Global Consumer Behavior - Case Study Example

This section seeks to explore various factors that affect consumer behavior in making their purchase decisions. Consumer behavior is the buying behavior of the prospective consumers. It is the selection, purchasing and consumption of goods by the consumers. The customers select the product that can adequately satisfy their wants; they estimate the amount of money they can pay for the product and analyzes the prices of such products. There exist many specificities, factors and characteristics that influence the customers on what they purchase for their consumption. Customers are led to their culture, personality, social status and their psychological factors. These factors define how the customers make various market decisions in their shopping habits. Cultural factors Cultural factors encompass a set of ideologies and values of a given group of individuals or community. Individual’s culture defines how the individual behaves. Whatever one learns from the relatives and parents from their childhood becomes their culture. Culture is the values that define an individual. For instance, in countries like India, there is still joint family ties and system. Children are supposed to stay at home until they marry or get married. This is different with other countries where children are allowed to be independent and detach themselves from their parents ones they get employment. These cultural values possess significant effect to the purchasing behavior of the consumers. Every person has various beliefs, habits and principles developed from their background that define their buying behavior (Lamb et al., 2010). Every country has its culture that defines the buying behavior of its citizens. The marketer should be careful when analyzing various cultures. For brands like gold, it is critical for the marketer to take into account and understand cultural factors that are inherent in every market for them to adapt their product and their marketing strategy. This plays a significant role in the habits, perception expectations and behavior of the consumers. The marketers should have up to date information on culture shifts and provide for their customers effectively. Culture is an essential factor that influences the consumers’ behavior (Kardes et al., 2014). Consequently, there exist several subcultures within the society that identify individuals. These are groups of individuals who have the same beliefs and values based on their similar lifestyle and common experiences. Various cultures contain subcultures such as nationalities, religions, racial groups, geographic regions and many more. These groups can be used by the marketers in segmenting their business into various segments that can be able to provide for the needs and wants of every subculture (Kardes et al., 2014). Culture defines how individuals make various marketing decisions in different countries, for instance in India, gold is considered to be a very crucial artifact, and it is used for various cultural values. Huma et al. (2013) in their research found out that in India, the expatriates use gold artifacts to sustain their culture and show that they have not diverged from their original culture. The research further illustrates that the expatriates valued gold due to the link it has to their cultural community. Then it can be seen that gold possession constitutes culture and the role it has in various societal rituals, sustains the culture. According Douglas and Craig (2006), these cultural rituals include the customer behavior as well as other occasions such as marriages, religious holidays and festive seasons. Huma et al. (2013) claim it is only in India where gold is seen as an important artifact since it is used for various cultural activities. In regions such as the United Arab Emirates, the existing culture does not require the use of gold. Douglas and Craig (2006) claims that in other cultures, gold does not have a considerate value as inculcated in the cross- generational relationships and tradition. Thus, generalization to other consumer societies and cultures is limited without accuracy and depth of comparison across various situations and context. Consequently, there exists a positive customer behavior in the purchase of gold in India than in other regions such as in the UAE. Regarding gender, women seem to have more attachment to gold as compared to men. Women hold different cultural attributes from men. For instance, women believe in embracing their beauty using gold jewelry. Like in the Indian culture, women pass gold to their daughters or give other women. A study conducted by Huma et al. (2013) disclosed that the Indian women purchased gold during important occasions such as weddings. It is a must for all the women to have gold artifact during the wedding ceremony. Men have little attachment to gold purchase since they do not embrace beauty. They feel they look good the way they are. Social status also defines the purchasing behavior of individuals. Individuals with a high level of income would spend more money on luxurious items such as gold. In contrary, individuals from the low class lack enough funds to spend on luxurious items such as gold. Such individuals would prefer to purchase items that are basic for their survival. On the other hand, individuals with middle income are less interested in luxurious things but are focused on buying things that can help improve their economic status, they tend to invest more. This depicts significant differences in the buying behavior of individuals from various social statuses. Based on this findings, marketers should have an elaborate consideration of various subcultures since individuals from different subculture have different desires and wants (Lamb et al., 2010). Social factors Human beings are perceived to be rational individuals. They need people around them to discuss and talk about various issues to obtain sound solutions and ideas. Since individuals live in a society, it is the responsibility all individuals to respect and adhere to the regulations stipulated by their societies. Social factors are the outside influences that impact the behavior of an individual either indirectly or directly. The social factor is also an important factor that affects the purchasing behavior of customers. Social factors can be categorized into three distinct groups. That is reference groups, social status and the family (Lamb et al., 2010). Reference groups are also referred to as membership group. These are social groups in which a person can be involved in and can influence their behavior. The reference groups is often related to age, social origin, work, leisure, place of work and hobbies. Membership groups are capable of transforming the behavior and attitude of an individual. However, the impacts of the membership group various across various items or products. For instance, in case the product is visible such as gold, there will be a high influence from the reference groups. There are also opinion leaders within the membership groups who influence other members of the group due to his skeptical knowledge and skills. Moreover, the reference groups provides the individuals the ability to compare behavior, lifestyle, consumer habits and desires (Kardes et al., 2014). Family is considerably the most influencing social factor that influences the behavior of individuals. Family is an environment where an individual evolves and grows. It shapes and individuals personality and values. Individuals are also in a position to develop various opinions, and attitudes and different topics such as the society, politics, social relations and their desires. A member of a family can greatly influence the buying behavior of the other member. This calls for the marketer to find out the influencers in the families. If the men are the influencers, then they should target men in their advertisements. For instance, if one has never realized the importance of gold, then a family member explains how gold makes beautiful jewelry; an individual may form a positive attitude towards gold and opt to purchase it. This is a clear sign of family influence (Cole, 2015). Social status is also significant factor in influencing the buying behavior of individuals. This is the position individuals’ holds within their workplace, family, country club and other places. Social status are all the activities that individuals are subjected to perform concerning their profession and their position at work, in the family or any place. For instance, individuals holding high positions in workplaces should pose luxurious gadgets made of gold. Moreover, it is likely that managers with low-quality devices will not obtain maximum respect from their juniors. Due to this pressure, the managers are compelled to purchase high-quality products made of gold. This increases their purchasing behavior. This is a clear indication of the effect of social status has on the purchasing behavior of individuals (Kaufmann, 2015). The female gender as already discussed earlier have high affinity for beauty. When they talk and relate to other women, they consider how they can buy jewelry to improve on their beauty. At homes, the mother may influence their daughters to buy gold due to the beauty it adds. Consequently, female managers would prefer to buy expensive jewelry due to the pressure from other women employees. On the other hand, men are not into beauty. They give little or no room for buying jewelry. This is a clear indication that women are highly influenced by the social factors to have a positive buying behavior. There are also various membership groups in different countries. For instance, in India, membership groups obey cultural activities and practices, such cultural events use gold as a sign of identity. This makes individuals of the groups have gold as a sign of identity with the social group. This is not true in the United Arabs Emirates where gold is not an influential sign of cultural identity. Family members in India also use gold for various rituals within the family, this makes other family members to have an interest in gold and make purchases (Huma et al., 2013). Personal factors Personal factors encompass variables such as lifecycle stage, economic circumstances, age and personality. This factor explains why an individual’s preference changes with changes in the situation. Characteristics of a consumer also influence the buying behavior and the decisions by the customers. Age is very significant in the buying behavior of the customers. Customers who are aged 20 have a different way of life as compared to customers of age 80. Their value, hobbies, the environment, and activities are very different. The consumer often changes their preferences as time goes by, when they become old, they possess different desires and wants. The marketer should consider every developmental stage and provide effective product to their customers depending on their needs and desires (Kardes et al., 2014). The other personal factor influencing customer behavior is their lifestyle. Lifestyle is the way in which people live in the community and is often expressed by things that exist in their surroundings. The lifestyle of the customer is determined by the interest, activities and opinions of the customers that shape the whole pattern on how the customer interact and act in the world. Customers with high living standards or high lifestyle are likely to buy more luxurious products as compared to individuals who have low lifestyle (Information Resources Management Association, 2015). Self-concept or personality is also a major determinant on how individual buy certain products. Personality is the characteristics and trait that a person possesses. Personality comes as a result of interactions of physiological and psychological characteristics of a person and leads to constant behavior. Personality can materialize into certain traits such as charisma, confidence, sociability, ambition and other personal traits. Self-concept is the image that an individual would like to possess and conveys the image to others. Individuals may want to be known for owning expensive products, such individuals will go around buying expensive products for them to maintain their personality (Cole, 2015). A person’s occupation significantly affects the buying behavior. Managers are likely to purchase very expensive suits as compared to an individual with little income. Managers have a high salary and they are considered upper-class individuals in the society. They tend to buy expensive products like gold jewelry. Individuals with low income are likely to buy essential goods that can satisfy their basic wants. They are liable to forgo expensive products and buy such goods that can aid their survival. This clearly indicates the significance of a person’s occupation and its effects on the buying behavior. Economic situation also has a significant impact on the purchasing behavior of individuals. If the income and saving of the consumer are high, then the consumer will purchase more expensive products such as gold. Customers with low economic situation are likely to buy less expensive products (Ammi, 2013). Personality can also be seen to influence the buying behavior of different customers of various genders. Women have a different personality to that of men. These personal factors show how they buy gold more as compared to men. Women want to convey a positive image to men, they want to be loved by men. This compels them to buy gold jewelry to improve their beauty. Thus, they have active purchasing behavior. On the other hand, men are tough and do not care about their personal attractions, they feel they are just okay the way they are. This makes them have a poor customer behavior as compared to that of women (Huma et al., 2013) Gold is used for several purposes in India than in United Arabs Emirates and other countries. Individuals in India would want to have a personal identify with society. The expatriates use gold artifacts to sustain their culture and show that they have not diverged from their original culture. The research further illustrates that the expatriates valued gold due to the link it has to their cultural community. The expatriates want to show their personality by obeying the rules of their societies (Huma et al., 2013). Psychological Factors Psychological factors affecting the decision of the customers can be divided into four distinct groups, which include: motivation, learning, beliefs and attitudes and perception. Consumers are always influenced by other people to make purchase decisions. The marketers are supposed to have a clear and elaborate idea about individuals who are often involved in such buying decisions. Through such information they can formulate relevant marketing strategies that can help them deal with such individuals. Among the psychological factors, motivation drives the customers to have a purchasing behavior. It is what makes a person express the need for purchase. Various customers have varied needs such as biological needs, psychological needs, social needs and many more. Some needs are much pressing as compared to others. Hence, a need is considered a motive when in presses an individual to seek for satisfaction (Kaufmann, 2015). For the marketing firms to increase their sales, they need to encourage their customers to buy their products. They should attempt to create and reinforce a need and want in the minds of the customers so that the customer may develop a motivation to purchase. The customers will be more compelled to buy the products due to the developed motivation. The marketers should conduct a market research and provide products that can motivate the customers. Their products should be able to satisfy the needs and desires of their consumers (Kaufmann, 2015). Perception is the act of selecting, organizing and interpreting information to convey a sensible idea. An individual’s perception at a given time dictates how the individual is likely to act. Thus perception can be seen as a means through which individuals select, organize and interprets ideas to come up with a meaningful world. The processes entails; selective distortion, selective attention and selective retention. In selective attention, marketers attempt to attract the attention of the customers. The individuals only focus on those details that they are subjected. In case of selective distortion, various customers attempt to interpret information in a way that supports what they believe already. Every customer has a different perception depending on their past experiences, beliefs, attitude and state of mind. Through selective distortion, the customers become consistent with their values and believe. In the case of selective retention, the customers do not retain all the stimuli or information that they obtain. Selective retention shows what an individual can store from a given stimulus. The customers will only remember the benefits of a product and forget the drawbacks that can be derived from the same product (Sokolowski, 2011). Learning is achieved through actions. When individuals act, they learn. This implies a change in an individual’s behavior resulting from learning. Learning can change a person’s behavior since the individual obtains relevant experience and information. For instance, when individuals fall sick due to the use of jewels made of gold, they develop a negative attitude towards gold jewels. This is because the state of discomfort makes individuals dislike the gold. Consequently, when an individual has a better experience with a given commodity or product, they are likely to make more purchases. A marketer can use learning theories in marketing their brands (Lamb et al., 2010). Beliefs are convictions that individuals pass on something. Through knowledge and experiences individual obtain from learning and other external influences, they are likely to develop various beliefs that affect their buying behavior. Customers also have their personal beliefs towards certain goods and products. Such beliefs and attitudes shape the image the customers have for various products. Consequently, marketers should be interested in the beliefs and attitudes of their customers. They should therefore change the customer’s attitude and image for their products and services by use of several campaigns. Marketers should also strive to develop positive attitude among their customers and remove bad negative beliefs for their products (Sokolowski, 2011). Individuals in India have their beliefs and attitudes regarding the use of gold. They believe that gold is a very significant product, as a result, the use it when conducting various ritualistic activities within their society. Indian expatriates living in other countries also use gold to show their loyalty. They have a positive perception of gold and its importance within the society. This makes them have a positive buying behavior and buy more gold for ritualistic activities. Such a pehonomena is not true of other nations like the Unite Arab Emirates where individuals are less attached to gold. Their culture does not embrace the use of gold in conducting rituals (Huma et al., 2013). In conclusion, the consumers are often affected by various factors in their attempt to make purchases. The customers may have a negative or a positive buying behavior. The marketers should be aware of the factors that impact the buying behavior of their customers and formulate relevant strategies that can make their business fruitful. Marketers need to win the loyalty of their customers and attract more customers to purchase their products. The study of the buying behavior of the customers, is a fundamental point of reference for a business that wants to succeed. References Ammi, C. (2013). Global Consumer Behavior. New York, NY: John Wiley & Sons. Cole, A. (2015). The implications of customer behavior for marketing: A case study of social class at Sainsbury. Douglas P and Craig C. (2006) Beyond national culture: implications for cultural dynamics for consumer research, International Marketing Review, 23(3), 322-342 Huma T, Donelda S., Grant, J. and Janice P. (2013). Shopping for gold. A Ritualistic experience. Retrieved from https://www.google.com/ Information Resources Management Association. (2015). consumer behavior and Marketing: Concepts, methodologies, tools, and applications. Kardes, F. R., Cronley, M. L. and Cline, T. W. (2014). Consumer behavior. Kaufmann, H.-R. (2015). Handbook of research on managing and influencing customer behavior. Lamb, C. W., McDaniel, C. D and Hair, J. F. (2010). MKTG4: Student Edition. Mason, OH: South-Western Cengage Learning. Sokolowski, O. (2011). Influences and Attitudes within Consumer Behaviour Process. München: GRIN Verlag GmbH. Read More