Reading : Lesson 4

Social Factors affecting Consumer Behavior

Consumer Behavior is an effort to study and understand the buying tendencies of consumers for their end use.

Social factors play an essential role in influencing the buying decisions of consumers.

Human beings are social animals. We need people around to talk to and discuss various issues to reach to better solutions and ideas. We all live in a society and it is really important for individuals to adhere to the laws and regulations of society.

Social Factors influencing consumer buying decision can be classified as under:

• Reference Groups
• Immediate Family Members
• Relatives
• Role in the Society
• Status in the society

1. Reference Groups
   Every individual has some people around who influence him/her in any way. Reference groups comprise of people that individuals compare themselves with. Every individual knows some people in the society who become their idols in due course of time.Co workers, family members, relatives, neighbors, friends, seniors at workplace often form reference groups.Reference groups are generally of two types:
   1. Primary Group – consists of individuals one interacts with on a regular basis.Primary groups include:
      • Friends
      • Family Members
      • Relatives
      • Co Workers
      • All the above influence the buying decisions of consumers due to following reasons:They have used the product or brand earlier.They know what the product is all about. They have complete knowledge about the features and specifications of the product.Tim wanted to purchase a laptop for himself. He went to the nearby store and purchased a Dell Laptop. The reason why he purchased a Dell Laptop was because all his friends were using the same model and were quite satisfied with the product. We tend to pick up products our friends recommend.A married individual would show strong inclination towards buying products which would benefit not only him but also his family members as compared to a bachelor. Family plays an important role in influencing the buying decisions of individuals.A consumer who has a wife and child at home would buy for them rather than spending on himself. An individual entering into marriage would be more interested in buying a house, car, household items, furniture and so on. When an individual gets married and starts a family, most of his buying decisions are taken by the entire family.Every individual goes through the following stages and shows a different buying need in each stage:
      • Bachelorhood: Purchases Alcohol, Beer, Bike, Mobile Handsets (Spends Lavishly)
      • Newly Married: Tend to purchase a new house, car, household furnishings. (Spends sensibly)
      • Family with Children: Purchases products to secure his as well as his family’s future.
      • Empty nest (Children getting married)/Retirement/Old Age: Medicines, Health Products, and Necessary Items.
      • A Ford Car in the neighborhood would prompt three more families to buy the same model.
2. Role in the Society
   Each individual plays a dual role in the society depending on the group he belongs to. An individual working as Chief Executive Officer with a reputed firm is also someone’s husband and father at home. The buying tendency of individuals depends on the role he plays in the society.
3. Social Status
   An individual from an upper middle class would spend on luxurious items whereas an individual from middle to lower income group would buy items required for his/her survival.https://www.managementstudyguide.com (Links to an external site.)

4 of the Biggest Factors That Affect Customer Purchase Decisions

May 17, 2018 (Links to an external site.) | Marketing (Links to an external site.) | By Shane Barker (Links to an external site.)

Management Adda. (2019, June 28). Factors influencing Consumer Behavior [Video]. YouTube. 

Buzzle. (2016, December 1). Key Factors That Influence the Buying Decisions of Consumers [Video]. YouTube. 

What makes another business more successful than yours? How is your competition affecting the purchasing decisions of customers and making so many more sales than you? As a brand, you have probably asked yourself these questions many times.

So now you’re wondering how to impact your customers (Links to an external site.)’ purchase decisions more effectively. This post will give you some easy steps to follow to boost your sales.

1. Scarcity

When a product is perceived as rare, people tend to place a higher value (Links to an external site.) on it. The more rare a product is, the more it is wanted. It doesn’t matter if the product is a costly mobile phone or simply a last cookie at a bakery.

Brands often use phrases like, “last day to grab 50% discount,” or “only 2 pieces left” to lure customers. Using the persuasion technique of scarcity, you should communicate what a consumer could lose if they don’t buy your product. If done correctly, consumers will be motivated to take action.

Many consumers believe that if a product is difficult to get, it is generally better in terms of quality. Thus, linking the availability factor to the quality factor. Brands need to communicate a feeling of urgency or a fear of missing out if a consumer is not taking action quickly.

Brands can use the following methods to trigger customers’ purchasing decisions:

• Limited Number – When a product is short of supply or will no longer be available once it is out of stock.
• Limited Time – When the product is available for a limited period of time.
• One-of-a Kind Specials – You can use one or both of the above-mentioned methods to create a one-of-a-kind special.
• Competitions – Users are often more interested in buying a product when others are also interested in buying it. This method is usually used during bids or auctions.

Good examples of scarcity can be found on Groupon (Links to an external site.). It is a deal site offering huge discounts on various products and services. The website uses limited time and quantity tags, and a small hourglass image. It develops a sense of urgency and scarcity to encourage consumers to make a purchase before they miss the opportunity.

Amazon (Links to an external site.) also uses the scarcity principle really well. In the image below, you will noticed a bold, green highlighted tag, “only 2 left in stock.” In this case, the limited number of the item is combined with the urgency of a limited-time, one-day shipping offer. This is one of the most effective ways of pushing customers to take actions.

1. Consistency and Convenience

Once they make a choice or decision, customers generally stick to it. It is because of convenience that customers usually stand by the decision they make regardless of so many other choices.

Brands can use this principle to convince the customer and get them to commit. Once the customer is committed, out of compulsion, they will stick to the decision and complete their purchase.

It is the nature of people to be comfortable and consistent with things they have done previously. Customers ensure that their actions are lined up with their intentions to maintain consistency. By asking for small commitments from the customer, brands can initiate and activate the consistency aspect among customers.

Filling out forms on any website is a classic example of consistency and convenience. Customers start out by filling out one quick, simple, and easy form, which later leads to a page asking for a much more detail information.

Upworthy (Links to an external site.) is a startup devoted to publishing uplifting stories that go viral on social media. When you visit their website and start to read an enticing story, a pop-up window comes up. The pop-up window shows messages like “I support equality for all,” with an agree and a disagree button below it. Now you would probably think that clicking “agree” won’t be of any harm and click it.

But the moment you click a button, the website draws you in with another pop-up email signup form. After filling in the form, you will keep getting more stories from Upworthy. All this method needs is a small commitment from the website visitor.

Brian Clark is the founder of Copyblogger (Links to an external site.), which sells content marketing software. On the website’s homepage, after scrolling a bit down, you’ll notice a huge headline. The headline invites visitors to capture the opportunity for a free online marketing courses from the company.

Obviously, this is a type of public commitment. It helps increase the chances that you will purchase one of their products like Synthesis or Scribe.

1. Social Proof

Knowingly or unknowingly, people always observe what other people are doing. There is a sense of satisfaction in knowing that other people are also doing the same thing as you. This means in situations when a consumer doesn’t know what to do, they simply observe other consumers. And they will often do the exact same thing that others are doing.

Brands can use this strategy effectively to increase their sales. Marketing advertisement usually uses endorsements or reviews (Links to an external site.) from other customers. These can influence the decisions of potential customers. Did you know almost 90% of customers (Links to an external site.) like to read an online review before making any decision on whether or not to buy a product?

Many companies showcase the number of products being sold or the number of satisfied customers they have. This is all about social proof. During sales, brands can use this data as social proof for pitching a new set of possible buyers. It’s a way of saying, “Look, other people love us and you will too.”

The objective of social proof is to showcase that consumers are using and also loving your product. So, take advantage of the opportunity to toot your own horn about your products and services to the people.

Amazon (Links to an external site.) uses this method. They show the ratings and reviews from real customers. You can also use videos and/or written reviews and testimonials. The positive feedback from existing customers can really push potential users to go through with a purchase.

Online clothing company, Modcloth (Links to an external site.), uses this strategy to increase their sales and conversion rates. The company has a big online community. They encourage their buyers to vote for a particular style, which the company will sell in the future. These styles are showcased with a “‘Be the Buyer Pick” badge. Displaying this badge tells shoppers that other customers love this particular item.

Just like reviews or testimonials, images of products also play an important role in people’s purchasing decisions. The way your product looks can hugely impact your sales. When a consumer is shopping, the factor that can quickly help them decide to make a purchase is a product image.

According to the BigCommerce product photography guide (Links to an external site.), people look for proof of a product’s quality and value when they’re viewing a product page. And the quality of the product image testifies for the quality of the product.

1. Authority

Expertise is a vital part of persuasion and influence. Regardless of the field, consumers often look to experts for tips and advice. And being obedient to authorities is something that is embedded in us since childhood.

When a famous influencer has given positive feedback about your products or services, display it on your website. Putting it on the pricing page or landing page will definitely increase your sales.

Any big celebrity, sports player, or thought leader that your target customers believe in can be a good choice to represent your brand. If a brand is promoting a food product, for instance, they could collaborate with professional chefs who could sway the target audience.

ShoeDazzle (Links to an external site.) is an online startup and women’s shoes and accessories retailer. And Kim Kardashian is a co-founder and chief fashion stylist. Because of her expertise in the fashion world, Kim is an influencer and authority personality among young female shoppers.

To promote yourself and your expertise, you can conduct “ask me anything” (AMA) sessions at regular intervals or times. You can participate in communities who organize them regularly if you cannot do it all by yourself. There are many online marketing expert agencies that participate in AMA sessions organized by Inbound (Links to an external site.).

Final Thoughts

All these methods, if done correctly, they can help you generate more conversions and boost sales. Let us know in the comment section below if you have any tips or strategies to add. We’d also love to hear how your brand has used these tactics to impact customer decisions.

Posted in Marketing (Links to an external site.)

About the Author: Shane Barker (Links to an external site.)

Shane Barker is a digital marketing consultant, named the #1 social media consultant in the nation by PROskore Power Rankings. He has expertise in business development, online marketing and is an SEO specialist who has consulted with Fortune 500 companies, government agencies, and a number of A-list celebrities.

https://www.searchenginepeople.com