Have you ever wondered as to why customers pick your products over that of competitors? What drives them to purchase more, certain times of the month or year? Why they choose certain types of products over others? Finding answers to these questions is important to sustain and stay as the preferred choice of customers. When you understand your consumer buying behaviour, you can adopt more directed marketing efforts towards increased sales.
Consumer buying behaviour stems out of certain specific factors.
Factors Influencing Consumer Buying Behaviour
1. Marketing and Advertisement
Advertisements are one of the factors influencing buying behaviour, the way consumers make purchase decisions and consume products. We are constantly bombarded with advertisements almost every living moment. One could argue that advertisements have become such an integral part that they influence our lives in its entirety. From the kind of outfit we wear to the electronic brands we prefer, they are all choices that are influenced by the power of advertising. And, advertising has become an even bigger part of our life due to social media. Most companies run ads on Facebook, Instagram, etc. as a way to bring in new customers and keep the existing ones invested in their brand.
People are influenced not only by the products they see on advertisements but by the products that are discussed in media. Let’s take an example of customer buying behaviour, customers are likely to try out a product if they see their favourite celebrities endorsing it in films, television shows or music videos. The popularity of YouTube has further turned these celebs into major influencers of what products customers purchase.
2. Personal Factors
Personal preferences largely drive the decision of consumer purchase behaviour, as to purchase a product or invest in a service. Because each person’s personality has its own quirks, preferences vary accordingly. Take for instance as a customer buying behaviour, age and lifestyle of individual customers. One of the factors influencing consumer buying behaviour significantly is the age.
Every individual goes through the following stages and shows a different buying need in each stage:
- Young Twenties: Spends on outfits, partying, casual dining, adventure activities, etc. (Spends extravagantly)
- Newly Married: Tend to invest in a good home, vehicle, household furnishings (Spends sensibly)
- Family with Children: Indulge in Financial Investments, Life Insurance, Health Schemes (Spends to secure the family future)
- Empty nest (Children getting married)/Retirement/Old Age: Medicines, Health Products, and Other activities of their interest.
Along with age, there are other personal factors of consumer behaviour like gender, body type, occupation, religious preference, colour preference, sexual orientation, lifestyle, etc. which is one of the factors influencing consumer buying behaviour. All of these play an important role in the way customers buy products. For example, one would expect someone in their teens, adolescence and young adulthood to invest in fidget spinners as opposed to someone in their 50s and 60s.
3. Social and Cultural Influence
The society we live in and the environment we are exposed to play an important role in how we make purchase decisions.
Much like how advertisements coax us to try new products, people around us also play an important role in deciding consumer purchase behaviour.
Most of us can attest to having been influenced by the choices of our friends, acquaintances and colleagues. Thinks about it, how many clothes, shoes, accessories, electronics you have bought, based on suggestions of your friends and acquaintances. Additionally, a person’s social status also plays a role in how they purchase. People from a financially richer persuasion (upper middle class and upper class) are more likely to buy certain products than others (middle class and below).
Cultural values are also important in defining buying tendencies of people. For example, people of faith are more likely to purchase certain items over others. The country, state and language we speak play a role as well in shaping purchase decisions of customers. For example, Indians are more likely to buy white clothes before the festival of Holi. The sale of sweets, dry fruits and condiments also increases during the festive season.
4. Economic Capability
Arguably, the most important way to understand buying pattern of consumers is through a person’s earnings. A person who makes less than 10 lakhs in a year is less likely to purchase a car worth Rs 35 lakhs as opposed to someone who makes 30 lakhs. Economics is important in deciding how we decide to make purchases.
There are other economic factors influencing consumer behaviour. A person’s savings and financial investments will dictate how comfortable he/she is in making large purchases (home purchase, car purchase, etc). Credit and EMI facilities also dictate the purchase behaviour. If a store provides EMI facility on its products, it incentivises the likelihood of a customer making a purchase. That’s because a customer can pay the amount in chunks over a given period of time as opposed to paying the whole amount one-shot. Of course, the credit facility is also dependent on a person’s income and savings but EMI facility eases customer apprehension about making a large purchase.
As a business owner, analyzing your customers’ economic capabilities will give you a good idea of what products they are likely to buy. You can obtain information about their income through feedback forms and surveys. If you aren’t sure of how to analyse them, sweat not. A best POS software can help you with this. POS software like Zopper POS, EasySol POS can analyse a customer’s purchases and create reports that help in understanding purchase patterns. It can also help in building a loyalty program which is great to target people looking for economical options that come with good rewards.