Topic 1 - Consumer Behaviour Managerial Perspective

Week 1

A Managerial Perspective

Why Study Consumer Behaviour?

From a managerial perspective it is important for the following reasons;

• Enables managers to define strategic applications for/of consumers behaviour.
• Describes the information required to understand consumer behaviour.
• Consider different approaches in the way we study consumer behaviour.
• Considers the importance of the use of the Web in providing consumers with information and empowering them to make a better and informed decision
• Provide managers to review and embrace changes and trends that are taking place within a particular market.

Managers are now concerned with;

• Delivering benefits to consumers.
• Learning more about the changing behaviour and attitudes of consumers.
• Infrastructure
• Influencing consumers perceptions.

When preparing the Marketing Plans, managers have to take into account the psychological and social forces that are likely to condition or change the consumer behaviour. Some of these forces are;

• Aging Baby Boomers (Those born between 1946 - 1964)
• Increasing concern about health and nutrition.
• Greater information access through the web
• Greater emphasis on value, quality and safety
• Greater focus on clean environment and environmental issues

Through the study of Consumer Behaviour, students will come across terms such as; Consumer Benefits; Consumer Perceptions; Consumer Attitudes. These terms to some extent influence the development of successful marketing strategies.Companies that fail to recognise consumer needs are more likely to make costly mistakes.

Let us look at one example as taken from Henry Assael Text Book Consumer Behaviour A Strategic Approach (2005)

Levi Straus & CO - The maker of Levi Jeans.
By 1985, the jean market began to take a slide. What was the major reason? Demographics and lifestyle trends started affecting the sales. The aging baby boomers were getting out of jeans into a more comfortable fitting. Another significant demographic trend was low birth rates resulting in fewer teens in the market for jeans.

What did the company do? Strategies were quickly changed. It has to introduce new products for;

• Baby Boomers (1946 - 1964) - From jeans to comfortable trousers and casual wears.
• Generation X (1965 - 1976) - Slacks, casual wears etc.
• Generation Y (1977 - 1994)

Taste and Preferences for the teenagers also has affected world wide markets as these group of young people started looking at different styles. The demographic shift means consumers wanted a greater variety of name brands at reasonable prices.

Human Behaviour Vs. Consumer Behaviour

Humans may be physically the same, but behave differently. In fact the same person may behave differently in different situations. This is due to a number of behavioural factors shaped by how a person is perceived. What all of these reveal is that human behavior is very complex and dynamic.

Consumer behavior is just one aspect of human behaviour. It is the behaviour of humans when consuming. What do they do, how they do it, when they do it and where they do it in a consumption environment?

Model of Man	Assumptions
Economic Man	Motivated purely by economic factors (Perks, privileges etc.)
Social Man	Prefers to create and develop social relations (communal minded)
Organizational Man	Sacrifice his personal needs for the good of the organization (Loyal and faithful)
Self-Actualizing Man	Progressive man. He like challenges and is creative and innovative
Complex Man	Motivated by complex variables
Impulsive Man	Reacts promptly without assessing situational factors
Compulsive Man	Opposite of the impulsive man. He assess situations before taking actions

What all of this indicates is that the different models of man has various and diversified characteristics and results if diversified behaviour. This will no doubt influence his decisions and choices he/she would make. Therefore from the consumer point of view it is critical to know what makes him/her do what he/she does.

It would be also in the best interest of Students to study Abraham Maslow Hierarchy of Needs when studying the behavior of consumers.