Consumer Behavior – Types, Scope, Models & Characteristics

Understanding consumer behavior is vital for businesses to grow and achieve success in the market. It’s also a key element in creating products and services that meet consumer needs and deliver value. No business can stay relevant for long without knowing what consumers think, how they make decisions, and what drives them to purchase.    

A deep knowledge of consumer behavior is important to tailor marketing efforts to specific segments and meet customer expectations. It’s also essential for creating offers that align with customer needs and preferences.   

More importantly, a business that understands consumer behavior can create unique value propositions and differentiate itself from competitors. From determining the right pricing to messaging to packaging, every key business decision is based on the understanding of consumer behavior.

It’s equally important to stay focused on changing consumer behavior and continuously adapt, or else it will be difficult to cater to the specific needs of the target audience.  

In this blog, we will explore consumer behavior in detail and understand its types, importance, models, characteristics, and factors influencing it. 

But first, let’s get started with understanding what is consumer behaviour…

What is Consumer Behavior? 

Consumer behavior refers to the actions and decisions that people or groups of people make in the selection, purchase, and use of a product or service. It’s a study of how consumers engage with businesses or with the market. The purpose of consumer behavior is to analyze the set of decisions that customers make to meet their needs and wants. 

Consumer behavior is a multidisciplinary field that involves insights from sociology, psychology, economics, and marketing to understand the basis behind the choices consumers make. All this analysis is important for businesses to anticipate and meet consumer needs by devising effective marketing strategies and tailoring their products or services.  

Importance of Consumer Behavior 

A business can grow and achieve success only when its products and services are well-accepted by consumers. Huge losses will happen to a company if customers don’t show interest in its offers. To avoid reaching that situation, it’s important to understand what customers want and how to meet their needs. This is where consumer behavior becomes important. 

There are many reasons that show why consumer behavior is important, including –  

• Effective Marketing Strategies – A business can create effective marketing strategies only when it knows what motivates consumers and what influences their purchase decisions.   
• Successful Product Development – Product and service development should always align with customer needs and preferences. Only this can ensure success with product launches. 
• Higher Levels of Customer Loyalty – Delivering products and services that meet customer expectations often leads to a higher level of customer loyalty. 
• Competitive Edge – Companies that are able to respond to changing consumer preferences and trends tend to perform better and gain a competitive edge in the market.  
• Proactive Measures – Consumer behavior research is vital to identifying potential risks in the market which can prepare businesses to take proactive measures and address customer needs earlier than others. 
• Customer Retention – A business that aligns its strategies to consumer needs experiences higher levels of customer retention.   

Different Types of Consumer Behavior 

For a business, it’s very important to study different consumer behavior types and tailor their marketing strategies accordingly. This is the best way to meet consumer needs effectively and boost a certain degree of loyalty. However, consumers may exhibit different behaviors depending on the specific circumstances of each buying decision.  

 Here are the most common types of consumer behavior – 

1. Habitual – When customers exhibit habitual buying, they make quick decisions, choose a brand over another without much thought, and hardly care about research. Such buyers either buy based on familiarity with a brand or are influenced by a lower price tag.   

2. Complex – This kind of behavior is generally seen in the purchase of an expensive product or service. Since the cost is high, consumers may research, read reviews, analyze features, consult friends or family, and compare with other options before making a buying decision. 

3. Dissonance Reducing – This type of behavior is visible when buying expensive items or making risky purchase decisions. Because the cost is high, consumers tend to feel confused about their decision, so they may seek some kind of reassurance and feedback from others to reduce confusion. 

     4- Variety Seeking –  This type of behavior is visible in those customers who are variety seekers who like to switch between brands and              products within a category. Since they are brand hoppers, they lack strong brand loyalty and rather prefer new experiences. 

5. Impulsive Buying – This type of behavior is seen in cases where buyers make spontaneous and unplanned purchases. Emotions are the driving force in such behavior types where consumers may not seek much information or analysis.  

6. Brand Loyalty – Some consumers show strong brand loyalty as they consistently choose a specific product or brand over others. This type of behavior is driven by a deep emotional connection to a brand.  

7. Analytical – These types of buyers are quite methodical with their purchase decisions as they use data, facts, information, and logic in buying a product. They do deep research and analyze the pros and cons of their decisions before going ahead with the buying. 

Characteristics of Consumer Behavior 

Consumer behavior is a multifaceted field of study involving various factors related to individuals or groups of people, Its ultimate aim is to analyze people and their buying decisions and all the motivations behind the purchase decision. So, consumer behavior is about analyzing all the characteristics so that buyers can be served well.  

Here are the key characteristics of consumer behavior – 

• Consumer behavior is a dynamic concept as it evolves over time in tune with the ever-changing needs, tastes, and preferences of people. 
• Various factors – both internal and external – such as those related to economic, social, and tech, play a key role in shaping consumer behavior. 
• Psychological factors have a big role to play in affecting consumers, their behavior, and their reach to marketing strategies. 
• Buying decisions are always heavily influenced by cultural and social influences as consumers’ choices and tastes reflect unique beliefs, values, and social groups they are part of.    

• Not all consumer decisions are rational and sometimes emotions have a big influence in driving buying choices.  
• Marketing and advertising do have a big influence on consumer behavior as they can help create awareness and shape perceptions.    
• External factors can impact consumer behavior as more price-sensitive decisions are witnessed during recession times and more sustainable products are bought during environmental concerns.   
• The growth of digital channels, social platforms, and the availability of online reviews are shaping consumer behavior.  

Theories of Consumer Behavior 

Consumer behavior is a complex field where any study needs to analyze and understand various perspectives. This has led to the development of several theories to tell consumer behavior in specific contexts. 

Here are some of the popular theories of consumer behavior –  

1. Theory of Planned Behavior (TPB) – This theory is based on the assumption that intention drives consumer behavior. It states that three factors —  attitude, subjective norm, and behavioral control— are key aspects behind a decision taken by a consumer. 

2. Maslow’s Hierarchy of Needs – It’s a popular psychological theory that suggests consumers have different levels of needs and they gradually prioritize and meet these needs in a hierarchical manner. They progress up the hierarchy in a gradual manner as lower-level needs are met. 

3. Cognitive Dissonance Theory- This theory suggests that individuals feel dissonance when their attitudes conflict with their actions. In consumer behavior, consumers experience dissonance after a purchase when they question the decision. 

4. Social Cognitive Theory (SCT) – This theory is based on the idea that people influence one another through persuasion. It suggests our thoughts, feelings, and actions are driven and regulated by various cognitive processes such as attention, memory, knowledge, and perception.       

Consumer Behavior Models 

Companies often use consumer behavior models to understand how consumers may react in a certain market and how they respond to certain products, pricing, and product features and advertisements. These models are very helpful in making certain marketing or business development decisions.  

Here are some of the popular consumer behavior models – 

1. Psychological or Learning Model

This model is based on Maslow’s hierarchy of needs which says buyer behavior often corresponds with the desire to feel basic needs and meet emotional requirements. This model suggests that people often address their basic needs first before moving ahead to fulfill their psychological needs.  

2. Sociological Model

The model states that a person typically purchases items that align with their values or expectations. It also states that purchasing habits are also influenced by buyers’ social standing. So, a business can benefit from this model by creating experiences based on the class of people who typically buy the products.  

3. Psychoanalytical Model

This model states that every buyer possesses conscious and unconscious motives that often drive their purchase decisions. This model is based on a psychological theory developed by Sigmund Freud that is meant to understand human behavior and personality. The main focus of this model is on the unconscious mind and how it affects a buyer’s thoughts, feelings, and behaviors.

4. Economic Model

This model states that consumers will first evaluate the value of a product compared to its price and then buy the most value-driven item available to them. Price, substitution, and income are the three key concepts that drive this model. 

5. Engel-Kollat-Blackwell (EKB) Model

This model outlines five stages in the decision-making process of most consumers as these stages are what many follow before buying an item. Awareness, Information Gathering, Evaluation, Decision, and Outcome Analysis are the five stages suggested by this contemporary model.

6. Howard Sheth Model

This model is based on the assumption that the buying decision is driven, and affected, by certain variables. These variables are the reasons why buyers solve their problems and make the relevant buying decision. The four most common variables in this model include inputs,  Perceptual Constructs, Outputs, and External Variables. 

7. Black Box Model 

This model states that most consumers respond to stimuli when making purchases. A buyer internalizes an external stimulus, processes it, and compares it to their personal interests to make a buying decision. As per this model, most consumers purchase items only after understanding how they can add value to their lifestyle. 

Scope of Consumer Behavior 

Consumer behavior is a broad field that helps in the study and analysis of how people make buying decisions and what drives those decisions. It sheds light on various aspects related to consumers such as their preferences, motives, choices, etc. All this amplifies its field and widens its scope.  

The scope of consumer behavior can be vast and varied, including – 

• The major focus area of consumer behavior is to understand the consumer decision-making process and analyze the factors that drive the way people make purchases.  
• This field is about analyzing the data related to consumer needs, how they make choices, what influences their decisions, and how they prefer one brand over another. 
• The scope of consumer behavior extends to the study of psychological factors, social and cultural Influences, and how they play a big role in shaping purchase decisions. 
• Consumer behavior research is a key aspect of understanding consumer attitudes and preferences, and this research involves various ways such as surveys, experiments, and data analysis. 
• For businesses, understanding consumer behavior is central to diving the market into groups and then leveraging targeted marketing efforts for specific preferences and needs. 
• The effectiveness of marketing, advertising, and promotional campaigns hinges on how well a business understands consumer behavior, or else its messaging may fail to evoke the kind of responses it expects.  
• The scope of consumer behavior also includes the analysis of how cultural and economic differences affect consumers and their purchase decisions in a globalized world.  
• The rate of technology adoption and innovation is accelerated only when the industry has a deep understanding of consumer behavior and their readiness to embrace new things.  

Factors Influencing Consumer Behavior

Consumer behavior is a dynamic field as it is influenced by many factors. The key for marketers is to understand those factors and serve customers better. Without knowing the factors affecting behavior, how can a business ensure value to its customers? 

Here are discussed the five key factors influencing consumer behavior – 

1. Psychological Factors

Human psychology has a big impact on the way consumers behave when it comes to making purchase decisions. These factors are never easy to measure but they do play a huge part in consumer behavior. These factors include – 

• Motivation – Every person has different needs, desires, and goals that can affect their purchasing decisions. 
• Learning – Consumer behavior and choices can evolve over time due to the information they collect and the experiences they gain regarding products or services.  
• Attitudes & Beliefs – Consumers have a set of beliefs and attitudes that shape how they choose or buy products. 
• Perception – How consumers perceive a product and how they look at the products can have a big say in their behavior. 

 2. Social Factors

The man is a social animal. Our life is very much influenced by the society we’re a part of. The choices we make, and the products we buy, all are shaped by imitating other people around us. More so, we have a yearning to fit in the surroundings and this shows how social factors influence our buying behavior. The three key social factors include –  

• Family – Our purchasing decisions are influenced a lot by the way our family buys products.  
• Reference Groups – The purchase decisions we often make are driven by the reference group we’re part of as people in these groups have a common pattern of purchase.  
• Roles and Status – The role and status we have in society is also significant determinant in our purchasing decisions. 

3. Cultural Factors

Consumer behavior is influenced by the culture and society they are part of. Consumers belonging to a set of values and ideologies may show slightly varying buying behavior compared to those belonging to different values and ideologies. Three main cultural factors are –  

• Culture – Consumers observe and learn behaviors, preferences, and values from the culture they are part of and this influences their purchase decisions.  
• Subculture – Subcultures exist within a cultural group and they consist of people from different ideologies and beliefs. This forms a type of customer segment and drives purchase decisions.   
• Social Class – Social class is a significant factor in determining and predicting consumer behavior as it’s made up of varied aspects such as income, occupation, education, family background, and residence location. 

4. Personal Factors

Every person is unique, and so are the choices they make and the buying decisions they make. This uniqueness is also shaped by various personal factors that contribute to the formation of different perceptions and choices. Some of the common personal factors are –  

• Age – Age is a significant factor in shaping buying behavior as we can see how youths often make different choices compared to middle and old-aged people.  
• Income – Purchasing power is shaped by income as consumers with a higher disposable income tend to spend on luxurious products while those with lower income focus more on meeting their basic needs. 
• Occupation – Most people tend to buy items or products that are in alignment with their profession.  
• Lifestyle – The kind of lifestyle we live or want to live determines the type of products we would buy.  

5. Economic Factors

Consumers have a higher purchasing power when the economy is strong. It shows how buying habits are also driven by the economic condition of a market or a country. Similarly, buyers experience a lower purchasing power in a weak economy.  

Key economic factors include – 

• The disposable income of the consumer 
• Country’s Economic Situation 
• Liquid Assets 

Consumer Behaviour in Marketing: Key Aspects  

For marketers, understanding consumer behavior is essential to develop result-driven and effective strategies. A study of consumer behavior helps marketers create products that meet and exceed consumer needs. In essence, consumer behavior in marketing is a key concept whose knowledge is vital for knowing how consumers make decisions. 

Here are the key aspects of consumer behavior in marketing –   

Analysis of consumer needs and wants Consumers have unique tastes and preferences, and they are also characterized by different needs and wants. Those needs and wants can be social, functional, or emotional, either separately or sometimes together.  

Guide consumers through the decision-making steps – Consumers often take time and do some research before purchasing from a business. They search for information, evaluate the available options, and then reach a decision. Effective marketing strategies can influence consumer decisions and guide them through each of the steps. 

Study of internal and external factors influencing consumer behavior – Consumer behavior is often shaped by a combination of internal and external factors. Marketing can help understand those factors better and ensure value propositions specific to consumer needs.  

Understanding consumer motivations – All marketing efforts would stand for nothing if they were not aligned with consumer motivation and perception. Marketing has a key role in understanding how consumers perceive and respond to marketing stimuli.

Considerations of social and cultural influences on consumers – Both social and cultural factors influence consumers on many levels. These factors have a big effect on how purchase decisions are made. Marketing is essential for analyzing and evaluating those needs. 

Predict consumer behavior – There are various models for explaining how consumers make purchase decisions. These models offer frameworks for marketers to predict consumer behavior over time.   

Assessment of consumer loyalty and satisfaction – Consumers show loyalty when they are satisfied with the product or service offered to them. It’s the role of marketers to understand and assess the post-purchase behavior of consumers and then cater to their needs. 

How to Collect Data on Consumer Behavior?  

Data is key when it comes to understanding how consumers make purchase decisions, or how they engage with the brand or with products or services. There are various methods to collect data on consumer behavior and get a good understanding of their motivations regarding purchase decisions. 

Let’s look at some of the popular methods and approaches to collect data on consumer behavior – 

Surveys and Questionnaires – Most brands rely on surveys and questionnaires to collect key quantitative data on consumer behavior. These methods are very helpful in collecting data on demographics, habits, and preferences, and can be used via online channels or in-person.     

Interviews – Interviews have always been among the most effective methods to collect data on consumer behavior. They are extensively used for gaining qualitative data and getting deep insights into their thoughts, motivations, experiences, and preferences.  

Focus Groups– For many top companies, focus groups remain a very powerful tool to collect data on consumer behavior. In this method, a small group of consumers are brought together to discuss their experiences and understand their perceptions and attitudes about the brand. 

Observational Study – There is no better method than an observational study to collect data on the actual behaviors of consumers. In this method, consumers are observed in real-life settings such as in public spaces or at retail stores and data is collected.  

Customer Feedback and Reviews – Customer reviews and feedback are very helpful forms of data on consumer behavior. They are also among the easiest to gain with the least possible effort on the part of marketers. The key is to encourage customers to give feedback and reviews so that you can know the areas for improvement. 

Purchase and Sales Data – Many businesses rely on sales and purchase data to analyze consumer behavior, buying patterns, market trends, and other key aspects.

Final Thoughts 

Understanding consumer behavior is key for a business to achieve growth and success. Unless a company is aware of how consumers behave and what drives their purchase decisions, it can never deliver the kind of targeted messages that convert.

At, REVE Chat, we know how engaging with customers is vital to serving them better and meeting their needs at each stage of their journey. 

We have a variety of engagement tools which you can sign up here and check and see how they can add value to their operations.