Factors Influencing Consumer Buying Behavior
Usually, the buying behavior of consumers is influenced and affected by various direct and indirect factors. One simple example, the more money consumer has the more he spends.
A consumer on the spot maybe can not make any purchase, he is affected by many factors such as money, values, cultures, status, family, psychology, and so on. A careful study of factors influencing consumer buying behavior helps the marketer or business firm to develop useful marketing plans.
So now, the major factors affecting consumer buying behavior are:
- Economic factors
- Socio-cultural factors
- Demographic factors
- Psychological factors
- Psycho-analytic factors
One of the influencing factors of consumer buying behavior is the economic factor. It refers to the consumer’s purchasing power and willingness to purchase goods and services. The consumer’s purchasing capacity or willingness largely depends on the following:
Level of Personal Income: The ability of the consumer to pay money depends upon the level of his personal income. The more income consumer gets the higher purchasing capacity he will have.
Income of Other Members of the Family: When there is the addition of earning members, the buying capacity of the other member of the family is affected in a positive way. In such circumstances, they are able and willing to spend more money on products they desire.
The Expectation of Income in the Future: The optimism or pessimism of the consumer about his future income also determines the level of his current expenditure. If he expects that, in the near future, he would receive additional income from any other sources, he will be willing to spend more and vice versa.
Availability of Liquid Assets. Liquid assets are those, which are readily available to turn into cash. The level of consumer spending on products and services also depends on the availability of liquid assets such as bank balance, cash in hand, shares, etc.
Availability of Credit to Consumer. If an adequate credit facility is available to consumers, they will tend to spend more on products and services although their regular income is low.
Past-Expenditure Habit. The buying behavior of the consumer is also affected by his past expenditure habits. If the consumer’s past living standard was high, the spending level of the consumer will also be higher although he may not have adequate income during the period as he is habituated to spend more. In such a situation, he would be initiated to sell even his fixed assets.
Society consists of individuals, groups, and families of diverse natures, tastes, values, motives, attitudes, and lifestyles. Therefore, the buying behavior of individuals, groups, and families differs from one another.
A successful marketer is one who can do a detailed study of significant social factors including family, reference group, social class, opinion leaders, and culture.
Family: Family is a primary social institution. It is a group of individuals related to each other such as the father, mother sons daughter, grandfather, grandmother, granddaughters, nephew, uncle, etc. A family is a primary group that exercises considerable influence on the consumption behavior of the individual.
Reference Groups: A reference group is a group of people with similar values, beliefs, and attitudes. A reference group consists of all the groups that have a direct or indirect influence on the person’s attitude or behavior. A reference group may be a family, friends, membership groups, neighbors, and so on.
Social Class: Social classes are formed due to differences in income levels. The major three social classes are, Upper class: They have high income with a luxurious lifestyle. Middle class: They have a medium level of income. Lower class: This is a very low-income class with low purchasing power.
Opinion Leaders: Opinion leaders are the individuals who lead to certain reference groups. Opinion leaders possess a disproportionately large amount of leadership quality. Opinion leadership refers to the degree to which an individual influences others in a given choice situation. A marketer must be able to identify such opinion leaders and analyze their roles that affect the buying behavior of the groups.
Culture: Culture is the total human-environment mankind’s knowledge, beliefs, art, morals, law, customs, religion, and any other capabilities and habits acquired by humans as members of society. The consumption pattern of each of these groups differs significantly from one another. For example, buying pattern of a vegetarian may differ from that of a non-vegetarian.
Psychology is a state of one’s mind which cannot be studied with the help of general information and analysis; it requires interpretive or insight knowledge about the consumer. Psychology is another major influencing factor that has a major impact on buying behavior of a consumer. While analyzing the psychology of a consumer, a marketer must be able to analyze:
- Why a person behaves as he does?
- What motivates him to behave in a particular manner?
- What role, attitude, personality, and own image play in influencing behavior?
The psychology of a person is governed by several factors, which must be carefully analyzed by the marketer. These factors include:
Motivation: Motivation is an activity directed towards a goal. It is an internal emerging force that directs a person’s behavior towards his goal. A buyer’s action at any time is affected by a set of motives. A person has many needs without satisfaction which he can not be motivated.
Perception: Perception means knowledge or idea about a product or situation received or derived by a person. In another word, perception is a process whereby a person acquires or perceives the meaning of an object or situation. A motivated person is ready to act in some way. How the motivated person acts is influenced by his or her perception of the situation. Two persons in the same motivated state may act quite differently because they perceive the situation differently.
Learning: When people perceive the meaning of an object or situation, they act. When they act, they learn, i.e., people learn through experience. So learning can be defined as the change in an individual’s behavior arising from experience or prior behavior in a similar situation.
Beliefs & Attitude: A belief is a descriptive thought that a person holds about something while an attitude consists of knowledge about an object or situation. Customers believe iPhone to be a product of premium quality while Micromax for them is a product that provides smartphone facilities at minimum cost.
Personality: Personalitymeans the person’s distinguishing psychological characteristics that lead to relatively consistent and enduring responses to his or her environment. Personality is usually described in terms of traits as self-confidence, self-control, dominance, autonomy, sociability, adaptability, aggressiveness, conservative, defensives, etc. Marketers generally believe that a person’s personality does influence the brand of products s/he purchases.
Consumer buying behavior is also affected by demographic factors. These are the individual characteristics such as age, sex, culture, income, family size, occupation, marital status, etc.
These demographic attributes can influence the individuals who are involved in family decision-making. They can influence the speed at which a person moves through the consumer buying process. They also affect the particular stages of the decision-making process. These factors can also affect the extent to which a person uses products in a specific product category.
The psychoanalytic approach, also called socio-psychology, propounded by Sigmund Freud states that personality (mental framework) is made up of three primary systems of interdependent psychological forces- the id, the superego, and the ego. Human behavior is a function of the interaction of these three systems.
The ‘id’: The ‘id‘ represents instinctive needs. It is the source of all its driving psychic energy. Its main function is to build up needs and desires, which m.ay or may not be fulfilled depending upon the social expectations and values.
The ‘super-ego’: The ‘super-ego represents the social values, which tend to be in conflict with instinctive needs and desires. In order words, the ‘super-ego’ is the conscience, accepting moral standards and directing the instinctive drives into acceptable channels. And, the ‘ego’ is a system of forces that functions to control and direct the ‘id’ impulses so that gratification can be achieved in the real world, thus resolving the conflict between the ‘id’ and the ‘super-ego’.
The ‘ego’: The ‘ego’ is the planner, the decider, the thinker; the executive of the personality because it controls the gateways to actions, selects the features of the environment to which it will respond, and decides what instincts will be satisfied and in what manner. The underlying theme of this theory is the belief that a person is unable to satisfy all his needs within the bounds of society. Consequently, such unsatisfied needs create tension within an individual conscience and continue to influence consumer behavior. Psychoanalytic theory has caused marketers to realize that they must provide buyers with socially acceptable rationalizations for their purchasing.