What is Consumer behavior?
Consumer behavior is a process of studying the buyers and users of products and services available in the market, their usage patterns, social and economic influence and many more. Such study and process leads to a decision making which help the business world to shape up the sales and marketing plan to cater to the customer needs better. Consumer behavior is a socio-psychological study which varies across different influencers; internal and external. Internals are consumers own needs whereas externals are imposed from economics, culture, age, family, beliefs, attitude etc.
It was around 1950 when marketing and sales concepts started to shape up and understanding consumer behavior became immensely important as that is the backbone of marketing as business revolves around its most celebrated entity which is consumer. Every business keeps customers at the heart and it commences with selling to customer and concludes when customer is satisfied with it.
A markets existence justifies only when it fulfills the needs of the consumer and hence understanding the consumer behavior is of paramount importance.
There can be many applications of consumer behavior, however; below are the four prominent ones
Improved marketing strategy: As explained earlier, one of the key applications of consumer behavior is to produce better marketing strategy.
Regulatory compliance: At times, consumer behaviors are restrained to comply with laws and regulations. This is mostly true for healthcare providers and drug manufacturers.
Improved government performance and spreading awareness: Government surveys consumer behavior to improve their own performance to serve public better or spread knowledge on topics which demands better public awareness.
Some of the key uses / benefits of consumer behavior analysis are
Better marketing strategy that helps markets and business entities to push sales and create customer loyalty.
By complying with regulations, companies dealing with healthcare and drug inform consumers about the advantages, disadvantages of their products.
Governments could find the areas to focus on and also make people cautious on usage of scarcity items (like natural resources etc.) which are government responsibilities.
With well informed consumers, there are dual benefits. First, it helps to go deep into customers mind and second, it also helps consumers to take educated decisions.
Since a consumer resides in each one of us, we consume things daily which may consist of consumable, special, healthcare, cosmetic etc. and many more. What, when and from whom consumers buy their products is the most important information for the marketers to predict. So, in order to meet the varied buying cycles and patterns of the consumer and to create a sales plan, its imperative to understand consumer behavior not just to sale more but also to create great consumer delight and loyalty.