Consumer Decision and Behavior: Literature Review
Introduction
Everybody is a consumer, whether intentionally or unintentionally, thus the study of consumer behavior is quite critical for all people. Often, consumers are confronted with decisions that tend to challenge not only their beliefs but principles as well. Consumer behavior basically deals with the procedures of making procurement resolutions and disposal of previously acquired products. A study of consumer behavior, according to Nelson (2004), also relates to factors that tend to influence property acquisition decisions as well as preference of certain goods and services against others.
Understanding people/consumer’s decisions and behaviors is critical for the people themselves, manufacturers/producers, and marketers/advertisers as it guides in production and promotion processes. Some of the important issues that they need to understand include the psychology of consumer’s reasoning, how they argue, feel, think, and are influenced by the environment, media, culture, and family. It is also important to understand how consumers behave while shopping or make other important marketing decisions and how their decision and motivation strategies tend to differ between services and products deferring in level of interest and value (Solomon, Russell-Bennett & Previte, 2012).
Consumers seldom make purchasing decisions vaguely with no apparent reason or controlling factors/influences. A number of factors come into play as they make decisions, which include: (I) Cultural factors, (II) Social factors, (III) Personal factors and (IV) Psychological factors (Yakup & Jablonsk, 2012). Using the Theory of Planned Behavior (TPB), this literature review seeks to explore these four factors in relation to their role in influencing consumer decisions and behavior. The Theory of Planned Behavior which originally began as the Theory of Reasoned Action sought to predict intentions of individuals to engage in certain behaviors at specific place and time (Ajzen, 2005). This theory is employed in seeking to explain behaviors that people have ability to exercise self-control. The theory states that behavioral achievement depends on intention/motivation and one’s ability to control behavior (behavioral control).
Consumer Decision and Behavior Factors
In his study on the factors that influence consumer behavior, Rani (2014) defined buying behavior as the decision processes as well as the subsequent acts of individuals involved in the process of acquiring/buying and using services and products. Some critical issues necessary in relation to consumer decisions and behavior include the reason as to why a person buys a specific item, the factors that come into play while the person acquires such an item, and the inconstant or changing factors within a particular community influencing the item acquisition decision. Numerous specificities, factors and characteristics tend to influence individuals in their decision processes, purchasing behavior, habits of shopping, the shops or organizations they buy from and the brands they opt for (Rani, 2014). Thus, it is apparent that every time an individual makes a purchase of any service or product, all such factors comes into play.
According to Rani (2014), a consumer’s purchasing decision is influenced by his/her social class, culture, and subculture, family, personality, membership to certain groups, and psychological factors among other factors. Nelson (2004) noted that cultural trends together with the shared atmosphere also come to play in swaying an individual’s purchase behavior. Producers and marketers seek to understand these factors so that they can develop appropriate strategies and marketing message that will rhyme with these factors, thus attracting the consumers to opt for their goods and services. The advertisers also employ the knowledge of such factors in preparing advertising campaigns that are not only efficient but also in line with the consumer needs, which helps them in increasing their sales (Nelson, 2004). This implies that a marketer or organization that takes time to understand the target population’s purchasing influencing factors is better positioned to make more sales than an individual who rushes to produce goods or services that they think potential clients are in need of.
Rani (2014) posited that the dynamics influencing a person’s behaviors cause them to develop preferences for certain makes of products. Even though most of such factors are not greatly controlled by the marketers, awareness or being informed of their impact is critical towards the development of selling strategies and one could influence the strategies, thereby appealing the market preferences of the people. Whenever a person wants to buy any item or even use any service, he/she goes through what is known as a “decision process.” This process, according to Jeddi, Atefi, Jelali, Poureisa and Haghi (2013), consist of 5 stages, which include identification of the problem, searching for the relevant information, evaluating the various alternatives, deciding on the purchase, and post-purchase behavior (see fig. 1).
The decision process length varies from one consumer to another because one consumer could act in isolation while another may be influenced by several factors and persons, each playing a particular role. As highlighted in the introduction, the most common factors influencing the decisions and behaviors of consumers are four: (I) Cultural factors, (II) Social factors, (III) Personal factors and (IV) Psychological characteristics.
Cultural Factors
International marketers argue that consumers tend to resemble each other in numerous areas such as their eating habits, dressing habits, and viewership of TV programs among other aspects of life. However, according to Yakup, Mucahit, and Reyhan (2011), the reality is totally different. Having the knowledge of people’s culture serves the marketers and producers/manufacturers in their ventures. Understanding individual needs and behaviors greatly depends on understanding their background, beliefs, way of life, and physical and social environment among other cultural factors. Culture influences people’s needs, thus influencing their property acquisition behavior. Such influences on acquisition behaviors differ from region to region and from state to state. A person’s buying decisions are influenced by the members of his/her family, the friends, the society, or cultural environment, which teaches him/her certain preferences and values, and the shared behavior with the rest of the society (Yakup et al., 2011). The behavioral intention component of TPB can explain the cultural factor because it refers to the motivational factors of influencing behavior. The component posits that a person’s behavior is majorly influenced by their intention to do perform such a behavior (Ajzen, 2005). In this case, the intention is to fit within a certain society, which will propel a consumer to buy a certain good or service: The higher the intention, the higher the probability of the individual acquiring the item or service.
This way of arguing seems credible because a person from a certain society is more likely to clothe in line with the cultural values and favorable to societal approval. For example, if dressing scantly is perceived as a social vice in a given cultural settings, most people would resist the urge to buy outfit that would be regarded as such despite their preference for such clothes. However, if they relocate to an area where cultural beliefs and practices do not care much about how the members dress, they are more likely to dress in what appeals to them more. A businessperson who seeks to respond to cultural needs is more likely to be successful in the business than one who just sells any product without much consideration of such cultural factors. A brilliant case study is McDonald’s adaptation to cultural needs that endeavors to address the diverse tastes of dissimilar cultural settings. For example, in France, McDonald has McBaguette which has French baguette, Chicken Maharaj in India (full of Indian spices), and Mega Teriyaki Burger for Japan (Rani, 2014).
Sub-cultural factors such as religion, ethnic groupings and citizenly also tend t influence behavior and decisions of buyers. Marketers use such groups in segmenting the market into different smaller portions such as ethnic communities. In the cosmetic industry, the marketers now understand products that are more suitable for Caucasian populations and others that are more preferable among non-Caucasians. Arabs, Indians and Africans’ skin pigmentation tend to play a critical role in persuading respective preference of cosmetics. Marketers who have in the past insisted on selling unsuitable products for a certain community has met immense resistance and soonest a competitor conducts a market research and introduces products that fits within a given subculture, he comfortably manages to influence the consumers’ purchase decisions and gains the control of the market (Yakup et al., 2011).
Social Class
In their study of social class factor in influencing consumer behavior, Durmaz and Taşdemir (2014) observed that inequality is assessed through societal stratification, which tends to concentrate on gender, status, class, castes and sometimes age. In this case, social class could be defined as grouping people according to their economic position and who tends to behave in the same way influenced by economic position within the market place (Durmaz & Taşdemir, 2014). Durmaz and Taşdemir (2014) observed that social classes have a number of characteristics:
- People within the same social class tend to have similar behaviors such as preferences for mass media, leisure activities, kind of clothes, the residential places, furniture, cars, and housing.
- A person’s social class is influenced by several factors such as their earnings, education level, occupation/profession, and asset ownership.
- Social class is not a permanent status; members of a given class could move from class to class depending on their prevailing economic circumstances.
However, Durmaz and Taşdemir (2014) observed that in some societies, it is very difficult for an individual to change their social class but within some other societies, one can move from a position of being a subject to ruling to the ruling class. What is important to understand is that an individual’s present class greatly influences their buying behaviors. A member of lower class is influenced more by price while an upper class may is more mindful of quality. This implies that an attempt to sell cheap products in a self-selection store located in an estate for the upper class will attract immense frustration. The same applies for attempts to sell high quality and expensive products in a shop located within a region majorly occupied by the lower class. This argument seems to make sense because as much as lower class people may desire to acquire the quality products, it is beyond their financial ability, and thus they are not likely to buy such products. A wealthy person will not buy low quality product, though can afford, because they will feel it is too cheap and does not rhyme with their social class. A person in the lower class is less mindful of aspects such as quality, features, and innovation, which seems to be the main appealing factors for a consumer from the upper class.
According to Rani (2014), social class also involves groupings like aspiration, reference, and membership. Other social class aspects include status and family, all of which explain the external influences of an individual’s decisions and behaviors while acquiring a product or using a given service. For instance, reference groups, which are basically linked with issues of age, residence, leisure and profession, have the potential of influencing the attitude of an individual. Such memberships differ across divergent brands. Reference groups more often than not have opinion leaders influencing members based on knowledge and skills among other characteristics. Family creates the socialization settings where a person’s tastes, character, and behaviors are shaped. Such socialization plays a significant role in development of opinions and attitudes about certain products and services, all of which influences a consumer’s decisions and behaviors.
The social class factor can also be explained using the Social norm element of the Theory of Planned Behavior which refers to the customary codes of behavior within a group or among people within a certain context (Ajzen, 2005). The social norms influences people’s decisions in that they are more to engage in behaviors that are acceptable within that particular settings. As much as personal interests play an important role in influencing behaviors, a consumer will have to consider the acceptability of viability of a particular decision within his/her social class.
Personal Factors
Muniady, Al- Mamun, Permarupan, and Zainol (2014) observed that personal factors include variables such as lifestyles (demographics, interests, activities and opinions), self concept, economic circumstances, age, stage in lifestyle, and personality, no wonder preferences keep changing. Buying decisions and behaviors are inevitably influenced by a person’s characteristics besides the cultural and social class factors. According to the attitude element in the Theory of Planned Behavior, a person has both favorable and unfavorable behavior evaluations based on personal interests (Ajzen, 2005). Prior to making any purchasing decision, a consumer will engage his/her personal interest based on his/her attitude towards certain goods or services, which will eventually play a critical role in determining whether to acquire the item or not. If the attitude is unfavorable, the highest probability is that the person will desist from buying the item or service, even with cultural and social factors at play.
Personal traits greatly influence a person’s decision in relation to the kind of products that a person buys or uses. As Rani (2014) would argue, a person will not buy the same products or use the same kind of services at early adulthood, say 20 years and as an elderly 70 year-old man or woman. The life cycle has immense effect on an individual’s decisions and buying/acquisition behavior. Some products such as ice-cream and chocolate are likely to be more appealing to young girls at their teenage but as they grow up and become more concerned about their health or become sensitive about their looks they may shift to healthy foods such as fruits and water. Young people are more likely to consume lots of sweet foods and fast foods while the elderly people persons will opt for healthier and traditional diets.
Lifestyle has to do with tastes, principles, and activities, all of which greatly influences decisions on what they buy (Muniady et al., 2014). This argument seems to make a lot of sense because it is apparent a consumer leading a healthy lifestyle is most likely going to consume organic products and thus visit specific grocery stores for such. He/she will also exercise regularly, thus is likely to buy lifestyle-related shoes and clothes among other products required for such a lifestyle. I fully concur with the argument because there is no way a person will buy products or seek for services that contrast with the kind of life they lead.
Khare and Handa (2009) defined self-concept and personality as a combination of a number of characteristics of an individual consumer. It is the human characteristic formed after the interaction of physiological and psychological traits of an individual, which leads to certain constant behaviors (Khare & Handa, 2009). It leads to some personal features like boldness or shyness, being proactive or passiveness, displaying confidence of showing fear, and being autonomous or dependant. A product or service that appeals to personal traits is more likely to influence their decision in acquisition of the product or a product with repelling features influence a consumer into shying away from such a product. Occupation also influences a consumer’s buying decisions and behavior because the roles that one plays go along with certain products or services. For example, a supplier is more likely going to purchase a lorry, pick up of station wagon kind of a car while a manager may be more comfortable with a saloon car.
Psychological Factors
Successful marketers and businessmen known how to leverage divergent factors, which tend to influence the consumers buying behaviors so as to effectively make their products appealing to the masses and optimize profitability. Numerous studies have classified the psychological factors into some distinct categories, including (I) Beliefs and attitudes, (II) Learning, (III) Perceptions and (Iv) motivations (Yakup, 2014).
Motives could be defined as persistent, strong, or somewhat enduring internal stimuli, which arouses and directs the individual’s behaviors towards a specific goal (Yakup, 2014). The buying/acquisition process starts with acknowledging there is a problem in need of attention. A person’s motivation to buy a certain product is directed by convenience, self-pride, style, prestige, or desire to be equal with others. The Maslow’s theory of motivation categorizes the needs in terms of priority, beginning with psychological needs such as food and health, followed by safety needs such as shelter, followed by a need to belong such as love and affection, the esteem need such as self-esteem and lastly the self-actualization need which involves achieving individual potential (Jonsson, 2010).
According to Yakup (2014), perception could be viewed as the vigor, which exposes a person to the surrounding world enabling them to create meaning about as a result of natural sensing. Perceptions among consumers tend to differ immensely. Although people may have a similar idea about an event or a situation but none can feel or seen an issue 100 percent like another. In response to internal spur also known as stimuli, a consumer will subconsciously evaluate their desired prospects as well as needs prior to employing their “evaluation to select, organize and interpret the stimuli” (Yakup, 2014, p. 196). Whether a person perceives a product or service as meeting their need or responding to their stimuli, their decision to acquire it will be influenced by such (Taylor et al., 2006).
Yakup (2014) perceived learning as changing of a person’s behavior following a novel exposure, emerging experiences or gaining new information. A consumer’s perception is conditioned by their previous experiences because it constitutes their expectations and framework which provides a background of organizing stimuli. Marketers build demand for certain services or products by associating it with some strong drives by use of motivational cues, which influences their target population’s purchase decisions and behaviors (Yakup, 2014). While beliefs are descriptive thoughts held by an individual about a given product or service, attitude are defined as enduring cognitive evaluations and feelings attached to something. The behaviors of a consumer tend to be greatly influenced by those ideologies they attach to certain product or service, with erroneous belief repelling the products while appealing beliefs attracts them.
Conclusion
In seeking to understand decisions and behaviors of consumers in buying certain products or services, this review sought to explore the factors that come into play. The review identified four main factors relevant in influencing consumer decisions and behaviors, which include cultural, social, personal, and psychological factors. Theory of Planned Behavior was used especially in relation to its elements of Attitude, Behavioral intention, and social norm in seeking to explain the four factors that influence consumer decision and behavior. The cultural factors relates to a certain community’s preferences, values and preferences as inculcated on members of that particular culture. The social class factor relates to shared values and standard of living with other individuals of the same economic rank. The study identified the personal factors as issues of lifestyles, self-concept, economic conditions, epoch, lifestyle phase, and persona. The psychological factor highlighted in this study include personal beliefs and outlook, knowledge acquisition or learning, perceptions and motivations, all of which influences a consumer’s decisions and behaviors in acquisition of certain goods or services
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