Definition: The Consumer Behavior is the observational activity conducted to study the behavior of the consumers in the marketplace from the time they enter the market and initiate the buying decision till the final purchase is made.
In other words, consumer behavior is the study of how the consumers, make purchase decisions and what are the underlying factors that influence such decisions. The marketers believe that by understanding what compels an individual to buy a particular product or service over the other, it is easy to identify which product are in need and which have become obsolete and accordingly the marketing strategies could be designed.
Importance of Consumer Behavior
- It is essential for the marketer to study the behavior of the consumers in order to make better strategic marketing decisions. If the marketer has complete knowledge about the consumer’s likings or disliking, then he can predict the response of the potential customers towards his offerings.
Thus, by studying the consumer behavior before and during purchase helps in production scheduling, designing, pricing, positioning, segmentation, advertising and other promotional activities.
- The study of consumer behavior is equally important for the non-profit organizations such as governmental agencies, hospitals, NGO’s, charitable organizations. For example, the polio campaigns can be designed for the vulnerable sections of the society who cannot afford the basic livelihood.
- The Government also studies the consumer behavior to provide them with the necessary goods and services, understanding the potential future problems, such as pollution, anti-plastic drive, Swacch Bharat Abhiyan, traffic, etc.
- The understanding of a behavior of a consumer is necessary before the launch of the demarketing programmes. For example, motives, attitude, behavior of the customers behind the purchase of injurious products Viz. Cigarettes, Tobacco, etc. should be properly understood.
Thus, marketers try to understand the consumer psychology with respect to their purchase decisions and identify the factors influencing the consumer behavior.