WHAT IS CONSUMER BEHAVIOUR AND HOW TO USE IT TO HELP YOUR MARKETING EFFORTS

September 23, 2021 | Fox Tales

What is consumer behaviour?

Consumer behaviour is the study of customers and how they behave while deciding to buy a product or service that satisfies their needs. In simple terms, consumer behavior is a psychology-based study of how individuals make buying decisions and what motivates them to make a purchase. Consumer buying behaviour is complex and multi-faceted and includes:

1. How consumers think and feel about certain brands, products, or services.
2. What motivates them to pick one product over another and why.
3. What factors in their daily environment affect buying decisions or brand perceptions and why.
4. What factors do consumers consider while researching and shopping.

Understanding consumer behavior can be a broad and complicated task – exploring how the consumer’s attitudes, emotions and preferences affect buying behaviour draws upon concepts from several fields including psychology, sociology, anthropology, marketing, and economics. But with the right research, you can begin to get a detailed understanding of your customers and their motivations which in turn can help you fine-tune your marketing strategy.

Why is it important to study consumer behaviour?

The answer to this is really simple. As marketers, if we know WHY consumers choose the products they choose, we have a better chance of steering them towards our products or service. Studying and understanding consumer behavior allows brands to identify what influences consumers and their decisions, and helps with:

1. Identifying consumer pain points – identifying and explaining the issues or difficulties customers face when dealing with a brand, product, or service.
2. Optimizing marketing efforts – understanding what consumers think and feel about a brand, what influences them to choose one over the other, and why and how they shop, helps you streamline your marketing and communications efforts and engage with consumers.
3. Brand innovation and product improvement – identifying what products or services consumers are missing in the current market can inform your product development strategy to better address consumer needs.

According to research cited by McKinsey, organizations that leverage customer behavior data to generate behavioral insights outperform peers by 85 percent in sales growth and more than 25 percent in gross margin. Clearly consumer behaviour data is the key to developing an effective marketing strategy.

How to use consumer behaviour data to help your brand?

When marketing strategy is based upon a detailed analysis of consumer behaviour, brands can expect success in their sales, higher profit margins, and competitive advantage in the market. Here is how you can use consumer behaviour data to build your brand:

1. Analyzing Market Opportunity: Consumer behavior helps in identifying the unfulfilled needs and wants of consumers and gaps in the market. Using this consumer behaviour data, you can evaluate opportunities for expansion for your product or service, and potentially uncover new markets for your brand.
2. Innovations: In addition to market opportunities, using consumer behaviour data can help your brand innovate faster and more successfully. Creating new products for your target audience based on their preferences is a recipe for success, and consumer behaviour analysis will help you get there faster!
3. Competitive Pricing: Consumer behaviour data shows you what consumers are willing to pay for products and services within your market segment. As you collect more data about pricing information, your company can take advantage of the findings to develop an appropriate pricing structure to attract more buyers. Adjusting your pricing to fit the data can help you increase sales and expand your customer base.
4. Promotional Efforts and Marketing Campaigns: Promotions and marketing campaigns directly influence purchasing decisions. If done right and regularly with the right marketing message (research-based message that will resonate with consumers), promotional campaigns can even persuade consumers to change brands or opt for other alternatives. Once you analyze the motivation behind purchase, brands can use consumer behaviour data to effectively tweak their marketing strategy.
5. Business Strategy and Forecasting: Understanding why your consumer’s purchase your products or services can help you define your business strategy more clearly. By analyzing trends, patterns, and motivations of consumers, you can forecast sales more efficiently and make strategic business decisions based on real-time data and research.

As you can see, collecting and analyzing consumer behaviour data is crucial for your business. In addition to the above-mentioned factors, consumer behaviour data can bring stability and success to your business by helping you make smarter decisions.

(The Author of this article is Nikita D’Souza, Sr. Social Media Manager, Bombay Fox)