The importance of consumer behavior
Wouldn't it be awesome for advertisers to learn just what causes their target audience to prefer a certain product over others? This knowledge, if interpreted and properly implemented, may have the potential of selling anything to anyone.
Big companies, from Ford to Apple, have spent large amounts of money researching consumer behavior over the years because they wanted to learn how people make purchasing decisions and exactly triggers those decisions. Probably not all companies have billions of dollars to allocate to a detailed consumer study, but that doesn't mean they can't at least try to analyze their customers' demands.
But what exactly is consumer behavior and how does it work? Let's dig deeper into the dynamics of it.
- According to Engel, Blackwell, and Mansard, ‘consumer behavior is the actions and decision processes of people who purchase goods and services for personal consumption’,
- According to Louden and Bitta, ‘consumer behavior is the decision process and physical activity, which individuals engage in when evaluating, acquiring, using or disposing of goods and services’.
On a more general note, consumer behavior is the analysis of how individual consumers, groups or organizations pick, buy, use and dispose products, goods and services to fulfill their needs and wishes. This corresponds to the actions of customers in the marketplace and the fundamental reasons behind those actions.
Marketers hope that by knowing what drives consumers to buy specific goods and services, they will be able to assess which items are needed on the market, which are outdated, and how best to sell the goods to customers.
And why should companies care for their consumers’ behavior?
Knowing customer behavior is important for an organization to be effective both in terms of its existing products and in terms of new product releases. Each customer has a specific thought process and mindset towards the buying of a single product. When an organization refuses to consider the consumer 's response to the product, there is a strong probability of failure of the product.
Consumer behavior is also evolving due to changing fashion, technology, lifestyle, disposable income and related influences. Marketers need to consider the trends that are evolving so that campaign strategies can be matched accordingly.
According to a Salesforce report, 76% of consumers expect companies to understand their needs and expectations. This means that if you don't understand what a consumer wants before they can tell you, they're probably taking their business elsewhere.
And what are the aspects that affect customers to say 'yes'? There are three types of influences that affect customer behavior:
1. Personal factors: the preferences and perceptions of individuals that could be affected by demographics (age, class, history, etc.).
2. Psychological factors: the individual's reaction to a marketing message depends on their beliefs and attitudes.
3. Social factors: family, friends, educational status, social media, employment, all affect customer behavior.
As mentioned above, companies that not only solve but also demonstrate that they solve actual customer challenges are the ones that dominate the competition today. Consumer behavior observations can also be used to inform nearly all aspects of the business campaign. That could include what content you will provide on your website/blog and other social media channels, the kinds of stories you share in your videos and display advertisements, or even how you adapt your product lines to offer what the user needs.
Let’s consider an example regarding the type of content the marketing team of a business may create in the upcoming weeks. If your business specializes in products for women, a plan could be to create a number of posts about gifting beauty products this quarter. When analyzing consumer behavior, you may notice that the offer “Valentine’s Day women gifts” gains more searches than “Women gift ideas for anniversary”. Although the differences aren’t that big, the subtle chance in the way you arrange the keywords to your content could make a difference in the number of visitors your website may attract.
Understanding customer behavior will allow you to create stronger marketing materials. You can generate improved copy writing, pick more suitable pictures, and deliver messages to the viewers that resonate with them.
Besides marketing campaigns, other frequent factors that could influence consumers behavior are:
-> Economic conditions – especially for expensive products such as houses or cars that require extra attention and thinking.
-> Personal preferences - if you’re vegetarian, it doesn’t matter how many ads containing meat you will see, your opinion and preference on them will still remain the same and you won’t start eating meat.
-> Group influence - peer pressure also affects consumer behavior. How our family friends, colleagues, neighbors and acquaintances say or do will play a major role in our decision-making.
-> Purchasing power - if you are not a millionaire, you might have to take your budget may into account before making any buying decisions.
There are three types of buyers: unconflicted, spendthrift, and tightwads. Each of these customers makes buying choices differently, and you've got to approach them at multiple moments in the selling funnel.
Consumer behavior knowledge can be derived in a number of ways. These may come from insights provided by the marketing or distribution systems, may be the product of surveys, or may come from your own review of publicly accessible data (such as search engine results). The more you recognize your target client, the more you can tailor your marketing strategies to lure those individuals.
In summary, advertisers who exploit consumer behavior data will inevitably take giant strides forward in their race against rivals to reach out to their customers. If consumer behavior is driving your marketing campaign right now, you might be losing out on valuable marketing opportunities right in front of you.