The field of consumer behaviour is enormous, and highlights the importance of the customer at the centre of the marketer’s universe. Each consumer is unique with different needs and wants and buying choices and habits are influenced by habit, and choice that are in turn tempered by psychological and social drivers that affect purchase decision processes. (Brassington and Pettitt, 2000)
A method of examining academic thinking on a subject such as consumer behaviour is by means of a literature review. A literature review serves to focus research problems and to understand current academic thinking and theoretical models around a research topic. It is a description as well as a critical review of the literature. (Saunders, Lewis and Thornhill, 2001)
This literature review provides a high level overview of consumer behaviour. It explores consumer behaviour from an individual perspective and considers consumer behaviour in the context of a rational purchasing decision process. It concludes with a perspective on the ethical responsibility of marketers.
Consumer Behaviour the evolution of the study of consumer behaviour mirrors the reshaping of western economies from production driven environments when the demand for goods and service exceeded output, to the post second world war era of market driven environments when production exceeded demand. This led to the development of marketing as a discipline, with the concomitant emergence of the study of consumer behaviour in order to better understand consumer needs and wants, methods of creating awareness of products and services, and methods of influencing buying decisions to create a competitive advantage for the producer. (Brassington and Pettitt, 2000)
Consumer behaviour can be defined as “the study of individuals, groups or organisations and the processes they use to select, secure, use and dispose of products, services, experiences or ideas to satisfy needs and the impacts that these processes have on the consumer and society.” (Hawkins, Best, and Coney, 2001, p7.) This definition implies a sequential process involving different activities that may influence the consumer in a number of ways.
Other definitions emphasise the mental, emotional, and physical processes and stress needs and wants, as well as the influence of perceived risk. (Arens, 1999, p129) The literature generally distinguishes between individual consumer buying and organisational purchasing processes. Wilson (2000) argues that the distinction is artificial and a generic behavioural model should be developed for both individual and organisational consumers with appropriate contextual adjustment.
It is beyond the scope of this review to consider both organisational and individual consumer behaviour, but suffice to mention that organisational buyer behaviour is considered a rational and logical activity of professionals that are less susceptible to the habitual, experiential behavioural influences experienced by individuals. (Wilson, 2000)
Foxall (1993) notes that a purely behavioural approach, which relies on observed results as a means to infer the end result of human information processing should be supplemented by an evolutionary explanation. He suggests that evolution is a causal mechanism which accounts for selection or a decision by consequence. The experience of results of prior and similar behaviour (operant conditioning), environmental influences, and cultural changes should thus be considered in order to explain and predict changes in consumer behaviour. The argument is therefore, that the principle of selection by environmental consequence will enhance behaviourist thinking in a marketing context.
Is the Consumer Rational or Irrational?
Consumer behaviour theory prior to the Second World War was based on accepted economic theory of the “rational man” model of decision making. The central idea of economics is that people make decisions by weighing costs and benefits in a rational manner. The consumer’s objective is therefore to select a set of product quantities that maximise satisfaction (or utility), subject to available income. Utility in this context means the ability of a product to meet functional needs. The consumer then expends their income (budget) and selects specific amounts of the two products. Product prices and income are predetermined and, consequently only the quantities of the two products purchased are varied to maximise utility. Rational therefore means the “explainable” processes of consumer behaviour. (Waldfogel, 2002)
Current approaches suggest that behavioural underpinnings in consumer decision processes are beyond pure rational dimensions and stem from both innate and acquired needs that involve a complex combination of conscious and unconscious processes as well as rational and emotional factors. (Lambkin, Foxall, Van Raaij and Heilbrunn 1999)
Wilson (2000) states that consumer rationality is mediated by dynamics such as personal paradigms and perceptual distortion, risk tolerance, and power relations which in turn are subject to cultural and intellectual prejudices such as gender, age, and ethnicity. This contributes to the notion of marketing as a normative discipline with elements of art rather than science in its practice. Arguably as research “explains” the complexity of the dynamics of consumer behaviour, it will expand the definition of what constitutes a rational consumer. This behavioural component allows marketers to identify prospective customers’ needs and wants, and influence the exchange, perception, and satisfaction dynamics of the purchasing decision process. (Foxall, 1993)