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Consumer behaviour

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What is
consumer behaviour?

Consumer behaviour is the study of how individuals, groups, or organizations make decisions to purchase, use, and dispose of goods and services. It encompasses the psychological, emotional, and behavioural responses that influence these decisions, as well as the external factors like culture, social norms, and economic conditions that shape them.

Key takeaways

1
Focus on decision-making

Explores why and how consumers make purchasing decisions.

2
Influencing factors

Includes purchase, usage, and disposal activities.

3
Influencing factors

Shaped by psychological, cultural, social, personal, and economic factors.

4
Business relevance

Helps businesses design targeted marketing strategies and improve customer satisfaction.

5
Dynamic nature
Consumer behaviour evolves with trends, technology, and societal changes.

How can consumer behaviour guide product innovation and customer relationships?

Consumer behaviour is a multidisciplinary field combining insights from psychology, sociology, economics, and marketing to understand what drives consumer decisions. It examines:

  1. Purchase activities: How consumers search for information, evaluate alternatives, and decide what to buy.
  2. Usage activities: How consumers use products or services and derive value from them.
  3. Disposal activities: How consumers discard products or packaging (e.g., recycling or reselling).

Consumer responses can be categorised into:

  • Emotional responses: Feelings or moods associated with a product or brand.
  • Cognitive responses: Thought processes like evaluating product features or comparing prices.
  • Behavioural responses: Observable actions like purchasing or recommending a product.

By studying consumer behaviour, businesses can:

  • Identify customer needs and preferences.
  • Develop effective marketing campaigns.
  • Innovate products based on market demand.
  • Build strong customer relationships.

Real-world examples

Blue border

Case study: Apple's ecosystem lock-in

Apple drives loyalty by creating a seamless ecosystem across devices—iPhone, Mac, Apple Watch, and AirPods—that simplifies life for users. This understanding of consumer preference for convenience keeps users deeply embedded in their ecosystem.

Case study:
Spotify’s behavioural data play
Spotify analyses listening habits to offer hyper-personalised playlists like “Discover Weekly.” This predictive engagement based on user behaviour encourages daily usage and builds emotional attachment.

Case study:
Unilever’s local market intelligence
Unilever adapts its product offerings and campaigns based on local consumer preferences. For instance, in India, it tailors its skincare products to suit different climate zones and skin types, showing its sensitivity to regional behaviours.

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Frequently asked questions about consumer behaviour

Blue border
It helps businesses understand customer needs, design better products, improve marketing strategies, and build long-term relationships.
Psychological (motivation, perception), social (family, peers), cultural (values), personal (age, lifestyle), and economic (income) factors all play significant roles.
Technology influences how consumers search for information (e.g., online reviews), make purchases (e.g., e-commerce), and interact with brands (e.g., social media).