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What Is Consumer Behavior?

Definition of consumer behavior, according to Engel, Blackwell, and Mansard,

“Consumer behavior is the actions and the decision processes of people who purchase goods and services for personal consumption”.

Consumer buying behavior refers to the study of customers and how they behave while deciding to buy a product that satisfies their needs. It is a study of the actions of the consumers that drive them to buy and use certain products.

Study of consumer buying behavior is most important for marketers as they can understand the expectation of the consumers. It helps to understand what makes a consumer to buy a product. It is important to assess the kind of products liked by consumers so that they can release it to the market. Marketers can understand the likes and dislikes of consumers and design base their marketing efforts based on the findings.

Consumer buying behavior studies about the various situations such as what do consumers buy, why do they buy, when do they buy, how often do consumers buy, for what reason do they buy, and much more.

For example, consumer buying behavior is studied by consumer researchers and their aim is to know why women buy moisturizers (to reduce skin problems), the most preferred brand (Olay, L’Oréal), how often do they apply it (twice a day, thrice a day), where do the women prefer to buy it (supermarkets, online) and how many times do they buy it (weekly, monthly).

Stages of Consumer Buying Behavior

Consumers go through a set of sequential steps while buying a product.

Philip Kotler lists down the five stages of a typical buying process:

1. Identifying a Problem

This is the first stage of the buying process where the consumer feels the need to buy a particular product as there is an unmet need or there is a problem which can be solved by buying a particular product. In this stage, the marketer should identify the needs of the consumers and offer the products based on the desire.

2. Information search

In this stage, the consumer knows that he wants to buy a product that can relive his problem, but he wants to know more about the product and hence reaches out to family, friends, social media, advertisements, distributors, retailers and many other such sources to get more information. At this stage, a marketer must offer a lot of information about the product in the form of informative videos, demos, blog, how-to-do videos, and celebrity interviews.

3. Evaluation of Alternatives

After the consumer has done enough research about the kind of product that can solve his problem, the next step is to find products that can solve his problem. The market offers many products that can solve the problem of a consumer, so the consumer has to make a choice after evaluating the various alternatives available.

4. Purchase decision/Purchase

The Consumer, chooses the product that he wants to buy, but many times, he may not actually buy it for various reasons. At this stage, a marketer should find out the various reasons due to which the consumer is hesitating to buy. The reasons could be price, value, and change in the needs of the consumer.

5. Post-Purchase Evaluation

Consumers will be happy after buying the product if it has satisfied their needs. But in case the product was not up to his expectations, the consumer will be dissatisfied. The consumer will share his experience with his friends and family and on social media. A marketer has to make sure that the consumer will be satisfied with the product so that his experience will lead to more consumers buying the product.

Importance of Consumer Behavior

Understanding consumer behavior is essential for a company to find success for its current products as well as new product launches. Every consumer has a different thought process and attitude towards buying a particular product. If a company fails to understand the reaction of a consumer towards a product, there are high chances of product failure.

Due to the changing fashion, technology, trends, living style, disposable income, and similar other factors, consumer behavior also changes. A marketer has to understand the factors that are changing so that the marketing efforts can be aligned accordingly.

The study of consumer behavior is important to understand the buying decision of consumers. It is important for marketers to know why, what, where, when, and how consumers buy products. Studying consumer behavior will help a marketer to design a product in such a way that it can satisfy the demands of the consumers.

Consumer behavior is not just important to attract new customers, but it is very important to retain existing customers as well. When a customer is happy about a particular product, he/she will repeat the purchase. Hence the marketers should not just look at attracting a new customer. They should also work towards retaining existing customers by studying consumer behavior.

Consumer behavior is also important to identify the factors that influence a consumer to buy a product. The factors that influence the buying decision can be many, like social influence, psychological factors, cultural influences, and personal factors. When the marketer understands these factors, it will help to sell the product to the right consumers.

Major Factors Influencing Consumer Behavior

Consumer behavior is influenced by many different factors. A marketer should try to understand the factors that influence consumer behavior.

Some major factors that influence consumer behavior are listed below:

1. Psychological Factors

Human psychology is a major determinant of consumer behavior. These factors are difficult to measure but are powerful enough to influence a buying decision.

Some of the important psychological factors are:


When a person is motivated enough, it influences the buying behaviour of the person. A person has many needs such as the social needs, basic needs, security needs, esteem needs and self-actualization needs. Out of all these needs, the basic needs and security needs take a position above all other needs. Hence basic needs and security needs have the power to motivate a consumer to buy products and services.


Consumer perception is a major factor that influences consumer behavior. Customer perception is a process where a customer collects information about a product and interprets the information to make a meaningful image about a particular product. When a customer sees advertisements, promotions, customer reviews, social media feedback, etc. relating to a product, they develop an impression about the product. Hence consumer perception becomes a great influence buying decision of consumers. Learning can be either conditional or cognitive.


When a person buys a product, he/she gets to learn something more about the product. Learning comes over a period of time through experience. A consumer’s learning depends on skills and knowledge. While a skill can be gained through practice, knowledge can be acquired only through experience. In conditional learning the consumer is exposed to a situation repeatedly, thereby making a consumer to develop a response towards it. Whereas in cognitive learning, the consumer will apply his knowledge and skills to find satisfaction and a solution from the product that he buys.

Attitudes and Beliefs

Consumers have certain attitude and beliefs which influence the buying decisions of a consumer. Based on this attitude, the consumer behaves in a particular way towards a product. This attitude plays a significant role in defining the brand image of a product. Hence, the marketers try hard to understand the attitude of a consumer to design their marketing campaigns.

2. Social Factors

Humans are social beings and they live around many people who influence their buying behavior. Human try to imitate other humans and also wish to be socially accepted in the society. Hence their buying behavior is influenced by other people around them. These factors are considered as social factors. Some of the social factors are:


Family plays a significant role in shaping the buying behavior of a person. A person develops preferences from his childhood by watching family buy products and continues to buy the same products even when they grow up.

Reference Groups

Reference group is a group of people with whom a person associates himself. Generally, all the people in the reference group have common buying behavior and influence each other.

Roles and status

A person is influenced by the role that he holds in the society. If a person is in a high position, his buying behavior will be influenced largely by his status. A person who is a Chief Executive Officer in a company will buy according to his status while a staff or an employee of the same company will have different buying pattern. 

3. Cultural factors

A group of people are associated with a set of values and ideologies that belong to a particular community. When a person comes from a particular community, his/her behavior is highly influenced by the culture relating to that particular community. Some of the cultural factors are:


Cultural Factors have strong influence on consumer buyer behavior.  Cultural Factors include the basic values, needs, wants, preferences, perceptions, and behaviors that are observed and learned by a consumer from their near family members and other important people around them.


Within a cultural group, there exists many subcultures. These subcultural groups share the same set of beliefs and values. Subcultures can consist of people from different religion, caste, geographies and nationalities. These subcultures by itself form a customer segment.

Social Class

Each and every society across the globe has form of social class. The social class is not just determined by the income, but also other factors such as the occupation, family background, education and residence location. Social class is important to predict the consumer behavior.

4. Personal Factors

Factors that are personal to the consumers influence their buying behavior. These personal factors differ from person to person, thereby producing different perceptions and consumer behavior.

Some of the personal factors are:


Age is a major factor that influences buying behavior. The buying choices of youth differ from that of middle-aged people. Elderly people have a totally different buying behavior. Teenagers will be more interested in buying colorful clothes and beauty products. Middle-aged are focused on house, property and vehicle for the family.


Income has the ability to influence the buying behavior of a person. Higher income gives higher purchasing power to consumers. When a consumer has higher disposable income, it gives more opportunity for the consumer to spend on luxurious products. Whereas low-income or middle-income group consumers spend most of their income on basic needs such as groceries and clothes.


Occupation of a consumer influences the buying behavior. A person tends to buy things that are appropriate to this/her profession. For example, a doctor would buy clothes according to this profession while a professor will have different buying pattern.


Lifestyle is an attitude, and a way in which an individual stay in the society. The buying behavior is highly influenced by the lifestyle of a consumer. For example when a consumer leads a healthy lifestyle, then the products he buys will relate to healthy alternatives to junk food.

5. Economic Factors

The consumer buying habits and decisions greatly depend on the economic situation of a country or a market. When a nation is prosperous, the economy is strong, which leads to the greater money supply in the market and higher purchasing power for consumers. When consumers experience a positive economic environment, they are more confident to spend on buying products.

Whereas, a weak economy reflects a struggling market that is impacted by unemployment and lower purchasing power.

Economic factors bear a significant influence on the buying decision of a consumer. Some of the important economic factors are:

Personal Income

When a person has a higher disposable income, the purchasing power increases simultaneously. Disposable income refers to the money that is left after spending towards the basic needs of a person.

When there is an increase in disposable income, it leads to higher expenditure on various items. But when the disposable income reduces, parallelly the spending on multiple items also reduced.

Family Income

Family income is the total income from all the members of a family. When more people are earning in the family, there is more income available for shopping basic needs and luxuries. Higher family income influences the people in the family to buy more. When there is a surplus income available for the family, the tendency is to buy more luxury items which otherwise a person might not have been able to buy.

Consumer Credit

When a consumer is offered easy credit to purchase goods, it promotes higher spending. Sellers are making it easy for the consumers to avail credit in the form of credit cards, easy installments, bank loans, hire purchase, and many such other credit options. When there is higher credit available to consumers, the purchase of comfort and luxury items increases.

Liquid Assets 

Consumers who have liquid assets tend to spend more on comfort and luxuries. Liquid assets are those assets, which can be converted into cash very easily. Cash in hand, bank savings and securities are some examples of liquid assets. When a consumer has higher liquid assets, it gives him more confidence to buy luxury goods.


A consumer is highly influenced by the amount of savings he/she wishes to set aside from his income. If a consumer decided to save more, then his expenditure on buying reduces. Whereas if a consumer is interested in saving more, then most of his income will go towards buying products.

Types of Consumer Behaviour

A consumer’s buying decision depends on the type of products that they need to buy. The behaviour of a consumer while buying a coffee is a lot different while buying a car.

Based on observations, it is clear that purchases that are more complex and expensive involve higher deliberation and many more participants.

Consumer buying behavior is determined by the level of involvement that a consumer shows towards a purchase decision.  The amount of risk involved in a purchase also determines the buying behaviour. Higher priced goods tend to high higher risk, thereby seeking higher involvement in buying decisions.

There are four type of consumer buying behavior:

Routine response

When consumers are buying products that they use for their daily routine, they do not put a lot of thought. They either buy their favorite brand or the one that they use regularly, or the one available in the store or the one that costs the least. For example, while a consumer buys a loaf of bread, he tends to buy the brand that he is familiar with without actually putting a lot of research and time.

Impulsive buying

Sometimes consumers do not plan a purchase, but it all happens suddenly. For example a woman is waiting in a coffee shop for her friend to arrive, but happens to see this beautiful coffee mug and decides to buy it on the spot. There is no research on whether the consumer really requires the mug or whether the mug is really worth the price. The consumer just decides to buy as it was very attractive.

Limited decision making

Consumers buy goods that do not have too many choices and therefore consumers will be left with limited decision making. Based on the products available, time limitation or the budget limitation, consumers buy certain products without a lot of research. For example, a consumer who is looking for a new collapsible table that can be taken for a camping, quickly decides on the product based on few brands available. The main criteria here will be the use and the feature of the collapsible table and the budget available with him.

Extensive decision making

Consumer behaves very different when buying an expensive product or a product that is unfamilar to him. When the risk of buying a product is very high, a consumer consults friends, family and experts before making the decision.

For example, when a consumer is buying a car for the first time, it’s a big decision as it involves high economic risk. There is a lot of thought on how it looks, how his friends and family will react, how will his social status change after buying the car, and so on.