Module1_ECC317

MODULE I
UNDERSTANDING CONSUMER BEHAVIOR
Overview
This week we will begin our semester into identifying the difference of Entrepreneurial and
Consumer Behavior, define and explain the latter. After reading and viewing the module content you will
complete your first written assignment. Everything that you need to successfully complete the assignment
is located in the Module Assessments, but if you have questions – please, do not hesitate to ask.
Learning Objectives
After your complete the required assignments you will be able to:
1. Define the consumer behavior and explain the components that make up the definition;
2. Discuss the benefits of studying consumer behavior; and
3. Explain how companies apply consumer behavior concepts when making marketing
decisions.
Content
Can you still define Entrepreneurial Behavior?
Team Team
Consumer Behavior Entrepreneurial Behavior
Consumer behavior is the study of consumers’ choices during searching, evaluating,

purchasing, and using products and services that they believe would satisfy their needs.
There are four factors that determine the characteristics of consumer behavior: personal,
psychological, social, and cultural. All factors have a major impact on a consumer’s behavior and
the characteristics that define a customer will change as her/his life changes.
1. The Personal Factors are the individual factors to the consumers that strongly
influences their buying behaviors. These factors vary from person to person that results in a
different set of perceptions, attitudes and behavior towards certain goods and services.
2. There are four psychological factors that influence consumer behavior: Motivation,
perception, learning, and attitude or belief system.
3. The main social factors affecting consumer behavior are family, roles, and status.
Social factors have a direct impact on the consumption and purchasing behavior of people.
4. Cultural Factors have a strong influence on consumer buying behavior. Cultural

Factors include the basic values, needs, wants, preferences, perceptions, and behaviors that are
observed and learned by a consumer from their near family members and other important people
around them.
Which Disciplines Inform the Study of Consumer Behavior?
As an area of study, consumer behavior draws from several decades of research in social
sciences, including economics, psychology, sociology, and anthropology. More recent advances
in neuroscience knowledge and methods of study have also attracted consumer behavior
researchers seeking ever more concrete and definitive ways of modifying marketing stimuli to
elicit predictably positive responses from consumers. Each of these disciplines provides a lens
through which a different aspect of consumer behavior becomes visible.
The traditional economist views consumer behavior as a reason-driven quest to maximize

utility, i.e., value for the money, with each purchase. While that perspective has fallen out of favor
from time to time, it has merit in a world of skeptical consumers who have ready access to ever
more product and company information. It also captures the goal-oriented nature of our cognitive
processes and consequent behaviors. In the book Absolute Value: What Really Influences
Customers in the Age of (Nearly) Perfect Information (2014), authors Itamar Simonson and
Emanuel Rosen argue that consumers can now choose brands based on their objective attributes
rather than having to rely on marketing hyperbole.
Martin Fishbein and Icek Ajzen, in their seminal 1975 book Belief, Attitude, Intention,
and Behavior, theorized that in order to explain or predict behavior, researchers must measure not
only our attitudes toward the action in question, but also our perceptions of what others will think
of us if we act as we are inclined. In a consumer context, our attitude (beliefs, feelings, evaluation)
toward a brand plays a major role in our decision whether to purchase it, but social norms may
either put the brakes on or support our choice. Most of us adults have learned to temper our
impulses to please people significant to us.
Social psychology reigned supreme in our study of consumer behavior until the 1980s,
when computer models of the brain became popular. The field of cognitive psychology emerged,
dramatically enriching our approach to studying consumer behavior. The computational model of
brain function enabled consumer behavior researchers to investigate how we make sense of, or
process, the information we encounter in the marketplace. Cognitive research revealed that our
memories are vast networks of concepts connected in many different ways, not all rational. Our
memories of familiar brands include many associative links to factual information, feelings, and
experiences we have had while using the brand. And new information may reinforce or
dramatically alter those associations.
We started this section by describing the classical economist’s view of the consumer as a
rational being whose goal is to maximize utility. We end it with a discussion of how behavioral
economists have deepened our understanding of consumer behavior by exploring the systematic
biases in our thinking that result in judgments and choices that are not rational.
Consumer behavior incorporates ideas from several sciences including psychology,

biology, chemistry, and economics.
Can you answer, why is consumer behavior important?
A consumer behavior analysis should reveal:
 What consumers think and how they feel about various alternatives (brands, products, etc.);
 What influences consumers to choose between various options;
 Consumers’ behavior while researching and shopping;
 How does consumers’ environment (friends, family, media, etc.) influence their behavior?
Consumer behavior is often influenced by different factors. Marketers should study consumer
purchase patterns and figure out buyer trends.
In most cases, brands influence consumer behavior only with the things they can control; think
about how IKEA seems to compel you to spend more than what you intended to every time you
walk into the store.
References:
 A Theoretical Approach to Social Factors Influencing Consumer Behavior (2021) by

Yakup Durmaz.
 Consumer behavior in marketing – patterns, types, segmentation (2019) by Valentin Radu.
 Essentials of Consumer Behavior (2017) by Debra L. Stephens.
 Https://businessjargons.com/personal-factors-influencing-consumer-behavior.html#:~:
text=Definition%3A%20The%20Personal%20Factors%20are,towards%20certain%20goods%20
and%20services retrieved by August 20, 2022.
 Https://www.clootrack.com/knowledge_base/major-factors-influencing-consumer-
behavior#:~:text=Cultural%20Factors%20have%20a%20strong,other%20important%20people%
20around%20them retrieved by August 20, 2022.
 Understanding Consumer Behaviour: The Four Factors (2018) By QuickBooks Canada
Team.

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MODULE I

UNDERSTANDING CONSUMER BEHAVIOR

Can you still define Entrepreneurial Behavior?

Consumer behavior is the study of consumers’ choices during searching, evaluating,

4. Cultural Factors have a strong influence on consumer buying behavior. Cultural

Which Disciplines Inform the Study of Consumer Behavior?

The traditional economist views consumer behavior as a reason-driven quest to maximize

Consumer behavior incorporates ideas from several sciences including psychology,

Can you answer, why is consumer behavior important?

A consumer behavior analysis should reveal:

 What influences consumers to choose between various options;

 Consumers’ behavior while researching and shopping;

 A Theoretical Approach to Social Factors Influencing Consumer Behavior (2021) by

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