Understanding Consumer Behavior: Key Insights for Marketers and Consumers (Full Transcript)

Speaker 1: Hello everyone, welcome to Business School 101. As a consumer, you may experience marketing transactions every day. For example, you might want to have a cup of coffee at a Starbucks and decide what kinds of coffee and size you want to have. You might also consider buying a drink using the stars on a Starbucks loyalty card that you earned. Similarly to this, consumers make different kinds of decisions while interacting with marketing stimuli in various situations. Consumer behavior is everywhere and every day. So what is consumer behavior? In this video, I will discuss this topic with you. Consumer behavior reflects the totality of consumers' decisions with respect to the acquisition, consumption, and disposition of goods, services, activities, experiences, people, and ideas by decision-making units. Consumer behavior includes not only buying tangible products such as books or cereal, but also includes the use of consumers' services, activities, and experiences such as getting haircuts, going to a movie theater, taking a vacation, and donating products at Goodwill. Moreover, consumers make decisions to vote for politicians, make choices to spend time either on Instagram or YouTube, or decide to work out at the gym. Consumer behavior involves more than buying. There are three broad categories in which consumers make decisions, and those are acquisition, consumption, and disposition. First, acquisition. The acquisition includes various ways of obtaining offerings, such as renting, leasing, trading, and sharing. For example, consumers will compare the price of rental cars in different stores such as Enterprise, Budget Car Rental, or Avis, etc., and then they will rent a car that meets their criteria. Second, consumption. After consumers obtain an offering, they use it. Through usage, consumers can be satisfied or feel regret from the purchase. Depending on their experiences with the usage, consumers provide positive or negative reviews about the product or services. As consumer reviews influence other consumers significantly, it is important to satisfy consumers' needs and wants. Lastly, disposition. Consumers get rid of an offering in various ways, and it also provides important implications for marketers. Consumers can give away their used products or sell them, lend them to others, or throw them away. Environmentally conscious consumers put effort into recycling and or reducing waste, and they even try to choose biodegradable products. Besides the above three categories, please also keep in mind that consumer behavior is a dynamic process because the acquisition, consumption, and disposition can occur over time in a dynamic order. It can involve many people and many decisions, such as where, when, and how to buy a product. Consumers are often influenced by marketing stimuli, and different domains of the study can explain consumer behaviors from various perspectives. For example, psychology explains the internal process of consumers, such as motivation, perception, and memory. Psychology and economics together help to understand consumers' decision-making process. Sociology explains why and how consumers are influenced by external factors such as culture and social influences. In sum, consumer behavior refers to the study of individuals, groups, or organization, and the process they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impact that these processes have on the consumer and society. Understanding consumer behavior is beneficial. First of all, marketers can better develop marketing strategies, identify target consumers, and properly position their products in consumers' minds. By doing so, they can build long-term relationships with consumers and increase sales. Next, managers at non-profit organizations can also get benefits by studying consumer behavior. They can understand the motivation of consumers who are willing to donate to their charities and can develop an effective strategy to increase donations. For example, When consumers think about time compared to money, they donate more to charity because thinking of time makes consumers more emotional. Lastly, learning consumer behavior is also helpful for consumers to make better decisions when they are surrounded by a bunch of marketing stimuli in the world. All right, that's all for today's topic. If you have any questions regarding this video, please leave your thoughts in a comment below. I hope that you guys have enjoyed this video, and if you did, make sure you give it a thumbs up and subscribe to my channel. Thanks for watching, and I will see you next time.