Consumer Behavior

In marketing, understanding how and why consumers behave. An appropriate marketing stimulus is formulated based on customer personality and needs to prompt sales. Consumers adjust behavior to the marketplace based on internal needs and interpersonal factors.

In September 1999, Polaroid Corparation introduced to the U.S. market a small, instant camera with a cheap lens that produced fuzzy, postage-stamp-sized photographs that could double as stickers. Scientists and engineers at Polaroid, holding true to the company's long-standing reputation for building high-quality, technologically innovative products, were skeptical. They worried that this new instant camera, called the I-Zone Instant Pocket Camera, would taint their reputation. Before becoming one of I-Zone's ardent supporters, Ed Coughlan thought the camera was crazy, "I'm an old engineer. I couldn't for the life of me figure out who'd buy it" (quoted in Klein, 2000, p. A1).

Figuring out not only who would buy it, but why they would buy it, where they would buy it, how often they would buy it, and how they would use it is the cornerstone of understanding consumer behavior. Consumer behavior is the study of people: how we buy, consume and dispose of products. There were 275 million people in the U.S. alone in 2000. Each of us is a consumer of hundreds of products every day. As consumers, we can benefit from a better understanding of how we make our decisions so that we can make wiser ones. Marketers can benefit from an understanding of consumer behavior so that they can better predict what consumers want and how best to offer it to them. Trusting their understanding of the changing consumer market, the marketing specialists at Polaroid convinced the company to launch the I-Zone. Less than three months after its launch, the I-Zone Instant Pocket Camera became America's number-one selling camera (Klein, 2000).

There are two major forces that shape who we are and what we buy. Our personal motives, attitudes, and decision-making abilities guide our consumption behavior. At the same time, our families, cultural background, the ads we see on TV, and the sites we visit on the Internet influence our thoughts and actions (see Figure 1).

Understanding Consumers: Internal Factors

Our consumption behavior is a function of who we are as individuals. Our thoughts, feelings, attitudes, and patterns of behavior determine what we buy, when we buy it, and how we use it. Internal factors have a major impact on consumer behavior.

Consumer motivation. A marketer's job is to figure out what needs and wants the consumer has, and what motivates the consumer to purchase. Motivation is the drive that initiates all our consumption behaviors, and consumers have multiple motives, or goals. Some of these are overt, like a physiological thirst that motivates a consumer to purchase a soft drink or the need to purchase a new suit for an interview. Other motives are more obscure, like a student's need to tote a Kate Spade bookbag or wear Doc Martens to gain social approval. Most consumption activities are the result of several motives operating at the same time. Researchers specially trained in uncovering motives often use qualitative research techniques in which consumers are encouraged to reveal their thoughts (cognitions) and feelings (affect) through probing dialogue. Focus groups and in-depth interviews give consumers an opportunity to discuss products and express opinions about consumption activities. Trained moderators or interviewers are often able to tap into preconscious motives that might otherwise go undetected. Sentence completion tasks (e.g., Men who wear Old Spice are . . .) or variants of the Thematic Apperception Tests (TAT), in which respondents are shown a picture and asked to tell a story surrounding it, are additional techniques that provide insight into underlying motives.

Consumer motives or goals can be represented by the values they hold. Values are people's broad life goals that symbolize a preferred mode of behaving (e.g., independent, compassionate, honest) or a preferred end-state of being (e.g., sense of accomplishment, love and affection, social recognition). Consumers buy products that will help them achieve desired values; they see product attributes as a means to an end. Understanding the means-end perspective can help marketers better position the product and create more effective advertising and promotion campaigns.

Consumer information processing. The consumer information-processing approach aids in understanding consumptive behavior by focusing on the sequence of mental activities that people use in interpreting and integrating their environment.

The sequence begins with human perception of external stimuli. Perception is the process of sensing, selecting, and interpreting stimuli in one's environment. We begin to perceive an external stimulus as it comes into contact with one of our sensory receptors—eyes, ears, nose, mouth, or skin. Perception of external stimuli influences our behavior even without our conscious knowledge that it is doing so. Marketers and retailers understand this, and they create products and stores specifically designed to influence our behavior. Fast-food chains paint their walls in "hot" colors, like red, to speed up customer turnover. Supermarkets steer entering customers directly into the produce section, where they can smell and touch the food, stimulating hunger. A hungry shopper spends more money.

Close your eyes and think for a moment about the hundreds of objects, noises, and smells surrounding you at this very moment. In order to function in this crowded environment, we choose to perceive certain stimuli while ignoring others. This process is called selectivity. Selectivity lets us focus our attention on the things that provide meaning for interpreting our environment or on the things that are relevant to us, while not wasting our limited information-processing resources on irrelevant items. Did you even notice that after you decide on, say, Florida, for your vacation destination, there seems to be an abundance of ads for Florida resorts, airline promotions for Florida, and articles about Florida restaurants and attractions everywhere? Coincidence? Not really. There are just as many now as there were before, only now you are selectively attending to them, whereas you previously filtered them out. Marketers continuously struggle to break through the clutter and grab consumers' attention. Advertising and packaging is designed to grab our attention through a host of techniques, like the use of contrast in colors and sound, repetition, and contextual placement.

Did you watch TV last night? You may have paid attention to many of the ads you saw during the commercial breaks; you may even have laughed out loud at a few of them. But how many can you recall today? Consumers' ability to store, retain, and retrieve product information is critical to a brand's success. When information is processed, it is held for a very brief time (less than one minute) in working, or short-term, memory. If this information is rehearsed (mentally repeated), it is transferred to long-term memory; if not, the information is lost and forgotten. Once transferred to long-term memory, information is encoded or arranged in a way that provides meaning to the individual. Information in long-term memory is constantly reorganized, updated, and rearranged as new information comes in, or learning takes place. Information-processing theorists represent the storage of information in long-term memory as a network consisting of nodes (word, idea, or concept) and links (relationships among them). Nodes are connected to each other depending on whether there is an association between concepts, with the length of the linkages representing the degree of the association. Figure 2 illustrates a network model of long-term memory. When Edwin Land invented the first Polaroid instant camera, knowledge structures for cameras changed to reflect the association between photography and instant output. Now, knowledge structures are changing to reflect the new I-Zone camera.

The complete network brought to mind when a product is activated is called the product schema. Knowing the set of associations that consumers retrieve from long-term memory about a particular product or category is critical to a successful marketing strategy. For new products or services, marketers must first select the set of associations they want consumers to have. This is called positioning the product, or selecting the brand image. Peak Freans' unique positioning as an adult cookie was accomplished by establishing a link between the concept "serious" and "cookie." The brand position is then translated into clever ads, reinforced on product packaging, and integrated into all promotion and communication strategies. Over time, a brand's image can fade or become diluted. Sometimes consumers associate concepts that are not favorable to a brand. When this occurs, marketers reposition the brand, using advertising and other marketing tools to help consumers create new links to positive association and discard links to the unfavorable ones. In the mid-1990s, Hush Puppies shoes made a comeback after decades of low sales. Introducing exciting, vibrant colors, Hush Puppies repositioned their basic comfort shoe as fashionable, youth-oriented, and "cool." Strategies for successful brand extensions also depend on the brand schema. Generally speaking, a brand extension is more likely to be successful if the set of associations for the extension matches the set of associations of the core product. Would Lifesavers brand toothpaste sell? Probably not, because the associations for Lifesavers (sweet, candy, sugar, fruity) are not the same as those for toothpaste (mint, clean, noncandy). On the other hand, a Lifesavers brand sugared children's cereal with colorful, fruity rings has a much better match of associations.

Attitude formation and change. The set of beliefs consumers have stored in long-term memory provides another critical function to marketers: It provides the basis for a consumer's attitude toward a brand or an ad. An attitude is an overall evaluation of an object, idea, or action. Attitudes can be positive or negative, and weakly or strongly held. The statement "I love Ben & Jerry's Vanilla Toffee Crunch" is a strong, positively valenced attitude toward a product. The statement "I dislike the new Toyota ad" is a weak, negatively valenced attitude toward an advertisement. Marketers work hard to continuously monitor consumer attitudes toward their products. Among other things, attitudes can indicate problems with a product or campaign, success with a product or campaign, likelihood of future sales, and overall strength of the brand or brand equity.

A popular perspective is that attitude has three components: cognitive, affective, and co native. The cognitive component reflects the knowledge and beliefs one has about the object (e.g., "Digital Club Network is an on-line live music Internet site."), the affective component reflects feelings (e.g., "I like the Digital Club Network site") and the co native component reflects a behavioral tendency toward the object (e.g., "I will become a registered user of digitalclubnetwork.com"). Thus, attitudes are predispositions to behave in a certain way. If you have a favorable attitude toward a politician, you will likely vote for him or her in the next election. Because of this, many marketers use attitude measures for forecasting future sales. It is important to note, however, that the link between attitudes and behavior is far from perfect. Consumers can hold positive attitudes toward multiple brands but intend to purchase only one. External economic, social, or personal factors often alter behavioral plans.

Attitudes are dynamic, which means they are constantly changing. As an individual learns new information, as fads change, as time goes on, the attitudes you once held with confidence may no longer exist. Did you ever look at old photos of yourself and wonder "What was I thinking wearing clothes like that? And look at my hairstyle!"

Understanding Consumers: External Factors

In addition to the internal factors, consumer behavior is also shaped to a large extent by social factors, such as culture, family relationships, and other aspects of the external environment. Awareness of these influences can help marketers to identify groups of consumers who tend to think, feel, or act similarly and separate them into unique market segments. Aspects of the marketing program—such as product design, advertising, and pricing—can then be tailored to meet the unique needs, values, and goals of these distinct groups.

Group influences on individual consumer behavior. Group influences on consumer behavior can impact motivation, values, and individual information processing; they can come from groups to which consumers already belong or from groups to which they aspire to belong (aspirational groups). Groups can exert a variety of influences on individuals, including: (1) informational influences where the group acts as a source for expert opinions; (2) comparative influences such that the group provides opportunities to manage the individual's self-concept with respect to the group's identity; and, (3) normative influences, whereby the group specifies guidelines and sanctions for appropriate or inappropriate individual behaviors.

The influence of groups on consumer behavior tends to vary with a variety of group and product-related factors. For example, the more the group is perceived to be a credible, valued source of approval or disapproval to the consumer, the more likely that consumer is to conform to group values. In addition, the more frequently group members interact, and the more outwardly visible use of the product is to group and non-group members, the greater the group's influence on individual consumption behavior.

Family influences on consumer behavior. Families have a particularly significant influence on consumer behavior. For example, consumption behavior often changes substantially as family status changes over time. Thus, young unmarried adults, who are often focused on individual self-definition, tend to purchase products that enhance or define their self-concepts. In contrast, couples with children may be more interested in purchasing items or experiences that can be shared by all family members and, as a result, may spend less on individually oriented products.

Family membership also leads to a greater need for joint rather than individual decision making, further complicating consumer behavior at the household level. For example, the person who buys a product may not be the ultimate consumer of the product. Or perhaps the husband and wife have differing levels of involvement with certain product decisions, leading to different types of separate decision processes that must be integrated before a choice is ultimately made. Understanding the dynamics involved in joint decision making and which family members influence which types of decisions has important implications for marketers interested in directing marketing efforts to the right person. Importantly, these family dynamics and lifestyle transitions are complicated by the decline in traditional households and the accompanying rise in nontraditional family structures, such as cohabitating couples or couples integrating families from previous marriages.

Cultural and sub-cultural influences on consumer behavior.Culture comprises the common meanings and socially constructed values accepted by the majority of members of a society or social group. It includes such things as shared values, beliefs, norms, and attitudes, as well as affective reactions, cognitive beliefs, and patterns of behavior. Typically, when we think of culture, we tend to think of differences among individuals from different countries or regions of the world. With the increasing globalization of the world economy, understanding differences and similarities in consumer behavior across cultures becomes increasingly meaningful, with important implications about the degree to which marketing strategies can be standardized across countries and cultures, or localized to reflect country or region-specific cultural distinctions.

One important cultural difference is the degree to which the self is defined as independent from others versus interdependent with important others. Individualistic cultures, such as the United States, tend to foster an independent sense of self, with the self believed to be a set of internal attributes unique to each person. Collectivist cultures, however, such as China, foster an interdependent sense of self, with the self believed to be inseparable from others and the social context; person-specific attributes are less important in self-definition than are interpersonal relations. These differences in self-definition affect a variety of consumer behaviors, including emotional reactions to advertisements, the degree to which information from others is valued when making consumption decisions, and gift-giving behavior.

In addition to cultural differences that exist across countries, marketers are also increasingly recognizing the importance of cultural differences within a society. Subcultures are distinctive groups within a society that share common meanings. Subcultures can often be identified based on demographic characteristics, such as geographic location (e.g., the southern United States), ethnicity (e.g., Hispanic Americans), or age (e.g., baby-boomers). Polaroid's I-Zone camera is targeted in the United States to appeal to the teenage subculture.

Subcultures can also be identified based on common lifestyles. For example, a strong subculture exists around Harley-Davidson motorcycles and the Harley Owner's Group (HOG). Members of this group share a core cultural value of personal freedom, which is exemplified in both the experience of using the product (taking to the open road) and in the company's marketing strategy (e.g., the open-winged insignia [Schouten and Alexander, 1995]). Importantly, identification of lifestyle subcultures, and the corresponding development of an inventory of shared meanings, is typically more difficult than the development of such understanding of subcultures based on observable demographic characteristics.

Increasingly, Internet marketers have come to realize the value of subculture segments and have tailored product offerings and/or Web site content to appeal to particular subcultures, most often demographically based, and to foster a greater sense of community and connection among subculture members. For example, iVillage.com features content of particular interest to women and offers forums for discussion of issues relevant to its users. Similarly, His panic.com aims to provide services and information to Hispanic Americans as well as to provide a virtual meeting space for Hispanic Americans to meet and help one another. These represent early attempts to use the Internet to target and serve subculture populations. Future sites are likely both to target more narrowly defined subcultures (e.g., Hispanic Americans with an interest in gourmet cooking) and to focus on reaching more lifestyle-based subcultures.

The Consumer Decision-Making Process

What consumers think and the social environment they live in determine what they buy and how that purchase decision is made. Typically, the decision process is described as a series of five stages. The first stage, need recognition, occurs when consumers perceive a difference between their ideal and actual states. Need recognition is often prompted by persuasive advertising. Consumers then begin the information search process by conducting an internal search of their own knowledge structures, followed by an external search for information from friends, family members, salespeople, and advertisements. This step can clarify the problem, providing criteria to use for assessing product alternatives and resulting in a subset, or "consideration set," of potential choices. These options are then assessed more completely in the third stage, alternative evaluation. In this stage, products in the consideration set are compared with one another. Sometimes a simple heuristic rule of thumb, such as "I'm going to buy the cheapest product" is used. At other times a more complex strategy, such as a weighted-average model that compensates for product strengths and weaknesses, is used. After examining each alternative, consumers are ready to purchase, the fourth step in the decision process. Finally, after buying, the consumers enter the post-purchase phase of the process, during which the performance of the chosen alternative is evaluated in light of prior expectations. Consumers will be satisfied with the product if it meets or exceeds expectations; dissatisfaction occurs if the product does not meet expectations.

This model of consumer behavior, while very useful, is highly simplified and does not always accurately reflect the decision process consumers follow. Consumers may not always proceed linearly through the five steps as described, and sometimes they may skip certain steps entirely. However, the model is a close approximation of the process for most consumers for most purchase occasions.

We are all consumers. Understanding why we behave as we do is integral to an efficient transfer of goods and services in a market-driven economy.

Bibliography

Klein, Alec. (2000). "On a Roll: The Techies Grumbled, but Polaroid's Pocket Turned into a Huge Hit." The Wall Street Journal May 2: A1.

Schouten, John W., and Alexander, James H. (1995). "Subcultures of Consumption: An Ethnography of the New Bikers." Journal of Consumer Research 22 (June): 43-61.

Wilkie, William L. (1994). Consumer Behavior, 3rd ed. New York: Wiley.

[Article by: LAUREN G. BLOCK; PATTI WILLIAMS]