Business Environment and Society Buyer Behaviour - Essay Example

Introduction Consumer behaviour is “the study of the processes involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and desires ” (Solomon et al. 2006, 6). Many factors both intrinsic and extrinsic affect consumer purchasing behaviour hence it is the duty of marketers to study consumer behaviour to understand their buying process and consequently develop effective marketing strategies. Most research focuses on buyer behaviour and tends to ignore the consumer who is central to this process. The possessions that we have tell much about us and the psychology behind consumer behaviour hence should be central to understanding consumer behaviour. This is mostly because people use possessions to define themselves or create their identities (extended self) especially in contemporary society based on materialism. As such, we are what we have and possessions are an extension of our selves. This has implication for marketers as they should strive to understand the value attached to possessions by consumers in order to develop effective marketing strategies. There are many theories put forward to explain customer behaviour. Economic theory views customer as a rational and self interested decision maker hence consumes to maximise utility. The theory thus concentrates on the buying action. The psychodynamic approach is attributed to Sigmund Freud (1856-1939) and posits that instinctive forces of Id, Ego and Superego are drivers of behaviour. The behaviourist theory views behaviour as being driven by external forces or events. The cognitive theory attributes behaviour to information processing in one’s mind while humanistic theory stresses the role of emotions in consumer behaviour. This essay will utilise the theories of consumer behaviour to discuss the concept of extended self and its effects on consumer purchasing behaviour. The Concept of Extended Self The idea of extended self is based on the fact that we are what we have; that is, we define ourselves based on the things that we possess. Belk (1988, 139) argues that “our possessions are a major contributor to and reflection of our identities.” He came up with this conclusion after collecting a variety of evidences and regarded it as the ‘extended self.’ The major categories of extended self according to Belk are body, internal processes, ideas, experiences and those persons, places and things to which one feels attached. These items are part of self and if by any chance they are lost or destroyed, we feel like we have lost or lessened part of us. For example, being held up in a mental institution lessens the self of those restricted. Involuntary loss through theft and contamination by rape is also viewed with same distaste; as a violation of self. The degree to which we consider objects as extended self is determined by the level of control we have on those possessions although the possessions also may have a degree of control on us enough to impose their identities on us (Belk, 1988, 141). In addition to control, other ways of incorporating possessions into extended self include creating and knowing them as well as contamination (e.g., rape). However, contamination is not intentional hence it cannot lead to self-extension for the victim but lessening of self through shame and loss of self-esteem. It is also worth noting that self-extension varies with age (Kumar & Lim, 2008). The objects children value is not what adults or old people value. This has implication for advertisers to appeal to different groups of people. There are also special cases of extended self such as collections, money, pets, body organs, and other people. The concept of extended self has implications on consumer purchasing behaviour and these can be analysed used the theories of consumer behaviour. For example, some people will buy items just to enhance their self-esteem and nothing to do with their level of income or tastes and preferences. It is essential thus to understand the psychology of consumers and reasons behind their buying to come up with effective marketing strategies. Economic Theories This is the earliest theory and assumes that man is a rational and self-interested being who aims at maximising utility whilst using least effort in acquiring the objects and incurring minimal costs. A consumer in this case is assumed to be well aware of all consumption options available as well as alternatives thus he/she can make a rational choice that gives maximum satisfaction. This level of satisfaction is regarded as utility and is vital in determining consumer choices (Wood, 2007). In this case, consumers acquire possessions that give them utility and these become part of the extended self as they are valuable to the owner. There are many ways of incorporating possessions into the extended self such as controlling the object for personal use, creating the objects or knowing them (Belk, 1988, 150). In this case, buying an object is creating it and money enlarges possibilities of what we might have and do. It also gives us power to selectively acquire or reject purchasable objects thereby more selectively shaping our extended selves. This is in line with economic theory which assumes consumers have perfect information regarding all the available alternatives hence can choose among these alternatives (Wood, 2007). Money is crucial as it assists the consumer in making the purchase decision. They want to get maximum utility at minimum cost and once they have achieved this goal, they feel satisfied and happy with themselves thus the objects become part of extended self. However, consumers cannot have perfect information, the time or motivation to rate all alternatives in the market hence making an optimum choice is not realistic. Most consumers will choose whatever satisfies them based on their current need rather than optimum choices (Young & Faber, 2000). Moreover, the law of marginal utility dictates that the satisfaction gained by consuming an extra unit of a product declines with more consumption (Williams, 2014). It reaches a point where consuming more of the product leads to dissatisfaction or is not useful to consumer. For example, consuming the first soda is more satisfying than when consuming the fifth bottle of soda. The same case applies to the concept of extended self. Using the object or learning to use it for the first time gives the user control over the object and it really becomes part of extended self (Belk, 1988). For example, learning to drive a car for the first time is a great experience that remains embedded in self for a long time. As time passes and the car depreciates and as new models get into the market, the satisfaction is no longer there and the owner might want to buy a new car which is more satisfactory than the older model. However, economically this will depend on disposable income and whether it is cost minimising; that it, it is more efficient to use than the older one and serves more purposes. This is because it is not easy to discard one’s property especially if it is a part of self as it would mean loss or lessening part of self. Also accumulation of materials reaches an optimum level where it becomes an obsession leading to pathological behaviours. Psychodynamic Theory The theory was put forward by Sigmund Freud (1856-1939) and posits that behaviour is subject to biological influences through instinctive forces of id, ego and superego (Wood, 2007) and not the rationality of humans as economists portend. The id is in the unconscious level and demands immediate gratification while the superego controls the drives of id by adhering to societal morals or standards. The ego negotiates between id and superego. Based on this theory, humans have drives that activate behaviour hence consumption is needs based. The basic needs such as shelter and clothing need to be satisfied first before the consumer moves to the next level of needs if Maslow’s hierarchy of needs is something to go by. This may explain why purchasing behaviour differs with age and from generation to generation (Belk, 1988; Kumar & Lim, 2008). Different age groups have different needs hence value different objects. For example, aged people have gained a lot of experience in usage of objects and are nearing their end hence may involve themselves in collecting and storing objects that memorable to them and which they would like to pass on to the next generation such as photos or antiques so as to extend their self. They may also engage in gift giving so as to keep their memories alive even when they are gone. Generation Y (between 1980 and 1984) on the other hand, are adopters of new technologies and extensive users of internet and like personalising their gadgets as a way of extending self (Kumar & Lim, 2008, 570). Baby boomers (1946 to 1964) have high disposable income and are big spenders and have different needs from Generation Y. In the same way, self-allied objects are also arranged in a hierarchy from most to the least allied: me (free will), my body (my conscience), my belongings, my friends and strangers (Belk, 1988, 140). We therefore value our free will more than strangers or physical universe. Needs and drives which determine the means of self-extension thus has great implication on purchasing behaviour and marketers should be able to understand different groups of customers for proper targeting of strategies. This theory can help explain the concept of extended self which is based on the assumption that individuals accumulate materials as a way of compensating for their lost self-esteem or basically to gain self-esteem, social status and sense of belonging (Belk, 1988). In the society, we are what we have hence if we do not have anything; we are viewed as lesser beings or acquire low status. As such, one must strive to acquire objects in order to gain status and feel like one belongs to that group one associates with. Research (Park & John, 2010, 74) indicates that there are two types of self-esteem (implicit and explicit) that impact on materialism. Explicit self-esteem is consciously reasoned evaluation of self and entails newly formed attitudes whereas implicit self-esteem is evaluation of self from outside awareness and entails older or habitual attitudes existing in memory. Explicit attitude requires motivation and cognition for retrieval while implicit attitudes occur automatically. These two attitudes drive materialism as individuals try to restore their self-value. Mainly, these customers have a shortcoming which they want to compensate for and may end up even buying counterfeit luxury brands to feel good if they cannot afford the real thing or in anticipation of buying the real object (Wilcox et al. 2009). Desire for status and self-esteem also explains why people are happy if they make a major purchase such as buying the latest automobile. According to Belk (1988, 154) people regard collections as the ultimate self-definition hence compensate their low self-esteem by addiction to collections. This gives them a complete sense of self, a sense of purpose and worth. Marketers should thus be able to understand the attitude of consumers and behaviour in order to make sound marketing decisions as consumers do not purchase items just because they are appealing or because they have a high income but for psychological reasons such as gaining self-esteem. Behaviourist Theory Consumer behaviour according to behaviourists like J.B Watson (1878-1958) and B.F Skinner (1904-1990) is driven by factors external to the individual and not internal drives as asserted by psychodynamic theories. One way consumers develop behaviour is by learning from the environment. Children at birth do not know how to differentiate things as the only thing they are accustomed to is the breast. However, as they grow, they learn to differentiate self from the environment and begin to learn about the different items from parents and peers. It is at this stage that children begin to extend their self by controlling and possessing objects in their immediate environment (Belk, 1988). Culture also instils values in them on what is important to buy based on cultural beliefs, norms and values (Arnould & Thompson, 2005). Those things valued by society become part of extended self and the consumer strives to possess them. There are three levels of self: individual, family and community. The consumption objects for an individual are things individuals own such as jewellery whereas the consumption object for family is the home. The community also has its consumption goods that make one have a sense of belonging and the need to protect such things. Social influence from family, community and peers determines consumer behaviour and consequently the extension of self. Belk (1988, 156) argues that “your identity and your self, depends upon the people and things that compose your associations.” These other people who influence our self include wife, children, ancestors and friends. As such, people tend to extend their self by vicariously consuming through other family members in the belief that by extending their self, we extend our self in the process as it makes us happy. Research (Childers and Rao 1992, 198) supports this claim that reference groups (peers and family) influence individual’s product and brand decisions. The two groups have varied degrees of influence and family-based influence varies across cultures. Intrafamily communication influences brand preferences and loyalties, information search, media reliance, price sensitivity, and adherence to price-quality beliefs. However, it is not always the case that children learn consumption behaviours from parents and society as children of nowadays are more aggressive and learn new things and technology early thus affecting parent’s consumption decisions (Ekstrom, 2007; Nairn, Griffin & Wicks, 2007). Parents thus have to learn to keep up with their children and this means extending self through children. Cognitive Theory This involves the stimulus-organism-response model of decision making in which behaviour is attributed to information processing in one’s mind (Young & Faber, 2000). Factors that affect cognition include perception, learning, memory, thinking, emotion and motivation. According to this consumer decision model, the consumer goes through various stages before purchasing an item such as need recognition, information search, evaluation of alternatives, purchase, post purchase and divestment which are influenced by stimuli and past experiences and external variables such as the environment and individual factors (culture, family, social class, personality, motivation) (Williams 2014). Cognitive theory can best explain the various ways people extend selves. Past experiences are part of extended self and determine what people consume or possessions they hold. If one has good memories from a previous purchase, it is highly likely to keep such an object especially for the aged to restore their lost glory or to feel good about themselves since now they are not in control of possessions (Belk, 1988). Personality also determines the kinds of objects one buys; some buy exciting objects like automobiles while others like calm objects. This is because objects we possess in most cases define who we are. It is therefore, no wonder for men to take time to choose the right wife or car as it is an extension of self. The purchase we make reflects on us and people judge us through it hence the need to go through that buying process to make the right decision (Escalas & Bettman, 2003). Humanistic Theory Humanistic theory stresses the role of emotions in consumer behaviour. People have different needs and views regarding objects which guide their decision making in their daily lives. Some have altruistic motives hence seeing other people happy makes them happy too. Others are driven by the need for self-actualisation hence buy items to fulfil this need. As such, their purchase decisions are a matter of free will (Young & Faber, 2000). It for this reason that consumers engage in ethical purchasing and gift giving. It is to feel good about themselves. Gift-giving ensures extension of self especially if the gift is to a family member of if receiver values the gift and treats it as an extension of self. Conclusion The concept of extended self is based on the popular belief that “we are what we have.” Our possessions determine our identity in society and are a reflection of who we are hence consumption behaviour is aimed at enhancing this self-extension especially by enhancing self-esteem and status. There are various consumer behaviour theories that help to explain this concept such as economics, psychodynamic, behavioural, cognitive, and humanistic theories. Economic theories view purchasing as based on rational decisions of humans. Psychodynamic theory views consumer behaviour as driven by biological forces. Behaviourists emphasise on external stimuli while cognitive theorists stress on rational information processing and is the most widely used by consumer behaviour researchers. 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