consumer behaviour & marketing action cm2072 [elective] | ibcom ba year II - term III (2020-2021) [by gycc]
CONSUMER BEHAVIOUR & MARKETING ACTION
(lecture notes) [by gycc]
WEEK ONE | 2021.02.11 – Introduction
Expert Video 1: Introduction into Consumer Behaviour
CONSUMER BEHAVIOUR (vital for success in marketing) → the understanding of how people
make decisions about what they want, need or buy; ‘the study of how and why individuals or groups
acquire, consume and dispose products’ (course definition)
important for two reasons:
I. Companies want people (not robots) to buy their products or services; therefore, to establish
this objective, they must understand people at the deepest level
II. Understanding the behaviour of your customer can help you to better show them what its
they are buying, why they are buying it, and what it will do to improve their lives; gaining
this knowledge will allow you to market your product/service to the right audience
4 key factors that can really influence consumer behaviour / purchasing decisions:
I. The opinion of the consumer (dominant form - no shit sherlock); ads could influence these
opinions to some extent, the personal life and decisive consumers exert the greatest influence
II. Economic situations; a positive economic environment allows consumers to be more willing
in making certain purchases
III. Advertising forms; most consumers get their information from social media, so if you want
to market in the modern age, as a company, you must establish a strong media presence
IV. Purchasing power; although products might be from high quality, if it fails to meet your
targeted audience purchasing ability, the sales of that product will be affected
Consumer behaviour is social, personal and psychological! Understanding, analysing, and keeping
track of consumer behaviour and subsequent consumer purchases is critical for marketing departments
to gain and obtain customers. Through consumer behaviour and actions, companies acquire
measurable and accurate information for their brand and establish successful marketing campaigns.
Thus,
● Companies need to understand customers at their deepest level of need
● This way companies can show consumers what they are buying (or want to buy), why they
are buying, explain what the product is and how it will improve their lives
● Marketing professionals want to find out what consumers buy and why. However, this
information is hidden in consumers’ mind (u don’t say)
● Therefore, marketing professional actively research and investigate how consumers respond
to various marketing actions, such as advertising
○ For instance, how are the attitudes of consumers formed, how are they persuaded,
what do(n’t) consumers process, what elements of information do they find
important, what needs are relevant, how do they get motivated, etc
The ‘Consumer Consumption Process’
I. Identify a need or desire, e.g. interest in buying a new car
II. Make a purchase, e.g. obtaining the car to drive
III. Dispose the product, e.g. when you substitute the new car, you will dispose the former one
1
, consumer behaviour & marketing action cm2072 [elective] | ibcom ba year II - term III (2020-2021) [by gycc]
Many people are involved in this process, such as family, friends, colleagues, but also influencers,
social media creators or designers. NOTE: the purchaser is not always the user of the product. For
instance, a mother-child relationship - the product is focused on the child, but the packaging is most
prominently designed for the parents, e.g. SpongeBob cookies with no added sugars.
Another example - recent studies have shown that family members have the biggest impact on one’s
consumer behaviour process. If they advise you to buy something, apparently you’ll listen to that.
Why is consumer behaviour important?
● Consumers have a huge impact on marketing strategies
● “Firms exist to satisfy consumers’ needs”
● Consumers have a huge impact on consumer behaviour since manufacturers want to know
how we are motivated to buy their products
● Imagine when you walk in a supermarket: how are we influenced by it?
○ For instance, when walking into the shop, most of the time we would see vegetables
and fruits first. According to research, after purchasing healthy food, we don’t feel as
guilty to buy the unhealthy snacks - this is strategy developed through studying CB
Some more insights into a ‘Supermarket Purchase’
● Supermarkets and food companies implemented sneaky ways that influence our purchasing
decisions often without us even noticing
● Although all individuals like to think that they are entirely responsible of their food decisions,
even the most disciplined person can’t always be in control of what we eat
● For instance, during grocery shopping, we walk alongside the aisles and decide what to buy;
most of the time, besides buying what’s on the list, we also make spontaneous purchases,
buying products we don’t need or actually don’t even want - this is explained by 3 concepts:
I. The Unconscious Mind → when you’re at the supermarket, even if our conscious
mind is not persuaded by food ads, our unconscious mind might be, as you’re
exposed to many ads even before stepping inside the store. Moreover, supermarkets
close deals with brands to determine where products are stalled - prime locations cost
more because they boost sales. Research has shown that products displayed at the
middle shelf grab consumers’ attention more than in contrast to higher or lower
shelves. Other purposely made decisions are: the chill music, the maze-alike map, etc
II. Defaults → products that you get unless you actively choose something else; certain
default factors influence what and how much we eat
➔ Package sizes: in one study, two groups of participants were given two
different defaults sizes of popcorn to eat - both parties weren’t a fan but those
with a bigger sized popcorn ate more
➔ Standardised food formulations: to influence our taste buds, over the years,
fabricants have increased the amount of salt, sugar and fat in everything.
Changing these defaults has changed our expectations and taste preferences
➔ Food pairing: e.g. through marketing, a company combined a sandwich with
chips instead of a pickle; by manipulating the defaults that define our eating
habits, food companies guide our hand as we toss food in our supermarket
carts, getting us to buy more unhealthy food that we wouldn’t otherwise
2
, consumer behaviour & marketing action cm2072 [elective] | ibcom ba year II - term III (2020-2021) [by gycc]
III. Willpower Reserves → ‘I can resist anything except temptation’; when we are tired,
overwhelmed or distracted, our willpower reserves will be low - when you go to the
supermarket after a long day at work, you’re likely to make different decisions than
when you go first thing on a Saturday. Making a lot of decisions is exhausting for an
individual, resulting in many of us giving into the wall of temptation that companies
intentionally set during a grocery shopping activity
The meaning of consumption
→ people often buy brands, not for what they do, but for what they mean! For instance, (1) it helps
us to form bonds with others who share the same preferences & (2) it conveys image or personality.
Expert Video 2: Consumer Decisions
Notes on TEDTalk: Watching shoppers by Ray Burke
● Researchers watch or observe shoppers to obtain data about consumer behaviour
● They use several hardware and software technology to track shopper’s habits
○ For instance, using cctv videos to examine where consumers are located, what they
reach out to, their facial expressions, etc
● Why do researchers spend so much time and energy watching shoppers, especially when
there are legitimate concerns about consumers’ privacy? Because through these insights:
○ You can improve customer experience
○ You can increase customer satisfaction and business performances
● By watching shoppers:
○ You can anticipate shoppers’ needs and desires (in the future)
○ Discover the points of engagement and friction (obstacles) in the shopping process
○ Modify and improve the retail experience and measure how shoppers respond → the
goal is to optimise the ‘shopability’ of the store
● For instance, research on the supermarket ‘Marsh’:
○ Very innovative in their use of technology - they were the first retailer to implement
the UPC scanners to improve operation efficiency, but in addition, they were also
able to gain valuable customers information
○ Furthermore, with customer loyalty cards, companies can also observe and track
their purchases over time; eventually, when they see recurrent patterns and
preferences, they can give members discounts opportunities according to their taste
● Through receipts and transactions, supermarkets could gather personal data of customers;
○ For instance, do they have kids? Or pets? Are they on a diet? Do they have a specific
hobby, e.g. like fishing - buying fishing rods?
○ Companies can now establish a certain ‘DNA’ that drives customers’ future
purchases
● However, it’s not enough to solely know the customers’ desires and needs, we also need to
know how they interact with the store environment
○ For instance, do direct research and ask customers to wear a pair of glasses that have
a little camera that tracks where they are looking during their shopping trip; it also
monitored the speed and targets of shoppers
● When shoppers walk through a store:
○ They first navigate horizontally the entire store
○ They notice special displays, such as 1+1 promotions or other discounts might
results in more concentration than the other surrounding products
● But not only the store environment plays a crucial role, customers’ personal goals do as well
3
, consumer behaviour & marketing action cm2072 [elective] | ibcom ba year II - term III (2020-2021) [by gycc]
● Another context: Apparel Shopping
○ ‘For men, it’s about getting in there, getting what they need, and getting the hell out’
○ When it comes to the male population, there was this issue of them walking into the
store, looking at the leading products, and then if they don’t find what they wanted,
they would skip the middle section and go straight towards the sales/clearance part
○ So to connect customers with the centre of the store, researcher did a couple things:
(1) looking at sales data to define customers’ needs, (2) products (outfits) men were
buying → creating a styling section to decline their struggle in matching pieces, (3)
watching them shop and see their discouragement of picking things up because they
can’t fold it back (lmao), so products became displayed and folded in only two parts
○ The results? 85% increase in product touch, 44% in unit sales and 38% in dollar sales
○ Nothing changed, except for better connection with what the consumers want
● The future of retailing - how to use innovations to improve shopping experiences:
○ Provide effective navigation ways, such as a colourful and easy map; if customers
don’t see or find the products, it’s practically not for sale
○ Show displays / examples; customers want to know what they are buying
○ Give solid information to customers of what they are actually buying
○ New products are the lifeblood of retailing as they keep customers from coming back
and draw new customers to come; so retailers need to showcase new items, e.g.
fashion brands would often organise a Fashion Show or Runway
● By using these insights to improve the ‘shopability’, shoppable stores benefit everyone:
○ Clearly communicate the benefits & values of brands
○ Provide a convenient and enjoyable shopping experiences
○ Satisfy consumers’ salient & latent needs
● Where is the future of shopping going?
○ Technology is going to continue to provide us with even more extensive and detailed
information of shoppers
○ Companies have to recognise that this data is the property from customers and retail
stores, and should be used for their mutual benefits
○ However, if they don’t respect customers’ privacy, they are going to lose their trust,
which undermines the foundation of success (customer knows best)
Several types of consumer decisions:
I. Habitual / Routine decision making
● Buying requires low involvement, frequently purchased, low-cost items
● Need little research (you know where to buy it) and little decision efforts
● Purchased almost automatically
● Example. Bread, milk or other daily needs
For marketers, this means the following tasks:
● For current customers: maintain brands’ quality, stock and value
● For non-customers: break normal buying habits (become a competitor)
○ Use promotions to call attention for a new brand
○ ads/promos should focus on one message
○ Message should be often repeated (do make an impression on consumers)
4
