Consumer Behaviour

Consumer Behaviour

This course contains the basics of Consumer Behaviour

Course introduction
Test Your Caliber
Interview Questions
Pragnya Meter Exam

Consumer Behaviour


Culture is the unique possession of man. Man is born and brought up in a cultural environment. Man is not only a social animal but also a cultural being. Man cannot survive as a man without culture. Culture fulfils our needs and represents the entire achievements of mankind. E. B.Taylor defined culture as "that complex whole which includes knowledge, beliefs, art, morale, laws, customs and any other capabilities and habits acquired by man as a member of society." Cultureinfluences the pattern of living, of consumption, of decision-making by individuals. It has certaincharacteristics and is transmitted from one generation to another.It is a comprehensive concept and includes all those things that influence an individualin his thinking and behaviour, e.g., People in the western world have a different culture thanthose in the east. Their behaviour, living style and decision making is different from those inthe eastern countries.

Characteristics of Culture

Culture has several important characteristics:

  1. Culture iscomprehensive. This means that all parts must fit together in some logical fashion. For example, bowing and a strong desire to avoid the loss of face are unified in their manifestation of the importance of respect.
  2. Culture is learned rather than being something we are born with. We will consider the mechanics of learning later in the course.
  3. Culture is manifested within boundaries of acceptable behavior. For example, in American society, one cannot show up to class naked, but wearing anything from a suit and tie to shorts and a T-shirt would usually be acceptable. Failure to behave within the prescribed norms may lead to sanctions, ranging from being hauled off by the police for indecent exposure to being laughed at by others for wearing a suit at the beach.
  4. Conscious awareness of cultural standards is limited. One American spy was intercepted by the Germans during World War II simply because of the way he held his knife and fork while eating.
  5. Cultures fall somewhere on a continuum between static and dynamic depending on how quickly they accept change. For example, American culture has changed a great deal since the 1950s, while the culture of Saudi Arabia has changed much less. Culture can be divided into two distinct components.

Material culture influences technology and how it brings cultural changes, i.e.,use of telephones, mobile phones, television, clothing styles, fashions and gives the marketeers achance to improve the product, packing, etc. to meet the needs of the consumer, etc.

The Functions of Culture
We have already seen that culture influences the behaviour of individuals. It provides a framework within which individuals and households build their pattern of living or exhibit their lifestyles.

Norms are the boundaries that culture sets on the behaviour. There are rules that encourage or prohibit certain behaviour in specific situations. Norms are derived from cultural values, which are widely told beliefs that specify what is desirable and what is not. When these rules are violated, it results in sanctions or penalties which are either disapproved of by the society, and in extreme cases the individual violating the norms are banished or ostracized from the society. Most individuals obey norms because it is natural to obey them. Culture outlines many business norms, family norms, behaviour norms, etc. How we greet people? How close one should stand to others while conducting business? The dress we wear and any other patterns of behaviour.

Culture keeps changing slowly over time; and is not static. Changes takes place due torapid technologies. In case of emergency, war, or natural calamities, marketeers and managers must understand the existing culture as well as the changing culture and culture of the country where the goods are to be marketed. Major companies have adapted themselves tointernational culture and are accepted globally. Coca Cola is sold all over the world. Procter Gamble and other companies give cross cultural training to their employees. By making cross-culture mistakes, many companies have difficulty in pushing their products, for example, (i) Coca Cola had to withdraw its 2-litrebottle from Spain, because it did not fit in the local refrigerator; (ii) Many countries are very traditional and do not like women displayed on the products. This acts as a detriment to businessin those countries.

Variation in Cultural Values

There are three broad forms of cultural values as shown in Figure Values, norms sanctions and consumption pattern.

Other Oriented Values of Culture
This shows the relationship between individuals and the society. The relationship influences marketing practices. If the society values collective activity decisions will be taken in a group.It gives rise to following questions which affect consumer behaviour:
Individual/collective: Whether individual initiation has more value than collective activity?
Romantic orientation: This depicts whether the communication is more effective which emphasises courtship or otherwise. In many countries, a romantic theme is more successful.
Adult/child theme: Is family life concentrated round children or adults? What role do children play in decision-making? Masculine/Feminine: Whether the society is made dominant or women dominant or balanced.
Competitive/Cooperation: Whether competition leads to success. This is achieved by forming alliances with others.
Youth/age: Are prestige roles assigned to younger or older members of the society. American society is youth oriented and Korean is age oriented. Decisions are taken by mature people in Korea.

Environment-oriented Values
Cleanliness: If a culture lays too much stress on cleanliness, there is scope for the sale of beauty creams, soaps, deodorants, insecticides, washing powder, vacuum cleaner, etc. In western countries, a lot of emphasis is placed on this aspect and perfumes and deodorants are widely used.
Performance Status: A status-oriented society cares for higher standards of living, and chooses quality goods and established brand names and high-price items. This is true for the United States, Japan, Singapore, Malaysia, Indonesia, Thailand and most of the Arabian countries.
In performance-oriented societies, where rewards and prestige is based on an individuals performance, less importance is given to brand names. Products which function equally well and may not be big brand names are used. Germans do not give the same amount of emphasis to brand names. The marketeers adopt strategies accordingly.
Tradition/change: Tradition-oriented societies stick to the old product and resist innovation or new techniques. In traditional societies, there is less scope for new products, and old traditional products are in greater demand. In some societies, which are upwardly mobile,consumers are looking for modern methods, new products, new models and new techniques.
Risk-taking/security: An individual who is in secure position and takes a risk can be either considered venture some or fool hardy. This depends on the culture of the society. For developing, new entrepreneurs risk taking is a must. It leads to new product development,new advertising themes and new channels of distribution. Security-oriented societies have little chances of development and innovation.
Problem solving/fatalist: A society can be optimistic and have a problem-solving attitude or, be inactive and depend on fate. This has marketing implications on the registering of complaints when consumers are dissatisfied with the purchase of the products. Advertising plays an important part and gives guidance to the consumer, and removes these doubts to a great extent.
Nature: There are differences in attitude over nature and its preservation. Consumers stress on packing materials that are recyclable and environment friendly. Some countries give great importance to stop environmental pollution and to recycling of products.

Companies like P&G, Colgate-Palmolive captured a great extent of the market by offering products which are less harmful to the environment. They also use ingredients in the products which are not harmful in any way.

Self-oriented Values

Active/passive: Whether a physically active approach to life is valued more highly than a less active orientation. An active approach leads to taking action all the time and doing nothing. In many countries, women are also taking an active part in all activities. This makes the society a highly active one, where everybody is involved in work.
Material/non-material: In many societies, money is given more importance, and a lot of emphasis is on being material minded. While in many societies things like comfort, leisure and relationships get precedence over being materialistic.
Materialism can be of two types. Instrumental materialism, which is the acquisition of things to enable one to do something or achieve something. Cars are used for transportation.
People like to possess things of material value which would help them to bring efficiency; other material objects can be computers, washing machines, microwave ovens, etc.
Terminal materialism: It is the requisition of materialism for the sake of owing it rather than for use Art is acquired for owing it. Cultural differences play an important role in this type of materialism. Instrumental materialism is common in the United States of America, where Japanese advertisements are mostly dominating terminal materialism. Antique collections is another example of terminal materialism.
Hard work/leisure: This has marketing implications on labour saving products and instant foods. Some societies value hard work and consider it as a fuller life. Others adopt labour saving devices and instant foods to have more leisure time at their disposal.
Postponed gratification/immediate gratification: Should one save for the rainy day or live for the day? Sacrifice the present for the future, or live only for the day? Some countries like The Netherlands and Germany consider buying against credit cards as living beyond one’smeans, whereas credit cards are very popular in America and other countries having a different cultural orientation, some prefer cash to debt. Some societies save for a morrow, others enjoy the present and spend lavishly.
Sexual gratification/abstinence: Some traditional societies curb their desires, food, drinking or sex, beyond a certain requirement. Muslim cultures are very conservative, and do not want their women to be seen in public or be exposed, so the Polaroid camera which gives instant photographs can be purchased and pictures can be taken by the family members without their women being exposed to the developers in a photo lab.
In other cultures, attractive female pictures are used for the advertisement of products.This may be considered very normal in these societies whereas, other societies may consider it strange.

Humour/Serious: Should we take life lightly and laugh it off on certain issues or, take everything seriously? This is another aspect of culture. Advertising personnel selling techniques and promotion may revolve around these themes and the way the appeal for a product is to be made in various cultures.

Within a culture there exists more homogeneous subgroups. These groups have their own values, customs, traditions and other ways of behaviour that are peculiar to a particular group within a culture. For instance, the Hindus in India have a certain pattern of living, values,food habits, clothing they wear and the language they speak. These can be divided into at least two subculture. The Hindus of the south whose food habits, clothing, values etc. are homogeneous in themselves but they are different from the Hindus of North which is a second subculture. The Hindus of North are homogenous in themselves but Heterogeneous when compared to those living in the South. Their Language, the clothing, the modernization their consumption are all different. Subcultures exist in all societies and nations. Amongst the Muslims of North and the Muslims of the South, East and West, the pattern of living, traditions, ceremonies,values, language also differ.
Culture is a broad term, we have American culture, Japanese culture, European culture,Asian culture, culture of the Far East, Middle East, African culture and many more.
These cultures are divided into subgroups and is known as the subculture. The division of these groups helps to assess the need of the subcultures more accurately and effectively and marketing becomes easier.
When we are talking of subculture, we must understand the term ethnic as well Ethnic identification is based on what a person is, when he or she is born and is largely unchangeable.
Members of ethnic groups in general descend from same forebears. They tend to reside in the same locale. Tend to marry within their own group. Share a common sense of people hood. The ethnic group can be divided on the basis of race, nationality and religion.
In America, we have 3 examples of important U.S. subcultures. These are:
Black subculture: They are disadvantaged compared with whites in terms of education,occupational attainment. They live in crowded places and neighbourhood of large cities.
Over the years, they have improved in education. The market for blacks is increasing fast almost 3 times that of whites. They have become skilled in many jobs and are getting better paying jobs. Another striking features about blacks is their tendency towards materialism.
Almost 50 percent of blacks live in families hearded by a female. They are interested in style, fashion and modernity. Since black families are larger than white ones, they are targetted for convenience, foods, home appliances etc.
Asian Americans: This population consists of Chinese, Filipions, Japanese, Indian,
Korean, Vietnamese, Hawaiin and other segments in the U.S. It is the fastest growing minority.They are scattered all over America and 56% of them live in the west. They are highly urbanized and about 93% live in the urban area. They give a lot of importance to education and getting westernized fast but some of them hold their old values and adhere to them.
They feel that the women’s place is at home. Many interact closely with relatives. Their family comes first in the making of important decisions. They care for their parents.

  • They adopt moderate behaviour instead of extreme behaviour.
  • Their relationship with parents are formalized.
  • They return favour to others.
  • They do not show affection openly. This is not acceptable.
  • Americans are a food target for marketeers.

Hispanie Culture
These are Spanish people moving to U.S.A. from Mexico. Although they like to live in U.S.A.but they do not want to loose their ethnic character, their culture and language. Their home is not far away from Mexico and they can always go back to their home. They strongly stick to their Spanish language. These constitute about 8% of the population. They are largely of Mexican origin, some from Porto RICO and Cuba. The Spanish subculture is largely an urban population segment and live in metro-politan cities like Texas, New York, California, Florida and Illinois. They are worthy blue-collar workers and 24 percent of them have white-collar occupation.
They give importance to education but they are lower in comparison to non-Hispanicsone syndicated psychographic consumer segmentation study has indicated 4 Hispanic consumer clusters. These are “Hopefull Loyalist” “Recent Aeekers”, “Young strivers” and “established adapters”. The details of these psychographic segments is given in the chapter on Psychographic segmentation.

Subculture in India
In India, we have cultures of different states, different religions etc. for instance we have the Punjab subculture, Bengali and Madrasi subculture, Maharashtrian or the culture of the west, Kashmiri culture of the north, the culture of Uttar Pradesh with a lof of “Tahzeeb” or respect and mild and docile caring for each other. The culture of the Nawabs, culture of the Rajas and Maharajas.
Under subculture we have the Tamil and Telugu culture, we have a mixed culture in Orissa and so on. On the religions front, we have different traditions, values and pattern of living in different parts of India. As already pointed out earlier these can be sub cultures in Hindus,Muslims. We have the Sikh culture which is a combination of Hindu and Muslim culture. The Christian culture, The Parsi culture and their values and traditions. The Zorastrians and many religions existing in India which are the subcultures in India. The subcultures give a better idea to marketeers to sell their products and make better strategy.