7.4 Psychological Factors
Cognitive Awareness
Why do you buy the things you do? How did you decide to go to the college you’re attending? Where do you like to shop and when? Do your friends shop at the same places or different places? Do you buy the same brands multiple times or eat at the same restaurants frequently? Marketing professionals who have the answers to those questions will have a much better chance of creating, communicating about, and delivering value-added products and services that you and people like you will want to buy. That’s what the study of consumer behaviour is all about. Consumer behaviour considers the many reasons – personal, situational, psychological, and social – why people shop for products, buy and use them, sometimes become loyal customers, and then dispose of them.
Companies spend billions of dollars annually studying what makes consumers “tick.” Although you might not like it, search engines monitor your web patterns. The companies that pay for search advertising, or ads that appear on the web pages you pull up after doing an online search, want to find out what kind of things interest you. Doing so allows these companies to send you pop-up ads and coupons you might be interested in instead of ads and coupons for things such as retirement communities.
In conjunction with a large retail center, the Massachusetts Institute of Technology (MIT) has tracked consumers in retail establishments to see when and where they tended to dwell or stop to look at merchandise. How was it done? By monitoring the position of the consumers’ mobile phones as the phones automatically transmitted signals to cellular towers, MIT found that when people’s “dwell times” increased, sales increased, too” (The Economist, 2008).
Researchers have even looked at people’s brains by having them lie in scanners and asking questions about different products. What people say about the products is then compared to what their brain scans show – what they think. Scanning people’s brains for marketing might sound nutty, but maybe not when considering that eight out of ten new consumer products fail, even when they are test-marketed. Could it be possible that what people say about potential new products and what they think about them differ? Marketing professionals want to find out.
Studying people’s buying habits isn’t just for big companies. Small businesses and entrepreneurs can study the behaviour of their customers with great success. By figuring out what postal codes their customers are in, a business might determine where to locate an additional store. Small companies, such as restaurants, often use coupon codes. For example, coupons are given different codes based on the other delivery mechanisms. Then, when the coupons are redeemed, the restaurants can tell which marketing avenues have the most significant effect on their sales.
Environmental factors (such as the economy and technology) and marketing actions taken to create, communicate, and deliver products and services (such as sale prices, coupons, Internet sites, and new product features) may affect consumers’ behaviour. However, a consumer’s situation, personal factors, and culture also influence what, when, and how he or she buys things.
Key Takeaways
- To effectively market your business to customers, you must learn about their behavioural patterns.
- Where people live, what they engage with, how they spend their time, and how their environments influence them are all factors to study and consider when planning.
“How People Make Buying Decisions” from BUS203: Principles of Marketing by Saylor Academy is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License—modifications: added Key Takeaways.
