Economical Sciences/6.
Marketing and management.
O.
Shabelnyk
National
University of Food Technologies
CONSUMERS BEHAVIOR AND MANAGEMENT
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. What we buy, how we buy, where and
when we buy, in how much quantity we buy depends on our perception, self
concept, social and cultural background and our age and family cycle, our
attitudes, beliefs values, motivation, personality, social class and many other
factors that are both internal and external to us. While buying, we also
consider whether to buy or not to buy and, from which source or seller to buy.
In some societies there is a lot of affluence and, these societies can afford
to buy in greater quantities and at shorter intervals. The marketers therefore
try to understand the needs of different consumers and having understood his
different behaviors which require an in-depth study of their internal and
external environment, they formulate their plans for marketing.
Management is the youngest of
sciences and oldest of arts and consumer behavior in management is a very young
discipline. Various scholars and academicians concentrated on it at a much
later stage. It was during the 1950s, that marketing concept developed, and
thus the need to study the behavior of consumers was recognized. Marketing
starts with the needs of the customer and ends with his satisfaction. When
every thing revolves round the customer, then the study of consumer behavior
becomes a necessity. It starts with the buying of goods. Goods can be bought
individually, or in groups. Goods can be bought under stress (to satisfy an
immediate need), for comfort and luxury in small quantities or in bulk.
Consumer behavior can be
defined as the decision-making process and physical activity involved in
acquiring, evaluating, using and disposing of goods and services. This
definition clearly brings out that it is not just the buying of goods/services that
receives attention in consumer behavior but, the process starts much before the
goods have been acquired or bought. A process of buying starts in the minds of the
consumer, which leads to the finding of alternatives between products that can be
acquired with their relative advantages and disadvantages. Consumer behavior is
a complex, dynamic, multidimensional process, and all marketing decisions are
based on assumptions about consumer behavior.
Marketing strategy is the game
plan which the firms must adhere to, in order to outdo the competitor or the
plans to achieve the desired objective. In formulating the marketing strategy,
to sell the product effectively, cost-benefit analysis must be undertaken.
There can be many benefits of
a product, for example, for owning a motor bike one can be looking for ease of
transportation, status, pleasure, comfort and feeling of ownership. The cost is
the amount of money paid for the bike, the cost of maintenance, gasoline,
parking, risk of injury in case of an accident, pollution and frustration such
as traffic jams. The difference between this total benefit and total cost
constitutes the customer value. The idea is to provide superior customer value and
this requires the formulation of a marketing strategy. The entire process consists
of market analysis, which leads to target market selection, and then to the formulation
of strategy by juggling the product, price, promotion and distribution, so that
a total product (a set of entire characteristics) is offered. The total product
creates an image in the mind of the consumer, who undergoes a decision process
To understand the consumer
researches are made. Sometimes motivational research becomes handy to bring out
hidden attitudes, uncover emotions and feelings. Many firms send questionnaires
to customers to ask about their satisfaction, future needs and ideas for a new
product. On the basis of the answers received, changes in the marketing mix are
made and advertising is also streamlined.
A common feature of standard
economic thought is the belief that when individuals make poor choices it is
the result of misinformation or a lack of information. As such, the
information-deficit model of behaviour change (or ‘knowledge-deficit’ model) contends
that poor decisions are made because people lack the information that would
enable them to make a better choice. Across many areas of consumer policy, information
provision is favoured as a policy tool because of its marginal cost (compared
to other options) and because it is assumed that too much information can never
be harmful (BRE and NCC 2007). However, both marketing and the behavioural
sciences have proven the information-deficit model to be deeply flawed.
Consumer autonomy, or the
right of consumers to make their own choices, is one of the most fundamental
features of classic free market economics, something psychology would initially
appear to support as beneficial. The provision of a right–to-choose has been
found to positively link to increases in perceived control, intrinsic motivations
and life satisfaction, as well as proving beneficial even when the choice itself
is trivial. However, when faced with too much choice, people have difficulty
managing their decisions and both satisfaction and the ability to easily make
preferential decisions are reduced. Research shows that as choice increases, consumers
consider fewer choices, process less overall information and evaluate information
differently.
The
most important things are the external analysis (company), the competition, the
conditions, market segmentation, need set, demographic and psychographic
characteristics, target segment, product, price, distribution (place),
promotion, service, consumer decision process.
References:
1. Khan, M. Consumer Behaviour and Advertising Management // [Electronic recourse]
Access mode: http://www.newagepublishers.com/samplechapter/000160.pdf
2. Designing policy to influence consumers: Consumer behaviour relating
to the purchasing of environmentally preferable goods // A project under the
Framework contract for economic analysis ENV.G.1/FRA/2006/0073 – 2nd
// [Electronic recourse] Access mode: http://ec.europa.eu/environment/enveco/pdf/RealWorldConsumerBehaviour.pdf