Page 14 - DMGT506_CONSUMER_BEHAVIOUR

Unit 1: Introduction to Consumer Behaviour

consumer information and influence, which is not under the direct control of the firm. It includes Notes
reference groups and individuals, members of the family, social class and castes, culture, and the
like. Both these stimuli variables influence consumers and their buying process.
Consumers receive the input factors and process input information through a deep psychological
process of information processing, evaluation of alternative information inputs, comparison of
each input's attributes with the expected consumer benefits that leads them to finally take a
decision. Decision is a mental rule used in favor of arriving at a solution to a confronting
consumption problem. We will discuss the stages in information processing in the subsequent
section of the chapter. Consumers also retrieve available information from their memory box
and use this information with the collected information from the external sources to process
information for arriving at a solution to a consumption problem. Due to the ability of capturing,
analyzing, retrieving and using a mental rule to arrive at a decision, consumer's mind is called
a black box.
The output factors are the end result of the information processing stage. These can be in the
form of creating positive word of mouth among potential consumers, leading to a trial of the
brand or final adoption of the brand for every purchase situation. The effectiveness of a marketing
program is evaluated by measuring the output results.

Case Study Consumer Behaviour has Changed

hen was the last time you heard someone warning his mobile service provider
and threatening him about switching to another brand? Or when was the last
Wtime you snubbed a representative from a reputed bank/insurance company
who tried selling you one of his loan/investment products? Else, try recalling the last
time you heard someone proudly brag about the dressing down he gave his MNC bank/
credit card company about the poor quality of their customer response time?

The chances are that if you are in India you would be experiencing one or more of these
things around you very frequently. And if you were an outsider you are most definitely
likely to reach a conclusion that you're perhaps seeing the reactions of consumers in
market where they don't have good service providers and/or the quality of service is fast
deteriorating.
Now consider the reality. About 10 years ago, it used to take 15 days to three months to get
a telephone installed at your residence. Today it takes less than 24 hours for an active
landline connection and you can have an active mobile phone connection almost instantly.
The approval time for a home loan has come down from months and weeks to 5-7 days.
You can apply and get a credit card almost instantly. The time required to get cash from
the bank has almost come to nil thanks to the technologies like ATMs compared to the
half-day it took a while ago.
Now consider the brand choice equation. About 10 years ago there was one telecom
service provider, one life insurance company and not more than 4-5 big banks to choose
from. Today there are more than five telecom service brands ranging from the international
giants such as Vodafone to homegrown biggie Airtel, Tata and Reliance to choose from.
There are more than 10-12 insurance brands, almost all of them partnered by the world
leaders. There are more than 20 banks to choose from - all of them armed with latest
technologies to make your life easy. More than half-a-dozen airlines are ready to fly you
through the day between different towns.
Contd...

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