cb research assignment

8/10/2019 Cb Research Assignment

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RESEARCH ASSIGNMENT

Question

Briefly discuss the impact of psychological factors on consumer buyingbehaviour? As a potential buyer of a latest brand of Smart phones & Car,

briefly explain the social and cultural factors affecting buying decisions.

Introduction

All of us are consumers. We consume things of daily use; we also consume and buy these

products according to our needs, preferences and buying power. These can be consumable

goods, durable goods, specialty goods or, industrial goods. In our globalizing world the

competition among the firms producing the same goods and services have intensified and the

consumer, who is considered the principal focus point in a modern business approach,

become more and more important. Consequently, knowing the consumers become a necessity

for firms.

General Concepts of Consumer and the Consumer Behaviour

Consumer is the one who consumes the goods and services produced. As such, consumers

play a vital role in the economic system of a nation because in the absence of the effective

demand that emanates from them, the economy virtually collapses. Customer is a person,

company, or other entity which buys goods and services produced by another person,

company, or other entity.

Marketing starts with the needs of the customer and ends with his satisfaction. When

everything revolves around the customer then the study of consumer behaviour becomes anecessity. In the modern marketing, the customers have great options to select so persuasion

of the customers by the marketers has a vital impact on their buying. In order to persuade the

consumers, the marketers have to study the consumer behaviour.

Consumer behaviour refers to the selection, purchase and consumption of goods and services

for the satisfaction of their wants. There are different processes involved in the consumer

behaviour. Initially the consumer tries to find what commodities he would like to consume,

then he selects only those commodities that promise greater utility. After selecting the


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they won t be a motivator and people start to seek the ways to satisfy the higher level needs.

Maslow s hierarchy of needs is shown as below

1) Physiological needs

These needs are the basic needs such as food, water, sleep, warmth.

2) Safety needs

People need to feel safe in a particular environment.

3) Social needs

Human beings want to be loved and to be accepted by others. They want to attend groups,

unions and contact with others.

4) Esteem needs

People want to be admired and respected.

5) Self-actualization needs

People who have all other needs below the pyramid want more and more. These needs show

how you regard yourself and how you are regarded.

1.2 Balance Theory


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The balance theory is a cognitive consistency theory that looks how inconsistent attitudes can

motivate individuals to be persuaded. It suggests that people have both attitudes toward

(sentiment relations) and connections to (unit relations) other people, objects, ideas or events.

How the relations are organized will determine whether or not they are balanced.

1.3 Drive Reduction Theory

According to the drive reduction theory (Hull, 1943), behaviour is directed towards reducing

the tension that is associated with unpleasant drives, which are themselves caused by needs

arising from tissue deficit.

2. Perception

Perception is called as the energy which makes us aware of the world around us and attaches

a meaning to it after a sensing process. Each human being in the world sees his/her

surroundings differently. Several people have the same ideas about a specific event. No one

can see or feel the 100% of all things. Ever wonder why people buy certain products? It is all

about perception. Perception is how consumers understand the world around them based on

information received through their senses. In response to stimuli, consumers subconsciously

evaluate their needs, values and expectations, and then they use that evaluation to select,

organize and interpret the stimuli.

The marketplace s perception of a brand or industry is extremely important, which is why big

brands work so hard to ensure that the general perception surrounding them and their industry

is as positive as possible. As a result, companies like Gillette, will pay David Beckham to

model their products. By aligning the way people feel about Beckham, with the Gillette

brand, Gillette ca n improve the perception of their brand or reinforce what s already positive

about it.

3. Learning

Learning describes changes in an individual s behaviour arising from experience. In every

circumstance our perception is conditioned by our prior experience, for it is this which

constitutes our preparatory set or expectations and the framework into which we seek to place

and organize new stimuli. In other words, we have learned from our earlier experience and

seek to maintain balance or consistency by relating to and interpreting new stimuli in terms of past or learned stimuli.


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The practical significance of learning theory of marketers is that they can build demand for a

product by associating it with strong drives, using motivating cues, and to the same drives as

competitors and providing similar cues because buyers are more likely to transfer loyalty to

similar brands then to dissimilar ones. There are two types of learning;

1) Experiential Learning: Experiential learning occurs when an experience changes your

behaviour.

2) Conceptual Learning: Conceptual learning is not acquired through direct experience.

4. Beliefs and Attitudes

Kotler defines belief as descriptive thought that a person holds about something and

attitude as a person s enduring favourable or unfavourable cognitive evaluations, emotional

feelings, and action tendencies toward some object or idea. Individuals can have specific

beliefs and attitudes about specific products and services.

Marketers are interested in the beliefs that people formulate about specific products and

services because these beliefs make up product and brand images that affect buying

behaviour. If some of the beliefs are wrong and prevent purchase, the marketer has to launch

a campaign to correct them. A consumer may believe that Sony s

Cyber-shot camera takes the best HD video, is easiest to use, and is the most reasonably

priced. These beliefs may be based on knowledge, faith, or hearsay. Consumers tend to

develop a set of bel iefs about a product s attributes and then, through these beliefs, form a

brand image-a set of beliefs about a particular brand.

People have attitudes regarding religion, politics, clothes, music, food, etc. Attitude of

consumer also influences the consumer behaviour . If consumer s attitu de towards a product is

favourable, then it will have positive effect on consumer behaviour. The marketers discover

prevailing attitude towards their product and try to make it positive, and if it is already

positive, then try to maintain it.

Cultural factors affecting consumer buying behaviour

Cultural factors have a significant impact on customer behaviour. Culture is the most basiccause of a person s wants and behaviour. Growing up, children learn basic values, perception


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and wants from the family and other important groups. Marketers are always trying to spot

cultural shifts which might point to new products that might be wanted by customers or to

increased demand.

1. Culture

Basically, culture is the part of every society and is the important cause of person wants and

behaviour. The influence of culture on buying behaviour varies from country to country

therefore marketers have to be very careful in analyzing the culture of different groups,

regions or even countries.

As a potential buyer of a latest brand of Smart phones I would prefer touch phones as it is

very much prevalent in Delhi, where I stay.

2. Subculture

Each culture contains different subcultures such as religions, nationalities, geographic

regions, racial groups etc. Marketers can use these groups by segmenting the market into

various small portions. For example marketers can design products according to the needs of

a particular geographic group.

If I would be living in village I would prefer tractors instead of cars like amaze, rapid etc.

3. Social Class

Every society possesses some form of social class which is important to the marketers

because the buying behaviour of people in a given social class is similar. In this way

marketing activities could be tailored according to different social classes. Here we shouldnote that social class is not only determined by income but there are various other factors as

well such as: wealth, education, occupation etc.

A person belonging to high society would prefer phone brands like apple and car brand like

Mercedes and BMW.

Social factors affecting consumer buying behaviour


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A customer s buying behaviour is also influenced by social factors, such as the groups to

which the customer belongs and social status.

Each culture contains sub -cultures groups of people with share values. Sub-cultures can

include nationalities, religions, racial groups, or groups of people sharing the same

geographical location. Sometimes a sub-culture will create a substantial and distinctive

market segment of its own. For example, the youth culture or club culture has quite

distinct values and buying characteristics from the much older gray generation

1. Reference Groups

Reference groups have potential in forming a person attitude or behaviour. The impact ofreference groups varies across products and brands. For example if the product is visible such

as dress, shoes, car, cell phones etc then the influence of reference groups will be high.

Reference groups also include opinion leader (a person who influences other because of his

special skill, knowledge or other characteristics).

If a boss is using nokia smart phone then, the employee would be more fascinated to buy

nokia smart phones.

2. Family

Buyer behaviour is strongly influenced by the member of a family. Therefore marketers are

trying to find the roles and influence of the husband, wife and children. If the buying decision

of a particular product is influenced by wife then the marketers will try to target the women

in their advertisement. Here we should note that buying roles change with change in

consumer lifestyles.

3. Roles and Status

Each person possesses different roles and status in the society depending upon the groups,

clubs, family, organization etc. to which he belongs. For example a woman is working in an

organization as finance manager. Now she is playing two roles, one of finance manager and

other of mother. Therefore her buying decisions will be influenced by her role and status.


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A working person will be needing a cell phone which is stylish, manages all its basic

operations that could be useful while working and side by side it should be strong enough that

can be handled by his children in home


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