Trends In Consumer Behaviour

Understanding of trends in consumer behaviour will give organisations certain strategic advantages. If the organisation is the pioneer in foreseeing the coming trends in consumer's needs and wants, it can be the first to introduce the product in the market and gain the initial advantage. Sabeer Bhatia was the first to anticipate the impact of free e-mail (hotmail). Similarly Citibank had been an early entrant to be successful in the acceptance of the credit card concept by Indian customers.

Secondly, on sighting a trend, it becomes possible for the industry to create a market by channeling a latent need. For this, the cellular phone industry can be quoted as an example. The cellular (or mobile) phone has gained wide acceptance among consumers because of the benefits of wireless technology. The cellular phone industry comprising of names such as Reliance, BSNL, Airtel, Hutch etc. have been able to attract customers by offering wide network coverage, attractive service contract and all at suitable prices.

And lastly, anticipating trends in customer needs and wants and responding to them will not only earn positive public opinion (for the organisation and industry) but also communicate a social responsible image of them. Examples can be quoted of organisations which endorse advertisements issued in public interest such as, banning of smoking at airports, aeroplanes and restaurants, and usage of organically grown vegetables/fruits, recycled paper products etc.

For understanding the trends in determinants of consumer behaviour, we have broadly viewed them under three categories:

• Customer demographic trends 

• Technological trends

• Trends in public policy.

a. Customer Demographic Trends

Changes occurring in customer demographics will help marketers to anticipate the needs and wants of their customer. A few visible changing trends affecting the demographic profile of customers at the market place are:

Declining birthrate and rising life expectancy.

The trend of aging population is visible due to declining birthrate and rising life expectancy. The aging of the population creates new needs and wants. A few of their concerns are related to health, financial security, personal safety and recreation facilities. Related to these concerns will be changes occurring in their purchase behaviour. Senior citizens will seek food items offering nutritional and dietary value, easy availability of products and services (suitable location of the store), attractive health insurance schemes and willingness to spend discretionary income for travel, eating out and other recreational activities.

Thus marketers will have to work out suitable product and services offerings to suit the changing consumer behaviour of senior citizens.

Women opting to work outside the home

Another changing trend is the increase in the double income households with more and more women opting to work outside the home. The increase in the number of working women has particularly affected the 'time resource' and a shift in the lifestyle of such households. With 'time' being a scarce resource at their disposal, working women are postponing their purchase time to weekends or holidays. They also prefer to purchase products from shops which are conveniently located along with the facility of ample parking space. To serve this category of customers, marketers must understand their changing needs and offer suitable products made available, at certain strategic locations.

Emergence of single individual households.

With both the sexes being (equally) qualified, there is another visible trend. Being more career conscious, educated youth have developed a tendency to postpone marriage, preferring to living alone, in order to enjoy their economic independence. Such households enjoy their personal lifestyles and freedom. Being away from their family, such households at times purchase goods which convey a feeling of belonging, takeup social causes etc. in order to escape loneliness. This category of customers may invest in cellular phones (or telephones), and other electronic goods.

For the marketer, this trend indicates that they need to offer more customised products and services (say, instant food preparations etc.) which are appealing and available at convenient locations. [For instance; stores (or services like beauty parlours, restaurants etc.) where the sales personnel are similar to them in demographics and lifestyles].

Shift in the definition of 'middle class' customers

Due to the boom in the economy, the middle class has been growing. Our economy is constantly being fuelled with demand for goods and services from the rapidly expanding middle class. These middle class customers have high aspiration levels, with more disposable income and purchasing power in their hands.

Alongwith these growing middle class aspirations and purchasing power, the neo rich (the affluent class and wealthy) are seeking ways to abandon old symbols of affluence and patronise new symbolic conspicious products.

The implications for the marketer will be to offer customised product and service offerings to cater to the different needs of both the aspiring middle class and neo rich customers. To, encourage increased buying among consumers, marketers have brought out appliances, automobiles and even consumables with attractive financial schemes like the SOTC Holiday Packages, Time share options, Low EMIS for purchasing cars (Santro Xing, Honda City, Baleno etc.) and so on.

Ethnic diversity

Ethnic diversity especially in metres and minimetros cities. To avail of better economic integration, people are seen to be migrating to metro cities and minimetros to enjoy better standards of living. This has resulted in more cultural and ethnic diversity especially due to increasing globalisation of the economy and the availability of job opportunities.

The implications of this for the marketers will be the need to segment the market carefully so as to effectively serve the distinct ethnic groups or diverse segments. This could be the reason behind wide acceptance for departmental stores, (Lifestyle, Shopper's Stop etc.) supermarkets (Nilgiris, Foodworld, Fabmall etc.), shopping malls and so on among the diverse customer market segments. Simultaneously, marketers are also required to deal with various marketing communication tools (internet, labelling of products in more than one language etc.) so as to tackle the cultural diversity.

Geographic shifting or redistribution of population

India has been a witness to shifting of people from the rural to urban areas. However, the influx of more and more people to the urban areas has made the city expand beyond its geographical boundaries. This has resulted in the breaking down of infrastructure such as roads, transport system and other public utilities. To partly solve this problem many organisations are relocating themselves to new locations to avail of the economic incentives and better infrastructure facilities. For instance, the ITPL park (Bangalore), Techno Park (Trivandrum). With the necessary support provided by the state governments, relocation of industries will be an attractive option.

Each region will have a greater mix of people from various places. Even procurement and consumption pattern of customers are likely to be divergent. Accordingly, the marketers will have to modify their marketing plans based on the regional tastes and preferences of the divergent group of customers.

b. Technological Trends

Technology also plays a role in shaping future customer values. Customers are now at the receiving end of information explosion, especially due to the technological advances. The benefits of technological advances are many :

• Customers have more control over market place information.

• The market has opened up to the new generation of smart products with voice- recognition capabilities, designed to the selected preferences of their owner or users.

• Today's customer has got the purchasing power and ability to have access to products anytime, anywhere.

• With technology, it is also possible to have products and services customised and delivered to consumers.

With technological advances, it will be easy to picturise future customers as being very knowledgeable and drivers of all marketing activity. Technological revolution will result in consumer behaviour which is more liberal, demanding, information seeking and individualistic.

c. Trends in Ethical Concern, Economic Pragmatism and Regional Economic Integration 

There is more ethical consciousness with organisations adopting certain explicit code of ethics for decision-making throughout the organisation. The widely accepted societal marketing concept calls for marketers to offer products and services which fulfill the needs of the target market with a long term perspective of improving the society as a whole. This trend of ethical concern will continue to be a focus area, with consumer behaviour becoming an integral part of strategic market planning. Even in future the marketers will continue to focus and address moral issues and ethical behaviour at the market place.

Economic Pragmatism on the part of government is seen in the way the market economy has been opened up giving way to greater participation of the private sector, deregularisation and internationalisation of products and services. The long term benefits which will affect the consumer behaviour will be seen through increased productivity, better allocation of resources and higher standards of living with increased purchasing power. Customers will stand to gain because in order to compete, the organisations will become customer oriented, offer better products and services at lower prices with more standardisation due to internationalisation and global competition.

More and more national governments are seen accepting regional economic integration. For instance, the Association of South East Asian Nations (ASEAN), which includes countries such as Malaysia, Indonesia, Singapore, Brunei, Thailand, Philippines and Japan (which is moving towards integrating its economy). Eventually, Australia, China and India could also join the alliance. Such alliances could be more than trading partners, integrate production facilities and currencies, with even the tariff barriers being pulled down. Such regional economic integration could occur even across cultural and climatic boundaries. The impact of this on consumer behaviour will be seen in the form of:

• Consumers will be able to enjoy goods throughout the year due to the blending of climatic boundaries with economic blocs.

• With liberalisation of international trade, consumers can enjoy purchasing goods and services from anywhere across the world.

• With globalisation of the consumer, inspite of there being national, geophysical, climatic and cultural boundaries, when it comes to consumption of goods and services, it will be a global village."