Customer Relationship Management (CRM) and HR
Human Resources are those constituents of an organization that take care of the human facets and needs of all employees within that organization. Key functions of HR in an organization are- Employee recruitment and selection. Compensation calculation and reward program management. In-house training for all employees according to skill sets. Performance calculation and managing employee […]
Need for a Uniform International Corporate Governance Code
With the globalization of the world economy starting in the 1970s, continuing through the 1980s and accelerating since the 1990s reaching its zenith in the first decade of the new millennium, there has been a concomitant trend of global corporations expanding their international footprint and operating in multiple countries around the world. This meant that […]
Steps in Preparing Personal SWOT Analysis
What to do when listing Strengths and Weaknesses A personal SWOT Analysis is needed to understand where one stands with respect to one’s career and life path. A personal SWOT Analysis is usually the first step towards recognizing one’s position in attempting to deal with life’s challenges and career prospects. First, one should never overestimate […]
Human, Social, and Intellectual Capital as a Means of Competitive Advantage
Introduction: Why Should Firms and Nations Invest in Human, Social, and Intellectual Capital We often hear economists and management experts exhorting nations and firms to invest in human, social, and intellectual capital. these calls range from asking governments to set aside substantial amounts of money to educate and skill the workforce as well as asking […]
Point of Sale Financing
There are several credit products which are being sold to the modern consumer. There are mortgages, car loans, education loans, and even credit card loans which have been aggressively sold over the years. The markets for most of these loans have now become saturated. This is the reason the banks and other financial institutions have […]
Consumer Behaviour deals with the study of buying behaviour of consumers.
Let us understand the effect of psychological factors on consumer behaviour:
Nancy went to a nearby restaurant and ordered pizza for herself.
Why did Nancy buy pizza ?
Answer - She was feeling hungry and wanted to eat something.
In the above example, Hunger was the motivating factor for Nancy to purchase pizza. There are several other factors which motivate individuals to purchase products and services.
An individual who is thirsty would definitely not mind spending on soft drinks, packaged water, juice and so on. Recognition and self esteem also influence the buying decision of individuals.
Why do people wear branded clothes ?
Individuals prefer to spend on premium brands and unique merchandise for others to look up to them. Certain products become their status symbol and people know them by their choice of picking up products that are exclusive. An individual who wears a Tag Heuer watch would never purchase a local watch as this would be against his image.
What is Perception ?
What an individual thinks about a particular product or service is his/her perception towards the same. For someone a Dell Laptop might be the best laptop while for others it could be just one of the best brands available.
Individuals with the same needs might not purchase similar products due to difference in perception.
Catherine and Roselyn had a hectic day at work and thus wanted to have something while returning from work. Catherine ordered a large chicken pizza with French fries and coke while Roselyn preferred a baked vegetable sandwich. Though both Catherine and Roselyn had the same motivation (hunger), but the products they purchased were entirely different as Roselyn perceived pizza to be a calorie laden food. Individuals think differently and their perceptions do not match.
Individuals perceive similar situation differently due to difference in the way they interpret information.
There are three different processes which lead to difference in perception:
Learning comes only through experience. An individual comes to know about a product and service only after he/she uses the same. An individual who is satisfied with a particular product/service will show a strong inclination towards buying the same product again.
Beliefs and attitude play an essential role in influencing the buying decision of consumers. Individuals create a certain image of every product or service available in the market. Every brand has an image attached to it, also called its brand image.
Consumers purchase products/services based on their opinions which they form towards a particular product or service. A product might be really good but if the consumer feels it is useless, he would never buy it.
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