Question

1) What is consumer behavior? Give examples of the types of questions about consumer behavior that marketers investigate.

Answer:  

2) Briefly describe each step in the consumer decision-making process.

Answer:  

3) How do heuristics affect a consumer's decision-making process? Give two examples of heuristics you might use when shopping.

Answer

Answer 1

1) What is consumer behavior? Give examples of the types of questions about consumer behavior that marketers investigate.

Answer :  

Consumer behaviour is the study of how individuals, groups, communities or an organizations select, use or buy a particular products, goods or services for consumption. It is the process of identifying how customers make decisions about what they want,need or desire and how do they buy, use and dispose of goods.

Types of questions about consumer behaviour that marketers investigate :

● Identify audience : Who are the customers?

● Find how customers reach us(marketers) : How do your customers research your products?

● Understand why customers choose our products : What need does your product satisfy?

● Pay attention to what the competitors are doing and why certain customers choose their products : What are the competitors doing?

Following are some model questions :

• Who buys your products and services?

• Who influence the decision to buy the product?

• Why does the customers buy your products ?

• What are the reasons for consumers preferring one brand over another?

• When do customers buy a product?

• What is the role of customer's lifestyle in his behaviour?

2 ) Briefly describe each step in the consumer decision-making process.

Answer:  

Inorder to purchase a particular product or services, customers passes through 5 steps in the consumers decisions making process. These stages are also known as consumers journey. Following are 5 steps of consumer decision-making process :

● Problem Recognition : First stage is to identify the need or desire. Usually a customer think to buy something, when he or she wants something to satisfy their problem or need. Need recognition occurs when a customer exactly determines their needs.

● Information Search : After identified the problem or need, next stage is to search information regarding the product which can satisfy their needs. Information can be collected from various forms such as commercial sources( advertisements, promotional campaigns), personal sources(family, friends, colleagues ), public sources( Magazines, newspapers, radio, ) and experimental sources(surveys, research, exams )

● Alternative Evaluation : After understanding the full details regarding the products, the next steps is to find rivalry products and substitute products which are available in market as same or similar to the selected product and comparing those products to select best out of them.

● Purchase Decision : After comparisons and selecting best choice, the customer reach into the final decision to buy the product. At this stage, the customer has evaluated all the facts and arrives into the conclusion which is either based upon the influence of marketing campaign or upon emotional connection, personal connection or both.

● Post Purchase Behaviour : After purchasing the product, customer rate the product according to its quality, durability, expectations, etc..to analysing as to whether the product was useful to the customer or not. Feedback can be positive and negative, negative feedback make the customers to move to the competitors in the next purchasing cycle and positive feedback make the customers to stick with the same company's product.

3) How do heuristics affect a consumer's decision-making process? Give two examples of heuristics you might use when shopping.

Answer :

Heuristics are simple strategies or a mental processes that uses shortcuts to produce good-enough solution within limited time frame or deadline. Heuristics can heavily influence people's decision-making according to their current emotions. People usually buys things according to their needs and desire, sometimes emotions will also plays a key role in making purchase decisions. It is found that when you are in positive emotional state, your decision making lead to activities which results high benefits and low risk and when you are in negative emotional state, your decision making results in low benefits and high risk.

If a customer decides to buy particular product 'X' which has high quality and brand image, but at the same time the customer saw an advertisment in television about a product 'Y' which is substitute of 'X'. The person get attracted to the substitute 'Y' because of its new offer shown in the advertisement. Actually the product 'Y' is not much good like the product 'X'. But the customer gets emotionally attached with the advertisement and decided to buy the product shown in the advertisement without knowing its quality and durability.

The above incident is just an example of how consumer's decision-making process can change according to heuristics affect.

Two examples of heuristics you might use when shopping

● When go for shopping to buy clothes, first starts looking from expensive dresses then select lower priced items and compare both higher priced and lower priced model to select better out of it. (This is an example of Anchoring heuristics, that is effect of prior judgment of an object on our future judgment regarding another object.)

● Sometimes decisions regarding purchasing a product will be based on ads seen on TV, if the product have a better offer or discounts. (This is a type of representativeness heuristic.)