Consumer Buying Behavior - Essay Example

Marketing intelligence Introduction Marketing is one of the vital practices in an organization that contributes significantly to the success of the organization in terms of achievement of sales and revenue goals and objectives. In this report, the researcher will attempt to explain and analyze the consumer buying behavior, its theories and factors affecting buying decisions, ways to conduct a market research and customer responses. Task one 1.1 Stages of consumers’ purchasing decisions The first stage is need recognition whereby a consumer realizes that he has a need that he has to satisfy. Bernice (2009) argues that a consumer recognizes his need through both internal and external stimuli. This is a stage whereby a consumer realizes that he needs new clothes for example. The next stage is information search whereby the consumer analyzes all the possible companies selling clothes such as Tesco and its competitors. The alternative evaluation stage is the third stage in which the consumer evaluates the quality of clothes and prices charged by various companies. For example, a consumer can compare the prices of Asda and those of Tesco. In the fourth stage, purchase decision, the consumer makes his decision on which store to purchase clothes from and goes for the company that offers quality clothes at affordable prices. The last stage is post-purchase behavior whereby the consumer analyzes if the clothes he purchased from Tesco for example satisfied his needs or not and taken relevant actions. 1.2 Theories of buying behavior Maslow’s theory of needs- This theory outlines that individual have certain needs that he needs to satisfy all through his life. In the buying behaviors of consumers, they first consider satisfying the most urgent needs necessary for their survival and good living (Kelly, 2002). Consumers start with satisfying basic needs then safety needs followed by social needs then self-esteem needs and lastly self-actualization needs. Diffusion of innovation theory- This theory outlines how advancements such as new technologies spread throughout cultures and societies from introduction to wider adoption. The costs, accessibility and familiarity with the technological change influence that buying behavior of consumers (Lehman, Ramsey and David, 2000). If the cost of new advanced products and services is much higher than those of the old ones, consumers will prefer purchasing the old ones since they satisfy the same needs. 1.3 Factors affecting consumer buying behavior Cultural and religious factors- The consumer’s buying behavior is highly influenced by the cultural and religious beliefs of a consumer. For example Muslims cannot purchase pork products being offered by Tesco in the market. In another, the reputation of an organization will determine whether a consumer will purchase their products or not since the culture of many consumers restricts them to deal only with reputable organizations. Social factors- McLaughlin (2008) argue that family, status and roles of a consumer in the society affect his purchasing behavior. In this case, the outside influences other people related to a consumer play a role in his purchasing decisions either indirectly or directly. Family members may prefer products from Asda since they believe that they are of the best quality, therefore the consumer will always prefer Asda to Tesco when in need of certain goods offered by the same supermarkets. 1.4 Brand loyalty, corporate image and repeat purchasing Brand loyalty simply refers to situation where consumers become loyal to the products and services provided by Tesco or Marks and Spencers. Consumers in each and every market prefer goods and services that are of high quality and fairly priced in a way that consumers do not feel exploited (Nelson, 2008). High quality goods and services in most cases meet needs of consumers fully and this motivates consumers to stay loyal to organizations producing such products and also creates a good corporate image for the organizations. Due to fair pricing and quality of goods and services produced by Tesco Supermarkets and Marks Spencers, consumers stay loyal to the organization. Brand loyalty and good corporate image facilitates repeat purchase in that consumers always go for Tesco’s products and services when in need to the products and services they had purchased from the organization before. Task two 2.1 Market research techniques to obtain information Use of a sales team- The sales team plays a very vital role in the improvement of organizations sales and identification of market gaps in the market. (Bernice 2009) argues that in order to obtain any relevant information on a certain market, the use of a sales team will be very instrumental. This team always has a physical contact with consumers and different sales team from other business organizations with whom the share all necessary information concerning the market. Conducting a SWOT analysis- SWOT analysis is a tool used by an organization to conduct research on both its internal and external environment. Through SWOT analysis, the top management of the organization acquires all the relevant and useful information concerning the market it operates in or is willing to operate in. the management will be able to know the opportunities and threats that exist in the market and the strengths its organization has to maximize the opportunities and counter the threats. 2.2 Sources of secondary data to achieve research objectives Internet- The internet contains a lot of information concerning a very wide variety of issues and trends in the business world. Most researchers, access the internet when looking for information they need in their study. The endless websites in the internet provide unlimited information that when accessed can be used by researchers to achieve their research objectives. The information on trends and issues of the market were obtained from the internet. Journals, books and magazines- Nelson (2008) defines secondary data as second hand information that plays a huge part in a research study. This secondary data can be obtained from books, journals and magazines. When conducting research on the market, books, magazines and journals containing all relevant information to the market were accessed in order to obtain secondary data needed for the study. 2.3 Assessment of Validity and reliability of market research findings Validity- This simply refers to how excellent a test measures what it purported to measure (Kelly, 2002). The information outlined in the market research findings need to be valid for research questions to be answered appropriately. The information should be true and should not be biased in any way by the researcher to fit research questions and objectives. All the pie charts, graphs and tables should be correctly formulated and contain the true values obtained in the research process. Reliability- This basically refers to the degree to which an assessment tool produces consistent and stable results. According to Bernice (2009), information that is obtained in the process of research should be reliable. The information outlined in the bar graphs and charts should be consistent so that good and effective conclusions can be made from the research findings. 2.4 Marketing research plan used to obtain information Research design- The type of research design was descriptive in nature. Descriptive research is of great help when conducting a certain study in most cases according to researchers and therefore was used in this study. Research population and sample- The research population was two hundred respondents. 125 of them were consumers in the market and 75 of them were employees of various firms in the market. All the 200 respondents were supplied with open-ended questionnaires collected after two weeks. Sources of data- The researcher obtained secondary data from books, journals, magazines and the internet. Primary data was obtained from the questionnaires distributed to respondents targeted in the study. Data analysis techniques- The researcher used qualitative tools to analyze the data obtained in the study. The use of graphs, tables and pie charts were considered in the study. Task three 3.1 Assessment of market size and trends From the information acquired in the research process, there are a number of restaurants that already exists near Brit College. Since restaurants provide goods and services that meet one of the basic needs of consumers, the number of consumers in the market is large. Existence a good number of restaurants around Brit college and a large number of consumers in need of the food products offered by the restaurants show that the market size is a bit large. In the market, the prices charged by all the restaurants operating in the area are marginally close. The quality of food products and services offered in the market is exceptional since consumers demand for such products and services and stays loyal to those restaurants offering food products and services of good quality. The technology adopted in almost all restaurants is modern in order to facilitate efficiency and effectiveness in the production of food products and services in that particular market. 3.2 Competitor analysis The level of competition in the market is high due to existence of a good number of restaurants near Brit college. Nelson (2008) argues that competition gives rise to production of high goods and services that are fairly priced. Therefore all restaurants operating in the market are concerned with the quality of their food products and services and most of them apply the customer focus strategy in conducting all their operations. All the restaurants aim at satisfying consumers in the market so as to establish a good customer base that will enable them possess a certain percentage of the market share. Each and every restaurant is in a good position in terms of financial ability in order to respond to competition in the market appropriately. The technology adopted in almost all organization is the latest in the market and each restaurant has various ways of creating a good competitive advantage over the other restaurants. 3.3 Opportunities and threats in the market Opportunities are those forces in the market that when exploited may facilitate success of an organization in the market while threats are those forces the market that may create barriers to the success of the organization in the market (Lehman, Ramsey and David, 2000). A business organization has to possess the ability to take full advantage of opportunities in the market to expand its business and achieve its goals and objectives and to counter threat that may be faced in the market accordingly. From the research conducted, here are the opportunities and threats facing my restaurant; Opportunities 1. Availability of a large number of consumers 2. Possibility of producing new food products and services to fill gaps in the market 3. Diversification of foods products and services to win more customers Threats 1. Stiff competition due to availability of many restaurants in the market 2. Existence of demanding consumers in the market Task four 4.1 Techniques of assessing customer response Customer response assessment basically refers to collection of customers’ information in order to determine the suggestions that can be implemented in the restaurants in order to meet the interests of the organization (Kelly, 2002). One of the techniques that can be used in this process is the home customer survey such as email surveys, phone surveys or mailed surveys that request information for customers on how they feel about the services and products of the restaurants and how they can be improved. Customer service questionnaires are another technique that can be used to assess customer responses. These questionnaires are usually given to consumers when they visit the premises of the organization and they are filled as customers are being attended to. The customers are given opportunities to address their complaints and compliments in the questionnaires and suggest ways in which they feel can be implemented to improve the services and products of the organization. 4.2 Design and completion of a customer survey DELICA RESTAURANT CUSTOMER SERVICE QUESTIONNAIRE PART A Name of customer: David Williams Length of association with Delica restaurant: 2 years Residential area: London Occupation: Student at Brit College PART B Please tick on the restaurants food products you prefer a. Burgers b. Chips c. Chicken d. Fish e. Rice f. Rice and stew g. Rice and vegetables h. Chips and chicken i. Chips and chicken Reasons 1. They are fairly priced 2. They are very delicious 3. They are served exceptionally well 4. The ingredients and spices used are amazing Complaints 1. Slow service delivery 2. Small variety of beverages to choose from Suggestions for improvements 1. The restaurants should consider increasing its product line 2. The organization should consider offering a variety of beverage products 3. Effective marketing should be conducted to create awareness of the restaurant’s existence in the area 4.3 Reviewing the success of the completed survey After completion of customers’ survey, the top management need to respond to all complaints outlined in the survey appropriately in order not to lose its loyal customers (McLaughlin, 2008). The suggestions that are given by the customers should be well analyzed by the top management and promising ideas put into practice. For example, Delica restaurant should consider offering a variety of beverage products and should increase its product line when it comes to food products. By doing so, the organization will be in a good position to increase its sales by attracting a large number of customers. Conclusion For a business organization to be successful in its respective market, the top management of the organization should ensure that a good marketing research has been conducted for relevant products and services to the market to be produced. It should also use various strategies to obtain complaints and suggestions from its customers in order to position its products and services appropriately in the market. References Bernice. K., 2009. Effectiveness of marketing strategies, UK. Sage: London Kelly. P., 2002. Market development: Developing a marketing strategy. The marketing Journal.75, pp. 117-135 Lehman. F., Ramsey. B. and David. S., 2000. Customer Response Strategies. 3rd edn. London: Longman. McLaughlin. E., 2008. Consumer buying behavior theories. Sage: London Nelson. T., 2008. The handbook of market development. 2nd edition. Cullompton: Willan publishing Read More