As Madonna said, “we are living in a material world” and that’s not all bad, especially if you happen to be in the business of selling something. Whether you’re a small business owner or an associate working for a retail chain, understanding consumer behavior is essential to ensure success in your business. While consumer behavior is a very in-depth topic, today I’m going to use myself as the example to cover the basics and introduce you to the topic.
Let’s start with a little background information, so you can better understand who I am as a consumer. I’m going to use some of my information from before we moved overseas since we’re military stationed in Germany.
I’m a mid-30s white, American identifying as a woman. I have 3 young children and I’m a stay-at-home mom. My husband is the breadwinner, but I do most of the shopping and take care of the bills. Our household makes approximately $55,000 per year and I live in Washington state. We own a home and shop regularly at Target, Safeway, and Starbucks.
Type of Consumer
There are 2 main types of consumers: individual and organizational (Kardes et al., 2015). Individual consumers make purchases to satisfy their wants and needs, as well as the wants and needs of others (i.e. family and friends). Organizational consumers purchase goods and services to resell, produce their own products, and/or run their organization. Examples of organizational purchases include office supplies, raw materials, and products like food and clothing that can be purchased in bulk and resold in stores.
I’m an individual consumer, making purchases for the needs and wants of myself and my family. Most frequently these purchases include groceries, clothing, household items, and entertainment.
We can also break individual consumers down using 7 subcategories (Bhasin, 2019):
- Needs-based consumers
- Loyal consumers
- Discount consumers
- Impulsive consumers
- Potential consumers
- New consumers
- Wandering consumers
Needs-based consumers know what they want and where to find it. These are the “in-and-out” shoppers who don’t tend to wander or stray from what they came for.
Loyal consumers not only return to the brand, they sing its praises and help bring family and friends to the brand. These are the consumer that will go a bit farther or pay a bit more to continue to have the value and experience they have come to expect.
Discount consumers typically make up the largest portion of a brand’s consumers however, they’re the least loyal. These consumers are the ones who will wait for sales and discounts before making a purchase or will shop elsewhere to find a better value.
Impulsive consumers have to be in the right mood to make a purchase. These are the consumers who see something and make a quick decision to purchase.
Potential consumers are those who are considering making a purchase but aren’t quite ready yet. While the interest is there, they have reservations or need more information before committing to a purchase.
New consumers are first-time buyers who have yet to fully experience the brand. These consumers’ idea of the brand and product/service is still developing and be swayed by how much value they perceive in their experience.
Wandering consumers are the “window shoppers” who don’t have an intent to make a purchase. These consumers make end up making an impulsive purchase or could be looking for a time in the future when they will become needs-based consumers who have already found what they want and have come back to purchase those items.
For me personally, I tend to fluctuate between being needs-based, loyal, and wandering as a consumer. For the most part, I combine needs-based and loyal consumerism, since I shop for specific brands I love and I know where to find them. If I’m looking for new clothes for my kids, I know right where the Cat & Jack brand is kept in Target. Every fall I know I’ll go to Torrid to stock up on my favorite jeggings and Aerie for new sweaters. I do fall into the wandering category often however since I tend to window shop before making an actual purchase. Whether in-store or through an app, I look through the options and decide what I like, then I tally up the cost and edit the items. Doing this in-store, usually means I’m coming back to purchase those items after we get paid, so I won’t be as tempted to buy impulsively and overspend. If I’m shopping online or through an app, I may leave the items in my cart for a few days then come back to decide what I really need and what can wait.
When making purchases there are many influences that come to mind. Pricing, brand image, quality & longevity, and usefulness are all important to me when making a purchasing decision. As a family of 5, we try to ensure we’re not overspending, while still receiving the quality we feel we need. A recent example would be budgeting for a hotel room on a family trip. We needed to ensure we didn’t overspend on a hotel room while making sure it would be in a safe area that was convenient for walking and sightseeing. Instead of booking a hotel room with bunk beds, I chose one that had 2 large beds so the kids could share a bed, saving us money to spend on experiences.
Brand image is also important to me since I like to support small businesses and those who are globally conscious. I purchase cleaning products that are plant-based and don’t contain harsh chemicals and our laundry detergent comes in concentrated stripes that are packaged in small envelopes that can be recycled. My favorite jams and soaps are from family-run businesses in Washington that use ingredients from local, generational family farms.
Longevity is also a huge consideration, whether I’m purchasing clothes or a kitchen appliance. Since my kids are all 2 years apart, I try to purchase clothes that can be passed down without being worn out or out of style the next year. I look at quality, but I also look at style and color. I avoid character-centric items as much as possible and try to find styles and colors that will flatter and appeal to more than one child. Another example of considering quality and longevity is when my mother-in-law bought me a stand mixer a decade ago. She owns a KitchenAid stand mixer that she has used for over 2 decades, so she knew that the higher price point was worth the investment. I use my mixer almost weekly throughout the year, and even more often when the fall baking season starts in October.
Lastly, the usefulness of the purchase is make-or-break for me. I have an easier time justifying a purchase I know will be used regularly versus one that will be forgotten about or unneeded in a short amount of time. When we travel, we get magnets for souvenirs because they’re small, useful, and won’t go out of style. While my kids would prefer stuffed animals most of the time, we try to get items that won’t be shoved in a toy box and forgot until our next toy purge. The same goes for clothing; while we try to purchase items that can be used for more than one year (or one child), sometimes I will buy something if I know it will be a fan favorite. For example, my 3-year-old loves bunnies, so I’ve taken to buying her dresses with bunny designs/prints because I know she will wear those before anything else.
Marketing Research and Marketing Design
Products marketed toward consumers in a specific stage or situation are more appealing to most consumers, including me. Ads and content that feature scenarios I can relate to are more likely to catch and hold my attention, which makes me identify more with the product or service. Additionally, targeted ads based on my previous purchasing behavior can turn me off to a company altogether. For example, after purchasing a pair of shoes online, I found it annoying to be hit with ads for the same company constantly, before I even received the products. I haven’t purchased from that company since. The design of the marketing also affects how I view the brand and if I decide to make a purchase or find another brand to purchase from. I find busy designs to be disorienting and overwhelming however, I also find some minimalist designs to be too stark and uninviting. My design preference is a balance between feature images, small amounts of information at a time, and pops of color that is fun and inviting. Whether it’s selling coffee, clothing, or appliances, designs that are bright, clean and fun will always catch my attention more than others.
After making purchases, I usually feel excited or happy about my purchase. The most widely displayed post-purchase behavior is to use the product/service. Depending on the satisfaction level after use, consumers will either experience contentment, delight, or dissonance. For me, contentment is most common, meaning I’m happy with my purchase, and has performed as expected. I experience delight in a purchase when either it outperforms my expectations or the company itself goes above and beyond; these are the purchases I leave stellar reviews for and tell all my friends about. Some of the purchases that have elicited my delight include my steam mop, beauty products, and favorite planner. On the other hand, dissonance is experienced when a purchase and/or company underperform according to a consumer’s expectations; when this happens, bad reviews, returns, and/or refunds often result. Cold food, a garment not fitting as expected, or an appliance malfunctioning are all commons scenarios that cause dissonance.
No matter what type of consumer you are, there are specific tendencies and preferences you exhibit when making purchases. As a business, the goal is to under those preferences and which types of consumers you align with. Understanding consumer behavior and how it impacts purchasing decisions can be the difference between reaching your target market and having your business fail. Studying consumer behavior will not only help businesses understand when a consumer is likely to purchase, but why they decided to purchase, and they why makes all the difference.