the celebrity.
6. Online Shopping Behaviour: The utilisation of customer behaviour data by e-commerce
platforms is a common practise in order to offer personalised suggestions. For instance, in the
context of online book purchasing, the platform might potentially offer recommendations
pertaining to related genres or authors, drawing upon the consumer's previous purchase records
and browsing activities.
7. Brand Loyalty and Switching: Brand loyalty and switching behaviour is a phenomenon
when a consumer who has consistently purchased a specific brand of shampoo over an
extended period of time decides to transition to a different brand. This shift in consumer

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behaviour may be attributed to various factors such as receiving a recommendation from a
friend or being enticed by a compelling promotional offer.
8. Product Perception on Consumer Decision-Making: Consumers' evaluation of a brand of
smartphones as reliable and high-quality can be shaped by good reviews and anecdotal
experiences shared by others. The perception has a significant impact on their purchasing
behaviour towards the brand in question.
9. Post-Purchase Behaviour: Following the acquisition of a smartphone, consumers may
engage in activities such as sharing their experience on social media platforms or composing a
review. Positive experiences have the potential to foster brand support, whilst negative
encounters can result in discontent and the propagation of negative word-of-mouth.

Factors influencing consumer behaviour:

1. Cultural Factors:
• Culture: The influence of cultural norms, values, beliefs, and rituals on consumer
behaviour is substantial. Diverse cultural groups exhibit distinct perspectives regarding
items, consumption behaviours, and preferences.
• Subculture: Subcultures, which emerge within broader cultural contexts, are shaped by
several elements such as race, religion, nationality, and regional identity, and have the
potential to impact consumer preferences and behaviours.
• Social Class: The purchasing behaviour, retail preferences, and brand perceptions of
consumers can be influenced by their social class.
2. Social Factors:
• Reference Groups: Family, friends, coworkers, and opinion leaders exert influence on
consumer behaviour through the provision of advice, opinions, and approval.
• Social Roles: The purchasing decisions of consumers are influenced by their social
roles, such as being a parent, student, or professional. For example, the consumer
preferences of a parent may differ from those of a college student.
• Social Norms: Social norms encompass the societal expectations and conventions that
govern and determine acceptable behaviour and spending patterns. Consumers
frequently conform to these conventions when making their selections.
3. Personal Factors:
• Age and Life Stage: Various life stages, including childhood, adolescence, maturity,
and retirement, give rise to evolving wants and spending patterns.
• Occupation and Income: The occupation and income of individuals have a significant
influence on their purchasing power and decision-making. There may be a divergence
in product preferences between professionals and blue-collar workers.
• Personality and Self-Concept: Consumers exhibiting distinct personality traits may
have a preference for particular products that are congruent with their self-concept and
image.
4. Psychological Factors:
• Motivation and Needs: Psychological factors play a significant role in consumer
behaviour, particularly in relation to motivation and requirements. The behaviour of
consumers is driven by their individual needs and motivations. One example of a
theoretical framework that elucidates the prioritisation of consumer needs is Maslow's
hierarchy of needs. This framework posits that individuals prioritise various needs such
as safety, belongingness, and self-esteem.

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 • Perception: The manner in which consumers see and understand information has a
significant impact on their decision-making processes. The process of perception is
subject to the effects of selective attention, interpretation, and retention of information.
• Attitudes and Beliefs: Consumer attitudes and beliefs have a significant role in shaping
their choices and purchase intentions towards items, brands, and advertising.
5. Situational Factors:
• One important aspect to consider while analysing a particular situation is the influence
of situational factors. These factors refer to the external circumstances and conditions
that can impact individuals' behaviour and
• Purchasing Context: The rationale behind a purchase, such as whether it is intended as
a gift or for personal use, can have an impact on the decision-making process.
• Time and Place: The temporal and spatial dimensions can have influence on consumer
decision-making processes. The convenience and geographical accessibility of
products and services are significant factors to consider.
• Urgency: The presence of urgency might elicit expedited decision-making among
consumers, whereas situations with lower levels of urgency afford more opportunity
for thoughtful deliberation.
The interplay and mutual influence of these factors contribute to the intricate nature of
consumer behaviour. Businesses and marketers engage in the analysis of these aspects in order
to get a deeper understanding of consumer motivations and preferences. This understanding
aids in the development of focused marketing strategies that effectively resonate with the
intended target audience, ultimately leading to favourable outcomes within the market.

Importance of consumer behaviour:

1. Understanding Consumer Behaviour Helps Businesses:
• Market Understanding: Market understanding is crucial for businesses to effectively
cater to client preferences, requirements, and wishes. Consumer behaviour insights play
a significant role in providing businesses with a comprehensive grasp of these factors,
enabling them to match their offers with the prevailing market demand.
• Competitive Advantage: Competitive advantage can be achieved by businesses that
possess a comprehensive understanding of customer behaviour, enabling them to create
distinctive products and services that differentiate themselves in the market and
effectively target certain consumer categories.
• Innovation: The utilisation of insights into customer behaviour has the potential to
foster innovation through the identification of unfulfilled demands and opportunities
for enhancement within current product offerings.
• Risk Mitigation: Risk mitigation involves the reduction of possible losses for
businesses through the comprehension of customer preferences. By gaining an
understanding of the preferences of the target audience, businesses can minimise the
risk associated with the launch of products that fail to resonate with consumers.

2. Creating Products That People Want:

Consumer behaviour analysis plays a crucial role in identifying market gaps and revealing areas
where demand exists but remains unfulfilled.

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 • Feature Alignment: Enterprises have the ability to create products that are in line with
the preferences, features, and benefits that are highly valued by the specific target
demographic.
• Tailored Offerings: The comprehension of customer behaviour empowers firms to
provide personalised and customised products, thereby responding to the unique
demands and preferences of consumers.
3. Develop Effective Marketing Strategies:
In order to enhance marketing efforts, it is imperative to develop strategies that are effective
and yield positive results.
• Segmentation and Targeting: Segmentation and targeting strategies are employed by
organisations to effectively divide the market into distinct segments based on several
factors such as demographics, psychographics, and behavioural patterns, which are
derived from consumer behaviour insights. This practise facilitates the customization
of marketing messaging to effectively reach and engage certain demographic segments.
• Message Resonance: Marketers possess the ability to construct messages that align with
the motivations, needs, and values of consumers, hence enhancing the efficacy of
communication.
• Channel Selection: The process of channel selection is crucial in comprehending how
customers get information, as it directly impacts the strategic decisions about
advertising and promotion of items. For example, online advertising has the potential
to be more efficacious when targeting specific audiences.
4. Aiding Towards Building Better Relationships with Customers:
• Adopting a Customer-Centric Approach: By comprehending consumer behaviour,
organisations may cultivate a customer-centric approach that prioritises providing value
and resolving customers' challenges.
• Improved Customer happiness: By strategically addressing consumer preferences,
organisations have the ability to offer products and experiences that result in elevated
levels of customer happiness and foster long-term loyalty.
• The Utilisation of Feedback: The utilisation of feedback derived from consumer
behaviour analysis enables firms to enhance their products, enhance their services, and
adjust their strategy in order to more effectively cater to client wants.
• Long-Term Loyalty: Long-term client loyalty may be fostered through generating great
experiences that are informed by consumer insights. This, in turn, can result in repeat
purchases and favourable word-of-mouth recommendations.
In conclusion, a comprehensive comprehension of customer behaviour is necessary for firms
to flourish in a highly competitive market. This enables firms to generate goods that are
pertinent and appealing, formulate tactics that efficiently convey value, and establish robust
customer relationships. Consumer behaviour insights provide organisations with the necessary
information to make well-informed decisions that are in line with customer preferences,
ultimately resulting in heightened levels of customer happiness, enhanced brand loyalty, and
overall business success.

Consumer Behaviour as a Marketing Discipline

Businesses and marketers use insights from consumer behaviour research to design
marketing strategies that align with consumer preferences, motivations, and behaviours,
ultimately driving successful outcomes in the marketplace. Consumer behaviour is a crucial

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field within the broader discipline of marketing. It focuses on understanding how individuals,
groups, and organizations make decisions about purchasing, using, and disposing of products,
services, ideas, or experiences. This understanding is essential for businesses to develop
effective marketing strategies and tailor their offerings to meet customer needs and preferences.

Key aspects of consumer behaviour as a marketing discipline include:

1. Understanding Decision-Making Processes:
Consumer behaviour delves into the cognitive, emotional, and behavioural processes
that influence purchasing decisions. Marketers strive to comprehend how consumers gather
information, evaluate alternatives, and ultimately choose products or services.
2. Factors Influencing Consumer Behaviour:
• Psychological Factors: These include perceptions, attitudes, motivations, and beliefs
that shape consumer choices. For instance, understanding how consumers perceive a
product's quality can affect marketing messaging and product design.
• Social Factors: Family, friends, culture, and social norms play a significant role in
shaping consumer behaviour. Marketers analyze how these external influences impact
purchasing decisions and tailor their campaigns accordingly.
• Situational Factors: The context in which a purchase occurs, such as time constraints or
the physical environment, can influence consumer choices. Marketing strategies need
to account for these situational factors.
3. Segmentation and Targeting:
Effective marketing involves identifying specific segments of the population that are
likely to be interested in a product or service. Consumer behaviour research helps marketers
create segments based on demographic, psychographic, and behavioural characteristics,
allowing them to tailor their marketing efforts to resonate with each segment.
4. Consumer Research Methods:
Marketers use various research methods to gather insights into consumer behaviour.
These methods include surveys, interviews, observational studies, focus groups, and data
analysis. By analyzing consumer preferences, behaviours, and trends, businesses can refine
their marketing strategies.
5. Brand Loyalty and Relationship Building:
Understanding consumer behaviour enables businesses to build strong relationships
with customers. By identifying what drives brand loyalty and repeat purchases, marketers can
develop loyalty programs and personalized marketing campaigns that cater to consumers'
preferences.
6. Product Design and Innovation:
Consumer behaviour insights can guide product development and innovation.
Businesses can identify unmet needs and design products that address them, leading to a
competitive advantage in the market.
7. Marketing Communication and Messaging:
Knowing how consumers perceive and process information helps marketers craft
effective advertising and messaging strategies. By understanding consumer attitudes and
preferences, marketers can create messages that resonate and drive action.
8. Ethical Considerations:

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 Consumer behaviour research also involves studying the ethical implications of
marketing practices. Understanding how consumers respond to ethical considerations can
guide businesses to develop responsible and transparent marketing strategies.

Consumer Involvement
Consumer involvement refers to the level of interest, attention, and engagement that an
individual has when making a purchasing decision. It reflects how much effort, thought, and
consideration a consumer invests in the decision-making process for a particular product or
service. In other words, consumer involvement measures how important a purchase is to an
individual and how much they care about making the right choice.

Role of Consumer Involvement in Purchase Decisions:

Consumer involvement plays a significant role in the purchase decision-making process
and has implications for how consumers approach various products and brands. Here's how it
affects purchase decisions:
• Differentiating Between Products: When consumers are highly involved in a purchase,
they are likely to engage in thorough research and comparison of different options. This
is particularly true for high involvement products like cars or electronics. They carefully
evaluate features, benefits, and prices to make an informed choice.
• Evaluation of Alternatives: Involvement affects how consumers weigh the pros and
cons of different alternatives. Highly involved consumers are more likely to consider
multiple factors before making a decision. They may read reviews, seek
recommendations, and even test products before buying.
• Brand Loyalty: Involvement can influence brand loyalty. Highly involved consumers
may feel more attached to a brand if it aligns with their values and needs. On the other
hand, low involvement purchases might lead to less brand loyalty since consumers may
be less invested in the decision.
• Impulse vs. Deliberate Buying: In low involvement situations, consumers might make
quick decisions without much thought. For example, grabbing a snack at the checkout
counter. High involvement purchases, on the other hand, involve more contemplation
due to the higher stakes or significance of the purchase.
• Word-of-Mouth Influence: Consumers who are highly involved in a purchase may seek
advice from friends, family, or online communities. This can be because they want to
ensure they're making the best choice, especially for important or expensive items.
• Risk Perception: Involvement can influence how consumers perceive risks associated
with a purchase. High involvement purchases may be seen as riskier because of the
potential negative consequences of making the wrong choice.
• Emotional Engagement: Highly involved purchases often have an emotional
component. Consumers might feel excited or anxious about the decision, depending on
the significance of the purchase. Emotional engagement can impact the overall
satisfaction with the chosen product.
In summary, consumer involvement shapes how individuals approach purchasing
decisions. It ranges from highly informed and researched choices to quick, habitual decisions.
Recognizing the level of consumer involvement is crucial for marketers to tailor their strategies
to match the consumer's mindset and expectations.

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Types of Consumer Involvement
High vs. Low Involvement
High involvement and low involvement are two distinct levels of consumer involvement in the
decision-making process when it comes to purchasing products or services. Let's explore both
terms in more detail:

High Involvement:
High involvement refers to situations where consumers are deeply engaged, committed, and
invested in the decision-making process for a particular product or service. These decisions are
usually more complex, have a higher perceived risk, and involve a significant amount of time
and effort. High involvement purchases are typically more expensive, have a long-term impact,
or are related to the consumer's self-identity.
Here are some characteristics of high involvement purchases:
• Extensive Research: Consumers invest time in researching and gathering information
about different options. They may read reviews, compare features, and seek
recommendations from friends and experts.
• Multiple Alternatives: Consumers consider a variety of alternatives before making a
decision. They evaluate different brands, models, and options to ensure they make the
best choice.
• High Stakes: These purchases involve a substantial financial investment, making the
decision more critical. Examples include buying a car, a house, or choosing a
university.
• Personal Relevance: The product is closely related to the consumer's self-identity,
lifestyle, or aspirations. This can include products like luxury items or high-end
electronics.
• Emotional Engagement: High involvement purchases often evoke strong emotions.
Consumers may feel excited, anxious, or even stressed about making the right choice.
• Significant Post-Purchase Evaluation: After the purchase, consumers continue to
evaluate their decision to ensure it meets their expectations and needs.

Low Involvement:
Low involvement refers to situations where consumers make decisions with minimal effort,
time, and consideration. These decisions are often routine, mundane, and require less cognitive
engagement. Low involvement purchases are usually low-cost items that have a lower
perceived risk.
Here are some characteristics of low involvement purchases:
• Limited Research: Consumers don't invest much time in researching or evaluating
alternatives. They might rely on familiarity, brand recognition, or convenience.
• Habitual Buying: Consumers often buy out of habit or routine. They may choose a
product they've bought before without actively seeking out new options.
• Low Financial Risk: The purchase involves a small financial commitment, so the
consequences of making a wrong choice are minimal. Examples include everyday items
like snacks or toiletries.
• Minimal Emotional Engagement: Low involvement purchases are less likely to evoke
strong emotions. Consumers might make these decisions without feeling a significant
emotional attachment.
• Quick Decision: These purchases are made rapidly, and consumers may not spend
much time evaluating different options.
• Limited Post-Purchase Evaluation: After the purchase, there might be little to no
evaluation of the decision, as the stakes are relatively low.

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Factors Influencing Involvement
Consumer involvement is influenced by a variety of factors that shape how much time, effort,
and consideration individuals put into their purchasing decisions. These factors can vary based
on the product, the individual's characteristics, and the context of the decision.
Here are some key factors that influence consumer involvement:
1. Product Characteristics:
• Risk Perception: The perceived risk associated with a product can influence
involvement. High-risk products, such as medical treatments, may lead to higher
involvement due to potential negative consequences.
• Cost: More expensive products generally lead to higher involvement as consumers
want to ensure they're making a wise investment.
• Complexity: Complex products, like electronics with numerous features, may require
more research and evaluation, leading to increased involvement.
• Personal Relevance:
• Personal Interest: Consumers are more likely to be highly involved when a product
aligns with their personal interests, hobbies, or passions.
• Self-Image: Products that reflect or enhance a consumer's self-identity and image can
lead to higher involvement. For example, fashion choices or luxury items.
2. Consumer Characteristics:
• Knowledge and Expertise: Consumers with more knowledge about a product category
may feel more confident in making informed decisions, leading to higher involvement.
• Involvement Level: Previous involvement in a particular product category can
influence future involvement. If someone has a hobby of photography, they may be
more involved in choosing a camera.
• Situational Factors:
• Time Constraints: Limited time availability may lead to lower involvement, causing
consumers to make quick decisions.
• Urgency: Urgent needs or unexpected situations may reduce involvement, leading to
impulsive buying.
• Social Influence: If others are involved in the decision-making process (e.g., a family
choosing a vacation destination), it may increase involvement.
3. Perceived Benefits:
• Personal Benefits: If consumers perceive that a product can provide significant
personal benefits, they may be more involved in evaluating those benefits.
• Functional vs. Emotional Benefits: Products offering emotional benefits (e.g., status,
pleasure) might lead to higher involvement compared to those offering functional
benefits only.
• Marketing and Communication:
• Marketing Tactics: Well-designed marketing campaigns, such as interactive
advertisements or personalized promotions, can increase consumer involvement.
• Information Availability: Providing clear and easily accessible information about a
product can encourage consumers to engage more in the decision-making process.
4. Cultural and Social Factors:
• Cultural Values: Cultural norms and values can influence how important a purchase
is to an individual and, consequently, their involvement level.
• Social Class: Individuals from different social classes may approach purchases
differently, impacting their involvement.
• Perceived Control: If consumers believe they have control over the decision and its
outcome, they may be more involved in making the choice.

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Consumer decision-making process:

The consumer decision making process can be divided into five stages:

1. Problem Recognition: Identifying a Need or Want: At this stage, consumers become aware
of a discrepancy between their current state and their desired state. This can arise from
various factors such as an unmet need, a desire for improvement, or exposure to external
stimuli like advertising. Problem recognition triggers the consumer's journey through the
decision-making process.
2. Information Search: Looking for Options: After recognizing a need or want, consumers seek
information to find possible solutions. This involves internal search (retrieving information
from memory) and external search (gathering information from external sources like friends,
family, reviews, advertisements, and online research). The extent of the search depends on
factors like the complexity of the decision and the consumer's motivation.
3. Evaluation of Alternatives: Comparing Choices: During this stage, consumers evaluate the
various options they've identified through their information search. They consider factors
such as price, features, benefits, quality, and brand reputation. This evaluation helps them
narrow down the alternatives and identify the one that best meets their needs and
preferences.
4. Purchase Decision: Making the Buy: After evaluating the alternatives, consumers make a
purchase decision. This is the point where they choose the product or service that they
believe offers the best value and aligns with their criteria. The purchase decision can be
influenced by factors like personal preferences, budget constraints, and external influences.
5. Post-Purchase Behaviour: Reflecting on the Purchase: After making the purchase,
consumers reflect on their decision and experience. If their expectations are met or
exceeded, they are likely to feel satisfied. However, if the product or service falls short of
their expectations, they might experience buyer's remorse or dissatisfaction. Positive post-
purchase experiences can lead to brand loyalty and advocacy, while negative experiences
can result in complaints or product returns.

This consumer decision-making process is not always linear; consumers might skip or
repeat stages based on the complexity of the purchase and their level of involvement.
Moreover, marketers play a critical role in each stage by providing relevant information,
building brand awareness, influencing perceptions, and ensuring positive post-purchase
interactions. Understanding this process helps businesses design effective marketing strategies
that guide consumers through their decision-making journey and enhance their overall
experience.

Consumer Buying Behaviour

Consumer buying behaviour can be categorized into several types based on the complexity of
the decision-making process and the level of involvement. The four types you mentioned are
common classifications:
a. Habitual Buying Behaviour: In this type of behaviour, consumers make routine, low-
involvement purchases without much thought or consideration. These purchases usually
involve products that are inexpensive and frequently used. Consumers are often loyal to a
particular brand and tend to stick to their habitual buying patterns. For example, buying
everyday items like toothpaste, soap, or packaged snacks often falls under habitual buying
behaviour.

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 Example: Buying Bottled Water Consumers often have a preferred brand of bottled
water that they purchase regularly without much thought. They might choose the same
brand because it's convenient, familiar, and meets their basic hydration needs. The
decision-making process is quick and automatic, and consumers don't invest significant
time in researching or evaluating different brand.
b. Complex Buying Behaviour: Complex buying behaviour is associated with high-
involvement purchases that require significant research, evaluation, and decision-making.
Consumers invest time and effort in gathering information, comparing alternatives, and
considering various factors before making a purchase. This type of behaviour is common
for expensive and infrequently purchased items such as cars, homes, and high-end
electronics.
Example: Purchasing a New Car When buying a new car, consumers engage in
complex buying behaviour. They research different car models, compare features, read
reviews, visit dealerships, and consider factors such as price, performance, fuel efficiency,
safety features, and brand reputation. This process involves substantial time and effort due
to the high cost and infrequency of the purchase.
c. Variety-Seeking Buying Behaviour: Consumers with variety-seeking behaviour are open
to trying different brands or products within a category. They enjoy novelty and change
and are willing to switch brands to experience new options. This behaviour is often seen
with products that are low-cost and frequently consumed, like snacks or beverages.
Marketing strategies for variety-seeking behaviour often focus on product differentiation
and unique features.
Example: Snack Foods Consumers often exhibit variety-seeking behaviour when
buying snack foods. They might choose different brands or flavours of chips, cookies, or
candy bars to satisfy their craving for variety and novelty. Marketers can capitalize on this
behaviour by introducing new flavours or limited-edition versions of products to attract
consumers seeking something different.
d. Dissonance-Reducing Buying Behaviour: Dissonance refers to the feeling of post-
purchase anxiety or doubt that can arise after making a significant purchase decision.
Consumers with dissonance-reducing behaviour seek to minimize this feeling by seeking
reassurance and affirmations that they made the right choice. They may actively seek
positive information about their chosen product to alleviate their doubts. High-
involvement purchases with multiple comparable alternatives, such as expensive
appliances or electronics, often lead to dissonance-reducing behaviour.
Example: High-End Smartphone After purchasing a high-end smartphone, a consumer
might experience dissonance due to the significant cost and the abundance of available
features. To reduce this dissonance, they might seek out positive reviews, user testimonials,
or technical specifications that reinforce their choice. Seeking reassurance that their
decision was correct helps alleviate any doubts they may have.
These types of buying behaviours provide valuable insights for marketers to tailor
their strategies based on the consumer's decision-making process and level of involvement.
Effective marketing involves understanding the specific type of behaviour a consumer
might exhibit for a particular product or service and crafting campaigns that resonate with
their preferences and motivations.

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 Module 2
Information Search Process and Decision Rules

Understanding the Information Search Process:

In the realm of consumer behavior, the information search process is a pivotal stage that
significantly influences how individuals make purchasing decisions. This process involves
seeking, gathering, and evaluating information about various products, services, or alternatives
to arrive at an informed choice. Let's explore the key aspects of the information search process
and its role in consumer behavior.
The Information Search Process consists of five stages:
• Problem Recognition: The information search process typically begins with the
recognition of a problem or need. This could be triggered by an external stimulus like
advertising, personal experiences, or internal cues such as a desire for a new product or
solution.
• Internal and External Search: Once a need is identified, consumers engage in both
internal and external searches for information. The internal search involves recalling
information from memory about past experiences and knowledge. External search
entails seeking information from external sources such as friends, family,
advertisements, reviews, online research, and expert opinions.
• Evaluation of Alternatives: Consumers compare and evaluate the various options
they've gathered during the information search. They consider attributes, features,
benefits, and other factors that matter to them. The goal is to identify the option that
best fulfills their requirements.
• Purchase Decision: Based on the evaluation, consumers make their purchase decision.
This involves selecting a product, service, or alternative that aligns with their
preferences and meets their needs.
• Post-Purchase Evaluation: After making the purchase, consumers reflect on their
decision. If the chosen option meets or exceeds their expectations, they experience
satisfaction. Conversely, if it falls short, they might feel dissonance or dissatisfaction.
In conclusion, the information search process is a fundamental element of consumer
behavior. It empowers individuals to make well-considered decisions, manage perceived risks,
and ultimately attain satisfaction with their chosen products or services. By understanding the
intricacies of this process, marketers can design strategies that provide consumers with relevant
and credible information, enhancing their overall buying experience.

Decision Rules in Consumer Behaviour

In the dynamic landscape of consumer behaviour, decision rules play a pivotal role in
guiding individuals through the complex process of making choices. Decision rules are
frameworks or strategies that consumers employ to simplify their decision-making by focusing
on specific criteria. These rules help consumers navigate through the multitude of options
available and arrive at a choice that aligns with their preferences, needs, and constraints.
Types of Decision Rules:
1. Compensatory Decision Rule: The compensatory decision rule involves weighing the pros
and cons of each option across various attributes. Consumers consider both the strengths
and weaknesses of each option and make trade-offs based on their relative importance.

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 Example: Imagine a consumer looking to buy a new laptop. They prioritize attributes like
performance, battery life, and price. Option A has exceptional performance but a higher
price, while option B is more affordable but has slightly lower performance. The consumer,
using the compensatory rule, might opt for option A due to its stronger performance even
though it's pricier.
2. Non-Compensatory Decision Rules: Non-compensatory decision rules involve setting
specific criteria that must be met. Options failing to meet these criteria are eliminated,
regardless of their performance in other areas. There are different types of non-
compensatory rules:
▪ Lexicographic Rule: Consumers rank criteria by importance, and the option that
performs best on the most important criterion is selected. Example: Consider a
consumer choosing a restaurant. They rank criteria as follows: food quality, service,
ambiance. If Restaurant A has the best food quality, it would be the preferred choice
for the consumer based on the lexicographic rule, even if other restaurants have
better service or ambiance.
▪ Elimination-by-Aspects Rule: Consumers start with the most important criterion,
eliminating options that fall below a threshold. The process continues with other
criteria. Example: A consumer is buying a smartphone. They prioritize battery life,
camera quality, and storage. If a smartphone doesn't meet the desired battery life
threshold, it's eliminated, regardless of its camera quality or storage capacity.
▪ Conjunctive Rule: Consumers set minimum acceptable levels for each criterion,
and an option must meet all criteria to be chosen. Example: When purchasing a car,
a consumer sets minimum requirements for safety, fuel efficiency, and cargo space.
If a car doesn't meet any of these minimum criteria, it's not considered, regardless
of its performance in other areas.

Factors Influencing Decision Rule Selection:

• Product Complexity: For complex products like computers, consumers might
employ non-compensatory rules to simplify their choices.
• Time Constraints: In urgent situations, consumers might use non-compensatory
rules for quick decisions.
• Consumer Expertise: Experienced consumers may apply compensatory rules
effectively based on their knowledge of the product.
• Risk Tolerance: Consumers with a higher risk tolerance might be more flexible in
using compensatory rules.
Understanding these decision rules is crucial for marketers aiming to tailor their
strategies to consumers' decision-making processes, thereby enhancing customer satisfaction
and fostering stronger relationships between consumers and brands.

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 Module 3
Decoding Consumer Decision Making

PERSONALITY & SELF-CONCEPT: INFLUENCES ON CONSUMER

BEHAVIOR

• PERSONALITY AND BUYING DECISIONS:

Our personality traits are like the unique ingredients that make up who we are. They
impact our behavior, preferences, and choices – including how we shop.
1. Extroversion:
- Extroverted individuals are outgoing and social. They enjoy being around people and often
seek excitement.
- Shopping Preferences: Extroverts might be drawn to shopping malls, where they can
interact with others and explore new products. They might also prefer products that help them
stand out or enhance social interactions, like trendy clothing, accessories, or gadgets for group
activities.
2. Conscientiousness:
- Conscientious individuals are organized, detail-oriented, and value efficiency and
practicality.
- Shopping Preferences: Conscientious consumers are likely to research their purchases
thoroughly, looking for items that offer value, durability, and functionality. They might
gravitate towards planners, efficient home appliances, and products that align with their
organized lifestyle.
3. Openness to Experience:
- People high in openness to experience are curious, creative, and open-minded. They're
willing to try new things and explore innovative ideas.
- Shopping Preferences: Open individuals might be early adopters of new technologies,
seeking out unique and innovative products. They could be drawn to niche fashion brands,
unconventional gadgets, and products that reflect their distinctive tastes.

• SELF-CONCEPT AND BUYING DECISIONS:

Our self-concept is the collection of beliefs, attitudes, and perceptions we hold about
ourselves. It strongly influences our choices, as we tend to select products that reflect who we
are or who we want to become.
1. Actual Self:
- This is how you currently perceive yourself. Your buying decisions often align with your
actual self to maintain a consistent self-image.
- Example: If you see yourself as someone who values health and fitness, you're more likely
to buy activewear, gym memberships, and health-conscious products to reinforce your self-
perception.
2. Ideal Self:
- Your ideal self is the person you aspire to be, reflecting your goals, aspirations, and values.
- Example: If you aspire to be more environmentally conscious, your ideal self-concept might
lead you to choose products that are eco-friendly, such as reusable items, sustainable fashion,
and green energy solutions.

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Why It Matters:
Understanding the deep connection between personality traits and self-concept is crucial for
both consumers and businesses:
- For Consumers: Recognizing how your personality traits and self-concept influence your
choices empowers you to make decisions that align with your values and aspirations. It leads
to more satisfying and fulfilling purchases.
- For Businesses: Companies leverage this knowledge to create targeted marketing campaigns
and design products that resonate with specific personality types and self-concepts. They craft
messages that appeal to consumers' desires, bridging the gap between their actual and ideal
selves.
In summary, personality and self-concept serve as powerful factors guiding our
consumer behavior. As you make purchasing decisions, consider how your personality traits
and self-perception shape your choices. It's a fascinating interplay between who you are, who
you want to be, and the products that bridge that gap.

BUYER'S BLACK BOX

The Buyer's Black Box is a pivotal concept in understanding consumer behavior,
shedding light on the intricate processes that occur within the mind of a consumer before they
make a purchasing decision. This metaphorical "black box" represents the psychological and
cognitive steps that individuals go through, often subconsciously, as they move from
recognizing a need to finalizing a purchase.
Components of the Buyer's Black Box:
1. Psychological Processes:
• Perception: Consumers interpret external stimuli through their senses, shaping how
they perceive products and brands.
• Learning: Consumers acquire information and knowledge over time, influencing their
preferences and attitudes.
• Motivation: Internal drives and external factors push consumers to fulfill their needs
and desires.
• Attitudes: Consumer attitudes are shaped by beliefs, emotions, and experiences,
impacting their evaluations of products.
2. Decision-Making Variables:
• Problem Recognition: Consumers identify a discrepancy between their current state and
a desired state, initiating the decision-making process.
• Information Search: Consumers actively seek information about possible solutions,
relying on various sources to gather insights.
• Alternative Evaluation: Consumers compare available options based on attributes such
as quality, price, and benefits.
• Purchase Decision: After evaluating alternatives, consumers decide whether to make a
purchase, considering factors like perceived value.
• Post-Purchase Behavior: Consumers' feelings of satisfaction or dissatisfaction after a
purchase influence future behaviors and decisions.

Implications for Marketers:

Understanding the intricacies of the Buyer's Black Box offers marketers valuable insights into
crafting effective strategies:

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 • Tailoring marketing messages to align with consumers' perceptions, motivations, and
attitudes.
• Providing clear and accessible information during the information search phase.
• Highlighting unique features and benefits during the alternative evaluation stage.
• Addressing potential cognitive dissonance and ensuring post-purchase satisfaction.

Real-World Application:
Companies often leverage the Buyer's Black Box to create impactful marketing campaigns:
• Nike's use of motivational messages taps into consumers' motivations and aspirations.
• Amazon's customer reviews provide information for the information search and
evaluation stages.
In essence, the Buyer's Black Box underscores the complexity of consumer decision-
making, emphasizing the dynamic interplay between psychology, perception, motivation, and
evaluation. By delving into this black box, marketers can better tailor their strategies to engage
consumers effectively and drive successful outcomes.

MASLOW'S HIERARCHY OF NEEDS THEORY

Abraham Maslow, a prominent American psychologist, introduced the Hierarchy of
Needs theory in the field of psychology. This theory, often referred to as Maslow's Pyramid or
Maslow's Hierarchy of Needs, suggests that human beings have a set of fundamental needs that
must be fulfilled in a specific order to achieve personal growth, self-actualization, and overall
well-being. The theory is often depicted as a pyramid with five levels, each representing a
different category of needs. These needs range from basic physiological requirements to higher-
order psychological needs.
• Physiological Needs: At the base of the pyramid are the physiological needs, which include
the fundamental requirements for survival such as air, water, food, shelter, sleep, and other
bodily necessities. These needs are of the highest priority, and until they are met, an
individual's focus remains primarily on obtaining these essentials. Only when these needs
are satisfied can a person move on to higher levels of the hierarchy.
• Safety Needs: Once physiological needs are met, individuals are concerned with safety and
security. This includes physical safety, emotional security, financial stability, health, and
protection from harm. People seek stability, predictability, and a sense of control over their
environment. Fulfilment of safety needs creates a foundation for individuals to progress
further.
• Social Needs: The third level involves social and interpersonal needs, including the desire
for companionship, affection, love, friendship, and a sense of belonging to a group or
community. Humans are inherently social beings, and these connections contribute to their
emotional well-being. Failure to meet these needs can lead to feelings of loneliness and
isolation.
• Esteem Needs: Esteem needs are divided into two subcategories: a) Self-esteem - which
encompasses self-respect, self-confidence, and a sense of achievement, and b) Esteem from
Others - which includes recognition, respect, and approval from others. Fulfilment of these
needs’ leads to a healthy level of self-worth and confidence.
• Self-Actualization Needs: The pinnacle of Maslow's hierarchy is self-actualization. This
refers to the realization of an individual's full potential and the pursuit of personal growth,
creativity, and fulfilling one's unique talents and abilities. Achieving self-actualization
implies a deep understanding of oneself, an alignment between personal values and actions,

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 and a sense of inner fulfilment. It's important to note that self-actualization is an ongoing
process and not a fixed destination.
Nonetheless, Maslow's theory has influenced various fields, including education,
business management, and self-help literature. It has provided a valuable framework for
understanding human motivation and behavior, emphasizing the importance of addressing
basic needs before pursuing higher-level aspirations.
In conclusion, Maslow's Hierarchy of Needs theory remains a foundational concept in
psychology, offering insights into the complex interplay between human needs, motivations,
and personal development. It continues to shape our understanding of human behavior and the
factors that contribute to human well-being.

FREUD'S THEORY OF MOTIVATION

Sigmund Freud, a pioneering figure in the field of psychology, developed a
comprehensive theory of motivation that delved into the complex interplay between conscious
and unconscious desires. His theory, known as psychoanalysis, revolutionized the way we
understand human behavior and motivation. Here's a detailed overview of Freud's Theory of
Motivation:
1. The Structure of the Mind: Freud proposed that the human mind consists of three main
components: the conscious mind, the preconscious mind, and the unconscious mind. The
conscious mind holds thoughts, feelings, and perceptions we are currently aware of. The
preconscious mind contains thoughts and memories that can be brought into consciousness
with effort. The unconscious mind, however, contains repressed memories, desires, and
emotions that greatly influence our behavior but remain hidden from our awareness.
2. The Tripartite Personality: Freud introduced a model of personality composed of three
parts: the id, the ego, and the superego. These elements constantly interact and influence our
motivations.
- Id: The id operates on the pleasure principle, seeking instant gratification for basic
biological and psychological needs. It is impulsive and unconstrained by societal
norms or morality.

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 - Ego: The ego is the rational part of the personality, operating on the reality principle.
It seeks to balance the desires of the id with the constraints of the external world,
making decisions that satisfy both.
- Superego: The superego represents our internalized moral and societal values. It
develops as we internalize the norms and values of our caregivers and society. It
often acts as a conscience, guiding us toward morally acceptable behaviors.
3. Motivational Conflict: According to Freud, conflicts arise within the individual due to the
competing demands of the id, ego, and superego. This inner conflict can lead to anxiety, and
the mind employs defense mechanisms to protect itself from the discomfort these conflicts
bring. Defense mechanisms include denial, repression, projection, and more.
4. Psychosexual Stages of Development: Freud proposed that human development is
characterized by a series of psychosexual stages, each associated with a particular erogenous
zone and a central psychological conflict. Successful resolution of these conflicts leads to
healthy personality development, while unresolved conflicts can result in fixations and issues
later in life.
5. Motivation and Unconscious Desires: At the core of Freud's theory of motivation is the
idea that unconscious desires and unresolved conflicts heavily influence our thoughts, feelings,
and behaviors. These hidden motivations can lead us to engage in seemingly inexplicable
actions or reactions.
6. Dreams and the Unconscious: Freud believed that dreams provided a window into the
unconscious mind. He introduced the concept of dream analysis, suggesting that the symbolism
and imagery in dreams could reveal repressed desires and conflicts. Through interpretation,
individuals could gain insights into their motivations and unresolved issues.
7. Application and Critique: Freud's theory has had a profound impact on psychology and
has influenced various therapeutic approaches. However, it has also faced criticism for its lack
of empirical evidence and its heavy focus on sexuality. Contemporary psychology has evolved
to incorporate and refine Freud's ideas while integrating newer research and perspectives.
In summary, Freud's Theory of Motivation highlights the intricate interplay between
conscious and unconscious motivations, exploring how our desires, conflicts, and personality
components influence our thoughts and actions. While it has its limitations, Freud's ideas have
undeniably shaped the landscape of psychology and continue to be relevant in understanding
human behavior.

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 Link for Final Examination:
Full Marks: 100
No. of Questions: 50
Pass Marks: 30

https://forms.gle/FeEy6wspE7LhCJCp8

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 Profile of the Tutor:

Dr. Samrat Bharadwaj

M. Com, M. Phil, PhD, PGDCA, Dip. Neuromarketing, Dip.
Journalism and Mass Communication, Dip. Acting and Film
Making, Cert. Digital Marketing (Google)
Assistant Professor, Department of Commerce, Digboi College, India
Email Id:[email protected]
Website: www.tinyurl.com/samratbharadwaj

Dr. Samrat Bharadwaj is an assistant professor at Digboi College, India, in the Department
of Commerce. His areas of interest include marketing, consumer behaviour, research
methodology, spiritual management and tourism. He holds an M. Phil in Marketing Warfare
and a Ph.D. in Consumer Behavior and Promotional Marketing from India. Bharadwaj has
published numerous research papers in prestigious national and international publications that
are indexed in Scopus, Web of Science, ABDC, UGC-Care List, and so on. In addition to being
the author and editor for five books published by international publishers, Bharadwaj has
contributed numerous research chapters to a plethora of edited volumes. In addition, he serves
as a member of the editorial board for two prestigious international journals and as an expert
reviewer for journals published by Routledge (Taylor & Francis Group) and Elsevier. With a
research experience of over six years, he happens to be a life member of organisations like
Indian Commerce Association (ICA) and Northeast India Commerce and Management
Association (NEICMA). He also has two patents to his credit.

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