INTRODUCTION TO CONSUMER BEHAVIOR MODULE I

MODULE - I
INTRODUCTION TO CONSUMER BEHAVIOR

Introduction to the study of Consumer Behaviour : Meaning & Definition of CB, Difference
between Consumer & Customer, Nature & Characteristics of Indian Consumers, Consumerism:
meaning, Consumer Movement in India, Rights & Responsibilities of consumers in India,
Benefits of Consumerism.

I. MEANING AND DEFINITION OF CONSUMER BEHAVIOUR

Consumer behaviour is a rapidly growing application-oriented discipline of study. The recent

advancement in the technological and digital communication are also influencing consumer behaviour.

This study is not just restricted to how a person buys a product but it is dynamic, complex and
multidimensional process and reflects the totality of consumers' decisions with respect to acquisition,
Consumption or use and disposal activities.

According to Leon G Schiffman , Consumer behaviour can be defined as " The behaviour that
consumers display in searching for, purchasing, using, evaluating, and disposing of products and services
that they expect will satisfy their needs " .

According to James F Engel , Roger D Blackwell and Paul Miniard “ CB refers to the actions and
decision processes of people who purchase goods and services for personal consumption “ .

II. CONSUMER BEHAVIOUR ROLES

 Initiator: Individual who determines that some needs or want is not being met and authorizes to
rectify the situation.
 Influencer: Individuals who intentionally or unintentionally influence the purchase decision.
 Buyer: Individuals who actually make the purchase transaction?
 User: Individuals who directly consume the product.

III . IMPORTANCE OF STUDYING CONSUMER BEHAVIOUR

 The consumer is king.

 Consumers do not always act or react as the theory suggests.
 Consumer preferences are changing and become highly diversified.
 Consumer dislikes the identical product and prefers differential products.
 Segmenting the market to cater to the special needs of consumers.
 Rapid introduction of new products with technological advancement.
 To sell products that might not sell easily.

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IV. NATURE OF CONSUMER BEHAVIOUR

 Systematic Process: Consumer behavior is a systematic process relating to the buying decisions of the
customers.
 Influenced by Various Factors: Consumer behavior is influenced by marketing, personal,
psychological, situational,social,cultural,etc.
 Different for Different Customers: All consumers do not behave in the same manner. Every customer
behaves differently. The difference in consumer behavior is due to individual factors such as the nature of
the consumer's lifestyle, culture, etc.
 Different for Different Products: Consumer behavior is different for different products. There are some
consumers who may buy more quantity of certain items and very low/no quantity of some other items.
 Varies across Regions: The consumer behavior varies across states, regions & countries. For instance,
the behavior of urban consumers is different from that of rural consumers. Normally, rural consumers are
conservative (traditional) in their buying behavior.
 Vital for Marketers: Marketers need to have a good knowledge of consumer behavior. They need to study
the various factors that influence the consumer behavior of their target customers. The knowledge of
consumer behavior enables marketers to take appropriate marketing decisions.
 Reflects Status: Consumers' buying behavior is not only influenced by the status of a consumer, but it
also reflects it. Those consumers who own luxury cars, watches, and other items are considered by others
as persons of higher status.
 Improves Standard of Living: Consumer buying behavior may lead to a higher standard of living. The
more a person buys goods and services, the higher is the standard of living.
 Undergoes a Change: The consumer's behavior undergoes a change over a period of time depending
upon changes in age, education and income level, etc., for example, kids may prefer colorful dresses, but
as they grow up as teenagers and young adults, they may prefer trendy clothes.
 Brand Loyalty: Brand loyalty is another characteristic of consumer behavior. Brand loyalty is the
tendency of a consumer to buy products or services from a certain company that one likes or equates, with
having high-quality goods and services. For example, if Naina‟s first car was a Honda as a teenager and
the car lasted 200,000 miles, she might have a tendency to buy Honda‟s in the future due to her
previously when considering her next vehicle's positive experience. This brand loyalty may be so strong
that she forgoes the information search altogether.

V . WHY WE STUDY OF CB
Consumer behavior focuses on how individuals make decisions to spend their available resources (time,
money, effort) on consumption-related items. That includes what they buy, why they buy it, where they
buy it, how often they buy it, how often they use it, how they evaluate it after the purchase, the impact of
such evaluations on future purchases and how they dispose of it. So in Consumer behavior, it is not only
learned, what is the behavior of the consumer when he buys it but also before the consumption, during the
consumption, and after consumption?

Who is a Consumer?

Any individual who purchases goods and services from the market for his/her end-use is called a consumer.
In simpler words, a consumer is one who consumes goods and services available in the market. Example -
Tom might purchase a tricycle for his son or Mike might buy a shirt for himself. In the above examples,
both Tom and Mike are consumers.

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VI . DIFFERENCE BETWEEN CUSTOMER AND CONSUMER

BASIS FOR
CUSTOMER CONSUMER
COMPARISON
The purchaser of goods or The end-user of goods or
Meaning Services is known as the Customer. services is known as a
Consumer.
A customer can be a business entity, who can
Resell purchase it for the purpose of resale. No

Purchase of goods Yes Not necessary

Purpose Resale or Consumption Consumption

Price of product or May not be paid by the
Paid by the customer
service consumer
Individual, Family Group of
Person Individual or Organization
people

KEY DIFFERENCES BETWEEN CUSTOMER AND CONSUMER

The fundamental differences between customer and consumer, in marketing are described below:

1. The person who buys the goods or services from a seller is known as the Customer. The person who uses
the goods or services is known as a Consumer.

2. The customer is also known as a buyer or client whereas the Consumer is the ultimate user of the goods.

3. The customer can be an individual or a business entity while a Consumer can be an individual or a family
or a group of people.
4. The customer pays the price of the product or service however he may recover it from the other party, in
case if he had purchased it on behalf of any person. Conversely, Consumer not necessarily pays the price
of the product, like in case the goods are gifted or if they are purchased by the parents of a child.

5. The customer purchases the goods for the purpose of resale or to add value or for his personal use or on
behalf of another person. In contrast to Consumer, who purchases the goods for the purpose of
consumption only?

VII. DEVELOPMENT OF MARKETING CONCEPT

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In marketing concept the firms analyze the needs of their customers and then make decisions to satisfy
those needs, better than the competition. To better understand the marketing concept, it is worthwhile to
put it in perspective by reviewing other concepts that once were predominant. While these alternative
concepts prevailed during different historical time frames, they are not restricted to those periods and are
still practiced by some firms today.

A. The Production Concept:

The term production concept was coined by Henry Ford who made the auto-mobile which was till then
only affordable for the rich people for even a common man to purchase. Assumes that consumers are
interested primarily in product availability at low prices
Marketing objectives:
 Cheap, efficient production
 Intensive distribution
 Market expansion
The production concept was the idea that a firm should focus on those products that it could produce most
efficiently and that the creation of a supply of low-cost products would in and of itself create the demand
for the products. Virtually everything that could be produced was sold easily by a sales team whose job it
was simply to execute transactions at a price determined by the cost of production. The production
concept prevailed into the late 1920's.

[Link] Product Concept:

Assumes that consumers will buy the product that offers them the highest quality, the best performance,
and the most features
Marketing objectives:
 Quality improvement
 Addition of features
 Tendency toward Marketing Myopia

C. The Sales Concept:

Assumes that consumers are unlikely to buy a product unless they are aggressively persuaded to do so
Marketing objectives:
 Sell, sell, sell
Lack of concern for customer needs and satisfaction By the early 1930's however, mass production had
become commonplace, competition had increased, and there was little unfulfilled demand. Around this
time, firms began to practice the sales concept (or selling concept), under which companies not only
would produce the products, but also would try to convince customers to buy them through advertising
and personal selling. Before producing a product, the key questions were:
 Can we sell the product?
 Can we charge enough for it?
The sales concept paid little attention to whether the product actually was needed; the goal simply was to
beat the competition to the sale with little regard to customer satisfaction. Marketing was a function that
was performed after the product was developed and produced, and many people came to associate
marketing with hard selling. Even today, many people use the word "marketing" when they really mean
sales.

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D. The Marketing Concept

Assumes that to be successful, a company must determine the needs and wants of specific target markets
and deliver the desired satisfactions better than the competition
Marketing objectives:
 Make what you can sell
 Focus on buyer‟s needs
After World War II, the variety of products increased and hard selling no longer could be relied upon to
generate sales. With increased discretionary income, customers could afford to be selective and buy only

VIII. MARKET SEGMENTATION

Definition: - market segmentation is defined as dividing a market into distinct groups of buyers who
might require separate products of marketing mix. A market segment is a buyer group having similar
wants. Market segmentation is dividing homogenous market into different heterogeneous market based on
customer‟s needs and wants.

Bases for market segmentation

• Geographic segmentation – Dividing the market into different geographical units such as nations, states,
regions, countries, and cities. The company can operates in one or a few areas, or operate in all but pay
attention to local variations.
• Demographic segmentation – The market is divided into groups on the basis of variables such as age,
family size, family life cycle, gender, income, occupation, education, religion, race, generation, social
class and nationality. The consumer needs, wants, and usage rates and product and brand preferences are
often associated with demographic variables.
• Psychographic segmentation – The market is divided into different groups on the basis of
psychological/personality traits, lifestyle or values. The people within the same demographic group can
exhibit very different psychographic profiles.
• Behavioural segmentation – Buyers are divided into groups on the basis of their knowledge of, attitude
toward, use of, or response to a product. Behavioural variables are occasions, benefits, user status, usage
rate, loyalty status, buyer readiness stage, and attitude.
 Occasions – day, week, month and year.
 User status – nonusers, ex-users, potential users, first time users and regular users.
 Usage rate – light, medium, heavy product users
 Buyer –readiness stage – unaware of the product, aware of the product, informed about the
product, interested about the product, desire about the product, intended to buy the product.
 Loyalty stage – hard-core loyal, split loyal, shifting loyal, switchers.

IX. MARKET TARGETING STRATEGIES

3 major target strategies are: -

 Undifferentiated marketing: - this marketing strategy offers only one product to all type of buyers
with one marketing programme, thereby ignoring the likes, dislikes, tastes and preferences. It treats
market as an aggregate focusing on what is common in the needs of the people rather than on what
is different.
Ex- soft drinks, tooth paste, cigarettes, etc.

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 Differentiated marketing: - under this strategy, a firm decides to operate in several or all market
segments but designs different marketing programs for each segment.
Ex-jet airways differentiated services, Maruthi Suzuki differentiated products etc
 Concentrated marketing: - it implies that the firm goes in for whole market. This alternative is
necessary when the company‟s resources are limited. Under this approach, the firm instead of
going after a small share of a large market, the firm goes after a large share of one or few sub
markets. It is also called as “niche marketing”. The demerit of concentrated marketing is that the
company‟s future growth depends on only one segment of the market.

X. PRODUCT POSITIONING

The place the product occupies in consumers‟ minds relative to competing products. The position of a
product with consumers is fixed by consumers themselves with or without the assistance of marketers.
Ex- Medimix soaps has regarded as antiseptic soap. Amul is identified with dairy products etc.

Positioning strategies
 Attributes positioning: - a product can be positioned on its specific features such as Maruthi Omni
van as a family car.
 Benefits as basis: - positioned on the benefits. Ex- Colgate reduces cavity, fair and lovely for
fairness etc.
 Usage occasions: - positioned according to usage. Ex – usha for cool summer.
 Classes of users: - positioning for certain classes. Ex- Johnson & Johnson baby bath soaps.
 Against competitors: - a product can be positioned directly against a competitor. Ex- Bajaj van is
advertised by giving comparative performance of vehicle with other make.
 Advertisement changes: - by making advertising claim, those made by its competitors. Ex-
Bounvita advertisement claims it as a health and energy drink. While viva is claimed as double
action drink.

XI. MARKETING MIX

It refers to the set of controllable tactical marketing tools- product, price, place and promotion that the
firm blends to produce the response it wants in the target market. The marketing mix will have to be
changed whenever marketing conditions like economical, technological, political, legal changes.

Definition: Acc to “William [Link], marketing mix is the term used to describe the combination of the
four inputs which constitute the core of a company‟s marketing system. The product, the price structure,
the promotional activities and the distribution system.

Elements of marketing mix

 Product: - product is the first P in marketing mix components. Product means the goods and services
combination the company offers to the target market. Product must satisfy consumer needs. The
management must first decide the product to be manufactured to the needs of the customers there
after company decides upon variety, quality, design, features, brand name, packaging etc.

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 Price: - price is the amounts of many customers have to pay to obtain the product. The company
decides on list price, discounts, allowances, terms of credit, payment period and so on. At last the
price paid by the buyer must be worth or equal to the product attributes and utility.
 Place: - place includes company activities that make the product available to target consumers. The
place component addresses the factors such as channel choice, coverage, assortments, locations,
inventory, transportation and logistics. Physical distribution is the delivery of products at the right
time and at the right place and to right person.
 Promotion: - it means activities that communicate merits/features of the product and persuade target
customers to buy it. The company must undertake promotion activities such as advertising, personal
selling, sales promotion, public relation and so on.

XII . NATURE AND CHARACTERISTICS OF INDIAN CONSUMERS

1) Young Demographics: The Indian market is blessed with young demography. With 60% of the
population below 30 years of age, the Indian market offers exciting opportunities for marketers. The
youngsters demand a new set of products and services. The rapid growth of the Indian economy has
created a lot of opportunities for younger consumers which have enabled them to earn handsome amounts
of money from a very young age.

2) Aspirational Consumer: Indian consumers are becoming more and more aspirational. Aspirational
products need not be expensive products. Consumers now look for better-designed products at a price that
offers excellent value. That is why firms now increasingly understand the importance of design in the
marketing of products.

3) Value-Consciousness: Even though there is an increased propensity for spending, Indian consumers
have not let go of the value-conscious nature. Brands like Indica and Nokia thrive by catering to this
value-conscious nature of the Indian consumers. Even at the luxury end of the markets, consumer‟s
features and comparisons with competing brands.

4) Networked Consumer: The global trend of a networked consumer is Indian consumers are more
connected in the Indian market also before. While most of the consumer connection is happening in the
worldwide web, the scope of networking is not limited to online. In the Indian context, the Penetration of
mobile telephony has also enabled networking between consumers.

5) Socially Conscious: Indian consumers are also becoming more and more socially conscious. There is
an increased awareness of good practices, trust, honesty, transparency, and ethics. Soft values have become
more important in the mind of consumers. The reflection of this trend can be seen in the numerous CSR
campaigns that are run by the brands.
6) Brand Switchers: The ever-increasing competitors have spoiled Indian consumers with choices.
Like, automobiles, mobiles, and toothpaste, Indian consumers have got plenty of brands to choose from.
This choice has in a way allowed consumers to switch brands without much suffering. Since product
features have largely become commoditized, brand managers have to find vets, powerful differentiators, to
encourage consumers to stay with the brand.

7) Thinking Beyond Categories: Like global counterparts. Indian consumers have started thinking
beyond product categories. Categories are largely becoming irrelevant. The boundaries between various
categories have blurred. Take the example of mobile phones which are now acting as a camera, music

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player, organizer, c-mail gadget and gaming device. This category blurring has resulted in an increasingly
competitive environment for marketers. The competition which was earlier limited to a category has
expanded across multiple categories. This has created a need for increased investment in R&D and
product innovation among the companies.

8) Religious Diversity: The one billion people of India belong to seven different religious groups viz.,
Hindus. Muslims, Christians, Sikhs, Buddhists, and Zoroastrians. In addition, there are other persuasions
and there are sects, sub-sects, castes, and sub-castes. Each religion has its own hierarchic structure,
concretized through centuries of practices. Each caste has its own customs established over generations. In
birth and death, in marriage and family life, the individual is entangled in the chores of his religion or
caste. What is welcome for one religion is taboo for the other, and something totally banned in one
religion is an accepted practice in another.

9) Diversity in Dress and Food Habits: As far as dress is concerned, India holds-out the picture of
widely varying styles. Almost every state, or religious community, has its own traditional styles of dress.
The same is the case with ornaments and jewellery.

As regard, rice is the staple food in the South and wheat in the North. Of course, in several of the southern
states, people now consume wheat products as co-food items. Likewise, certain Southern dishes have
become popular in the north. Still, the basic difference in food habits remains for meat-eaters, there are
several restrictions; for the Hindu, beef is taboo, for the Muslim, pork is taboo, for the Christian, both are
delicious. Some use coconut oil as the cooking medium. Some use groundnut oil, and some others, mustard
or gingerly oil.
10) Working Women: This segment is the one, which has seen tremendous growth in the late 40s. This
has opened the floodgates for Indian retailers. The working woman today has grown out of her image of
been the home-maker. Today, she is rubbing shoulders with men. Working women have their own minds
in a decision to purchase the products that appeal to them.
11) High degree Value Orientation :Luxury brands have to design a unique pricing strategy in order to
get a foothold in the Indian market.
12) Family Orientation : Indian consumers have a high degree of family orientation.
13) Increasing power of Consumerism : Which shifts towards need based market .
14) Increasing buying power : Especially electronics durables travel and entertainment .
15) Increasing use of foreign made products
16) Borrowing money from different sources for current consumption and comfortable.
17) Increasing demand for luxury products and services.
18) Consumers changes from need based market to want based market.
19) Globalization majority affected on Indian market

XIII. FACTORS INFLUENCING INDIAN CONSUMERS

I) Changing Demographics: By the end of the year 2020, more than 50% of the Indian population will be
below 30 years. This is regarded as a demographic wonder and it will bring a revolution in terms of market
opportunities in the years to come. The product and promotion strategies of marketers will be focused on

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the emerging demographic profile.

2) Smaller Households: In urban India, especially in the Southern States, a significant number of
families are nuclear type in contrast to large joint families in rural India. Another distinct trend is that of
the emergence of the "Double Income No Kids" (DINK) family. This has led to a considerable new pattern
of consumption and growth in demand for lower pack size Stock Keeping Unit (SKU).

3) Increasing Awareness: The mass media, both conventional and newer social media, such as SMS,
MMS, to the internet are playing an active role in creating awareness in the minds of the consumers about
the variety of choices. Currently, most advertisements are very intelligently created, which leaves a lasting
impression on the minds of the consumers about the particular brand.

4) Westernization: Increased reach of the media has brought the western culture at the doorstep of the
urban Indians. In urban India, many people have adopted western consumption habits in the sphere of
food, clothing, cosmetics, cars, and many other externally visible product categories. For example, we find
Indian families are now regularly consuming cereals like corn flakes, oats, etc., for breakfast instead of the
traditional dosa, idli, chapatti/puri, and pav bhaji.

5) Organized Retail Stores: Since the mid-1990s, the most visible transition in the urban market has
been the creation of modern format retail stores or shopping malls, as commonly noticed in the western
countries. Many of them are offering facilities like multiplex entertainment, food, and beverages, pubs,
kid/game zones, car parking, ATM facility, etc., under one roof. There are large shopping complexes and
large retailers like Reliance Fresh, Spencer's Daily, Pantaloons, Subhiksihea on are opening shops all over
the country.

6) Celebrity Influence: This is an important tool that is able to influence Indian consumer buying
behavior. In India, celebrities are being increasingly used in T.V. media has increased. Celebrities create
headlines. Their lend personality to their products.

7) Quality-Oriented Outlets: Indian consumers looking for quality, choose expensive brands as they feel
that price is an indicator of quality. However, in the absence of well-known brands in the selected product
range, consumers are likely to take cues from well-established retail outlets hoping that these outlets carry
quality products.

XIV. CONSUMER MOVEMENT IN INDIA

The consumer is the center of all business activities. In modern days, it is said that the consumer is the king
in the market. Business activities are carried out to satisfy, the wants of consumers. A commercial
organization totally depends on the customer not only for its survival but also for its growth.

At present customer is given top-most important and every attempt is made to satisfy the customer. But in
reality, the position of the consumer is different. He is like a slave. He is exploited by well organized and
well-informed sellers by charging higher prices, by supplying poor quality goods, even by supplying
adulterated goods, shot weight, misleading advertisement, etc.

Customers are still un-organized and have no idea about their basic rights of safety, right to choose, right
to be heard, etc. The consumer movement arose out of dissatisfaction with the consumers as many unfair
practices were being indulged in by sellers. There was no legal system available to consumers, to protect
them from exploitation in the marketplace. It was presumed that it was the responsibility of the consumers
to be careful while buying a commodity or service. It took many years for organizations in India, and

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around the world, to create awareness amongst people. This has also shifted the responsibility of ensuring
the quality of goods and services on the sellers.

The consumer movement is similar to trade unions because it is a collective approach to solve the
malpractices and injustice done by any organization. Thus, it is a movement of the consumers, for the
consumers and by the consumers because it is a social movement of consumers and it has come into
existence to educate and unite consumers to fight for their rights. In short, the process of uniting
consumers is nothing but the Consumer Movement. The consumer is one who has purchased goods or who
has availed of or hired services.
In the Consumer Protection Act, the word "Consumer" has been defined separately for the purpose of
goods and services. The consumer should necessarily constitute the end terminal in the line of trade.

Consumerism is a social as well as economic order which encourages the buying of goods and services in
ever-greater amounts. This term is sometimes associated with critics of consumption beginning with
Thorstein Veblen. Veblen's topic of examination, the newly emerging middle class coming up at the
threshold of the twentieth century, is coming to full fruition by the twentieth-century end through the
globalization process.

In some places, the term "consumerism" refers to the consumerist‟s movement, consumer activism or
consumer protection which seeks to defend and inform consumers by having required these practices as
honest advertising and packaging, product guarantees, and enhanced standards of safety. In this regard, it is
a movement or an array of policies having a mission of regulating the products, methods, services, and
standards of sellers, manufacturers, and advertisers in the buyers‟ interests.

The consumer movement historically began in the early part of this century with the formation of the
passengers and traffic relief association and the women graduates union, Bombay . During 1915 . But its
real beginning in terms of sustained visible and continuing expansion was during the sixties.
 The consumer guidance society of India (CGSI).
 All india bank depositor association , Bombay
 Surat consumer association , Surat
 Jyothi sangh grahak suraksha vibag , Ahmedabad were all set up in the sixties.

During the sixties there were 2 major developments at the international level.

 Establishment of MRTP commission

 Emergence of Mumbai grahak panchayat
 Emergence of Consumer education and research center ( CERC )
 Consumer protection law by late prime minister Rajiv Gandhi – COPRA 1986
 Emergence of consumer coordination council – CCC

RIGHTS OF CONSUMERS

1. Right to Safety: The consumer right is referred to as „right to be protected against the marketing of
goods and services which are hazardous to life and property‟. It is applicable to specific areas like

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healthcare, pharmaceuticals and food processing; this right is spread across the domain having a serious
effect on the health of the consumers or their wellbeing.

2. Right to be Informed: The right to be informed about the quality, quantity, potency, purity, standard
and price of goods or services, as the case may be so as to protect the consumer against unfair trade
practices‟ in the Consumer Protection Act of 1986. Consumers should be protected against fraudulent,
deceitful or grossly misleading information, advertising, labeling or other practices. They should be
provided with full information concerning the product or service.

3. Right to Choose: The right to be assured, wherever possible of access to a variety of products and
services at competitive prices. Even in a competitive market, consumers should have an assurance of
satisfactory quality and services. For regulating the market place, there is just one factor required and that
is competition. The existence of cartels, oligopolies, and monopolies proves to be counterproductive to
consumerism.
4. Right to be Heard: Consumers should be assured that their interest will receive full and sympathetic
consideration in the formulation of Government policy and fair and expeditious treatment in its
administrative tribunals. This right helps to empower the consumers of India for putting forward their
complaints and concerns fearlessly and raising their voice against products or even companies and ensure
that their issues are taken into consideration as well as handled expeditiously

5. Right to Seek Redressal: This right ensures compensation to consumers for the loss suffered by them
or injury caused to them by the sellers. In a broader sense, the term 'redress' includes all the means open to
consumers to set right the perceived wrongs or to prevent future abuses. Consumer courts like District
Consumer Disputes Redressal Forums at the district level, State Consumer Disputes Redressal
Commissions and National Consumer Disputes Redressal Commissions have been incorporated with the
help of the consumer protection act. These consumer grievance redressal agencies have fiduciary as well
as geographical jurisdictions that address consumer cases between businesses and consumers.

6. Right to Consumer Education: Unless consumers are made aware of their rights and the remedies
available to them, they cannot protect themselves against the unfair and unethical trade practices of
unscrupulous traders. The right makes sure that the consumers in the country have informational programs
and materials which are easily accessible and would enable them to make purchasing decisions that are
better than before Therefore, consumers should be educated about their rights through consumer
education. Such education can be provided by educational institutions, voluntary organizations, and
institutional agencies.

7. Right to Healthy Environment: The products or services supplied to the public should not bring any
harmful effects to the physical environment. They should not pollute air or water. They should not
adversely affect the lives of users as well as non-users. Every consumer has the right to a healthy
environment.

8. Right to Basic Needs: The right to basic needs means the right to basic goods and services that
guarantee survival. It includes adequate food, clothing, shelter, healthcare, education, and sanitation.

9. Right to be Privacy : To be protected and should be privacy is maintained in consumer point of

view.

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XV . MARKETING ETHICS AND SOCIAL RESPONSIBILITY

1. Marketing to children: Advertising to children is subject to self – regulation according to guidelines

developed by the children’s advertising review unit (CARU). The guidelines state that product
presentations or claims must not mislead children about the product‟s performance or benefits, exploit the
child‟s imagination or create unrealistic expectations that products must be shown in safe condition.
2. Overaggressive promotion : Teenagers and college students are often provided with too much easy
credit, which put them into financial difficulties for years. Aggressive marketing of credit cards to college
students; college loan debt has been rising .Marketing of credit cards to college students has become far
too aggressive and against society‟s best interests. Strict rules limiting the marketing of banks and credit
card companies on college campuses, and some banks developed codes of conduct limiting the promotion
of credit cards directed at students.
3. Selling pharmaceuticals directly to consumers : Direct to consumers pharmaceutical advertising,
permitted since 1997, has increased the consumption of numerous categories of medications. Consumers
confirm that they obtain most of the information about these medications from TV commercials rather
than from their physicians. Recognising that direct to consumer advertising has become too aggressive.
The pharmaceutical industry has developed voluntary restrictions regarding their marketing. Not to
advertise new drugs to consumers during their first year on the market.
4. The perils of precision targeting : Consumers‟ loss of privacy is an increasing problematic ethical issue
as marketers identify and reach out to increasingly smaller audiences through innovative media and more
sophisticated tracking. Advertisers are increasingly adopting Narrowcasting – a technique that allows
them to send precisely directed messages to very small audiences on an on going basis.

Manipulating consumers

Marketers can use the knowledge of perception and learning to manipulate consumers‟ consumption
behaviour.
1. Forced exposure to advertising : Marketers increasingly use techniques that make it difficult for
consumers to clearly distinguish advertising from entertainment content. Product placements are fairly
common in big budget movies – Hrithik Roshan in Krrish showed a variety of brands prominently
positioned.
2. Tinkering with consumers perceptions : Marketers manipulate consumer‟s perception and behaviour by
using the physical setting where consumption occurs. Both children and adults consume more juice when
the product is presented in short, wide glasses than in tall slender glasses. Candies placed in clear jaws
were eaten much quicker than those in opaque wraps. The visibility and aroma of tempting foods
generated greater consumptions. The principle of stimulus generalisation can be used to confuse
consumers and alter intended consumption behaviour. – Less expensive brands and placed next to
expensive premium brands.
3. Covert marketing : it is also known as masked or stealth marketing Consists of marketing messages and
promotional materials that appear to come from independent parties although, in fact, they are sent by
marketers.
4. Socially undesirable representations : Marketers may convey socially undesirable stereotypes and
images in products and advertisements.
5. False or misleading advertising : The ethical issues related to advertising focus on the accuracy of the
information provided and the potential misuse of promotional messages.

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Social responsibility

1. Advocating socially beneficial causes : The primary objective of many not-for-profit organisations is to
promote socially desirable behaviours and discourage ones that produce negative outcomes. Even
government organisations try to induce public behaviour.
2. Cause – related marketing : Where they contribute a portion of the revenues they receive from selling
certain products to such causes as helping people inflicted with incurable diseases. In India, as part of their
corporate social responsibility programs, companies tie up with NGOs or government agencies either for
specific projects or as a long term association.
3. Green marketing : Many companies presently promote their use of renewable, clean, and sustainable
energy and recycled and non-polluting materials.
4. Consumer ethics : Measuring consumers‟ views and perception of companies that tackles exploitation. Is
buyers‟ dishonest behaviour in the market place. Software piracy, abnormal return pattern for a refund.

XVI . MEANING OF CONSUMERISM

In the word Consumerism, "Consumer" means the user or customer and "ism" means movement", and
hence, consumer movement is popularly known as "Consumerism. It is an organized and collective
movement of consumers. This movement started in the year 1920 to protect the interest of the consumers.
The main object of this movement is to educate and unite consumers and to fight for the protection of their
rights.

As per economics, consumerism means economic policies laying emphasis on consumption. In a sense, it
is believed that consumers are free to make a choice and should dictate society‟s economic structure.

The term "consumerism" had been first used in the year 1915 and referred to "advocacy of the rights and
interests of consumers" defined in Oxford English Dictionary but here in this article the term
"consumerism" means the sense which was first used in 1960, "emphasis on or preoccupation with the
acquisition of consumer goods‟.

According to Cravens and Hills, "Consumerism is a social force within the environment designed to aid
and protects the consumers by exerting legal, moral and economic pressures on business".

According to Philip Kotler, "Consumerism is a social movement seeking to augment the rights and powers
of the buyers in relation to sellers".

Consumerism promotes the concept of "Let the seller beware" or Caveat Venditor in comparison to the old
age Caveat Emptor or "Let the buyer beware". Now in the age of consumerism, the principle of Caveat
Venditor forced the seller for the obligation to make a disclosure about the quality of the product.
India's large youth population is driving the consumerism trend in the country. For youth, shopping is just
not a necessity but a leisure activity. Also, more disposable income and the number of persons working in
families have also contributed to this trend. The good news is that Indian consumerism is yet to attain
maturity. But the catch here is society as a whole believes in saving rather than spending.

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A. RESPONSIBILITIES OF CONSUMERS
1. Responsibility of Self-help: It is always desirable that a consumer should not depend on the seller for
any information and choice as far as possible. As a consumer, you are expected to act in a responsible
manner to protect yourself from being deceived. An informed consumer can always take care of his/her interest
more than anyone else. Also, it is always better to be forewarned and forearmed rather than getting remedies
after suffering a loss or injury.

2. Proof of Transactions: The second responsibility of every consumer is that proof of purchase and
documents relating to the purchase of durable goods should be invariably obtained and preserved. For
example, it is important to get a cash memo on the purchase of goods.

3. Proper Claim: Another responsibility that consumers are expected to bear in mind is that while
making complaints and claiming compensation for loss or injury, they should not make unreasonably large
claims. Very often, consumers have to exercise their right to seek redressal in a court.

4. Proper use of Product/Services: Some consumers, especially during the guarantee period, make
rough use of the product, thinking that it will be replaced during the guarantee period. This is not fair on
their Part. They should always use the products properly. Besides the above responsibilities, consumers
should be conscious of some other responsibilities.

B. BENEFITS OF CONSUMERISM

1. Improvement in Supply: Hoarding and black marketing by traders results in a shortage of supply.
With the help of the support of consumers, the producers will be able to minimize the imperfections on the
distribution front.

2. No Unfair Trade Practices: When consumers are strong enough to protect their rights, the producers
will any take consumers for granted which will compel producers to shun unfair trade practice.

3. Better Relation with Consumers: Producers can understand consumer needs and wants better as
consumerism will provide feedback for the business which ultimately leads to cordial relations between
producer and consumer.

4. Better Support of Government: Consumerism will make the government more quick and responsive
to consumer interest and thus will take statutory measures and both legal redressal machinery will be
provided to protect Consumer rights.
5. Educating Consumer: A well-organized consumerism helps in giving information about various goods
and services like prices, what the consumer can expect, etc., to the consumer.

6. Liaison with Government and Producers: As the government is the key factor in meeting most
consumer, needs in India, the consumer organizations try to maintain liaison with producers on one
hand and Government authorities on the other hand, which ultimately benefits the consumer as well.

7. Consumer Education: The consumer is given information about various consumer goods and services'
this relates to prices, what the consumer can expect, standard trade practices, etc.

8. Product research and inform the consumers : Product research is a part of the broader term . Which
help in the generation of more product knowledge in terms of its various attributes information related

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to prices , ingredients , competing brands utility value and so on.

9. Improves the economy

10. Creates boom in the consumer goods and services

11. Consumerism helps to creates green marketing

12. Improves social standing

C. OBSTACLES IN GROWTH OF CONSUMERISM

1. Lack of Leadership: It is an important hurdle that has seriously affected the growth of the consumer
movement in India.

2. Illiteracy: Most of the Indian consumers are illiterate. They have lack consumer education and also do
not know their rights.

3. Difficulty in Disseminating Consumer Education: India is a vast country; it is very difficult to

disseminate consumer education, throughout the country. Further, different languages and customs also
affect the growth of the consumer movement.

4. Cumbersome Legal Process: It is said that the legal process in India is time-consuming and
cumbersome. Due to this reason, many consumers do not come forward to seek legal remedies.

5. Lack of Effective Implementation of Legislative Measures: The government has enacted numerous
legislative measures to protect the interests of consumers. However, they are not effectively implemented
to achieve the basic objective.

XVII. SOCIAL AND SOCIETAL MARKETING CONCEPTS

Three Considerations of Societal Marketing Concept

The Societal Marketing Concept puts Human welfare on top before profits and satisfying the wants.

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Meaning : The societal marketing concept holds that a company should make good marketing decisions
by considering consumer‟s wants, the company‟s requirements, and society‟s long-term interests.
Companies should balance three considerations in setting their marketing strategies: company
profits, the consumer wants, and society‟s interests.
1. Society (Human Welfare) : Companies must make sure the products, services, actions, investment
innovations servers society first.
2. Consumers (Satisfaction) : Products and services should be satisfying the consumer‟s needs.
3. Company (Profits) : Building long-term customer relationships, being socially responsible, and
providing satisfactory products are important for profit-making and wealth maximization.
Objectives of Societal Marketing Concept
 To maintain a long-term relationship with customers.
 To create a better image in the society for the company than it‟s competitors.
 To carry out its social responsibilities.
 Developing community awareness towards its brands.
 To carry out its social responsibilities.
 To increase the consumer base and market share.
Societal Marketing Concept Advantages and Benefits
 It helps to build a better image for the company.
 It gives a competitive advantage over the competitors.
 Useful in customer retention and long-term relationships.
 Increases sales and market share.
 Facilitate expansion and growth in the long term.
 Products and company policies should prioritize social welfare and society in general.
 Economic resources are properly used.
 Societal marketing raises the living standard of people in society.
 It ensures economic planning more significant and more fruitful to society.
Importance of Societal Marketing Concept
1. Societal Marketing is very important to society, the environment, and businesses. This concept was
developed to tackle the consumerism and profit only the motive of business.
2. The societal marketing concept helps to maximize profits for the organization and creates a long-term
relationship with customers.

3. It encourages developing products that benefit society in the long run and satisfies consumers.

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