Showing posts with label Learning. Show all posts
Showing posts with label Learning. Show all posts

Factors Determining Consumer Buying Decisions | Consumer Buying Behavior

Factors Determining Consumer Buying Decisions


Economic, demographic, psychological and socio-cultural factors determine consumer buying decisions. These factors directly affect consumer behavior.

Factors determining Consumer Buying Decision


I. Economic Factors            


Economic factors play an important role in consumer buying behavior decision. It also directly affects purchasing power of the consumers. If consumers’ purchasing power is weak, they cannot make decision to buy goods or services even if they like very much. But, if they have purchasing power, they can take prompt decision to buy goods or services they like. Income level, income of their family members, liquid asset, spending attitude, credit facility etc. are the economic factors to determine consumers’ buying decision.
  1. Consumer’s income level: Income of all consumers’ cannot be same. Some have more and others have low income level. If the income of consumers is high, purchasing power and readiness become high, otherwise their purchasing power and readiness become low. The consumers having high level income take quick decision to buy high quality goods or services. But those having low income take slow decision to buy low quality goods or services.
  2. Income of other members of family: Consumer lives in family. Family expense is managed by adding the income of all members of the family. Any change in income of other members also affects the purchasing decision of the consumer. If income of the other family members increases, purchasing power also increases; if decreases, it also decreases. In the countries like Nepal where joint families live together, income of other family members also should be studied and analyzed while analyzing the economic determining factors.
  3. Liquid assets: If the consumers have liquid assets such bank balance, gold, silver, share, government bond etc., their purchasing power does not drop off even if incomes become irregular or drop down, because such liquid assets increase their purchasing power.
  4. Attitude towards spending: Consumers’ spending attitude becomes different. Some consumers form positive and others form negative attitude towards expense. Such attitude also influences buying decision.
  5. Credit facility: Credit facility also influences consumers’ purchasing power and readiness. If credit facility is available, consumers’ spending level increases. Just the opposite, if no credit facility is available, consumers’ spending level decreases.


II. Demographic Factors             


Demographic factors play an important role in purchasing decision of the consumers. It directly or indirectly influences the consumers’ buying decision. The demographic factors include family size, family life cycle, occupation, age, sex or gender etc.

a) Family size and life cycle: Family size of all consumers may not be same. Size of some family may be small and others may be big. The size of family influences selection of goods and buying quantity. If the family size is big, such consumers, generally, purchase large quantity of same brand. If family size is small, they purchase small quantity of goods of different brands.

Life cycle of a family also influences consumers’ buying behavior. Unmarried, married but have no children, married and have children, old and other consumers have their own behaviors towards selecting and buying goods. Behaviors of consumers are different. Such behaviors also directly influence buying decision.

b) Occupation: Occupation of the consumers also influences their buying behavior. For example, workers buy cheap clothes to wear while working in factory. Teachers, professors, advocates, managers etc. buy costly dresses to wear while working in their offices. So, the occupation affects buying behavior of the consumers.

c) Sex or Gender: Buying behavior and decision also differs between men and women. Women buyers give importance to price, quality and warranty of goods and evaluate alternatives. They take longer time and make efforts for making buying decision. But males give comparatively less importance to price, quality and warranty of the goods. They are influenced by advertisements, sale promotion and other activities. They do not take long time and efforts to take buying decision. They take buying decision promptly. They also do not base on evaluation of alternatives as many as the women base on.

III. Psychological Factors           


Psychological factors also play important role in buying behavior of consumers. Consumer’s psychology becomes more self-centered. These factors include learning, motivation, perception, personality, attitudes, life style etc.

a) Learning: The changes that come in consumers from observation, experiment and experience is called learning. Consumers take buying decision after learning. Without learning and knowing anything about goods, they cannot take buying decision. Learning affects human behavior directly. Learning involves four factors such as curiosity, cue, response and reinforcement. Learning has two main theories. They are:
  • Stimulus response theory: This is called S-R theory. Consumers express response as a result of stimulus. For example; consumers can be simulated by advertisement and they buy goods or services as response to the advertisement.
  • Modern theory: This theory includes drive, cue, response and reinforcement. Drive stimulates consumers to buy goods or services, cue gives information how the consumers respond. If the response is positive, its enforce takes place, otherwise it does not.

b) Motivation: Motivation is the power sprung from the heart of a man. It leads towards objective. Until the man does not achieve objective, he becomes restless. So, whatever activities a man does, they are all the results of motivation. Motivation also affects buying behavior of consumers. Motivation brings purposeful changes in human behavior. Motivated consumer becomes heartily ready to buy goods or services. There are many theories of motivation. Among them Maslow’s Hierarchy of Need Theory and Herzberg’s Two-Factor Theory have been discussed as follows:

i) Maslow’s Hierarchy of Need Theory

Abraham Maslow’s hierarchy of need theory believes that human being acts like motivated by need and need has a certain hierarchy. These needs are fulfilled one after another setting them in hierarchy. But men cannot be motivated by satisfied needs, only unsatisfied need affects human behavior. Abraham Maslow’s hierarchy of need theory can be presented as follows:

Maslow's Hierarchy of Need Theory

  • Physiological needs: Physiological needs of human being are compulsory nature. Food, shelter, clothes, thrust, hunger etc. are physiological needs.
  • Safety needs: When human’s physiological needs are fulfilled, security needs are realized. Security from physical danger, bad health, weak economic condition etc. are included in safety needs.
  • Social needs: After the security needs have been fulfilled, human begins realize social needs. Friendly behavior, socially acceptable, living with love, involvement in social organizations etc. are included in social needs.
  • Ego or esteem needs: After the human’s physiological, safety and social needs are fulfilled, she/he begins to realize ego or esteem needs. Under this, self respect, dignity, honor, freedom, praise, recognition of freedom etc. are included.
  • Self actualization needs: According to Maslow, after the ego or esteem needs are fulfilled, human realizes self-actualization needs. This includes use of special skill, ability, creativeness, self-development etc.


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ii) Herzberg’s two-factor theory

Herzberg’s two-factor theory is based on hygiene and motivation factors. According to him, hygiene factor does not motivate human to work, it prevents dissatisfaction only, and motivating factors lead human towards works and increases satisfaction. According to this theory, the lower level needs are classified by Maslow as physiological needs, safety needs and social need and higher level needs as ego or esteem needs that come under hygiene factors and self actualization needs come under motivating factors. The following figure makes it clearer:

Comparison between Maslow's and Hertzberg's Need Theories

c) Perception: The process of understanding about anything and making out its meaning is called perception. In other word, knowledge or understanding meaning or making out view about anything or any situation is called perception. Different persons may have different perception about same thing. Consumers collect information by looking, feeling, hearing, smelling, tasting etc. and make a certain perception. Accordingly the consumers make buying decision.

d) Personality: Consumers’ personality also influences buying behavior. Living style, talking style, interest, wants, personal style etc. as a whole, is personality. Personality is expressed in the form of self control and self confidence. Personality is expressed through dress, speaking style, his vehicle, his house, words he uses, restaurant he goes etc. The characteristics of personality are as follows:
  • Self-confidence or dependency
  • Aggressive or friendly
  • Introvert or extrovert
  • Traditional or dynamic

e) Attitude: Consumer’s knowledge, perception and belief about goods or services is called attitude. Attitude of any person towards goods is not set by birth. Attitude is formed through learning and perception. What a consumer learns from society forms persons’ attitude. Such attitude makes the person decide to buy or not to buy goods.

Consumer’s attitude towards goods many be positive or negative. If it is positive, business organization tries to maintain it; if negative, the organization should adjust marketing mix and make it positive, because if the attitude becomes positive consumer decides to buy goods, otherwise decides not to buy. Attitude includes the following factors:-
  1. Learning: Attitude develops through learning process. For example, consumer learns something about goods through direct experience, information collection, mass communication media etc. As a result, his/her attitude develops.
  2. Consistency: Attitude becomes comparatively consistent but it becomes temporary. Attitude changes after a long time. As situation also affects attitude, it may change even in shorter time.
  3. Favorable or unfavorable: Consumers’ attitude towards goods or services becomes either positive or negative. It never remains neutral.

f) Life style: Living, wearing, eating, spending and other behaviors of men as a whole is called lifestyle. Life style of the person can be understood from different activities, interest, ideas and thinking style. They should be studied and analyzed to find out how the consumers spend time, what is their interest and how is their thought. Consumers’ life style makes difference in their need of goods and choice of brand. Consumers’ life style is influenced by their education, society, context etc. Lifestyle gives preference to the following three aspects of consumers:-
  1. Activities: Activity aspect includes how the consumers pass their time, what works they do, what their interest is, how they buy and how they pass holidays etc.
  2. Interest: Consumers’ interests about home, family, food, job, fashion etc. are included under this aspect.
  3. Opinion: Consumers’ thought, ideas and attitude towards society, politics, business, goods, services etc. are included in this aspect.


IV. Socio-cultural Factors             


Social and cultural factors also play an important role in consumers’ buying behavior. The collective form of persons is called society, and their custom, tradition, wearing and eating, festivals, values and norms, religion, etc. on the whole is called culture. Social and cultural factors include family, reference group, social group etc.

a) Family: If the persons having same blood relations, married to others or adopted persons live in same home, they all are a family. A family includes father, mother, wife, children (sons and daughters), uncle and aunts, nephew etc. Family may be in joint or nuclear form. Different members of a family may play different roles. This influences buying decision. Generally the following roles are found in a family:-
  1. Initiator: The person who first presents suggestion or proposes to buy any goods is called initiator.
  2. Influencer: The person who influences buying decision is called influencer. Influencer plays an important role in buying decision.
  3. Decider: The person who takes last decision about what to buy, how to buy, where to buy and when to buy is called decider.
  4. User: The person who uses goods or services is called user.

The above mentioned roles may change in a family. The roles of each member of a family become different depending upon the nature of goods or services. For instance, all the members cannot have equal role in buying daily necessities for home, buying dolls, buying land or house, or buying expensive ornaments etc. Roles are found changing according to the nature of goods or services.

b) Social Class: High, middle and low class people live in society. Consumers’ class can be identified from their economic condition, life style, profession/occupation, education, premises, norms and values, belief, attitudes etc. The consumers who have high economic condition, prosperous psychology and customized life style are called or counted as high class. In the same way, middle class and lower class consumers can be identified.

The bases to distinguish social class are:
  • Economic condition
  • Life style
  • Values, beliefs and attitudes
  • Occupation/ profession
  • Education

Buying behavior becomes different according to social class. High social class selects high quality, prestigious sophisticated and famous brand of goods. Low social class people select low quality goods and middle class people middle class quality goods. High class people visit foreign countries in holidays, celebrate Good Friday, birthday party. But low and middle class people cannot, due to lack of money even if they want.

c) Culture: Language, religion, belief, food, dress etc. on the whole is called culture. Culture is the behavior learnt from generation to generation. It influences activities of all the people. It naturally influences buying behavior. Men learn different things from culture, which leaves deep and indelible impression. It becomes very difficult to change culture along with the time. Culture may be seen or unseen. Home, food, living style, dress, behavior, working style etc. are seen culture where as language, religion, belief, attitude etc. are unseen culture. Although culture also may change after a long time. Different societies have different cultures which direct the people of their own society. Culture forms deep seated tradition and behavior which cannot be broken easily.

d) Subculture: The community adopting same culture can be classified in different ways on the basis of region, language, caste, religion etc. The culture classified in this way is called sub-culture. For example, Nepal’s culture can be classified into two subcultures as western culture and eastern culture on the basis of region. Similarly, culture can be classified into subcultures on the basis of caste, race like Gurung, Magar, Newar, Brahmin, Kshetri etc. In the same way, it can be classified into other subcultures on other bases. Culture influences consumers’ behavior. As special introduction and identity of consumers’ can be learnt from the study of culture, it helps to make marketing mix more effective.

e) Reference group: The group which influences consumers’ buying behavior is called reference group. Each consumer is associated with one or the other society and is directly influenced by the same. The group influences consumers’ buying behavior by providing information, influencing person’s attitude, giving pressure due to which they decide to buy goods or services. Generally, reference groups are as follows:
  1. Membership group: This includes family, religious group, professional group, trade union, etc.
  2. Aspiration group: The group interested to be member of any desired group is called aspiration group. For instance, political group, social or religious group, sport group, other extra activity group etc.
  3. Disassociate group: The group which breaks up from one and joins any other group is called disassociation. For example, if any political leader renounces politics and starts religious, social or other activities, it is called dissociation.

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Principles of Learning

Learning principles are the proving guidelines in the learning process. The application of these principles assists managers, training instructors and individuals working in the organization to gain knowledge of how to learn and get its benefits to influence behavior. The major principles of learning are as follows:
  1. Principles of Reinforcement: Reinforcement is the attempt to develop or strengthen desirable behavior by either bestowing positive consequences or withholding negative consequences. Positive reinforcement results from the application of a positive consequence following a desirable behavior. Bonuses paid at the end of successful business years are an example of positive reinforcement. Negative reinforcement results from withholding a threatened negative consequence when a desirable behavior occurs. For example, if the boss imposes a penalty on an employee for coming late is an example of negative reinforcement. 
  2. Principles of Punishment: Punishment is yet another way of changing human behavior. It is inverse of the reward. The purpose of punishment is to eliminate or weaken an undesirable behavior. It is done in two ways. One way to punish a person is through the application of a negative consequence following an undesirable behavior. For example, a football player who is excessively offensive to the referee in the football ground (undesirable behavior) may be rejected from the game (negative consequence). The second way to be used to punish the person is through the withholding of a positive consequence following in undesirable behavior. For example, a sales representative who makes few visits to companies and in turn, make sales below quota (undesirable behavior) is given less commission (positive consequence).
  3. Principles of motivation: Whether it is learning in the classroom or workplace, if people themselves are not sufficiently motivated to learn for goal achievement and development, there will be no productivity, career development and other forms of development. However, one can not be forced to learn. Learning needs motivation on the part of the learner in order to exert a high level of effort.
  4. Principles of practice: The most useful way to learn is implicit learning i.e. the experiential way we acquires information about relationships in the environment without any conscious attempt to do so. Implicit learning occurs when we directly interact with the environmental forces, competitors, customers, supervisors and so on. One popular form of practice learning is action learning.
  5. Principles of feedback: There is a set of feedback rules to enhance learning. Examples are, be specific, non judgmental, express your own feelings etc and so forth. With the application of these sets of effective feedback, one can learn in the organization too.
  6. Principle of Generalization: The principle states that the learned behavior should be generalized i.e. to respond of two different stimuli in a uniform manner. Learners must transfer what they have learned to actual working environment if not such learning would be useless for the individual as well as for the organization. For example: the skill learned by an employee in training workshop has to be generalized at actual work floor.
  7. Principle of Learning Practice: The principle states that learning beings rapidly then plateaus. It states that at the beginning phase of learning, the learning is at faster rate, then as the time increases, the rate of learning will decline until a plateau is reached.
Learning principles are the guidelines that help a manager to gain maximum efficiency in a learning situation. These guidelines are to be applied in content of the task and the level of the person. These principles are:
Principles of Learning
1. Knowledge of Results
The knowledge regarding one’s own performances is an essential condition for learning. This feedback of performance enables the learner to know where he stands and to initiate corrective action if any deviation from the expected goals has taken place. In practice a trainee without information will usually try to generation his own knowledge of results that is select a goal he thinks is, correct and adjust his performance accordingly.

2. Meaningfulness of the Subject
A definite relationship has been established between learning and meaningfulness of the subject learnt. More meaningful the material, better would be the learning. Acquisition of nonsense syllabus proceeds more slowly than that of prose or poetry. On a broader scale, a programme of learning where each task makes meaning, trainers do have a certain techniques that are meaningfulness for trainees.

3. Schedules of Learning
Schedules of Learning seem to be true both for simple laboratory task and for highly complex tasks. Actually, schedules of learning can be manipulated in following three different ways as:
  • Duration of practice session,
  • Duration of rest session, and
  • Positioning of rest session

4. Motivation
Motivation is something that moves a person to action, and continues him in the course of action initiated. Motivation is related in several ways to learning. The extent to which valued rewards follow high performance, for example, will affect an employees’ willingness to work hard in the future, and the cause and effect linkage needs to be clear. That is, employees should recognize that certain behaviors (such as hard work) cause certain outcomes (desired rewards). Similarly, if rewards do not follow performance, the employees may be less inclined to work had in future.

5. Reinforcement
Reinforcement is the fundamental condition of learning. Without it, no measurable modification of behavior takes place. The term reinforcement is very closely related to the psychological process of motivation. It may be defined as anything that increases the strength of response. Reinforcement strategies can be employed by managers to influence the behavior of employees viz,
  • Positive reinforcement
  • Negative reinforcement
  • Extinction, and
  • Punishment

6. Learning Curve
Learning is a continuous process. The principle of learning curve involves the time factor and the repeated efforts in order to gradually increase the strength of the response. This especially true when the behaviors to be learnt are comparatively complex such as skills that are learnt and improved by practice. For example, a person who wants to learn typing would execute awkward strokes in the beginning, but under guided supervision, time and conscious repeated efforts, the skill is improved and as the person gains confidence, the rate of typing speed increases until a maximum rate possible for him is reached. The limiting factor may depend upon motivation, co-ordination or other physical constraints. This means that as the practice time increases, the degree of skill also increases. However, the rate of increase in the degree of skill is higher in the beginning but decreases with time until it reaches zero and the person has obtained the maximum skill.

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Meaning of Learning | Features of Learning | Process of Learning and Factors influencing Learning

   Concept of Learning       


Learning is another important psychological process determining human behavior. It is a term frequently used by people in a wide variety of contexts. Learning is a continuous process. It occurs all the time. Learning is any relatively permanent change in behavior that occurs as a result of experience. We can say that the changes in the behavior indicate that the learning has taken place and that learning is a change in behavior.

In other words, learning may be defined as the process of acquiring, assimilating, and internalizing cognitive, motor, or behavioral inputs for their effective and varied use when required, leading to an enhanced capability for further self-monitored learning. It is a change in behavior through education and training, practice and experience. It is accompanied by acquisition of knowledge, skills and expertise which are relatively permanent. Temporary changes may be only reflexive and fail to represent any learning. If reinforcement does not accompany that practice or experience, the temporary changes in behavior will eventually disappear. It is reinforcement which makes learning or change in behavior enduring by strengthening and intensifying certain aspects of an individual’s behavior. Some definitions are presented by the experts are as follows:

“Learning is the process by which new behaviors are acquired. It is generally agreed the learning involves changes in behavior, practicing new behaviors, and establishing permanency in the change.” – T. R. Mitchell

“Learning is a process within the organism which results in the capacity for changed performance which can be related to experience rather than maturation.” – Ribeaux and Poopleton

“Learning is the process by which an activity originates or is changed through reacting to an encountered situation, provided that the characteristics of the change in activity cannot be explained on the basis of native response tendencies, maturity or temporary status of the organism.” – E. R. Hilgard

“Learning is a relatively permanent change in the frequency of occurrence of a specific individual behavior.” – Hellriegel

From the above definitions, learning may be described as the process of acquiring the ability to respond adequately to a situation which may or may not have been previously encountered, as the favorable modification of response tendencies consequent upon previous experience, particularly the building of a new series of complex co-ordinated motor response; the fixation of times in memory so that they can be recalled or organized; the process of acquiring insight into situation. Thus, learning can be defined as a relatively permanent change in behavior as a result of prior experience.

Learning is any relatively permanent change in behavior that occurs as a result of experience. We can say that the changes in the behavior indicate that the learning has taken place and that learning is a change in behavior. The definition of learning highlights few characteristics of learning:
  1. Learning involves change. This may be good or bad from an organizational point of view. People can learn unfavorable behaviors as well as favorable behaviors.
  2. The change must be relatively permanent. Temporary changes may be only reflexive and fail to represent any learning.
  3. Learning takes place when there is change in actions. A change in an individual's thought processes or attitudes, if accompanies by no change in behaviors and would not be learning.
  4. Some form of experience is necessary for learning. This may be required directly through observation or practice or if may result from indirect experiences such as that acquired through reading. 

Features of Learning


Features and characteristics of learning are as follows:
  1. Leaning takes place when there is a change in actions. A change in an individual’s thought processes or attitudes, if accompanied by no change in behavior, would not be learning.
  2. The practice of experience must be reinforced in order for learning to occur. If reinforcement does not accompany the practice or experience, the temporary learnt behavior will disappear and hence no learning would be there.
  3. Learning involves change. This may be good or bad from an organizational point of view. People can learn unfavorable behaviors as well as favorable behaviors.
  4. Some form of experience is necessary for learning. This may be required directly through observation or practice or it may result from indirect experiences such as those acquired through reading.
  5. Learning occurs throughout one’s life and hence it is a continuous process.
  6. The change must be relatively permanent. Temporary changes may be only reflexive and fail to represent any learning.

Learning is the process of acquiring the ability to respond adequately to a situation which may or may not have been previously encountered. It is an important aspect of personality of an individual. Learning is any change in behavior, resulting from behavior. Learning has its certain process. The process of learning has following steps.


Process of Learning


1. Acquiring Knowledge or Input 


The first step in learning is the acquiring of new inputs in terms of knowledge and understanding (Cognition); some physical (Motor Activity) or a new behavior (including values and attitudes). Stimuli are basis or initial sources for acquiring knowledge. These are any objects existing in the environment as perceived by the individual. In the workplace, unless the employee understands the messages communicated by the management, he is unlikely to the affected in the appropriate direction as intended by the communication. When this process is quick and clear, learning is effective. 

2. Assimilation or Retention 


The second step of learning process is the assimilation of new input. It should not only be acquired quickly but should also be retained for a length of time. The stability of learned behavior over time is defending as retention and course in forgetting. If input that is acquired is short-term in the memory, learning will not be effective. 

3. Internalization of New Knowledge 


Effective learning is characterized by the internalization of new inputs. New inputs are acquired from outside environment. But after these are assimilated, they should become a part of the individual’s personality, lifestyle and psychological words. Internalization also means that inputs get transformed according to the individual’s own psychological and cognitive system. 

4. Application of New Learning 


Once the acquired inputs are internalized, they should be available to the individual for their effective use when the need arises. If what is learnt is only ‘ornamental’ and not effectively used, learning cannot be said to be effective. For example, the learning of management techniques and skills should result in better management of the various activities and fields with which the person works. 

5. Using Learning in all Situations 


Learning should have transfer value. What one has learned in one field, one should be able to apply and use in another field. One should be able to use one’s knowledge and skills in the new situation. This would mean being creative, making one’s own contribution to what one has learnt. Thus, there is continuous enrichment of knowledge and practice. Learning must contribute to this process of development of creativity, generation of new knowledge, development of new field of application and building of new theories and conceptual models. In fact, creativity would also imply improvement of practice with new knowledge and skills, and the development of new knowledge from improved action and practice. 

6. Self-monitored Learning 


Learning should in addition, increase a person’s capability for learning more on his or her own. This does happen in effective learning. After a child has learned to take the first few steps, he learns to walk and balance himself on his own. Similarly, initial learning in a particular field enables a person to organize further learning on his or her own. Without such self-learning, an individual’s growth would remain limited and dependent on external resources.

Factors influencing Learning


There are lots of factors that influence learning. To be more specific, the following are some;
  1. Psychological factors: The psychological factors that influence learning includes an individual's interest, values, perception, beliefs, needs and motives etc. Therefore, the organization must be familiar about individual psychological factors in order to make learning more effective. 
  2. Physiological factors: Another influencing factor of learning are human physiological difference. This includes intelligence, age, sex, health and memory power. It is well known fact that healthy and intelligent people can learn more than dull and physically unfit people.
  3. Learning method: What are the learning principles and method followed by organization play vital role in learning. So to say, learning depends in organization fund, qualified hired resource person, two way openly communication between trainee and trainer etc. influence learning.
  4. Environmental factors: Environmental factors consist of sound and healthy organizational environment. That is, clean, bright and peaceful environment play a dominant role in learning. The major barrier for learner is noise and air pollution, massive hot weather or cold that influence for learning.
  5. Appropriate feedback system: These should be set of feedback rules to enhance learning. Some examples are, be specific, non judgmental, express your own feeling etc. With the application of these sets of effective feedback, one can learn in the organization.

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