Consumer behavior refers to the study of individuals and their decision process when purchasing products and services for their own needs. It identifies their actions and drives in buying and using brand products and services, as well as time and frequency of purchase. Several sciences, such as psychology and economics, contribute to the understanding of consumer behavior.
Brands and retailers can generate consumer behavior insights through surveys and analytics such as A/B testing and social media listening. You can analyze how users interact with your website content and ads to understand your customers better and know which campaigns work the best. The insights you gained will then be used to create and modify marketing efforts accordingly.
Many factors influence consumer behavior. These include economic conditions, personal preferences, purchasing power, peer pressure, and marketing campaigns, among many others.
Types of Consumer Behavior
In general, there are four main types of consumer behavior. These are the following:
- Complex buying behavior. Customers are highly engaged in the process, from research to purchase, because there is often a high economic risk. This is usually observed in customers buying expensive products such as home décor and jewelry.
- Dissonance-reducing buying behavior. Like complex buying behavior, customers are highly engaged but find it challenging to choose and differentiate between their choices. Because they fear regretting their choice, they are more likely to seek advice and reassurance from family, friends, and the Internet.
- Habitual buying behavior. Customers are not highly involved in the purchasing process. The brands are not taken into consideration when buying.
- Variety-seeking behavior. Shoppers will buy without considering brand loyalty. They simply want variety and will often change their choice even when there is no dissatisfaction with their purchase.
Why It Matters
Studying consumer behavior matters because it allows brands to understand what motivates shoppers to make a purchase. As such, you can modify your efforts across the site, from homepage merchandising to products recommendations on the checkout page, to engage more customers and increase conversions.
You can also identify the needs of your customers and respond with the appropriate products and services. The insights can influence how the products are presented in such a way that guarantees maximum impact because it fulfills what shoppers expect from your brand and website.
Knowing consumer behavior is also important in retaining existing customers. When current customers are satisfied with a brand and their purchase, they are more likely to repeat the process. You can tweak marketing campaigns, user experience design, and eCommerce best practices to influence buying behavior and make customers purchase again.
Consumer behavior also lets brands improve their customer service. Understanding your shoppers lets you respond appropriately to individual wants and needs.
To understand purchasing decisions and create experiences that convert, check out the video below where digital psychologist Dr. Liraz Margalit shares her insights into changing consumer behaviors, habits, and expectations of modern shoppers.