Consumer Behavior 2

Consumer behavior entails the study of individuals’ purchasing behavior and their decisions on the selection and use of goods and services. Consumer behavior mainly encompasses all the actions and decisions that may have an impact on consumers’ purchasing power and decision-making. (Hoyer, 2018).To understand consumer behavior, marketers try to analyze the forces or factors that influence consumers to choose a certain product from several alternatives. Most of the consumer purchasing behavior is guided by reasoning and emotions, which shape consumers’ preferences during the product selection process. Consumer behavior thus ties together issues of motivation, decision-making, behavior, psychology, communication, and social status. Individuals can express their identities through purchasing as it is believed that we are what we purchase. Thus, for corporations and marketers to understand consumers’ behavior, it is essential to understand and analyze the forces that influence their purchasing habits. (Solomon, 2017).

Other factors that influence the purchasing behavior of consumers include purchasing power, personal preferences, group influence, marketing campaigns, and economic conditions. The purchasing capacity of customers affects their decisions to purchase a particular product. This directly impacts the particular product’s sales. Based on consumers’ purchasing power, an organization can easily determine the segments of customers that would be eligible for their products. Certain influential groups such as classmates and acquaintances influence purchasing decisions and hence sales for certain products.

For example, fast foods are known to have a mass liking compared to homemade foods. Depending on the person’s perception of marketing campaigns, coupled with personal preferences, marketing campaigns may influence an individual to purchase a product. This also depends on the prevailing economic conditions. A positive economic condition would tend to boost consumers’ confidence hence impacting their decisions to purchase specific products. (Peter, & Olson, 2010).

Understanding consumer behavior is a crucial part of the success of any business. Businesses invest massive efforts to attract many customers or to influence consumers to purchase more. These efforts are directed towards the understanding of consumer behavior as this enables organizations to devise the most appropriate approaches to market their products. An understanding of the consumers’ purchasing patterns is highly useful for the prediction of future patterns. From the analysis of past purchasing patterns of consumers, it possible to make projections on future consumer purchasing patterns. This is not only crucial in production decision-making but could also be necessary for marketing planning. (Stephens, 2017). For example, if consumers seem to be influenced by advertisements, more resources could be directed towards the advertisement of a particular product or service. Product development could also be based on consumer behavior. Guided by the analysis of consumer behavior, new products or development of the existing products should be aligned to the consumers’ preferences. Thus, examining consumer behavior, for example, using consumer search behavior, could help in the identification of market niches. (Jun, Park, & Yeom, 2014).

Through the analysis of consumer behavior, an organization can enhance its marketing strategies. Consumer behavior provides an understanding of how consumers are influenced by their environments about purchasing behavior. For example, the advertising media, signs, or culture could affect consumers buying behavior. (Lantos, 2015). Understanding consumer behavior also helps in the understanding of consumers’ psychology regarding reasoning, feelings, and their process of choosing between products from different brands. The effect of consumer knowledge in purchasing behavior could also be analyzed through the understanding of consumer behavior. For example, the information processing abilities and limitations in consumer knowledge have a large influence on consumers’ decision-making and hence the overall marketing outcomes for an organization. Organizations and marketers can utilize the understanding of consumer behavior to improve their marketing strategies and marketing campaigns to enhance their marketing outcomes and to have an active reach to their customers. (Information Resources Management Association, 2015).
In any organization, maintaining brand loyalty is a crucial goal as it helps in retaining customers and keeping sales high. The Starbucks Corporation is one such organization, known to have relatively high brand loyalty. Starbucks is a coffee company based in the US that has many coffee and beverage locations worldwide. Starbucks operates in the coffee shop industry and faces stiff competition from other coffee beverages in the industry. However, its ability to offer quality to customers has helped the company to in gaining a competitive advantage and thus remains to be one of the largest coffeehouse chains worldwide. Understanding consumer behavior plays a critical role in enhancing brand loyalty. The focus by Starbucks on maintaining a positive customer experience has been crucial to Starbucks’ continued success. The company’s strong brand loyalty ensures that customers remain frequent buyers and relatively insensitive to price changes. However, competition in the coffee shop industry is on the rise and could pose a possible threat to Starbucks’ brand loyalty and, ultimately, its coffee sales. (Behar, Goldstein, & Schultz, 2014).

Currently, Starbucks is believed to hold a market share of approximately 33 percent of the entire coffee market. Although the company produces a variety of other products, coffee products remain its high-selling line of products. Coffee products account for the most significant portion of the company’s total sales. Most of Starbucks’ customers are in the urban areas and the upscale suburban areas. Customers in rural areas account for only a small portion of the company’s customer base. In addition to this customer description, Starbucks has distinct customer segments. The customer segments are defined by the percentage of sales attributed to each. The segments represent the company’s primary and secondary target audience. (Schoja, 2016).

A large number of Starbucks customers are individuals between the ages of 25 and 40 years. This group forms Starbucks’ primary target audience. It accounts for close to half of the total Starbucks coffee sales. This target audience mostly consists of urbanites, with a focus on social welfare, professional careers, and relatively high incomes. To appeal to this target audience, Starbucks maintains a consistent contemporary design through deco and advertisements. The secondary target audience for Starbuck consists of young adults aged between 18 and 24 years. This target audience constitutes close to 40 percent of Starbucks coffee sales. Most of the individuals in this target audience are college students. To appeal to this population, Starbuck positions itself at the available areas for young adults such as hang-out places. The company also introduces the latest technology on its products with the view of maintaining a cool image of the product. Teens also constitute the secondary target audience as they account for 2 percent of the company’s sales. (Schoja, 2016).

Despite the significant market share for coffee beverages that Starbucks enjoys, there is always the threat of a decline in the market share due to the high level of competition. This could quickly lead to low profitability in the coffee beverages production. The understanding of consumer behavior presents a massive opportunity for Starbucks to grow its customer base as well as increasing its brand loyalty. The adverse effect of the competition is that it poses the threat of an organization losing its customers to the competitors. One of Starbucks ‘ main competitors, McDonald’s, is investing a lot in the production of a large variety of coffee beverages. As a result of its more extensive menu compared to the Starbucks’ menu, McDonald’s is increasingly attracting more customers which could be a worry for Starbucks. What other coffee beverage producers are seeking is to meet the wide range of consumer needs and preferences. A poor or lack of a good understanding of consumer behavior may be liable for the relatively short Starbucks menu for coffee beverages. In the long run, Starbucks’ brand loyalty may suffer as well as the profitability of the business. (Ng, & Lee, 2015).
To ensure long-term brand loyalty, Starbucks can invest more resources in product development, product differentiation, and the production of different types of coffee beverages. Offering differentiated and a wide variety of products to consumers would help in meeting their varied needs and preferences, and thus they would be discouraged to buy products from the company’s competitors. The best way to approach this is by having a good understanding of consumer behavior. It is essential for Starbucks to determine the kind of products that the customers are looking for and thus, through product development, introduce products that fully meet consumer preferences. There is always a close connection between consumers’ repeated purchasing behavior and attitudes. Many consumers would thus tend to purchase what they believe aligns with their attitudes and preferences. Understanding those positions and difference presents a big opportunity for Starbucks to maintain the loyalty of its large number of customers. (Rajagopal, & Castano, 2015).

The social environment has a huge influence on consumers’ purchasing habits. One major factor in the social environment that influences consumer purchasing behavior is the use of different media by organizations to market their products. In addition to offering a wide variety of coffee beverages to customers, Starbucks’ competitors are also employing a variety of methods for advertising their coffee beverages. This could also have a huge influence on consumers’ attitudes towards purchasing from these organizations. Consumer behavior would help in the understanding of consumers’ perceptions towards the different types of media used by Starbucks’ competitors. This would provide clear knowledge on how consumers tend to align their purchasing decisions as a result of the influence of such media advertisements. From the analysis of the effect that media has on the purchasing behavior of consumers, Starbuck can design new marketing campaigns or enhance the existing campaigns to improve the company’s sales. (Quester, Pettigrew, Kopanidis, Hill, & Hawkins, 2014).

Starbucks could also use the understanding of consumer behavior to enhance consumers’ attitudinal loyalty to the company. Attitudinal loyalty is the type of brand loyalty that involves consumers developing preferences and emotional attachment to a certain brand over the competing brands regarding the purchasing of products and services. In such a case, a consumer would even refer others to purchase products from the company. Starbucks has excelled in the establishment of such relationships with its customers through the Starbucks experience. However, with the increasing competition in the coffee shop industry, it is important for the company to strengthen its relationship with its customers further. This may be done through the understanding of consumer behavior in the sense that the company seeks to examine the general perceptions of the customers. Based on this information, it would be easy to implement the necessary measures to strengthen the loyalty of the customers. For example, if customers cite a lack convenience in the coffee stores, the company would respond by ensuring convenience in the location of the coffee stores. That way, customers would feel valued and thus maintain their preference for Starbucks’ products. (Dholakia, 2012).

Conclusion
An understanding of consumer behavior is highly essential in enhancing the loyalty of customers to any organization. In the process of building brand loyalty, it is vital to evaluate how customers feel about the brand. Through the understanding of consumer behavior, companies can improve their marketing strategies as they get to know the reasoning behind consumers’ selection of alternative brands of products. It is also important to analyze how the environment affects consumers’ psychology and how their decision-making could be influenced. The information processing abilities of consumers need to be evaluated and thus marketing strategies adjusted accordingly to enhance consumer knowledge. (Zhang, 2012). By investing more in the understanding of consumer knowledge, marketers can figure out the important ways of increasing the effectiveness of their marketing campaigns regarding reaching out to the consumers. Starbucks should invest more in understanding consumer behavior to effectively beat the competition and enhance brand loyalty. By evaluating the consumers’ preference, Starbucks can increase the variety of its coffee products and thus retain its customers who would otherwise move to other companies offering a wide range of products to fulfill their varied preferences. Hence, consumer behavior plays a critical role in enhancing brand loyalty. (Oliver, 2010).

References
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