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Influencing factors on the behaviour of customers

A literature review is a body of text that aims to review the critical points of previously published work. This chapter will support the subject of the research. It is written to highlight specific arguments and ideas in this field of study. By highlighting these arguments, the researcher attempts to exhibit, what has been studied in this field, and also where the weakness, gaps, or areas required for further study? Therefore, the literature review is based on the objectives of the dissertation finding carefully all previous research areas.

Since its formal establishment as a separate discipline from marketing in 1974, consumer behaviour has changed substantially in the way it is studied. The current thinking in consumer behaviour attempts to tackle previously untargeted issues in the field, namely the emotional, cultural and symbolic aspects to consumer buying behaviour

It is important to note that this chapter will provide an overview of consumer behaviour with respect to the models, theories and general concepts which affects the behaviour of the consumer. It is the review of books, journal, articles and the data collected via internet on consumer decision making .The results from this chapter would be concluded in the last section of the research.

2.2 SOURCES OF INFLUENCE ON CONSUMER. 

The behaviour of the consumer is influenced by several sources which modify their purchase aspect and this is the reason why every consumer has different purchase tendency it can be influenced by several factors. Solomon(1994:100)

Source: http://www.consumerpsychologist.com/

Cultural factors:-According to Kanuk(1997)These factors shape the basic necessity of the person while a British person will go for tea rather than a coffee which is derived by the culture where his upbringing

Physical factors:-It can be explained as “want is a want” We are more likely to buy a soft drink when we are thirsty, for example, and food manufacturers have found that it is more effective to advertise their products on the radio and television in the late afternoon when people are coming from work.( Churchill & peter 1998:143) states that a self image of a person is a driving urge for the want, as a well developed business owner would have more wants as compared to the middle class person.

Social factors:- Solomon (1994:94) continues by stating that influence what the consumers buy often for example consumers seek to imitate others whom they admire, and may buy the same brands.   The social environment of a person change the person purchase decision.Multi National Companies are mixing the brand values of the company with the social factors e.g. A social icon is explaining the brand values of the company which help to shape the behaviour of the consumer both ways which can include the mainstream culture. Thus, company introduces “social icons” in their advertisements to influence the social needs of the consumers.

 Learning factors:- Consumer behaviour is influenced by the learn factor which derives the urge to purchase again. A person tries a particular product and learn that it satisfies his needs and the next time the same need arise he would go for the same product rather than trying any other alternative.(Lilien & Kotler (1983:205)

2.3 DECESION MAKING

One model of consumer decision making involves several steps. The following steps are

Problem recognition:-Walter (1974:65) states that a person realizes that something is lacking or missing . Consumer recognises need for something to satisfy the current want .for example: when a person is not feeling well then the want to medication arises.

Information search:-Consumer search for the alternative ways of satisfying the want. In this stage person gathers information and here he studies the brand values of the company and seeks to correlates it with the his personal satisfaction.(Hughes.G.D and Naert.P.A,1970:359)

Evaluation of alternatives: - Evaluation of alternatives represents the search for the best alternative and in this phase: advertising, purchase schemes help to shape the decision of the person. In this stage the buyer is limited to certain alternatives and sees the” pros”and “crons” of each chosen alternative.

Purchase stage: -This is the final stage ,when the consumer selects one from the chosen alternatives and purchase the product. Walters (1974:67) on the other hand concluded that sometimes a post-purchase stage affects the purchase stage because a person returns the purchase product to the store because he does not find it satisfactory, consumer reflects on all the above factors before making any purchase decision

2.3.1 INFORMATION SEARCH

Consumers engage in both internal and external information search. 

Internal search:-It involves the consumer identifying alternatives from his or her memory.  For certain low involvement products the marketing strategy of the company affects the consumer behaviour, if the product is visible(consumer sees it every time via radio, television etc) then the consumer remembers the product that initiates him to buy it. (Kotler. 1979:35). 

In addition to the above statement he says that the internal search is the basic step that initiates a person to search about the product and to know more about the associated company.

External Search: - Kotler (1979:37) states that the external factor affects the decision of a person when there is huge investment involved then a person would like to go for an external search to attain the desired satisfaction. Consumer gains information about the product through friends, reading brochure, internet surfing. External search resembles gaining information from the external source. As stated by the fellow writer (Lillien, 1979) external research are the reliable multi indicators and involves variety of self reported measures.

The amount of effort a consumer puts into the search for the product depends on a number of factors such as market situation, difference between the brands and the investment involved.(Oliver.R.L,1980:467)

2.4 CONSUMER CHARACTERSTICS

Determines the interest of the consumer in the product generally, in analyzing product characteristics and making the best possible deal, and situational characteristics

2.4.1 DECESION INTREST

Variety seeking:- Consumer wants to try the new brands and seeks satisfaction via choosing different brand and the external factors help to shape the decision of the consumer and engage him to try the new brand because it considered as better than what he is using in the present.(Schiffman & Kanuk 1987:654)Thus we can conclude that the brand loyalty of a particular person can effect the decision of the another person.

Impulse purchases:-As described by (Perner.L, 2007) These are known as the unplanned buys: for example:, a shopper may plan to buy general items but only decide in the store to actually buy bread and butter. Alternatively, a person may buy an item which is currently on sale, or one that he or she remembers that is needed only once inside the store.eg. Reduced price offers.

Some consumers are also more motivated by comparison shopping they always search for the best price, but some consumer believe in saving “time” instead of saving “money”

Personality is the major aspect which impacts decisions.  Some like variety more than others, and some are more receptive to stimulation and excitement in trying new stores.  “Perception influences decisions”. (Feber.R,1973) Some people, for example, can taste the difference between generic and name brand foods while many cannot.(discussion in later section)  Selective perception occurs when a person is paying attention only to information of interest.  For example, when looking for a new car, the consumer may pay more attention to car ads. Most of the consumers are affected by the perceived risk of buying the product; they focus on after sale services.

According to Belk’s on the article on.“The Emergence and transformation of consumer behaviour research”: lifespan of consumer behaviour is relatively short. Starting with the concept of the consumer is still rooted in economics from which it was borne, as a rational economic man; the paper tracks the shift from this to the motivational ideas of irrational buying, to the consumer as an information processor to the emergence of new consumer behaviour research. Belk brings attention to the “convergence” that appears when new consumer behaviour is held up against the old and states some likely implications of the emergence of this new paradigm in consumer research. The paper describes some important issues addressed in the new model that Belk believes will have to be considered by marketers in the future: for example; the world’s globalisation, social class and the change in the perception of the consumer. Whilst the incommensurability of the two viewpoints and the inevitable resistance to the shift is clear in Belk’s mind, he believes the new ideas are gaining academic ground.

2.4.2 CONSUMER INVOLMENT

Consumer involvement for the product determines the required satisfaction, if a person shares love for the music and he want to buy a new I-pod so he will try to search for several different alternative which provide him best bass and great sound quality (Russo&Dosher,1983).In addition he states that consumer involvement would also depend on the type of product,  In general, consumer involvement will be higher for products that are expensive.

According to Holbrook and Hirshman (1982) “The Experiential aspects of consumption: Consumer fantasies, feelings and fun” deliver a relatively detailed argument for the important role that the ‘experiential’ view should play in marketing: that is, a view of consumption which encapsulates an attempt to understand the consumer’s pursuit of ‘fantasies, feelings and fun’ in product/service selection notably in the arts and leisure related activities. Central to the theme of this paper is the assertion that this is a view that’s importance has previously has been unrecognised, that research has favoured the information processing model. The two views are contrasted with reference to the ‘environmental and consumer inputs’ (e.g. the product and individual difference), the ‘intervening response system’ (e.g. cognitive aspects) and ‘output consequences and learning’ (e.g. satisfaction) involved in the consumption experience. An attempt is made to underline the complex phenomena that a company each process including aesthetics, multi sensory aspects and emotion. The writers aim to introduce new life into our understanding of consumer behaviour by advocating the incorporation of these experiential aspects to marketing in future research.(Discussed in section.

2.4.3 ETHICS AND CULTURE

Shaw and Clarke’s paper on “Culture Consumption and Choice: Towards a Conceptual Relationship”, discusses the linkage of consumption, culture and product choice. It highlights the need for a greater conceptual understanding of this relationship, which they see as previously neglected by research. In the writers’ view, cultural factors, according to Linton (1945) are learned and shared amongst a population, will determine the prioritisation of a consumer’s ‘ethical concerns’ and this in turn will affect product choice. It is thus necessary for international marketers to gain understanding of these cultural processes in order to reflect how and if a product will be affected in differing cultures. The article calls for comparative research using qualitative and quantitative techniques to identify influences and suggests the selection of culturally bounded products that would have varying cultural impacts.

2.6 OVERVIEW OF CHAPTER

I shall now review the following articles on this subject: R.W Belk, “The Emergence and transformation of consumer behaviour research”, M Holbrook and E Hirschman (1982), “The Experiential aspects of consumption: Consumer fantasies, feelings and fun” and D.S Shaw and I Clarke (1998), “Culture Consumption and Choice: Towards a Conceptual Relationship”.

The main use that can be derived from Belk’s paper is a relatively clear narration of the evolution of consumer behaviour. While it is an informative writing, it does not provide any particular new thought or interpretation of the theory already in existence. Belk offers passing comments on new consumer behaviour concepts in a brief manner. An example of this is his comment that social class is a “consumption reality involving wealth and poverty…” yet how and to what extent they affect consumption is not discussed. A superficial knowledge of marketing would be sufficient to already know that class is inevitably linked to spending power. Paucity of detail and lack of specific example reoccurs in the paper: he talks of a car as a, “vehicle for fantasy and fun” a family as, “symbolically rich” and of “infant formula marketing”, statements which unless substantiated with further comment are somewhat meaningless in themselves. I also find that Belk’s conclusions adopt a fairly subjective tone. There is an underlying implication here that the business school is synonymous with a complete lack of “social responsibility” unlike the new model, which, paradoxically, is linked to the business school. I believe this to be an over generalisation on Belk’s part, which he fails to justify adequately.

Holbrook and Hirschman’s paper, although I believe it puts forward some evocative ideas about the more symbolic and emotional aspects to consumption, my main problem with this paper is its lack of definition and therefore ultimately its limited use in actual marketing practice. It talks in a very broad sense about “hedonic response” and “arousal” without attributing any solid meaning. Consumption is described as a “primarily subjective state of consciousness”. Subjectivity by its very nature renders it problematic to apply in a general way and more difficult still as a basis from which to derive an actual marketing tool. Whilst the writers concede that validity problems arise from the employment of subjective terms, I find the measures suggested by which to extract meaning unsatisfactory. Firstly, there is a heavy reliance on consumers to give meaning to their own experiences through ‘personal narratives’. This may be an unreliable source of information for the following reasons: consumers may lie, exaggerate or simply be unskilled in expressing their own experience. Secondly, these methods have not, according to the writers, been specifically applied to consumer research, thus providing no empirical evidence of their effectiveness in this area. Generalising successful techniques from one discipline to another is not indicative of their potential for guaranteed utility. Thus the article’s principal offering is merely conceptual, as one of improved awareness of symbolism in the marketing concept. It presents a good example of what Brownlie and Saren (1992) describe as a fundamental gap between theory, which has become a little ideological, and practice.

Shaw and Clarke’s paper is a good theoretical standpoint from which to contemplate how culture may manifest itself as an influence on product choice. One criticism I noticed in this article is, its tendency to gloss over the potential danger of misconception of culture. The article’s overall tone could be described as somewhat simplistic, especially regarding a company’s ability to correctly identify cultural forces once it turns its attention to that variable. However, in reality it is often more difficult than one would imagine to overcome significant barriers such as stereotyping. Similarly, a company may try to project how culture will affect product acceptance. This would necessitate a significant degree of immersion in that culture, yet one should not presume that even this would be adequate to develop an accurate awareness of the influences that operate.

Ideally, it is naturally important for companies to devote time, money and human resource investigating culture but the constraints to which a company may be subject in doing this are not reflected in this paper. Equally, the article fails to reflect that culture is only one of many variables that will contribute to the success of a product in a market and perhaps taking this into account, the article overstates the importance cultural influence seeing cultural recognition as too much as a panacea for international market penetration. For example, in India, so culturally rich and renowned for its cuisine and to which much leisure time is traditionally devoted, one may be surprised to learn that the southern city New Mumbai has more McDonalds fast food outlets than any other city in Asia. McDonald’s international success cannot merely be attributed to its adaptation to culture, but rather one element of its overall operating strategy. Finally, in the article’s discussion of ‘ethical concerns’, a distinction is made between the differing concerns from country to country, yet presumes a large extent of homogeneity of ethical concern within a culture. However, a degree of variance will occur due to the existence of subcultures. The writers hint at this with reference to differences in how consumers will individually prioritise these concerns, but little discussion is dedicated to the implications for marketing of strong differentiation amongst subcultures.

When critically reviewing such papers as discussed above it is important not to dismiss the concepts that arise from them, each of the three articles present interesting for future research. Belk’s article could be expanded upon with research for example into the present relationship between old and new consumer behaviour models, to what extent has the new model gained in influence, or is the old perspective still pervasive? Is it possible to extract elements from the two viewpoints to develop marketing strategies which may further the applicability of them both? I have criticised Holbrook and Hirschman’s paper for the research methods it suggests, in future research into consumer research, I would suggest methods that have less reliance on introspective methods. This perhaps could be achieved through combining personal narratives with in depth interviews with consumers or even participant observations, so that the researcher is in a position to attribute meaning to consumer experience. This may help reduce problems associated with consumers being unable to articulate experience. In the qualitative techniques suggested, as with all empirical evidence, it would be important to use a large sample size that reflects a broad range of consumers. Further research following from Shaw and Clarke’s paper could include detailed case studies on companies that have been successful or not successful in their global marketing strategies, asking the question: how was cultural or sub cultural influence isolated to produce success or how was it contributory to a products failure?

In conclusion, the conceptual frameworks presented in each paper are worthy of attention and contemplation, yet further research is necessary to develop and explore the issues raised. Practical employment of the frameworks in real life marketing methods would be the best indicator of their actual utility beyond the boundaries of academia

2.6 THEORIES AND MODELS ON CONSUMER BEHAVIOUR

2.6.1 MASLOW’S HERIARCH OF NEEDS

Source: http://www.ict-learningnow.com/maslows-hierarchy-of-needs-theoryabraham-maslow-economics/

“The study of crippled, stunted, immature and healthy specimens can yield only a cripple psychology and a cripple philosophy” (Maslow, Abraham, 1954).

“Maslow is a humanistic psychologist”.(Belk.R.W,1988) Maslow do not believe that human beings are pushed and pulled by mechanical forces, either of stimuli and reinforcements (behaviorism) or of unconscious instinctual impulses (psychoanalysis). Humanists focus upon potentials.(Solomon.M ,1999 )argued that humans strive for an upper level of capabilities. Humans seek the frontiers of creativity, the highest reaches of consciousness and wisdom. This has been labelled "fully functioning person", "healthy personality", or as Maslow calls this level, "self-actualizing person."

As cited from the journal by (Manrney.J, 1993) Maslow has set up a hierarchy of five levels of basic needs. Beyond these needs, higher levels of needs exist.These include needs for understanding, esthetic appreciation and purely spiritual needs. In the levels of the five basic needs, the person does not feel the second need until the demands of the first have been satisfied or the third until the second has been satisfied, and so on.

Maslow divided the needs of motivation on the basis of personal experience. He divided them into five categories.

Physiological needs:-These are the most basic needs and these needs must be fulfilled to move to next level of needs, such as hunger, thirst, sleep, sex. These are biological needs.. They are the strongest needs because if a person is deprived of all needs, the physiological ones would come first in the person's search for satisfaction. (Berlyne,D.E,1970:279-286)

Safety needs:-When the physiological needs are fulfilled then the person strives for the security, such as employment, health, property etc. When all physiological needs are satisfied , the needs for security can become active. (Clee.M.et.all, 1980:390)Adults have little awareness of their security needs except in times of emergency or periods of disorganization in the social structure

Social needs:-This level is also termed as the love, affection and affiliation needs such as friendship, intimacy. When the needs for safety and for physiological well-being are satisfied, the next class of needs for love, affection and belongingness will emerge.( Berlyne,D.E,1970:279-286) Maslow states that people seek to overcome feelings of loneliness and alienation. This involves both giving and receiving love, affection and the sense of belonging.

Esteem needs:-Power and achievement need, main concern of the person is to gain recognisation in the society. When the first three classes of needs are satisfied, the needs for esteem can become dominant.(Cialdini,R.B,1993) These involve needs for both self-esteem and for the esteem a person gets from others. Humans have a need for a stable, firmly based, high level of self-respect, and respect from others. When these needs are satisfied, the person feels self-confident and valuable as a person in the world. When these needs are frustrated, the person feels inferior, weak, helpless and worthless.

Self-Actualization:-This is the highest level in the Maslow hierarchy of need. In this level the person is self satisfied and transforms perception into reality. When all of the foregoing needs are satisfied, then and only then are the needs for self-actualization activated. (Assmus.G, 1984:65)Maslow describes self-actualization as a person's need to be and do that which the person was "born to do." "A musician must make music, an artist must paint, and a poet must write." These needs make themselves felt in signs of restlessness. The person feels on edge, tense, lacking something, in short, restless. If a person is hungry, unsafe, not loved or accepted, or lacking self-esteem, it is very easy to know what the person is restless about. It is not always clear what a person wants when there is a need for self-actualization.

Maslow theory was accepted by many writers of management textbook but the theory was criticised on the factor that humans have multi-determined and multi-motivated behaviour.

.

2.5 THE HOWARD-SHETH MODEL

The Howard-Sheth model of buying behaviour presents a sophisticated integration of the psychological and various social and marketing influences on consumer behaviour into a coherent sequence of information processing.He adds that the model attempts to explain “rational brand choice” within the constraints of incomplete information and limited individual capacities,it also provides an empharical testable description of behaviour in terms of cognitive functioning and its outcomes.

Shiffman and Kanuk (1987:654) explains the Howard-Seth model in three different stages also referred as the level of learning, namely extensive, limited and routinised problem solving.

Extensive problem solving:- Implies that the consumer has very little or no knowledge about the brands. The consumer actively seeks information on a number of alternatives due to lack of brand preference.Foxall 1990:12 adds that in order to reduce the brand ambiguity,the consumer is involved in a decision process and undertakes prolonged deliberation contemplating which brand to purchase.

Limited problem-solving:-When the consumer is not able to fully assess the brand differences to arrive at a preference and the knowledge and beliefs about the brands are partially established.Consumer knows few brands well and favour them equally because have already tried several brands at this stage.

Routinised response behaviour: Consumer has well established knowledge about the brands and he has the sufficient knowledge about the brand that help him to avoid the confusion between the various brands. According to the Foxall 1990:12 routinised response behaviour can be characterised as the controlled behaviour, not effected by the external search. Consumer shares a well developed predisposition towards the available brands.

Thus the amount of knowledge needed for the prior purchase great for the extensive research, moderate for limited problem solving and little for routinised response,which directly affects the speed of decision making that would be fast for the routinised response and slow for the extensive problem solving.

2.6.4 BETTMAN INFORMATION PROCESSING MODEL

According to Runyon and Stewart (1987:708) attempts to model a specific field of consumer behaviour ,namely information processing.Lilien & Kotler (1983:206) adds that the model provides an analytical frame work for understanding consumer behaviour in an environment where the choice is made by selecting between two different alternatives. The model focuses on the information processing prospective by viewing the type of information used by the consumer and how the information is evaluated and decision are made.

(Lilinen and Kotler,1983:42) continued by stating that that the main model comprises of two sub models and also mentioned that there is no logical starting and ending point in the model.

a)Basic Hierarchy

The first component of the basic hierarch is the motivation and the goal heriarchy, that serves the mechanism to one critical state to the desired goal or state with in an individual.(Ronyon & Stewart1987:708) states that these components together with information acquisition are divided into three different segments.

First segment represents the prior experience and information obtained by the consumer. The second segment comprises of the voluntary attention which imply consumer’s allocation of information processing effort and involuntary attention.(Bettman.J.R,1973)

The third segment states that the attention is influenced by the goals pursued and therefore activates the search for the information.(Bettman.J.R,1973) The evaluation concept determines when the sufficient information is obtained for the purpose of decision making.

As discussed by(Bettman.J.R,1973)The final segment of the basic hierarch states that the consumption and learning focuses on the purchase and consumption of product offer a new source of information to the consumer.

b)The intermediate Process

It is also referred as the modulating process and focuses on four elements perpetual encoding, processing capacity, memory and external research and scanner and interrupt mechanism.

In contrast (Kotler,1983:207) states that perpetual encoding comprises the interpretation process of an individual once exposed to the stimulus.Bettman adds that the process is influenced by memory, implying the way things were, and by the stimulus itself, implying the way things are.

Processing capacity, the second component implies the capacity allocated to the decision task since the complete information-processing process is limited by capacity.(Kotler,1983:207.)

Memory and external search component, information may be obtained through the internal search of the memory and the external search, where attention and perceptual decoding is focused on stimuli outside the consumer memory.Runyon&Steward(1987:710)

The final component is the scanner and interrupts mechanism, indicates that the consumer are interruptible and not single minded when pursuing a goal. The scanner monitors the environment in order to note the condition that may warrant changes in current action and belief.

2.6.5 NICOSIA MODEL

Nicosia model describes the relationship between the firm and its potential consumers. It states that the buying and selling is a two way process, firm market their product through advertisements and the consumer react through a purchase response.

Model states that the firm and the consumer are connected to each other, whilst the decision of either one of them influences the whole chain reaction. Consumer influence the firm by his purchase decision and the firm tries to influence the purchase decision of the consumer.

Field 1

Message

Exposure

Subfield 1

Firms

Attribute

Subfield 2

Consumers

Attributes

(Especially

Predisposition

Attitude

Search

and evaluation Field 2: Search

And evaluation

Of mean/end(s) Experience relation(s)

(Preaction field)

Motivation

Consumption Field 4:

Feedback

Decision

(Action)

Field 3: Act of

Purchase

Purchasing

Behavior

Source: ...................

The Nicosia model is divided into four major fields:

Field 1: Attitude and Advertisements.

Field 1 is based on the “marketing environment and communication efforts”. The firm initially tries to reach the consumer through various marketing strategies; consumer interprets the information based on his experience and personality and forms an attitude towards the firm.

Field 2: Evaluation

According to (Robort.F.M,1980:471),consumer search for the alternatives, firms that are competing in the same field and evaluates the brand values of each firm. This stage consumer analysis the brands on the basis of the desired satisfaction and the brands motivate the consumer to buy their products.

Field 3: Purchase decision

The motivation will lead to the purchase decision; the consumer is convinced and buys a particular product.

Field 4: Feed back

(Robort.F.M,1980:472) commented that the consumer analyse the post purchase behaviour of the firm, after sale services etc.These experience of the consumer affects the hs perception towards the might lead to the brand loyalty if he is satisfied.

Nicosia does not provide discussion about the” internal factors” that affects the behaviours of the consumer. It fails to co relate the basic factors that hinders the reaction of the consumer, while the consumer realises the potential or the service quality of the firm, addition of these factors might have given the detailed interpretation of consumer behaviour.

2.7 SUMMARY

Chapter 2 provides a detail discussion about the consumer behaviour and several aspects that effect the decision of the consumer. It also contains some theories and models which explains the partial way in which consumer behaves in certain different environments.

The final part of the chapter focuses on the models of consumer behaviour and shows how theory has been evolved over the years.

The models and theories involved attempts to cover all the possible variables of consumer behaviour which includes covering the social to the economic environment.

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