Scope and Significance of Consumer Behavior
Scope of consumer behavior
- Consumer behavior and marketing Management
Effective business managers realise the importance of marketing to the success of their firm. A sound understanding of consumer behavior is essential to the long run success of any marketing program. In fact, it is seen as a comerstone of the Marketing concept, an important orientation of philosophy of many marketing managers. The essence of the Marketing concept is captured in three interrelated orientations consumers needs and wants, company integrated strategy.
- Consumer behavior and non profit and social marketing
In today’s world even the non-profit organizations like government agencies, religious sects, universities and charitable institutions have to market their services for ideas to the “target group of consumers or institution.” At other times these groups are required to appeal to the general public for support of certain causes or ideas. Also they make their contribution towards eradication of the problems of the society. Thus a clear understanding of the consumer behavior and decision making process will assist these efforts.
- Consumer behavior and government decision making
In recent years the relevance of consumer behavior principles to government decision making. Two major areas of activities have been affected:
- Government services: It is increasingly and that government provision of public services can benefit significantly from an understanding of the consumers, or users, of these services.
- Consumer protection: Many Agencies at all levels of government are involved with regulating business practices for the purpose of protecting consumers welfare.
- Consumer behavior and demarketing
It has become increasingly clear that consumers are entering an era of scarcity in terms of some natural gas and water. These scarcities have led to promotions stressing conservation rather than consumption. In other circumstances, consumers have been encouraged to decrease or stop their use of particular goods believed to have harmful effects. Programs designed to reduce drug abuse, gambling, and similar types of conception examples. These actions have been undertaken by government agencies non profit organizations, and other private groups. The term “demarketing” refers to all such efforts to encourage consumers to reduce their consumption of a particular product or services.
- Consumer behavior and consumer education
Consumer also stands to benefit directly from orderly investigations of their own behavior. This can occur on an individual basis or as part of more formal educational programs. For example, when consumers learn that a large proportion of the billions spend annually on grocery products is used for impulse purchases and not spend according to pre planned shopping list, consumers may be more willing to plan effort to save money. In general, as marketers that can influence consumers’ purchases, consumers have the opportunity to understand better how they affect their own behavior.
- Production Policies
The study of consumer behavior effects production policies of enterprise. Consumer behavior discovers the habits, tastes and preferences of consumers and such discovery enables and enterprise to plan and develop its products according to these specifications. It is necessary for an enterprise to be in continuous touch with the changes in consumer behavior so that necessary changes in products may be made.
- Price Policies
The buyer behavior is equally important in having price policies. The buyers of some products purchase only because particular articles are cheaper than the competitive articles available in the market.
- Decision regarding channels of distribution
The goods, which are sold and solely on the basis of low price mast and economical distribution channels. In case of those articles, which week T.V. sets, refrigerators etc. Must have different channels of distribution. Thus, decisions regarding channels of distribution are taken on the basis of consumer behavior.
- Decision regarding sales promotion
Study of consumer behavior is also vital in making decisions regarding sales promotion. It enables the producer to know what motive prompt consumer to make purchase and the same are utilised in promotional campaigns to awaken desire to purchase.
- Exploiting marketing opportunities
Study of consumer behavior helps the marketers to understand the consumers needs, aspirations, expectations, problems etc. This knowledge will be useful to the marketers in exploiting marketing opportunities and meeting the challenges of the market.
- Consumer do not always act or react predictably
The consumers of the past used to react to price levels as if price and quality had positive relation. Today, week value for money, lesser price but with superior features. The consumers response indicates that the shift had occurred.
- Highly diversified consumer preferences
This shift has occurred due to availability of more choice now. Thus study of consumer behavior is important to understand the changes.
- Rapid introduction of new products
Rapid introduction of new product with technological advancement has made the job of studying consumer behavior more imperative. For example, the information Technologies are changing very fast in personal computer industry.
- Implementing the “Marketing concept”
These calls for studying the consumer behavior, all customers need have to be given priority. Thus identification of target market before production becomes essential to deliver the desired customer satisfaction and delight.