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

• Focus on decision-making: Explores why and how consumers make purchasing decisions.
• Three stages: Includes purchase, usage, and disposal activities.
• Influencing factors: Shaped by psychological, cultural, social, personal, and economic factors.
• Business relevance: Helps businesses design targeted marketing strategies and improve customer satisfaction.
• Dynamic nature: Consumer behaviour evolves with trends, technology, and societal changes.

In-depth explanation

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

• 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.
• 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.
• 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.
• Patagonia’s ethical positioning
  Patagonia resonates with conscious consumers by highlighting its commitment to environmental causes, including using recycled materials and encouraging product repairs. This taps into the rising preference for value-aligned brands.
• YouTube’s algorithmic engagement
  YouTube uses user viewing data to curate content recommendations that keep people watching longer. This behaviour-based content strategy has made it one of the most addictive platforms globally.