Customer Behavior

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What is customer behavior? How to analyze it?

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Team Storyly
May 22, 2023
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What is customer behavior?

Customer behavior is the actions, decisions, and preferences of people when they interact with products or services. It includes factors such as buying habits, attitudes, and loyalty.

Customer behavior can be influenced by a variety of factors, such as personal preferences, social norms, and marketing efforts.

Why is consumer behavior important?

Understanding consumer behavior is critical for businesses to create products and services that meet the needs and wants of their target audience and to develop marketing strategies that effectively communicate the value of those offerings to potential customers.

Consumer behavior is important for several reasons:

  • Business success: Understanding customer behavior is important to build products and services that meet the demands and needs of their target audience. Businesses that discover what encourages consumers to make decisions can adjust their marketing strategies accordingly. Also, they can build better products that contribute to increased sales and profit. 
  • Marketing effectiveness: Businesses can generate more effective marketing campaigns that speak to their target audience by understanding consumer behavior. This contains developing messaging that addresses the values, beliefs, and emotions that drive customer decision-making.  
  • Product development: Getting insights into consumer behavior can also inform product development. Thus, businesses may be able to develop products that are more likely to achieve success in the market. This contains analyzing trends, preferences, and points of consumers to create better product alternatives.

Types of consumer behavior

There are four main types of consumer behavior. These are:

  1. Complex-buying behavior
  2. Dissonance-reducing buying behavior
  3. Habitual buying behavior
  4. Variety-seeking buying behavior

Complex-buying behavior

Complex buying behavior occurs when a customer is greatly involved in the purchasing process and conducts extensive research before making a decision. It is generally seen when a customer buys an uncertain, expensive, or infrequently purchased product such as a house, car, or university education. 

Customers may tend to spend a lot of time researching different options, making comparisons among the characteristics or features, reading customer reviews and seeking advice from others before actually buying. To learn more and clear up any questions, they may also engage in personal selling and speak with salespeople.

In complex buying behavior, customers consider several criteria before making a purchase decision. They often evaluate several criteria: product features, quality, reputation, price, and post-sales service before buying a product. In complex buying behavior, customers typically weigh multiple criteria, such as product features, quality, reputation, price, and after-sales service, before making a purchase decision. In fact, they can even complicate the progress more if they involve several decision-markers such as their spouse, family members, or experts in the field.

Understanding complex buying behavior is essential for marketers and salespeople, as it requires a different approach to marketing and selling compared to simpler buying behaviors. Marketers must provide detailed information, establish trust, and address any concerns that customers may have to facilitate the decision-making process and increase the likelihood of a sale.

Dissonance-reducing buying behavior

Making a high-involvement purchase, such as buying a new home or car, make the customer feel nervous and uncertain about their purchase. This is when dissonance-reducing behavior occurs. This type of behavior causes the customer to be doubtful or uncertain about the purchase, even if they have conducted extensive research regarding the product or compared it with other options available.  

The customer may look for supplementary information, such as customer reviews or advice from friends and family. In order to support their choice, they can also turn to the salesman or the business for reassurance or compare what they bought to those of other similar items or brands.

By giving customers access to after-sale support, clear and thorough information about the product or service, and opportunities to give feedback and discuss their experiences, marketers may reduce dissonance. 

Habitual buying behavior

Habitual buying behavior is a type of consumer behavior where a consumer buys a product without having a prior thought or effort about it, often out of habit or routine. It frequently occurs when customers buy low-involvement products like groceries or household items. For these types of products, customers tend to have a brand preference or are just searching for the most convenient alternative. 

Customers that display habitual buying behavior tend to have a robust sense of brand loyalty. They may continue to buy a product from a specific brand even when they are provided with other new options. These customers may not research too much or compare prices or features since they already prefer a specific brand or product. 

Marketers can leverage habitual buying behavior by investing in brand loyalty and repeat purchases, by offering incentives or rewards programs, and by creating strong brand recognition through advertising and promotion.

Brands should remain consistent and ensure quality to build customer loyalty and increase the possibility of repeat purchases. 

Variety-seeking buying behavior

The term "variety-seeking buying behavior" refers to a style of behavior where people look for new and unique experiences or products rather than repeatedly selecting the same ones. This type of behavior can be the cause of a need for innovation or variety in order to prevent boredom.

Consumers that display variety-seeking behavior may tend to experiment with new products or explore different flavors or styles. This behavior can be affected by different factors, such as personal preferences, cultural norms, and social influences. 

Understanding variety-seeking behavior can be significant for businesses to come up with marketing strategies that entice consumers who value innovation and variety. For instance, businesses may offer limited edition or seasonal products, rotating product offerings and emphasizing distinct features or flavors.  

What affects consumer behavior

Several factors affect how consumers behave when making purchases. These can be generally classified as internal and external factors.

Individual characteristics such as personality, motivation, opinions, attitudes, and values of the customer can be categorized as internal factors. Internal factors can affect how consumers regard products and brands, which can influence their decision-making process. 

On the other hand, external factors such as  environmental and social factors can impact consumer behavior. These can consist of cultural norms and values, social and peer groups, influences from families and households, marketing and advertising, and even situational elements like place and time.

Other personal and psychological factors, such as lifestyle and income, along with the features of the product, such as the price, quality, and availability can also influence consumer behavior during purchasing. 

In order to create marketing strategies that successfully appeal to the target audiences, understanding these factors can be helpful. Businesses can adjust their marketing efforts to better fit the needs and preferences of their target customers by knowing the different aspects that affect consumer behavior during the purchasing process.

How to collect data on consumer behavior?

There are several methods that can be used to collect data on consumer behavior:

  • Surveys: A common way to collect data on consumer behavior is by creating surveys. A wide range of consumer behavior variables, such as preferences, attitudes, and purchase behaviors, can be learned from surveys, which can be carried out online, over the phone, or in person.
  • Interviews: Businesses can conduct interviews either face-to-face or over the phone. Interviews offer more in-depth information on consumer behavior and can be useful for discovering sensitive or complex issues.
  • Observation: Consumer interaction with products and services can be better understood by observing consumer behavior in actual environments, such as a store or online.
  • Focus groups: A group of consumers gets together in focus groups to discuss a specific product or service. Focus groups can give insights into consumers’ opinions and preferences, as well as help discover new ideas or concerns. 
  • Data mining: Data mining is the process of analyzing massive volumes of data, such as online purchase habits or social media activity, using algorithms and statistical techniques. Data mining can offer insights into consumer behavior patterns and trends.
  • Experimentation: Experiments include altering one or more variables to analyze their impact on consumer behavior. They can either be conducted in natural settings such as a store, or in controlled settings, such as a laboratory.

By using a combination of these methods, businesses can gather a comprehensive picture of consumer behavior, and use this information to develop effective marketing strategies that meet the needs and desires of their target customers.

How to conduct consumer behavior analysis

Conducting a consumer behavior analysis involves a systematic approach to gathering and analyzing data on consumer behavior. Here are the steps to follow:

  1. Identify the research objectives: Determine the research objectives and questions to be answered. This will make it easier to guide the research process and guarantee that the analysis is concentrated on the most relevant information. 
  1. Determine the research method: Select the relevant research method to collect data about consumer behavior. As we mentioned above, some research methods to collect data include surveys, interviews, observation, focus groups, data mining, and experimentation. Research objectives will determine the method chosen, the target audiences, and the available resources.
  1. Collect data: With your chosen method, conduct research and compile data on consumer behavior. It is crucial that the data is reliable, valid, and represents the target audience. 
  1. Analyze the data: Use statistical methods, qualitative analysis, and other techniques to determine patterns, trends, and connections. This can help discover insights about consumer behavior and guide marketing plans. 
  1. Draw conclusions and make recommendations: Based on the analysis of the data, draw conclusions and make recommendations for marketing strategies. These recommendations should be actionable and based on the insights uncovered in the analysis.
  1. Implement and monitor marketing strategies: Implement marketing strategies and observe how effective they are. Businesses should take a record of the success of their marketing strategies and adapt if necessary based on consumer behavior. 

By following these steps, businesses can conduct a thorough analysis of consumer behavior and use this information to develop effective marketing strategies that meet the needs and desires of their target customers.

How to use consumer behavior in marketing

Consumer behavior can be used in marketing to better understand the needs and desires of target customers, and to develop effective marketing strategies that appeal to them. Here are some ways to use consumer behavior in marketing:

  1. Determine target customers
  2. Build products and services
  3. Customize marketing messages
  4. Enhance customer experience
  5. Track and analyze consumer behavior in time

Determine target customers

Conducting research on consumer behavior can help establish the target audience based on their preferences, attitudes, and behaviors. Information can be later on utilized to adjust marketing messages and promotions in line with the target audience. 

Build products and services

Consumer behavior helps inform the development of new products or services that are tailored to the preferences of their target audience. Consequently, it can bring on increased customer satisfaction and loyalty. 

Customize marketing messages

It can be beneficial to adjust marketing messages and promotions to the specific needs and preferences of the target audience by understanding consumer behavior. This can improve the efficiency of marketing initiatives and boost sales.

Enhance customer experience

Consumer behavior makes it possible for businesses to determine areas for improvement regarding the customer experience, such as the product offering, pricing, or customer service. Making improvements based on the data can boost customer satisfaction and loyalty as a result. 

Track and analyze consumer behavior in time

Businesses can keep ahead of trends by monitoring and evaluating changes in consumer behavior over time and revising their marketing plans accordingly. This can help maintain success in a competitive market.

Use Stories to understand customer behavior

The best way to understand your customers is to get the information directly from them. However, brands may benefit from a little creative thinking to motivate their customers to share their pain points, feedback, and opinions. Consider integrating Storyly to better understand your customers while providing highly visualized and engaging experiences. 

Storyly brings the most captivating format of the day, Stories, to your app or website to allow brands to communicate better with their customers. And Stories offer various interactive elements to effectively interact with audiences. For instance, you may utilize question stickers, polls, quizzes, or emoji sliders on Stories to gather valuable feedback and gain insights into your customers’ preferences. Moreover, the Storyly Dashboard enables you to interpret customer behavior better. This way, you can tailor your marketing campaigns to better meet the needs and preferences of your customers. Read more on how you can use the Storyly’s interactives to collect feedback and gain insights into your customers.

ABOUT THE AUTHOR

Team Storyly

Group of experts from Storyly's team who writes about their proficiency.