Tag: exchange

What is Consumer Behavior?

According to the American Marketing Association, consumer behavior is “the dynamic interaction of affect and cognition, behavior, and the environment by which human beings conduct the exchange aspect of their lives.”

That’s some pretty hardcore definition right there. And I wish I can provide a simpler one. But because of the nature of consumer behavior, all I can give are situations in which they become obvious and relevant.

If you’re a consumer, it’s reflected on your buying decisions and consumption as affected by your thoughts, emotions, attitudes and environment.

If you’re an entrepreneur, then your knowledge of consumer behavior becomes indispensable in drawing up your winning strategy – because it’s all about knowing, serving and influencing your target market1.

THE NATURE OF CONSUMER BEHAVIOR

  • DYNAMIC
    Consumer Behavior is Dynamic
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    One thing that makes the study of consumer behavior both exciting and challenging is that it’s constantly changing. What your market wants now might not be what they want in the future. What worked in your strategy today may be an epic fail the next time you implement it. You got to be aware of trends and how these respective trends shape your market’s preference. You got to be on the look out for new technological advancements, environment changes, spending behavior, lifestyle changes, etc. to keep up with your market.

  • INVOLVES INTERACTION
    Consumer Behavior Involves Interaction
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    This nature of consumer behavior makes it very difficult to define since it’s the result of our thoughts, emotions, actions and environment – all combined. What does your market think about your product? How do they feel about your product? What do they need to do to get or use your product? How do you influence the external environment of your market to make it more conducive for your product? You got to be as accurate as possible to better satisfy your customers and give them value.

  • INVOLVES EXCHANGES
    Consumer Behavior Involves Exchange
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    People has to give something up so they can have something in return. It can be your product or services in exchange for your customer’s money. As an entrepreneur, you got to create strategies for these exchanges to take place.

1Peter,J.P., Olson,J.C., Consumer Behavior and Marketing Strategy 7th Edition, International Edition 2007
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