Last Updated on September 2, 2022
As a business, understanding your consumers is one of the most important ways to grow and scale. That is because it allows you to target them effectively and boost your sales.
So, if you are looking to understand your consumers better, you are in the right place.
Here is your complete guide to understanding consumer buying behavior.
What Is Consumer Buying Behavior?
The behavior of your consumers is not limited to your online presence. That is why consumer buying behavior is all about your consumers’ actions online and offline before making purchasing decisions. These include:
- Looking for your reviews on search engines
- Engaging with your social media posts
- Visiting your website
- Reading your blogs on certain products and services
- Or much more
You might be wondering why you need to know what is consumer behavior. Well, once you understand consumer behavior, you can take better marketing initiatives and efforts to influence consumers’ purchasing decisions.
The key is to do this in subtle ways, so your customer doesn’t feel targeted by your efforts.
Top 4 Types Of Consumer Buying Behavior
You need to understand various types of consumer buying behavior to categorize potential customers. Here are the top categories that are relevant to every business and industry:
A habitual buying behavior is one where the involvement is low in purchasing decisions. That is because the customer will not see any difference between brands and habitually buy products over an extended period. The most common example of habitual buying behavior is of everyday use products, such as tissues.
2. Complex Or Extensive
A complex buying behavior is where there is high involvement in the purchasing decision. The customer will perform extensive research before investing in your product or service because it might come with psychological or financial risks. An example of complex buying behavior is when people are buying a new car or home.
3. Variety Seeking
A variety-seeking consumer buying behavior is where the consumer wants to switch brands to incorporate variety. It is not because of dissatisfaction. For example, one of the top variety-seeking behaviors can be seen in restaurants as consumers look for new foods.
4. Dissonance Reducing
Dissonance reducing buying behavior also contains a high level of involvement in purchasing decisions and processes. It may be because of the high price and because of infrequent purchasing of the product or service.
In this behavior, customers will find it challenging to choose between brands, and they may fear regretting their choice afterward.
A top example of such buying behavior is when consumers may purchase a waffle maker. They will not think about which models to choose, but the various brands and what they offer.
Importance Of Understanding What Is Consumer Buying Behavior For Businesses
If you are still wondering why consumer buying behavior is important for your business to understand, here are a few top reasons:
1. Staying Relevant In The Market
The world is moving fast, and everything is rapidly changing all the time. Because of this, markets are also changing. Businesses that don’t adapt to the changes will not stay relevant, and consumers will stop purchasing their products and services altogether.
One of the top examples of a company product that failed to stay relevant in the market is the Sony Walkman. Now, we have many other digital music options where we can listen to music without the hassle of a Walkman.
2. Product Innovation
Most new ideas and products don’t make it to the final stage and fail during creation. Companies are constantly investing in trying to enhance the success rates of new ideas and products. Of course, the key to enhancing this success rate is to perform in-depth research on consumer buying behavior.
For example, Nike conducted a consumer buying behavior analysis and realized that a significant chunk of its target audience is not professional athletes. Instead, they are regular people who strive to be more like their role model athletes.
The research led to the Find Your Greatness campaign by Nike that inspired consumers to make better purchasing decisions at Nike.
3. Customer Retention
The primary aim of many businesses is to retain their customers for the long haul. Understanding customer behavior is the key to retaining existing customers and attracting new customers.
That is why your marketing efforts must be backed by your consumer buying behavior research, as it will enable customers to keep buying your products.
You must also track your customer retention rates from time to time to check which strategies are working best for you. Once you do, you can use tried and tested methods with consistency to see excellent results in the long run.
Keep in mind that customer retention takes time to come to fruition.
4. Gaining A Competitive Advantage
Competitive advantage is dependent on many factors, such as consumer expectations, perceptions, tastes, and much more. Studying this in detail will help you face your competition and stay ahead in the market.
The secret is to ask the right questions to understand consumer buying behavior in detail.
Here are the top questions you can ask yourself to gain a competitive advantage:
- Are your customers buying from competitors?
- Why are they purchasing from competitors?
- What factors are attracting customers to your competitor’s products and services?
- What gaps are there in your product or service that your competitor is filling for your consumers?
Answering these questions will help you understand consumer buying behavior in relation to your competitors. Once you understand this, you can make better decisions to gain a competitive advantage and offer better solutions to your customers in no time.
That is everything you need to know about what is consumer buying behavior and why it is important for your business to know.
Now that you have a complete guide, you can implement the best tips to understand consumer buying behavior and target your audience accordingly.
Once you do it with consistency, you will retain your customers for the long haul.