Consumer Behavior in Marketing - Patterns, Types, Segmentation - Omniconvert Blog (2023)

How many times do you make decisions throughout the day? What should I wear today? What perfume should I use? What am I having for lunch?

If you think about it, we make a lot of buying decisions every day without giving them much thought.

These decisions, as insignificant as they may seem, keep marketers up at night. Because decoding the processes behind customer decisions means we can use this information to increase revenue.

What is the meaning of consumer behavior?

Consumer behaviorIt is the study of consumers and the processes they use to choose, use (consume), and dispose of products and services, including consumers' emotional, mental, and behavioral responses.

Consumer behavior incorporates ideas from various sciences, including psychology, biology, chemistry and economics.

In this guide, we'll look at the different aspects and facets of consumer behavior and discuss the most effective types ofcustomer segmentation.

Why is consumer behavior important?

Studying consumer behavior is important because it helps marketers understand what influences consumers' buying decisions.

By understanding how consumers decide on a product, they can bridge the gap in the market and identify needed and obsolete products.

Studying consumer behavior also helps marketers decide how to present their products in a way that makes the most impact on consumers. Understanding consumer buying behavior is the key to reaching and engaging your customers and converting them to buy from you.

An analysis of consumer behavior should reveal:

• What consumers think and how they feel about various alternatives (brands, products, etc.);
• What influences consumers to choose between various options;
• Consumer behavior in research and purchase;
• How consumers' environment (friends, family, media, etc.) influences their behavior.

Consumer behavior is often influenced by many factors. Marketers must study consumer buying patterns and discover buyer trends.

In most cases, brands influence consumer behavior only with the things they can control; think about how IKEA seems to force you to spend more than you intended every time you walk into the store.

So what are the factors that influence consumers to say yes? There are three categories of factors that influence consumer behavior:

1. Personal Factors: An individual's interests and opinions may be influenced by demographics (age, gender,culture, etc).
2. Psychological Factors: An individual's response to a marketing message will depend on their perceptions and attitudes.
3. Social factors: family, friends, education, social networks, income, all influence consumer behavior.

Types of consumer behavior.

There are four main types of consumer behavior:

1. Complex buying behavior

This type of behavior is found when consumers purchase an expensive product that is purchased infrequently. They are heavily involved in the buying process and consumer research before committing to a high-value investment. Imagine buying a house or a car; these are an example of complex buying behavior.

2. Buying behavior that reduces dissonance

The consumer is highly involved in the buying process, but has difficulty identifying differences between brands. “Dissonance” can occur when the consumer fears he will regret his choice.

Imagine that you are buying a lawn mower. You'll choose one based on price and convenience, but after you buy it, you'll be looking for confirmation that you made the right choice.

3. Usual buying behavior

Habitual purchases are characterized by the consumer having very little involvement with the product category or brand. Imagine going shopping: you go to the store and buy your favorite type of bread. You are displaying a habitual pattern, not strong brand loyalty.

4. Variety seeking behavior

In this situation, the consumer buys a different product not because he is dissatisfied with the old one, but because he is looking for variety. Like when you're experimenting with new shower gel scents.

Knowing what types of customers your online store attracts will give you a better idea abouthow to segment types of customers.

What affects consumer behavior?

Many things can affect consumer behavior, but the most frequent factors influencing consumer behavior are:

1. Marketing campaigns

Marketing campaigns greatly influence purchasing decisions. If done well and regularly, with the right marketing message, it can even persuade consumers to switch brands or to more expensive alternatives.

Marketing campaigns such asFacebook Ads for Ecommerce, they can even be used as reminders of products/services that need to be purchased regularly, but are not necessarily on the minds of customers (like insurance, for example). A good marketing message can influence impulse purchases.

2. Economic conditions

Especially for expensive products (such as houses or cars), economic conditions play an important role. A positive economic environment is known to make consumers more confident and willing to make purchases, regardless of their financial responsibilities.

The consumer's decision-making process is longer for expensive purchases and can be influenced by more personal factors at the same time.

3. Personal Preferences

Consumer behavior can also be influenced by personal factors: likes, dislikes, priorities, morals and values. In industries like fashion or food, personal opinions are especially powerful.

Ads can influence behavior, of course, but at the end of the day, consumer choices are highly influenced by their preferences. If you're vegan, no matter how many hamburger ads you see, you're not going to start eating meat because of it.

4. Group influence

Peer pressure also influences consumer behavior. What our family members, classmates, immediate relatives, neighbors and acquaintances think or do can play an important role in our decisions.

Social psychology impacts consumer behavior. Opting for fast food over homemade meals, for example, is just one of those situations. Education levels and social factors can have an impact.

5. Purchasing power

Last but not least, our purchasing power plays an important role in influencing our behavior. Unless you're a billionaire, consider your budget before making a purchase decision.

The product might be great, the marketing might be up to par, but if you can't afford it, you won't buy it.

Targeting consumers based on their purchasing power will help marketers determine qualified consumers and get better results.

Customer behavior patterns

Buying behavior patterns are not synonymous with buying habits. Habits develop as action tendencies and become spontaneous over time, while patterns show a predictable mental blueprint.

Each customer has their unique buying habits, while buying behavior patterns are collective and offer marketers a unique characterization. Customer behavior patterns can be grouped into:

1. Place of purchase

Most of the time, customers split their purchases between multiple stores, even if all items are available at the same store. Think of your favorite hypermarket: although you'll also find clothes and shoes there, you'll probably buy them from real clothing brands.

When a customer has the ability and access to purchase the same products at different stores, he is not permanently loyal to any store unless it is the only store he has access to. Studying customer behavior in terms of location choice will help marketers identify key store locations.

2. Purchased Items

Analyzing a shopping cart can provide marketers with many consumer insights into which items were purchased and how much of each item was purchased. Basic items can be purchased in bulk, while luxury items are purchased less frequently and in small quantities.

The quantity of each item purchased is influenced by the perishability of the item, the purchasing power of the buyer, the unit of sale, the price, the number of consumers for whom the item is intended, etc.

3. Purchase time and frequency

Customers will shop at their convenience and expect service even during the oddest of hours; especially now in the age of e-commerce where everything is just a few clicks away.

It is up to the store to meet these demands, identifying a purchase pattern and adapting its service according to the time and frequency of purchases.

One thing to keep in mind: seasonal variations and regional differences must also be taken into account.

4. Form of purchase

A customer can walk into a store and purchase an item, or place an order online and pay online with a credit card or cash on delivery.

The purchase method may also result in more expenses for the customer (for online purchases, a shipping fee may also be charged, for example).

How a customer chooses to purchase an item also says a lot about the type of customer they are. Gathering information about their behavior patterns helps identify new ways to get customers to come back, more often and at higher prices.

Think of all the data you've collected about your customers. Buying patterns are hidden in your online store reviews, and you can manually search for information or integrate a tool into your e-commerce platform such as Shopify ou WooCommerceto obtain automated information about patterns of behavior.

Customer behavior segmentation

Segmenting customers and identifying types of buyers has always been important. Now that the customization andcustomer experienceare factors that determine the success of a business, effective segmentation is even more important.

Only 33% of companies that use customer segmentation say they find it significantly impactful, so it's important to find the segmentation technique that gives clarity and fits your business.

Traditionally, most marketers have used six main types of behavioral targeting.

1. Benefits sought

A customer buying toothpaste might search for four different reasons: whitening, sensitive teeth, taste, or price.

When customers search for a product or service, their behavior can reveal valuable information about which benefits, features, values, use cases, or issues are the most motivating factors influencing their purchase decision.

When a customer places a much higher value on one or more benefits than others, those top benefits sought are the motivating factors that shape that customer's purchase decision.

2. Based on occasion or time

Occasion-based and time-based behavior segments refer to both universal and personal occasions.

• Universal occasions apply to most customers or target audiences. For example, holidays and seasonal events, when consumers are more likely to make certain purchases.
• Recurring personal occasions are buying patterns for an individual customer that repeat consistently over time. For example birthdays, anniversaries or holidays, monthly shopping or even daily rituals like stopping for coffee on the way to work each morning.
• Non-personal occasions are also related to individual customers, but they are more irregular and spontaneous and therefore more difficult to predict. For example, going to a friend's wedding.

3. Usage fee

Product or service usage is another common way to segment customers by behavior, based on how often a customer purchases or interacts with a product or service. Usage behavior can be a strong predictive indicator ofloyaltyodrumsand thereforelifetime value.

4. Brand loyalty status

Loyal customers are a company's most valuable assets. They are cheaper to maintain, usually havehigher lifetime valueand they can become brand advocates.

By analyzing behavioral data, customers can be segmented by their level of loyalty so marketers can understand their needs and ensure they are met.

Loyal customers are those who should receive special treatment and privileges, such as exclusive rewards programs to nurture and strengthen customer relationships and encourage future business continuity.

5. User status

There are many different possible user states that you can have depending on your business. Some examples are:

• non-users
• prospects
• first-time buyers
• regular users
• Defectors (former customers who switched to a competitor).

6. Stage of the customer journey

Audience-based targeting in Buyer Readiness enables marketers to align communications and personalize experiences to increaseconversionat each step.

In addition, it helps them discover the stages where customers are not progressing, so they can identify the biggest obstacles and opportunities for improvement, including in post-purchase behaviors.

In addition to these traditional forms, another type of segmentation isRFM model🇧🇷 This approach is popular with ecommerce marketers because it helps them build customer experiences based on the insights they have about each customer segment.

RFM is a behavioral targeting model and the three letters stand for Recency, Frequency, and Monetary Value.

This is what these variables show:

• Recency = how long ago a customer last ordered on your site;
• Frequency = how many times a customer bought something from your site in the analyzed period;
• Monetary value = how much each customer has spent on your site since their first order.

LosRFM model analysisIt can be executed in 2 ways:

• Manually: export your database in a spreadsheet and analyze your customers following the rules ofRFM analysis;
• Automatically – through certain tools that arecreating RFM dashboards.

Segmentation and RFM analysis can reveal whoyour most loyal and profitable customersare and also:

• Reveal which brands and products are dragging your business down;
• Create personalized recommendations for your customers;
• solve rightcustomer experienceproblems.

Before you make gut decisions about your customers and audience, observe their behavior, listen to them, and build a relationship that will keep them loyal no matter how aggressive your competitors are.

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