Consumer Behaviour Report
People everyday finds them in diverse situation which requires arriving at a decision. In marketing terms, a situation reflects individual circumstances during a purchase decision.
This purchase decision is influence by physical surroundings, individual emotional state and time constraints. The understanding of these influential factors in the consumer buying behaviour and decision making process is important for marketers for strategic planning of marketing activities and for effective marketing decisions (Kotler, 2012).
The purpose of the report is to access a purchase situation and target market segment to gain a better understanding of the consumer decision process in reaching final decision to purchase a laptop product. The report reflects the trend in consumer behaviour in purchasing a laptop through a consumer decision making process.
The report explains the motivational theories in relation to purchase decisions for laptop. The report also describes the internal, external and situational factors that affect the different aspects of consumer behaviour in this purchasing situation.
Finally, recommendation is made based on the analysis for the marketers to develop strategic marketing plan to increase its consumption in society. The secondary data sources include scholarly journal articles, ebooks, online published article such as business and news article from online platform.
The limitation for this report is that it focused on the main factors that influences the purchase of laptop and did not cover other factors that may impact the purchase decision of a consumer.
2. Purchase Situation and Target Market Profile
A purchase situation points to different factors that affect a purchase decisions. The consumer buying behaviour is influenced by external factors such as time pressure, emotional state and environment when faced with a purchase situation (Grimmer et al., 2016). The initial steps in the purchasing situation of an electronic consumer product is planning and locating the product in the market.
Description of product: The purchasing situation is described for Laptop, a multi-purpose electronic device that falls under the category of personal computers. These products are developed to imitate functionality of a desktop computer.
The compact size and portability of the laptops to carry it along unlike desktops lead to the high acceptance and growing demands in the society. Laptops as a portable computer majorly replaced the desktop computers in home use and in gaming. Laptops are being been extensively in education sector and for office work, personal multi-media and internet surfing.
According to Adamuthe eeet al. (2016), growth of the laptop market will continue in developing economies such as China and India and other Asia Pacific regions is attributed to growing corporate sector, consumer demands for both personal and professional use, digitization of education and competitive pricing strategy of laptop manufacturers.
The global laptop demand in several countries like North America, Europe, Africa, etc. is also fueled by rapid industrialization, organizational requirements for real- time communication, increase in R&D innovations and rise in consumer disposable income.
Laptop as a consumer electronic product falls in the category of shopping product. The potential buyers of a laptop product spend more time in getting information and locating the products as they are expensive and the purchase of this product might provide psychological benefits to the consumer.
The consumer requirements for innovative features in laptop such as Wi-fi, touch screen display, full HD display, anti-glare feature, high RAM and disk storage, light-weight, gaming laptops increase the cost of laptops.
There are also a number of major brands competing in laptop market such as Apple, HP, Lenovo, Dell, Acer, Asus and Samsung that are following product differentiation strategy by incorporating latest advanced features to attract consumers.
Thus, the purchase of a laptop is a medium to high involvement as with higher specifications of the product, new laptop models becomes more expensive to buy with premium features and consumer is highly selective about the brand and also choosing distribution outlet from physical store or online to buy the laptop.
Thus, this selective nature of purchase for laptop the customer may consume a moderate schedule and spend a considerable time to make the purchase decision as apart fulfilling the need it will provide additional psychological benefits for the consumer in terms of raising the perceived status level in the social group. Therefore, purchasing of laptop requires a medium to high level of purchase involvement.
The ever increasing advancement brought up by the companies in developing the most appropriate laptops have also resulted in growing the demands for the product in the market.
Easy to take along and with latest upgraded features attract the customers to make a purchase decision. The customers now can also easily get their laptops repair by using the online repair services which has also influenced the customers to shift their choice on purchasing a laptop.
The after sale services have been improved with time, hence adopting all the possible ways to serve the customers in the most prominent way and resulting in providing customer satisfaction.
Companies are making innovations so that they can attain a better market share by serving to a large customer base (Brown, et al., 1989). They have even started taking feedbacks from the already existed buyers so it can help in making future improvements and serving the potential customers better.
The segmentation of laptop market is significant to segment the customer into smaller groups based on demographic, behavioral and psychological characteristics to help the marketers in developing appealing marketing communications plans for increase its consumptions to gain more market share and profits for business.
The demographic segmentation of the laptop market categorise the markets based on age, income level, occupation and education. This segmentation is useful to get an insight of the consumer requirements and influencing factor based on different age groups and income levels (Hassan and Craft, 2012).
For instance, Apple, HP, Lenovo and Dell targets youth, adults and seniors and Acer majorly targets teens, youth and seniors. The income level is used to divide laptop market for medium and high income groups as it has influence on the customer purchasing power for shopping products.
For instance, Apple products influences high income group while HP, Lenovo, Dell, Acer and Asus considers medium to high income earning groups. The medium to high level of education in literate individuals and occupations such as designers, freelancers, business analysts is also considers for the use of laptop to fulfill consumer needs and purpose of buying.
Psychographic segmentation of laptop considers variable such as personality characteristics and lifestyle in buying expensive products (Rucker et al., 2012). A competitive and extrovert trait in an individual would like to buy a laptop for internet surfing and to fulfill information needs and to socialization needs.
The lifestyle in terms of personal interest and activities can affect the manner in which the individual would like to spend its money and time (internet surfing, socializing, watching movies online, online shopping, and playing games).
Behavioral Segmentation divides the market based on usage rate (heavy users and medium users of laptop consumption like for personal use, commercial use, professional work or gaming) and buyer-readiness stage for laptops in relation to product awareness, interest and suitability for laptop purchasing, brand preference and willingness to purchase (Wells et al., 2010).
Based on the above segmentation, the laptop market targets population comprises of students, gadget lovers, tech-savvy individuals, designers, freelancers and professionals belonging to age group 18 to 54 from medium and high income market segments.
Thus, it can be understood that buying a laptop is a process of extensive decision making as investment ranges from medium to high and consumer may or may not have sufficient experience in using or product experience. Thus, spends a considerable time in searching and evaluating the different product brands to arrive at a final purchasing decision.
It is said that not only the males require laptops the females also require for their work. Both males and females have started to work and are in need of using and managing their work on laptops.
The nature of this market includes not only the professionals, but also the student who work on daily basis (Bharadwaj, et al., 1993). Companies have launched techno-savvy and economical laptops by keeping in mind the preferences, tastes, and needs of the customers in the market.
People have also been influenced by seeing their friends, relatives, and peer group having a laptop this also results in attracting and persuading the target market.
3. Factors influencing the Consumer Decision Making Process
3.1 Consumer Decision Making Process
The consumer decision making process for a laptop is extensive as the buying behaviour of customers is influenced by personal, psychological, social and situational factors to arrive in purchasing decision.
The learning model of consumer behaviour describes the internal stimuli/drive that induce motivation to obtain the product and cues such as advertising to a further stimulate a particular drive to create a response that lead to influence the consumer behaviour.
The economic model of consumer behaviour for income effect points that consumers will purchase more quantity when income earned is more and disposable money is available to make purchase to fulfil its needs from the act of purchase (De los Santos et al., 2012).
The process of consumer decision making comprises of several stages starting from the need or problem recognition, search for information, evaluation of alternative option, selection, purchase action, and post-purchase evaluation.
The different stages in buying process of laptop initiate with the process of need recognition for the product to fulfil the individual purpose for personal use or professional use or for gaming and entertainment purposes. The recognition of need or problem is the beginning of the decision process as the buyer will try to solve the need/problem recognised (Keane and Wasi, 2013).
Once the need is recognised the potential buyer, look out for the feasibility and the cost of the laptop. The potential buyer considers the latest features and specifications in the market and search the information from online sources to broaden the knowledge of the products and broader the selection for different brands.
This search for information about laptops by the potential buyer forms the second stage in the consumer decision process. The next step is evaluation of alternatives where the consumer will investigate the different laptop brands that are available according to the individual budget and specification as important criteria to solve the defined need/problem.
The buyer takes account of requirements fulfilment in short listing the brands according to prices, usage, specifications, online reviews, discussion with family and friends (Strauss, 2016) .
This setting of criteria helps the customers to evaluate the available laptop brands to develop a brand preference. This is useful in selecting a laptop product and selection of a brand to decide what to buy and from where to buy like from online or physical store.
Once the customer purchases a laptop product, the consumer constantly evaluates the laptop during its use to understand its experience in buying the laptop and level or satisfaction and dissatisfaction achieved in the overall process to guide its future purchase for the preferred brand.
This post-purchase evaluation forms the last step in the consumer decision making process. The process indicates that the consumer first thinks, then plans and searches information and then according to time and money resources evaluates and then act to form a purchase decision (Kannan and Raja, 2016).
In this process there are several internal and external factors that influence the consumer decision making process at each stage. The social, psychological and economical and factors have a significant impact on the customer behavior.
The social classes to which the potential buyer belongs and the income level influences the customer behavior as a motivation to buy an expensive product like laptop. The individual personality might encourage an individual to buy laptop.
The opinion of other and knowledge awareness about latest features and specification about a laptop can drive the desire of a buying behavior for purchasing laptop.
Moreover, listening to other laptop users opinions and might change the psychological state for brand preference. According to Solomon et al. (2012), the psychology of consumer affects the thinking process and decision making process for an expensive product.
Thus, social surrounding is a situational factor that affects the consumer buying behavior of a laptop. The social surrounding which includes the interactions of the buyers with social group and the shopping conditions during the purchase decisions impacts the buying behavior and decisions.
Another situational factor is time which plays an important role in search for information and evaluation of different brands to reach a preferred brand in the process. For buying a laptop, buyers requires a sufficient time in making the final purchase decisions.
3.2 Motivation Theories on Decision Making Process
There are different factors that may influence the consumer buying behaviour. For this report, motivational factors will be considered to determine their impact on the buying behaviour of the customers towards laptops.
Motivational theories are considerable to determine the significance of motivation in impacting the purchasing intention and perception of the customers towards laptops. Motivation is a force that triggers certain behaviour and provides and facilitates direction to that behaviour.
There are different motives behind the purchasing of any product. As per Maslow’s hierarchy of needs theory, the needs of the people can be arranged in a hierarchical order including physiological needs, safety needs, love needs, esteem needs and self-actualization needs (Kumaran & Anand, 2016).
As the motivation theory, the theory of the McGuire’s psychological can be also considered. In this theory, highlights the 16 motives factors in the decision making process.
These 16 motive factors con be divided into four groups such as Cognitive preservation, cognitive growth, affective preservation, and affective growth motive. Cognitive preservation is concerned in the maintaining equilibrium in the store.
In this, a consumer is motivated after seeing the quantity of the product in the store. In this situation a customer motivates to buy the product at the time of the purchasing other product. In the next group as the cognitive growth, the customers try to achieving the focus on achieving a séance of meaning.
Furthermore, in the affective preservations, the customer is to be motivated to buy a product to complete its personal requirements (Kumaran & Anand, 2016). As the concerning the last group as affective growth motives refers to personal development factors.
In the same concern of this, Porter and Lawler’s Expectancy Theory is also an important motivation theory in the consumer behaviour. According to this theory, motivation cannot be compared with the satisfaction and performance.
At the same time, there are also some factors that also motivate the people to buy something. In this, need of the product is major. Customer thinks that there is lack of something in life without this product so that it purchases products (Nurmi, et al., 2014).
The efficiency of the some products is another motivational factor that motivates the customer to buy new product. In this, it is possible that customer can save time and money after the purchasing of the product.
With this kind of think, a customer motivates in the market to buy new product. The motivation theory of Blais, et. al. (2013) considers the safety is also one of factor that motivates the customer to buy the product.
In the market, there are some products that improve the safety of the people so that people are to be motivated to buy them. Along with this, in the consumer behaviour, convenience is largest motivational factor that encourage the customer to buy the product.
On the basis of above discussion, it is concluded that there is laptop is the emerging market in the competitive business market as it performs the multiple task such as storing large information, easy to carry. Thus these are the features that increase the demand of the laptop. But at the same time, Laptops as a portable computer majorly replaced by the desktop computers in home use and in gaming.
It indicated that consumers have a medium- high involvement in the purchasing of laptop. The cause of medium involvement is the increasing competition in the market as every brand brought new digital electronic device which has more unique and efficient features comparatively to previous laptop structure.
Likewise, apple is considered as a leading player in the I-pads as due to consisting of high features, consumer preferred it more as compare to other electronic devices like desktop and PCs.
Moreover, the target market of the laptop is the freelancers, students, business-men as for them it is considered as an essential part. Therefore, the laptop market is segmented on the basis of the changing lifestyle and technology of the consumers.
The study is also undertake the consumer buying decision steps in order to determined that how the consumers purchasing decision can be influences in regards to buying the laptop. For this, the problems and need is recognized of the customer then once the problem is identified then the buyer look at the feasibility like cost, quality etc.
Afterwards, buyer search for alternatives which is suited to them. Lastly final decision about the purchasing the product is taken by the buyer. Therefore, on the basis of the process, marketers try to influences the target customers.
On the basis of above study, it is recommended that laptop market should start focusing on the untapped areas like rural market. It is because till now people of rural area is not using laptop or unaware about the importance’s of laptop.
Moreover, laptop allows the rural people to connect with the global market and this helps in making rural people aware about the current status of global market.
Furthermore, it is also suggested that companies should tries to reduce the cost of the laptop so that uncovered areas like rural market can able to afford the product.
This can be done through using the TQM and lean manufacturing method as it reduces the maximum waste of the company which also have positive influences over the cost of the company. It leads to reduce the final price of the laptop. Thus, the above mention recommendations would contribute high for enhancing sells of laptop in the target market.
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