Term Paper Sample: Study on Consumer Buying Behavior and Satisfaction Level

Introduction

Everyone is faced with the consumption of goods and services every day. A person constantly interacts with the services and products offered by the modern market. During the consumption, the person evaluates offered goods, and the opinion is usually formed after consumption or directly in the process of consumption. The understanding of buying behaviors is of great help to marketers, as it helps to understand how consumers feel, think, and select products. Moreover, the understanding of consumer behavior helps to see the influence of environment and other external factors on the behavior of consumers. The majority of factors that influence buyer behavior cannot be controlled by marketers and advertisement, but they still have to be considered while understanding the complexity of the issue.

This paper overviews buying behaviors and their relations to the levels of consumer satisfaction. While approaching consuming behavior, the author studies not only the act of purchase but also the pre-purchase stage and post-purchase one. Only the whole study of buying behaviors gives a possibility to determine the relationship between buying behaviors and consumer satisfaction. This paper is aimed to showing that, while buying behaviors can be pre-determined to some extent, it is hard to manipulate them in order to increase satisfaction. In order to ensure customer satisfaction with products and services it is essential to study customer behaviors in a particular market and adjust the product according to them.

There are numerous theories that try to define the reasoning behind consumer behavior. Although the research on the issue was initiated by economists, currently psychologists, social psychologists, and sociologists are studying consumer behaviors and ways of determining them. Traditional-positivist approach in studying consumer behavior is built on the rationalist principle and have a positivist-based approach to the study of consumers. At the beginning of their research economists were reviewing behaviors of consumers only as the act of purchase itself and believed that purchases are made on a rational basis, which means that a buyer chooses goods that give the most satisfaction (utility) according to one’s taste and prices. Behavioral scientists emphasize the role of environmental factors that massively shape the customer behavior. Such researchers as Thorndike, Watson, and Ryner believed that consumer patterns are created as responses to environmental conditions. According to the cognitive perspective, processing of information plays an ultimate role in the decision-making process of customers. This theory perceives customers as problem-solvers who use surrounding information to get as much as possible from the environment. Another model of studying consumer behavior is a comprehensive consumer decision-making model. There are, in fact, three models, united by the same goal: “to trace the psychological state of individual consumers from the point at which they become aware of the possibility of satisfying a material need by purchasing and consuming a product to their final evaluation of the consequences of having done so” (Brosekhan, Velayutham, and Phil, 11). The personality perspective, which was derived from Goffman’s theory, states that consumers choose products individually, according to the representation of self they want to create in the society. Other perspectives propose to take into consideration attitudes and predispositions of customers, or measurement of personality in order to measure marketing steps.

As a contrast to traditional perspectives on consumer behavior, postmodernist ones see the customer as a subject who can proactively assign meanings to products and influence environments, instead of being just a passive respondent (Brosekhan, Velayutham, and Phil, 14). Postmodernists believe that the process of buying is not rational, as consumers give their own personal contexts, thus giving subjective meanings to all purchases. All theories within this non-positivist concept try to acknowledge that consumer behaviors are measured not only by simple dichotomous concepts, but also (and mainly) by more complex, quite often unpredictable and irrational consumer behavior.

The marketing theories are rapidly developing today and new ones appear very often. The study of consumer buying behavior relies on numerous different theories, and currently, it is complicated to use only one of them. Therefore, this research utilizes a number of different theories within the context of consumer buying behavior and levels of consumer satisfaction.

Consumer Buyer Behavior Analysis

Type of consumer behavior determines consumer’s purchasing decisions. Decisions to purchase toothpaste or a new car differ. Large and expensive purchase will require the buyer think more, as well as need a larger number of the decision-making process participants. Assel distinguishes 4 types of consumer buying behavior based on the level of one’s involvement in the process of buying and awareness of differences between brands of goods (Oliver).

The complex buying behavior is present in case of high degree of involvement of a consumer in the buying process and in case of knowledge of significant differences in brands. Usually, such behavior is noted in rare purchases of expensive goods. Most often, the buyer does not have sufficient information about the product category, and thus requires more information. For example, a person who buys a computer may not know the meaning of such specifications as RAM 32 MB, monitor resolution, hard drive. Such details do not matter to the buyer until one gets familiar with the concepts. Producers of goods the purchase of which requires a high degree of involvement of the consumer should be aware of how serious a consumer will collect information about prospective purchase and evaluate it. Marketers need to develop strategies to help consumers understand the relative importance of the characteristics of goods and inform buyers about the ways one brand differs from another.

Sometimes buying process takes place at a high degree of consumer involvement, who does not always notice small differences of similar products from different manufacturers. The high degree of involvement is based on the fact that the purchase is risky, one does not purchase such items often, and the value of goods is high. In this case, the buyer will try to get around all the shops to compare the products, but he will make a purchase quickly enough judging mainly from the levels of price and service in a store. For example, buying a carpet involves a high degree of involvement of the consumer, as it is quite an expensive purchase and, moreover, should reflect the taste of the buyer. On the other hand, the majority of carpets from different manufacturers of about the same price may seem very similar to each other. After the purchase the consumer can experience the feeling of dissonance; note some deficiencies in the carpet or hear positive reviews about the carpets of friends and colleagues. At the same time, the customer will attentively listen to information confirming the correctness of his choice. In this example, the consumer makes a purchase first and then he forms a new belief followed by an attitude. Therefore, the marketing policy should be aimed at providing the consumer with information that would help him stay happy with a purchase.

The process of purchasing goods usually has low involvement of the customer in the process in case of the absence of significant differences between brands. For example, the purchase of salt: here the degree of involvement of consumers is low. When purchasing a product that does not require a high degree of involvement of the consumer, there is no need to actively search for information about different brands and carefully make purchasing decisions (Oliver). Manufacturers of such products with small differences between brands can increase sales effectively by using the practice of discounts and sales, as buyers do not pay much attention to a particular brand. The advertisement should describe only the most important qualities of a product; visual symbols should be catchy, imaginative, and clearly associated with a particular brand. Such advertising campaign should focus on the repetition of short messages.

Some purchases have a low degree of involvement of consumers, but significant differences between brands of goods. In this case, the consumer is no longer focused on a definite brand. In this case one can use an example of buying hair dye: the customer has developed some beliefs about this product and without much hesitation chooses some brand and, while using, values it. But in time, with a desire to try something new (or just out of curiosity) another hair dye is bought. Switching from one brand to another is caused by a wide range of products rather than by discontent with certain brands. In this situation, the strategy for market leaders and its’ subjects vary: leaders will strive to maintain habitual buying behavior by increasing the share of their goods in the stores and investing in regular intensive advertising; competitors will encourage the buyer to switch from one brand to another by offering their goods at special prices, coupons, free samples and advertisements persuading customers to try something new.

The marketing system is trying to define the whole complex of disincentives that guide consumers while choosing a product. For example, the marketing mix factors are powerful stimuli influencing the buying decision, but they are not sufficient for the consumer to make one’s choice (Oliver). The customer is influenced by psychological, social, cultural and situational factors. Some psychological factors are: motivation, personality type, perceptions, values, beliefs, attitudes, and lifestyle.

People who are driven by a motive are ready for action. The nature of this action depends on one’s perception of a situation. Perception is the process of selection, organization, and interpretation of information received by an individual and the creation of meaningful picture of the world. Perception depends not only on physical stimuli but also on one’s relationship to the environment, and the characteristics of the individual. The key word in the definition of perception is the individual. People have different perceptions of the same situation. This happens because the perceptual process occurs in the form of selective attention, selective distortion, and selective memory. As a result, consumers do not always see or hear the signals that are sent by manufacturers. Therefore, while developing a marketing campaign one must consider all three processes of perception. Beliefs and attitudes are formed through individual actions and perceptions, and have a significant influence on consumer behavior (Halstead and Page). Belief is a mental characteristic of something. Of course, manufacturers are very interested in beliefs of buyers regarding products and services that create images of products and brands. Based on beliefs people commit acts. If some beliefs are wrong and prevent active purchase, marketers need to campaign to have them corrected. Certain beliefs regarding brands and consumers depend largely depend on what country they were produced in.

Attitude is a stable positive or negative assessment of an individual object or idea, feelings that are experienced towards them, and orientation of possible actions against these items. People form attitudes towards everything: religion, politics, clothes, music, food, etc. The way people feel about an object makes them love or hate it; approach it or move away. A well-formed and stable assessment determines one’s attitude towards similar objects because in this case there is no need for a new way to respond to every single stimulus. Attitudes save physical and mental energy of the individual and that is why they are very stable. Human relations form a logically coherent chain, in which a change in one unit will require transformation of others. Thus, when developing new products it is advisable to take into account the already existing customer attitudes without trying to change them. There are still exceptions, when a change of attitude is justified.

The study of all the factors that are affecting consumer behavior, purchasing motifs, and perception of goods allows marketers simulate the process of making a purchasing decision (Seiders et. al.). Here one can consider the following steps: awareness of the need, information search, evaluation of alternatives, purchase decisions, and behavior after the purchase. The model of purchase process involves these sequential stages. In practice, the order may be violated especially when it comes to a product that requires a low level of involvement in the process. The buyer may omit or rearrange process.

Buying process begins with one’s awareness of problems or needs when one feels the difference between the present and the desired state (Oliver). The demand may be caused by external or internal stimuli. There are some ordinary human needs, like hunger or thirst. Marketers need to determine under what circumstances each of the needs arises. By receiving information from consumers manufacturers can determine the most frequently occurring stimuli that arouse interest in a specific product category. Based on this data, they develop a marketing strategy designed to generate interest of consumers in a particular product. Often a consumer who is interested in a product starts looking for more information about it. Sources could be personal, commercial, or public. A company must develop a marketing strategy that would ensure the presence of this product. In addition, the manufacturer must determine what other products are included in the set of consumer choice, identify information resources the consumer uses, and establish their relative value (Halstead and Page). It is essential to conduct a survey among customers and find out when they first heard about the product, what do they know about it and how do they evaluate informational resources about the product. Customers’ answers will help the company to maintain effective communication with the target market.

The consumer analysis of the information about alternative brands is based on several basic provisions: firstly, the consumer seeks to satisfy one’s need; secondly, he is looking for some benefit by choosing a particular brand; thirdly, each product is perceived as a set of properties required to meet one’s needs. Each product has certain properties that interest a consumer. Consumers allocate those properties, which are important to them, and determine the importance of each (Seiders et. al.). The greatest attention is paid to characteristics that can bring the desired benefits. Therefore, the market of a particular product can always be segmented according to its’ properties that are of paramount importance for different groups of consumers.

The customer’s desire to change and/or postpone buying decision largely depends on perceived risks. The magnitude of the risk is affected by the amount of money required to purchase; customer’s doubts; the degree of buyer’s self-confidence. In order to reduce the risks associated with the purchase, consumers postpone decision until better times and meanwhile collect additional information focusing on the country of origin and provided guarantees. Marketers need to keep in mind the factors that induce the buyer to think about the risks of buying and thus should in advance provide consumers with information that reduces the perceived risk of buying.

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After a purchase the consumer experiences either a sense of satisfaction, or a sense of dissatisfaction. After the purchase is made the manufacturer still has to continue its’ work with the customer in the post-purchase period. Marketer should examine the degree of customer satisfaction purchase, the reaction after the acquisition of goods and the fate of the product. After purchasing the product the consumer can stumble upon some previously unnoticed defect. Some will refuse to keep a defective thing, some will remain indifferent to its shortcomings while others may find that the existing flaw only increases the value of an item (Halstead and Page). For example, if in the first edition of the famous writer there is a page printed upside down, over time it becomes a rarity that can be sold at a much higher price than the original cost. On the other hand, some defects are of real danger to the user. Companies producing automobiles, toys, medicine, must urgently withdraw any items that can cause even the slightest harm to the consumer.

Purchase satisfaction is the ratio of the expectations of the buyer and the actual qualities of the product. If someone’s purchase does not meet the initial expectations, the consumer remains disappointed; when the hope of a buyer if justified he feels satisfied (Oliver). In the case where the characteristics of the product exceed the expectations of the consumer, the latter feel a sense of admiration. The degree of customer satisfaction depends on the decision to re-purchase and reviews about the item among friends and acquaintances. To keep the buyer satisfied, advertisement producer must faithfully reflect the real and the probabilistic characteristics of goods. Some retailers may to some extent even understate the item qualities so the buyer receives guaranteed pleasure of shopping. Satisfaction or frustration of the consumer determines one’s next steps. If a person is satisfied with the purchase, most likely s/he will buy this product again. For example, studies of consumer choices when buying a car say that there is a direct relationship between the satisfaction of the buyer and his desire to buy same goods (Ali, Alvi & Ali). An unsatisfied customer reacts quite differently. One can stop using the goods, return an item to the store, or start looking for information that would confirm the value of the goods. In addition, one can write a complaint to the company that produces this product, seek help from a lawyer or a government agency. A customer can simply stop buying this product and warn all friends and acquaintances.

Manufacturers need to minimize consumer dissatisfaction purchase. Recently, as a result of the extended practice of communicating with customers after sales, the numbers of canceled orders and refunds have declined. Manufacturers should be interested in the following question: how the customer uses purchased goods and what eventually does with them. If the buyer keeps the item in the closet, he might not be very happy with the purchase. If the customer sells or exchanges the product for something more useful it will decrease the volume of new sales. If buyers find a new use for the product, the manufacturers should use it in their advertising (Ali, Alvi & Ali). Someday the buyer will have to part with the item and the manufacturer must take care that the remains do not cause any damage to the environment.

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Satisfaction Level Analysis

Current economic conditions objectively alter the relationship between producer and consumer. These changes could be more efficient and fast if based on experience and knowledge. It is essential to know some basics of interaction between producer and consumer while satisfying the needs of the latter. The concept of customer satisfaction is a complex of a large number of components, which vary for different businesses and consumers (Brosekhan, Velayutham, and Phil). To manage this complex, one must first identify its specific components and only then make an effort to maintain them at the proper level. Satisfaction is associated with the subjective perception of how the supplier meets the needs or the expectations of a particular consumer. And the reflection of the quality of goods in the consumer’s mind can be confirmed or not confirmed by the real situation. In the latter case, consumers feel dissatisfaction. At the same time, the relationship between customer satisfaction and profitability of a company is commonly recognized. The key to success of a company in the market is satisfied customer who is committed to the company (Seiders et. al.). Without accurate measurement of customer satisfaction managers cannot make effective decisions about what needs to be improved for products and services. Only if something is measured, it can be managed.

The study on customer satisfaction is suitable for organizations that can achieve their goals by supporting existing users of their product. Studies to evaluate consumer satisfaction with a type of goods should identify a successful organization in achieving the main objectives in the market – to be the best in what is most significant for consumers.

The study to assess customer satisfaction allows:

• To measure satisfaction with the goods as a whole;
• Compare the representation of staff commodity customer expectations;
• Identify priorities affecting the improvement;
• Provide the basic data of employees quality management system;
• Increase the retention rates of consumers;
• Summarize the values of consumers.

From the standpoint of marketing, it is essential to show the difference between the buyer, the consumer, and the client, although these terms are often used interchangeably. When it comes to the consumer, there is an individual who buys products to meet personal needs. The consumer may not be the buyer: for example, when children order meals in the restaurant the parents are intermediaries between the seller and the real consumer. Therefore, for the efficient sale of a product, one must be familiar with the end user and not only with the one who makes the order and (or) is charged for it (Halstead and Page). Despite the fact that very often the notion of consumer and buyer are the same, the difference still has to be kept in mind. The customer and client are also very close. The difference is that the client is a consumer of services of a particular company. This category is used to describe single or sustained interaction between the company and those who use its services. Each consumer acts as the client, but only at the time of the consumption.

From the end user must one distinguish those buyers who purchase services companies for resale (for example, travel agencies) or use them for meetings, conferences, exhibitions, educational activities, etc. Thus, consumers services companies fall into two groups: end users of individual buyers purchasing services for personal needs; organization of consumer buyers purchasing services for resale or use to solve their corporate objectives.

It is essential to clearly understand that the behavior of these two groups of consumers can vary significantly, due to:

• Purchase motivation ;
• Frequency of shopping; ways making purchasing decisions ;
• Sources of information used in making purchasing decisions;
• The requirements for the service provider, etc.

Correct understanding of consumers allows the company :

• To find out their needs and preferences;
• To identify the services that are most in demand;
• Gain the trust of consumers;
• To find out what the consumer is guided by taking the decision to purchase and which uses the sources of information;
• To determine who and how affects the production and purchasing decisions;
• Develop an appropriate marketing strategy and specific elements are most effective marketing mix;
• Establish a system of feedback from customers;
• Develop effective and long-term relationships with customers.

The importance of a correct understanding of consumer needs is clear from the numerous practical facts. For example, as a result of market research of clients, XX hotels found that up to a third of guests on arrival to the room, first of all, open the mini-bar and are interested in its contents. It meant that it makes sense to have mini-bars in even the cheapest hotels hotel rooms, especially considering the fact that the prices for the use of drinks from the mini-bars are typically several times higher than those in the retail industry. Furthermore, it was found that 95% of the guests take a shower, while only 5% prefer to take the bath. As a result, many hotels set cheaper showers rather than full-size baths in rooms. Up to 40 % of the guests need a wake-up call. Hence, the importance of appropriate automatic systems equipment became clear, as even in a small hotel wake-up with a telephone operator can be a problem because most of the customers are asked to wake them up at about the same time. Marketing research results also allowed consumers to reveal that one of the main criteria when choosing a place of temporary residence is the sanitary condition of the hotel. Moreover, according to 70 % of the guests, the most striking indication of purity in them was the state of toilets.

A correct understanding of consumers in marketing comes from a number of principles. The first one is the consumer freedom of choice and the real benefits of the enterprise success. Services may be accepted or rejected by the consumer to the extent that they comply with its requests. Understanding this and constant adjustment to the needs of the consumer ensure efficient practical implementation of the concept of marketing. Secondly, consumer behavior can be studied with the help of market research. This is done by modeling consumer behavior, the study of motives and factors characterizing the customer needs and the ways of meeting them (Seiders et. al.). Thirdly, the behavior of consumers can be influenced. Marketing can have a strong influence on the motivation and behavior of consumers. This can be achieved provided that the products offered are really a means of satisfying customer needs. At the same time, there should be no manipulation of consumers’ behavior. Lastly, it is essential to remember that consumer behavior is socially legitimate due to the fact that consumer sovereignty in a market economy is based on a number of rights. In particular, consumers are entitled to relevant and reliable information about the company, which produces goods or provides a range of services, which should be safe for life and health and should not harm their property. Consumers are also legally protected from unfair competition in advertising (prevention and suppression of inappropriate advertising that is able to mislead consumers or harm the health and property of citizens, as well as infringing upon public interests, principles of humanity and morality). The observance of legitimate rights and interests of consumers is an important task not only for the society but also for individual enterprises (Ali, Alvi & Ali). Social legitimacy of consumer rights is a guarantee to meet their needs. Deception, misrepresentation, low quality of services, lack of response to the legitimate grievances and complaints, and other similar activities are nothing but a violation of the legitimate rights and interests of clients.

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Conclusion

This study shows that, although it is possible to define consumer behaviors in particular market, they cannot be adjusted to the product. On the contrary, each product has to suit to the requirements and demands of consumers on a market. While many of the factors determining consumer behavior cannot be influenced (religious and cultural background, psychological factors of each consumer), they still have to be studied in order to understand the customer profile and peculiarities of buying behaviors in particular market. According to these behaviors products and services can be adjusted in order to suit the major needs of customers. As a result, the study of buying behaviors will not only increase the sales, but also raise the satisfaction levels among product customers. Therefore, without the understanding of customer behavior and purchase patterns, it is very hard to achieve high satisfaction levels of customers.

Works Cited

A. Abdul Brosekhan, C. Muthu Velayutham, and M. Phil. “Consumer Buying Behaviour–A Literature Review.” Journal of Business and Management 231-7668. Web.

Ali, Imran, Abdul Khaliq Alvi, and Rana Raffaqat Ali. “CORPORATE REPUTATION, CONSUMER SATISFACTION AND LOYALTY.” Romanian Review of Social Sciences 3. 2012. Print.

Halstead, Diane, and Thomas J. Page. “The effects of satisfaction and complaining behavior on consumer repurchase intentions.” Journal of Consumer Satisfaction, Dissatisfaction and Complaining Behavior 5.1.1992. Print.

Oliver, Richard L. Satisfaction: A Behavioral Perspective on the Consumer. USA: Business & Economics. 2010. Print.

Seiders, Kathleen, et al. “Do satisfied customers buy more? Examining moderating influences in a retailing context.” Journal of Marketing 69.4. 2005. Print.