Lecture Notes
Consumer Behaviour
Dr. Jisha Vijay
2025
*Images and articles extracted from online sources
Module 1 - Topics
1. Consumer Behaviour
2. Psychological and Sociological dynamics of consumer behaviour
3. Consumer Behaviour in a dynamic world
4. Segmentation - VALS
5. Communication process
6. Persuasion- Needs & Importance- ELM
[Link] Behaviour
Definition: Consumer behaviour is the study of how individuals, groups, or organizations select,
buy, use, and dispose of products, services, ideas, or experiences to satisfy their needs and wants.
Importance for Marketers:
Helps understand how and why consumers make purchase decisions.
Enables businesses to tailor products, services, and marketing strategies to consumer preferences.
Facilitates segmentation and targeting for more effective advertising.
Aids in predicting consumer trends and adapting to changing markets.
The study of consumer behaviour is fundamental in marketing because it enables organizations
to understand and anticipate the needs, preferences, and decision-making processes of their
customers.
2. Psychological and Sociological dynamics of consumer behaviour
By analyzing consumer behaviour, marketers can design products, services, and communication
strategies that are more likely to resonate with their target audience. This field examines both
psychological and sociological dynamics.
1. Psychological factors include motivation, perception, learning, beliefs, and attitudes,
all of which shape how individuals make purchasing decisions.
2. Sociological influences, such as family, culture, and social groups, also play a
significant role in shaping consumer preferences and consumption patterns.
PSYCHOLOGICAL FACTORS
Persuasion Theory:
1. Elaboration Likelihood Model
2. Cognitive Dissonance Theory
Motivation Theory
1. Maslow’s Need Hierarchy
2. Herzberg Two Factor Theory
Attitude Theory
1. Theory of Planned Behaviour
2. Tricomponent / ABC Model
3. Multi Attribute Theory
[Link] Behaviour in a dynamic world
In today's dynamic and digital environment, consumer behaviour is continually evolving. The
growth of digital platforms, social media, and e-commerce has empowered consumers with
greater access to information and more options for comparison, making their decision-making
processes more complex and informed.
Five years after the start of the COVID-19 pandemic, consumers’ crisis-era habits have lingered.
Globally, consumer sentiment is still poorer on average than it was at the beginning of 2020, and
consumers remain concerned about rising prices and inflation. Despite this persistent uncertainty,
they keep spending. In fact, the relationship between sentiment and spending has weakened.
Meanwhile, consumers’ expectations for value and convenience have them making unexpected
trade-offs across categories: trading down in one place while simultaneously splurging on
something else. These choices may be confusing to anyone trying to predict what consumers will
do next.
It’s not that today’s consumers are irrational; it’s that the old frameworks used to decipher their
behavior no longer apply. What once seemed like short-term adaptations born of the COVID-19
pandemic have solidified into lasting behavioral change. As the world heads into the second
half of the decade, consumer-facing companies confront new challenges, but being able to
understand the motivations of an unpredictable consumer can help them stay agile and relevant.
From an analysis of the McKinsey ConsumerWise Sentiment Survey and State of the Consumer
Market Survey data, we have identified five behavioral forces that will shape the sector in the
years ahead and four strategic imperatives to position organizations for growth. (While growth in
emerging markets and global demographic shifts, such as an aging global population and lower
average birth rates, are also reshaping the consumer landscape.)
Notes Extracted from McKinsey Report
[Link] - VALS
Segmentation is a key marketing strategy that involves dividing the market into distinct groups
based on shared characteristics.
VALS MODEL
The VALS (Values and Lifestyles) framework is a psychographic segmentation tool that
categorizes consumers according to their values, attitudes, and lifestyles, allowing marketers to
tailor their offerings and messages more effectively. Other bases for segmentation include
demographic, geographic, and behavioural factors.
VALS Framework and Segment
These consumers are on the leading edge of change, have the highest incomes, and such high
self-esteem and abundant resources that they can induldge in any or all self-orientations. They
are located above the rectangle. Image is important to them as an expression of taste,
independence, and character. Their consumer choices are directed toward the "finer things in
life."
1. Innovators:
These consumers are successful, sophisticated, and driven by high self-esteem and resources.
2. Thinkers.
These consumers are the high-resource group of those who are motivated by ideals. They are
mature, responsible, well-educated professionals. Their leisure activities center on their homes,
but they are well informed about what goes on in the world and are open to new ideas and social
change. They have high incomes but are practical consumers and rational decision makers.
3. Believers
These consumers are the low-resource group of those who are motivated by ideals. They are
conservative and predictable consumers who favor American products and established brands.
Their lives are centered on family, church, community, and the nation. They have modest
incomes.
[Link]
These consumers are the high-resource group of those who are motivated by achievement. They
are successful work-oriented people who get their satisfaction from their jobs and families. They
are politically conservative and respect authority and the status quo. They favor established
products and services that show off their success to their peers.
5. Strivers
These consumers are the low-resource group of those who are motivated by achievements. They
have values very similar to achievers but have fewer economic, social, and psychological
resources. Style is extremely important to them as they strive to emulate people they admire.
6. Experiencers.
These consumers are the high-resource group of those who are motivated by self-expression.
They are the youngest of all the segments, with a median age of 25. They have a lot of energy,
which they pour into physical exercise and social activities. They are avid consumers, spending
heavily on clothing, fast-foods, music, and other youthful favorites, with particular emphasis on
new products and services.
7. Makers.
These consumers are the low-resource group of those who are motivated by self-expression.
They are practical people who value self-sufficiency. They are focused on the familiar-family,
work, and physical recreation-and have little interest in the broader world. As consumers, they
appreciate practical and functional products.
8. Survivors
These consumers have the lowest incomes. They have too few resources to be included in any
consumer self-orientation and are thus located below the rectangle. They are the oldest of all the
segments, with a median age of 61. Within their limited means, they tend to be brand-loyal
consumers.
[Link] process
The communication process in marketing involves encoding a message, selecting the appropriate
medium, and ensuring that the intended audience decodes and understands the message as
intended. Effective communication is essential for building brand awareness and influencing
consumer attitudes and behaviours. Persuasion is central to this process.
The process of communication consists of the following steps or stages:
(i) Message: This is the background step to the process of communication; which, by forming
the subject matter of communication necessitates the start of a communication process. The
message might be a factor an idea, or a request or a suggestion, or an order or a grievance.
(ii) Sender: The actual process of communication is initiated at the hands of the sender; who
takes steps to send the message to the recipient.
(iii) Encoding: Encoding means giving a form and meaning to the message through expressing it
into – words, symbol, gestures, graph, drawings etc.
(iv) Medium: It refers to the method or channel, through which the message is to be conveyed to
the recipient. For example, an oral communication might be made through a peon or over the
telephone etc.; while a written communication might be routed through a letter or a notice
displayed on the notice board etc.
(v) Recipient (or the Receiver): Technically, a communication is complete, only when it comes
to the knowledge of the intended person i.e. the recipient or the receiver.
(vi) Decoding: Decoding means the interpretation of the message by the recipient – with a view
to getting the meaning of the message, as per the intentions of the sender. It is at this stage in the
communication process, that communication is philosophically defined as, ‘the transmission of
understanding.’
(vii) Feedback: To complete the communication process, sending feedback to communication,
by the recipient to the sender is imperative. ‘Feedback’ implies the reaction or response.
[Link] theory- (ELM, Cognitive Dissonance Theory)
(How attitudes can be influenced or changed)
The Elaboration Likelihood Model (ELM) describes how consumers process persuasive
messages either through a central route, which involves careful and thoughtful consideration, or
a peripheral route, which relies on superficial cues such as emotions or endorsements. Marketers
use various persuasive advertising appeals—rational, emotional, moral, or
fear-based—depending on the product and target audience.
The Elaboration Likelihood Model (ELM) is a dual-process theory of persuasion that explains
how people process persuasive messages. It proposes two routes to persuasion:
● Central Route: Involves careful and thoughtful consideration of the arguments presented.
This leads to lasting attitude change when the audience is motivated and able to process
the information.
● Peripheral Route: Relies on superficial cues such as the attractiveness of the speaker or
emotional appeal, leading to temporary attitude change when motivation or ability is low
Cognitive dissonance theory
Cognitive dissonance refers to the discomfort consumers may feel after making a purchase if
their experience does not align with their expectations or prior beliefs. Marketers often address
this by providing reassurance and support post-purchase.
Cognitive dissonance is the mental discomfort experienced when a person holds two conflicting
beliefs or when their actions don’t align with their beliefs.
To reduce this uncomfortable feeling, people often change their thoughts or justify their
behavior to make everything feel more consistent.
Cognitive dissonance happens when there’s a clash between what we believe and how we act. For example, if
you value healthy living but smoke cigarettes, your mind feels uncomfortable because your behavior doesn’t
match your belief. This inner conflict creates tension, pushing you to either change your behavior, adjust your
beliefs, or find a way to justify the difference to feel better.
Module 2- Topics
1. Motivation Theory
2. Attitude- Theory-Tricomponent
3. Multiattitude Model
4. Cognitive Dissonance
5. Personality- Freud- Personality traits-Self Concept
1. Motivation Theory ( Maslow & Herzberg Theory)
(Why consumers behave a certain way)
Maslow Theory
Motivation is a primary psychological determinant of consumer behaviour. According to
Maslow’s hierarchy of needs, individuals are motivated by a progression of needs, starting from
basic physiological requirements and advancing through safety, social belonging, esteem, and
finally self-actualization.
Maslow’s Hierarchy of Needs is a motivational theory depicted as a pyramid with five levels:
1. Physiological Needs : Basic survival needs (food, water, shelter).
2. Safety Needs : Security, stability, and protection.
3. Love and Belonging : Social relationships and affection.
4. Esteem : Respect, self-esteem, and recognition.
5. Self-Actualization : Realizing personal potential and self-fulfillment.
Lower needs must be satisfied before higher needs become motivational drivers
Herzberg Two Factor Theory
Herzberg’s Two-Factor Theory, also known as the Motivation-Hygiene Theory, distinguishes
between:
● Hygiene Factors: Elements like salary, company policies, and working conditions that
prevent dissatisfaction but do not motivate.
● Motivators: Factors such as achievement, recognition, and personal growth that truly
motivate and increase job satisfaction.
2. Attitude Theory ( Tricomponent, Multi attribute, Theory of planned behaviour)
(How consumers form opinions/attitudes)
Attitudes, which are enduring evaluations of people, objects, or ideas, are another crucial factor.
The tricomponent model posits that attitudes consist of cognitive (beliefs), affective (feelings),
and cognitive (intentions) components.
Tricomponent
The Tricomponent or ABC Model of Attitude describes attitudes as having three components:
● Affective (A): Emotional feelings toward an object.
● Behavioral (B): Actions or observable responses toward the object.
● Cognitive (C): Beliefs or knowledge about the object.
This model helps explain how attitudes are formed and how they influence behavior
The tri-component theory of attitudes suggests that an individual's attitude toward something
(like a product or brand) is composed of three interconnected elements: cognitive, affective, and
cognitive. These components are believed to influence and shape each other, ultimately affecting
behavior towards the attitude object.
Multi Attribute Theory
The multiattitude model further suggests that consumers evaluate products based on multiple
attributes, each weighted by its importance.
Multiattribute Theory, often used in consumer behavior, evaluates attitudes based on multiple
attributes of an object (e.g., a product or brand). Each attribute is assigned a weight based on its
importance, and beliefs about each attribute are scored. The overall attitude is calculated by
combining these weighted beliefs, helping to predict preferences and decision-making
3. Personality Theory ( Freud Theory& Carl Jung Theory)
Personality also influences consumer behaviour. (Personality= Pattern of behaviour)
Freud Theory
Freud’s theory emphasizes unconscious motives, while Jung’s approach highlights archetypes
and the collective unconscious. Personality traits such as innovativeness, sociability, and risk
tolerance can affect buying choices. The concept of self, including both actual and ideal
self-perceptions, also shapes consumption patterns, as individuals tend to purchase products that
align with their self-image.
Id: The instinct-driven, pleasure-seeking part of the mind, focused on immediate gratification.
Ego: The rational mediator that balances the Id’s impulses with real-world constraints.
Superego: The moral conscience representing societal and parental standards, striving for ideal
behavior.
Carl Jung Theory
Carl Jung’s personality theory focuses on the interplay between the conscious and unconscious
mind, universal archetypes, the process of individuation, and psychological types.
The theory emphasizes the integration of various aspects of personality to achieve
self-realization and encompasses universal and individual dynamics.
These resonate with their inner self-image or aspirations.
Extraversion and Introversion
Carl Jung’s analytical psychology offers a powerful lens for understanding why consumers feel
drawn to certain brands, products, or messages. At its heart are two key concepts:
Jung identified eight main personality types:
A brief indication of each type follows.
● Extraverted Thinking
Principled, idealistic, objective, rational.
● Introverted Thinking
Influenced by ideas, independent, often fearful of intimacy.
● Extraverted Feeling
Adaptive, relating well to the external.
● Introverted Feeling
Sympathetic, pleases others, may be dependent, reserved.
● Extraverted Sensation
Realistic, concrete, pleasant and friendly.
● Introverted Sensation
Calm and passive, restrained, controlled and controlling.
● Extraverted Intuition
Enterprising, outgoing, can be irresponsible.
● Introverted Intuition
Mystical, dreamer and artist. Can be obsessive.