Applications of Consumer Behavior

Today I am going to write about why the world going gaga over consumer behavior or in other words customer intelligence. The industry uses this intelligence or data to analyze the market to gain better insight into the life of customers and hence make better strategic decisions. The main applications of consumer behavior:

• The most obvious is for marketing strategy—i.e., for making better marketing campaigns. For example, in the simplest case, by understanding that consumers are more receptive to food advertisements when they are hungry, they learn to schedule snack advertisements late in the afternoon.  That is the reason why you see all those pizza ads in the afternoon or evening and not right in the morning. Okay lets take another case, by understanding that new products are usually initially adopted by a few consumers and only spread later, and then only gradually, to the rest of the population, they learn that (1) companies that introduce new products must be financially well equipped so that they have the capability of suffering the losses initially until their products become a commercial success and (2) it is important to please initial customers, since they will in turn influence many subsequent customers’ brand choices. It is also important to understand that what kind of products are more receptive to the people who try new things out(in technical language, innovators). A new type of razor may be more receptive to the people than a new OLED TV.

• Social marketing involves getting ideas across to consumers rather than selling something. Dr. Marty Fishbein, a marketing professor, went on for leave to work for the Centers for Disease Control trying to reduce the transmission of diseases through illegal drug use. The best solution, obviously, would be if we could get illegal drug users to stop. This, however, was seeming to be impossible. It was also determined that the practice of sharing needles was too habitual in the drug culture to be stopped. As a result, using knowledge of consumer attitudes, Dr. Fishbein created a campaign that inspired the cleaning of needles in bleach before sharing them. This served their purpose.

• The next one is public policy. In the 1980s, Accutane, a near miracle cure for acne, was introduced. Unfortunately, Accutane resulted in severe birth defects if taken by pregnant women. Although physicians were instructed to warn their female patients of this, a number still became pregnant while taking the drug. To get consumers’ attention, the Federal Drug Administration (FDA) took the step of requiring that very graphic pictures of deformed babies be shown on the medicine containers. The same thing can be seen with cigarettes where a picture is embedded on the pack showing a pair of lungs full of tar. 

• This one is for the customer. Studying consumer behavior should make us better consumers and judge decisions of the others correctly before getting influenced. Two people buying the same thing may (1) pay different prices (2) have different reasons to buy them (3) have different attitude towards it. An example is always helpful. Meera buys an android phone after telling her friend Asha that she prefers Apple. Asha perceives this purchase as an opinion from Meera that Mac is not worth it as it doesn't have Bluetooth and other features. However it just may be the case that Meera didn't have enough money to buy an Apple iPhone and hence bought the Android.