Customer and Consumer - Class 9
Customer occupies a pivotal position and place in the process of marketing and sales. So, It is important for the marketers to identify who are their customer or buyers.
Customer or Know you customer’.
A Customer is an individual or business that purchases the goods or services produced by a business. The customer is the end goal of a business. He is also called king of the market. He is the reason for existence of the business. Thus, the marketers must understand the demographic, geographic and psychographic profile of the customers to suggest the type of goods or service to be produced.
Customer and consumer:
The word consumer is derived from the word ‘consume' which means to use. A consumer is a person who is the end user of the product. Customer means a person who pays the price to purchase the product or service. These two terms are used interchangeably here.
Differences between business v/s individual buyers.
People buy products and services for their consumption with different purposes. They can be:
(1) Personal consumer:
Personal consumers buy products and services purely for their own use or for the use of the family members. They are the final user of the product and services.
(2) Organizational consumer:
When goods are purchased for resale, further production or to run their own entity e.g. by the government departments, schools, hospitals etc.
Difference between customer and consumer:
 | Customer | Consumer |
1 | He purchases goods from seller. | He uses the goods and services. |
2 | Known as buyer or client. | Ultimate user of the goods and services |
3 | An individual or a business entity | Individual, a family or a group of people. |
4 | Must pay the price. | Doesn’t pay the price always. |
5 | Purpose of re-sale. | Purpose of own consumption. |
The person who is a customer or a buyer is not necessarily a consumer and vice-versa'.
The companies must focus on the two, customers as well as consumer as the buying decision is taken by both (consumer and customer) together or by keeping in view of the other. We should also know that the customers will buy your products or services only if consumer demands your product.
Customer and Consumer - Class 9
Types of customers:
The company should follow some approach like division of customers into groups because each customer has to be considered valuable and profitable. Customer can be of following types:
- Ready to buy customers or need based customer:
This type of customers is often driven by specific need and have a sense of urgency. As the customer is in need, the salesperson or service provider has to find out what the specific requirement is and how to meet. If you can satisfy his needs only then he can become a repeat customer.
- Potential customers:
A person entering a shop or visiting a website is a potential customer. It is possible that he is simply gathering information or doing window shopping. He is not in a hurry to purchase. A good skilled salesman can present few positive features about the products, so that potential customer becomes the actual customer.
- Repeat customer or loyal customer:
The most loyal customer is a repeat customer or one who regularly uses company's services and purchases its products. They are called life blood of the business, so they deserve due respect. As long as long as you continue to satisfy their needs, he will come to you again and again. All efforts should be made to retain such loyal customers.
- Sales and Discount customers:
This type of customers always shops for the best deal on items. They regularly read newspapers advertisements, store's circulars, pay attention to local dealers, conduct price comparisons online before going to the store to purchase. This type is popular in Malls, Big Department Stores and Big Bazaar all over India.
- Impulse buying customers:
These customers make purchasing decision on an impressive sales presentation by a skilled salesman. Mostly, a good presentation about the product or service can inspire this customer to make a purchase. They take decision on the spot. Salesman will always offer his services to such customers at once.
Customer and Consumer - Class 9
Meaning of Buyer’s Behavior:
The company can earn profits only if it satisfies its customers. So, It must know the tastes, preferences, likes, dislikes, financial position and consumption pattern of the users. Buyer’s behavior in searching/ purchasing the products/ services can be discussed under the following phases:
- Acquisition Phase:
It is concerned with as to why and how buyers buy the product and services for their consumption.
- Consumption Phase:
This is concerned with knowing how buyer is going to use the product and services and his/her experiences after its consumption.
- Disposition Phase:
It is concerned with information what buyers do with the product once them consumed it fully.
The study of these phases will help the marketers in understanding the buyer's behavior and help them in designing and developing the right product and services.
Customer and Consumer - Class 9
Consumer’s motivation to buying:
Why consumer wants to buy a product or service?
Because it satisfies his needs, which are the essence of the marketing concept. Needs can be subjective and psychological. So, it is necessary to understand needs, and its types.
Types of Needs:
- Innate Needs: Also called physiological needs. These are primary needs or motives, food, water, medicine and education etc.
- Acquired Needs: These are generally physiological and considered secondary but depend on social (affection friendship) culture (belief, value, religion etc.) or environment, safety needs (physical damage), security (losing a job), esteem (Power, status), Self-actualization (achievements and growth).
Importance of study of Buyer’s behaviour:
It will help companies to improve marketing strategies and tactics by understanding issues such as:
(a) The effect of culture, social factor, family and media, on buying behaviour.
(b) Buyer’s choice of different alternatives such as brands, products and services.
(c) Decision regarding improving their promotional activities and changing their marketing strategies to target the buyers more effectively.
The study of buyer’s behaviour is very important these days of changing technology and its effect on the buyer.
Customer and Consumer - Class 9
Factors influencing buyer behavior:
Psychological factors: These factors influence consumers in differential way, from product to product and from time to time. They are motivations, perceptions, personal, occupation, economic, culture and social etc.
(a) Motivation:
Motivation is the activation of goal-oriented behavior. It creates desire to act. According to psychologists, motivations may be related to the basic needs, safety needs, social needs, esteem needs and self-actualization needs.
(b) Perceptions:
Perception is the viewpoint and an individual process. It depends on personal beliefs, experience, needs, moods and expectations.
(c) Personal Factors:
A buyer‘s decision is always influenced by personal factors like age, lifestyle, occupation, financial position and overall personality.
(d) Occupation:
A person‘s occupation is an important factor which is tied to his social status. Marketers always keep this factor while targeting market for their products or services.
(e) Economic situation:
Economic Position of the people affects the market as it affects the purchasing power of the buyer.
(f) Culture Factors:
These factors include beliefs and values of customers. Cultural values are transmitted from one generation to other. These also include factors like-race, religion, nationality, low calories foods, fast food, health and fitness, language and urban rural identification etc.
(g) Social Factors:
According to marketing Guru, Dr. Philp Kotler, a person’s reference group consists of all groups that have a direct or indirect influence on the persons attitudes and behaviour. These are generally friends, family members, colleagues and neighbour with whom person interacts frequently on regular basis. The influence of these persons may be positive or negative.