Change of Consumer Behavior in Retail Paper Example

Consumer behavior is a social science that seeks to understand the factors that affect the decisions customers make before they purchase items. It expounds the attitudes, emotions, tastes, and preferences that influence the consumers. The behavioral, emotional, and mental conditions of consumers affect their purchasing decisions in retail. Internal and external factors influence the decisions customers make both in the short-term and in the long-term (Parment, 2013). Consumer behavior examines the pre-purchase process as well as the post-purchase period to access whether a client has received the satisfaction he or she expected from a product. Consumer behavior is not constant as clients are influenced by the presence of different commodities in the market that attract their attention (Gupta, 2011). Aggressive marketing from organizations affects the purchasing behavior of customers, necessitating retailers to constantly evaluate their clients' behavior to understand the decision-making dynamics. Consumers make both minor and major decisions as they purchase products in the market due to the variety of commodities. All consumers determine the products they can afford based on their budgets (Dholakia et al., 2010). When purchasing long-term assets, some consumers search for a piece of extensive and detailed information about the product and compare prices between different suppliers before making the purchase decision. However, cheap commodities that are easy to replace do not involve a thorough decision-making process. Psychological, social, cultural, and personal factors trigger the change in consumer behavior in retail.

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Retailers must study and understand consumer behavior before they can succeed in making sales (De Mooij, 2010). The competitive market dictates that only a few and a limited number of retailers that invest in understanding the customer will succeed. The evolving world and penetration of technological channels have made purchasing processes and decisions easier for the consumer as long as they are connected to the internet. Retailers' ability to shift to the changes taking place in the market affects their market size. Adapting and embracing the changes taking place in the market and industry enables retailers to shift their focus from manufacturing products to identifying the needs of customers, then designing commodities that will satisfy their needs (De Mooij, 2010). For instance, in the modern day where customers use the internet to purchase their commodities, retail marketers can study virtual data analytics to predict future patterns. Marketers can then use the data analytics results to create products that have a high probability of attracting the attention of customers. Retailers that focus on delivering a tailor-made experience to their customers create a conducive environment for brand loyalty to thrive (Parment, 2013). Personalized and customized products affect consumer purchase decisions. For instance, when retail managers of high-end stores like Henry Bendel fail to focus on the specific needs of their clients and instead factor in the maximization of profits, then clients are forced to move to lower-end-stores that consider their needs. The marketers in lower-end-stores focus on the customers' preferences and provision of a customized shopping experience might be their main reason for the success. In addition, after-sales services assure customers that a retailer is not only concerned about their resources but rather, their comfort and satisfaction both in the short-term and in the long-term (Dholakia et al., 2010). A close business relationship with customers enables retailers to understand the mind of the consumer and eventually changing the mindset. It also becomes easy to increase the customer experience which leads to brand loyalty in the long-term.

The recent past has seen a significant number of notable retail outlets close down or record declining sales at the end of each financial year (Gupta, 2011). The closure and reduction in profits can be closely attributed to the retailers' inability to understanding the dynamic yet extensive shifts in consumer behavior. In the modern day, customers are aware of what they need and are confident when making purchase decisions. A large number of suppliers in the market competes for their attention, making the customers have better bargaining power for quality and pricing of commodities. Customers with a higher purchasing power go for high-quality products that add value to their lives and they spend a lot of money to secure their commodities (De Mooij, 2010). In addition to the high-quality products, consumers are concerned about the convenience and services they receive from a retailer. For instance, a retailer that has good customer service and offers high-quality products is more likely to attract and retain clients than one that does not offer additional or instant services. A good human experience and personalized treatment excite clients who feel appreciated by an organization.

Customers are spending money on online retail outlets instead of the conventional physical stores. The business environment has changed and digital platforms have been developed that allow clients to order products from the comfort of their homes and offices using their mobile phones and computers (Grewal et al., 2012). The online environment is exciting for customers as all they need to do is identify the commodity they need, then click to order, and have it delivered at a destination of their convenience. Most customers that use the digital platforms to purchase their commodities know what they want before they make an order. However, clients that have no pre-meditated and decided what they need are easily convinced by the products on display on the online platforms (Dholakia et al., 2010). Customers experience impulse buying and end up spending more resources than they had anticipated. A retailer that uses the digital platform to sell its products to the consumers can gather customer purchasing patterns online and the information as a decision-making tool. For instance, the retailer can customize the offerings on the online platform by ensuring that customers see more products related to their searches and purchases in the past.

Change of consumer behavior in retail affects the selection process that clients go through before they can acquire a product or service (Gupta, 2011). A consumer searches the market for the commodity he or she needs, then chooses a product that has a high probability of meeting his or her need. Selecting a product from the various alternatives in the market depends on the disposable income a client has and the value attached to the commodity or service. Cultural factors affect the purchase decisions of a client (Darley, Blankson, & Luethge, 2010). For instance, the beliefs and culture of a person affect their purchase decisions as commodities bought must align with their way of life. The social class that separates the income levels in the society affects the quality and quantity of products purchased at the local and international market. For instance, people from the upper social class might prefer importing their clothing, furniture, fittings, and other commodities used in their daily lives from internationally recognized countries that focus on quality, as opposed to getting them locally like individuals from the lower social class. Education, accumulated wealth, and occupation of individuals determine the social classes that people identify within the society (Grewal et al., 2012). For instance, people that have attained a certain level of education may perceive owning a specific type of vehicles as a norm, dictating their purchase decisions of the brand.

Retailers that study the social factors that consumers consider before making a purchase decision have a high probability of influencing their choices in the market (Parment, 2013). For instance, family traditions, role, and reference groups determine consumer behavior in the market. One of the most popular family traditions and assumptions is that females tend to control most of the purchasing decisions in a home. Therefore, retailers and manufacturers must design advertisements and products that will appeal to women, who then convince their male partners to purchase the items (De Mooij, 2010). Social relationships in the society affect businesses indirectly as satisfied customers might refer their friends and family to a retailer. This necessitates retailers to focus on a quality customer experience. Organizations that invest in good and professional customer service can attract referrals and business relationships with their existing clients. One of the most common strategies retailers use to attract referrals from their existing customers is by offering cash discounts to those that bring clients. Dholakia et al. (2010) argued that retailers should focus more on their existing customers and strive to transform them into loyal clients, as opposed to ignoring their needs and chasing the new clients. Existing customers ensure an organization has ongoing businesses throughout the year and enable the firm has a regular income.

Psychological factors that affect consumer behavior include attitudes, beliefs, motivation, and perception. The attitudes towards particular brands affect the purchase decision that clients make before they can acquire a product (Grewal et al., 2012). For instance, most clients assume that expensive commodities are of high quality. The assumption is applicable to some items, but not all, meaning that clients have to perform a background study on a commodity before buying to avoid disappointments either in the short-term or in the long-term. Retailers and marketers have the power and influence to change the attitudes that clients have towards their products by availing commodities in the market that reflect their claims (Gupta, 2011). For instance, if a retailer claims that his or her products have a longer lifespan than those of his or her competitors and convinces a client to purchase, the customer must get value for their money and have little or no complaints on the quality of a commodity. Brand positioning in the market enables retailers to change the negative perceptions that clients might have about a product.

Change of consumer behavior in the retail industry is affected by customers' personal factors. Personalities, economic power, lifestyles, age, and self-esteem affect the purchase decisions made by customers (Darley, Blankson, & Luethge, 2010). For instance, most young people are willing and able to experiment with different products in the market. Once companies have introduced new products in the market targeting the youths, organizations make sales from the early adopters. The clients' lifestyle also affects the choices they make when purchasing items in the market. The economic status of clients affects their purchasing power. For instance, young people that have a large amount of money at their disposal may easily purchase items once they are released in the market as opposed to others within that age-group that have little or no income to spend on items. The economic forces in a country affect the amount of money in circulation. When the amount of money in circulation is high, citizens in a country have more buying power than when there is a limited amount of money in the economy. In addition, when the savings and income levels of customers are more, they are able to allocate a higher percentage towards spending, which increases their purchasing patterns. Retailers that correctly interpret the economic status of a country adjust their prices to accommodate the changes taking place.

Conclusion

In conclusion, consumer behavior in the retail industry is influenced by...