The study of consumer behavior is an important part of marketing, which allows you to plan product promotion programs, build communication with a potential buyer. The question of how the consumer decides in favor of the purchase of a product worries all manufacturers. Consumer Choice Theory helps you find the answers you need.
The concept of "consumer"
A person who has a certain intention to buy a product or service for personal use is called a consumer. It differs from the buyer, who can purchase goods for resale or collective use. The consumer defines all the components of the marketing chain: from product design to the creation of a communication program.
This is the center of any production. The interests and needs of such a buyer should be dominant not only in marketing, but also in production, service, etc. The consumer is a person with psychological characteristics inherent in him, the main ones for studying his behavior are sensations, perception, memory, motivation, knowledge. Today, such a buyer is studied in extremely detail to understand how to influence his behavior.
Needs and Motivation
The most important difference of the consumer is the presence of his needs. They, in turn, are the main motivating factor of a person to buying activity. Need is a deficient state of a person, which can be conscious and unconscious, but always stemming from the need for something. When a need arises, a person has a feeling of discomfort, from which he seeks to get rid of by satisfying his desire. Traditionally, needs are divided into organic and social. The latter include needs for security, belonging to a social group, status and public recognition, as well as self-realization.
According to A. Maslow, needs can be represented in the form of a pyramid, as a person moves along the ladder of satisfying needs: from physiological to spiritual. It is impossible to pass the steps, as well as reaching the top. A hungry person is unlikely to seek recognition and realization of his creative potential, and having reached certain heights, he will always find a new unconquered peak. But the desire for self-improvement and achievement on this path is the meaning of life and happiness, according to A. Maslow.
Awareness of need and finding a way to meet it is called motivation. A person performs actions that will help him cope with a need. Each individual simultaneously overcomes several needs, and he needs motivation to build a hierarchy of needs and focus on achieving the goal. The motivation process is controlled by a variety of factors, depending on which a person can suppress some desires, focusing his efforts on the recognized most important.
Consumer behavior
Consumer marketing is the starting point of program planning. He has a set of needs that make him look for ways to satisfy them. You can influence consumer behavior, so you need to study it. For the first time, American marketers spoke about consumer behavior as an independent field of knowledge in the 50s of the 20th century.Since that time, the theory of consumer choice, an entity whose goals have become the object of many marketing disciplines, has grown to an independent science, which is at the junction of marketing, physiology and psychology.
Consumer behavior is subject to study and management. The most important question that marketers are interested in is: “What happens in a person’s psyche when he makes a final purchase decision?” In the 60s F. Kotler called this psychic area a “black box of the consumer”, but today it has been studied to a large extent, although not completely, therefore, many discoveries still have to be made in this area.
Factors Affecting Consumer Behavior
Despite the fact that the consumer always remains free, his decisions can be influenced based on various factors: cultural values, traditions, norms, human life style. The theory of consumer behavior, the choice of goods is based on the fact that the buyer is manageable, you should only carefully study the factors of influence. Traditionally, they are divided into external and internal. External include:
- Culture. The decision to purchase is influenced by the cultural values of society, traditions, rituals, social myths, and religious principles.
- Social class. Stratification of society is the most important regulator of human behavior. The consumer chooses a product of "their" category or slightly higher in order to establish itself in society.
- Reference groups. Family, friends, work colleagues - all of them are taken into account by the consumer when buying many public goods: clothes, a car, a place of rest, etc.
Internal factors include:
- Life style. This is a set of psychographic characteristics of the consumer, including his resources and how he spends them, his aspirations. So, there are innovators, conservatives, aspirants, and other types of consumers who make purchase decisions differently.
- Psychotype of personality. Peculiarities of the psyche and reaction are also important for decision making.
The essence of consumer choice theory
As a result of studying the characteristics of the buyer, his needs and actions, a theory of consumer choice has developed. It proceeds from the fact that each time, when making a purchasing decision, the consumer seeks to maximize the benefits of his costs. Each time a person chooses, he weighs the costs and benefits, taking into account the emotional and rational arguments. Consumer choice is not always fully understood. So, a person often acts under the influence of advertising, but does not understand this at all.
Successful purchases add up to consumer preferences. A person seldom ponders re-buying just as hard; he prefers to move along an already paved path. Therefore, it is so important for the seller to incline him to a trial purchase. The theory of consumer choice is based on the fact that a person seeks to streamline the decision-making process on a purchase and tries to evaluate a product according to profitability criteria.
Goals and criteria of consumer choice
In his choice, the consumer seeks to balance costs with benefits, his goal is to use his resources as efficiently as possible: temporary, financial, informational. It is important for the buyer to be sure of the correctness of his decision, only in this case he will be satisfied with the purchase. He takes into account several factors: how fully the product meets the complex of needs, how profitable the transaction is, whether it is approved by society.
The theory of consumer choice, the purpose of which is to determine the factors influencing decisions, is based on the fact that the consumer ranks his needs according to the priority of their satisfaction. The place of need in this hierarchy is the most important selection criterion. The needs at the front of the line and the goods that satisfy them are more likely to be realized.
Usefulness in choosing a consumer
The ordinal theory of consumer choice is based on the principle of utility. When deciding on a purchase, a person evaluates the usefulness of the good, that is, its ability to fully satisfy the needs. Moreover, utility can be determined not only by the physical properties of the good, but also by subjective characteristics. Usefulness is associated with the hierarchy of needs of an individual consumer, it is individual for each person: someone in the first place will spend resources on delicacies, and someone on a ticket to the theater.
There is general utility — that is, the general ability of goods to satisfy human needs. It is the sum of the utility of all consumed goods. There is also marginal utility, which is achieved by the consumption of goods. So, a barefoot person acquiring shoes extracts maximum utility from this product. But buying each subsequent pair of shoes has less or less usefulness. Consumer choice and utility theories substantiate the thesis that, with a decrease in utility, satisfaction decreases, which, accordingly, leads to a decrease in consumption.
Concept of indifference
The theory of consumer choice, in short, is based on the search for mechanisms to increase satisfaction and consumption. At the same time, the provision is adopted that the consumer seeks to increase overall utility and maximize his benefits. Since satisfaction can be achieved using different products, a concept such as indifference appears, which means that it may not matter to a person which product to choose.
The theory of consumer choice, indifference curves indicate that there is a set of products with the same utility, and therefore a person can always replace one product with another.
Effects of Income and Substitution
The theory of consumer choice proves that when buying a person is sensitive to price and advertising. The buyer’s income is directly related to his choice. When they fall, a person is ready to replace the goods with cheaper ones, if they prove to him that the quality was not affected and the usefulness of the goods remains at the proper level. Price reduction is a powerful argument when choosing a product. Budgetary constraints force the consumer to distribute their expenses on goods, determining the degree of their usefulness.
