New and existing companies can increase their growth and profitability by understanding consumer decision-making in their target marketplace. In other words, you need to think about the behaviors, attitudes, and opinions that make consumers want to purchase the types of products or services that your company sells.
Understanding why your target consumer base makes certain purchasing decisions can give you valuable insight into your competition and the needs of your consumers. Then, you can create new opportunities, products, services, and advertising campaigns that appeal to them and make them want to do business with your company.
What is Behavioral Science?
There is a particular science behind understanding consumer decision-making, and it is called behavioral science. The clinical definition of behavioral science is the study of human behavior through systematic observation, research, and experimentation. When applying behavioral science to market analysis in the business world, it is the study of consumer behavior and decision-making in the marketplace.
Every consumer decides to visit a storefront, contact a company, and make a purchase because of their personal preferences, motivations, and desires. Through behavioral science, you can learn more about the consumers’ preferences, motivations, and desires in the marketplace that your company wants to target. Then, you can use this information to address your consumers’ needs and preferences by improving your company’s marketing strategies, customer support, and products and services.
Psychological, economic, and social factors typically influence consumer decision-making in the marketplace. Behavioral science will help you understand these factors as they pertain to your targeted consumer base. All you need is the right team of consumer researchers to assist you in this effort.
Studying Consumer Behavior and its Impact on Consumer Decision-Making
You do not have to become a professional psychologist to study and understand consumer behavior. Many business leaders and strategists utilize their analytical skills to understand consumer behavior and how it impacts consumer decision-making in the marketplace. That is what you can learn to do for your business.
Below are five areas that influence consumer behavior and impact consumer decision-making.
1) Consumer Demographics
Analyzing consumer behavior requires grouping consumers in various demographics, such as age, location, interests, job title, income, education, etc. Even though every person has independent thoughts and feelings, the people within each demographic group tend to make similar purchasing decisions.
Studying the consumer behavior of various demographics can help you pinpoint which demographics want what you are selling and which don’t. Then, you may direct your marketing campaigns toward the demographics who wish to purchase your products or services. Either that or you can attempt to convert the adverse demographics by creating new products or services that appeal to them.
2) Consumer Reactions to New Products and Services
How do consumers react to your new products or services? Since consumer behavior can change over time, you need to know if your latest products or services motivate consumers to buy or run away from them. Studying consumer decision-making regarding your company’s latest products or services can determine whether it satisfies or dissatisfies its consumer demand.
3) Consumer Feedback and Comments
Consumer feedback and comments posted online make it easier to understand the consumer thought processes that go into their decision-making. Consumers often post blunt, straightforward remarks about why they are happy or unhappy with a particular product or service. These positive and negative comments can give you insight into their needs and what goes into their purchasing decisions. Based on this information, you can provide better products and services in the future.
4) Consumer Loyalty
What attitudes, beliefs, and feelings motivate consumers to stay loyal to your company and its competitors? Consumer loyalty is the key to running a successful business because it provides repeat sales from existing consumers who are happy with your products or services. So, whether consumers are staying loyal to your company or not, studying consumer behavior can help you determine why consumers have made that decision. If more consumers are moving away from your company, understanding their behavior will help you develop new strategies for winning back their loyalty.
5) Consumer Trends
Every marketplace develops consumer trends toward specific products and services. Sometimes, the trends are only temporary, while others may last long. In any case, which social, psychological, and economic factors cause these trends? If you can answer this question, you can better predict how long the trends will last and then introduce products or services that appeal to them.
The Benefits of Using Behavioral Science to Understand Consumer Decision-Making
Understanding behavior science and its impact on consumer decision-making can benefit your company in many ways. Here are the top four benefits below:
1) Improve Consumer Engagement
You can expect increased consumer engagement with your company if you implement the appropriate marketing strategies and organizational changes based on behavioral research. These strategies should revolve around the wants and needs of your targeted consumers based on their past and present purchasing decisions.
For instance, maybe you need to lower your prices or make more visually appealing ads to attract consumers. If you understand how consumers interact with your company and its competitors, you will know which strategies and changes to execute to increase consumer engagement.
2) Increase Sales
Researching consumer behavior can help you identify your target audience, their needs, and the products or services they want to buy. If you know which products or services consumers want to buy in your marketplace, you can provide those products or services to increase sales for your company.
3) Provide Better Customer Service
Successful businesses strive to make consumers happy. If you have studied your targeted consumers’ behavior, you will know what makes them happy in the marketplace. Perhaps you need to improve the quality of your products, reduce late service deliveries, or hire a friendlier customer service team. Whatever it is, understanding consumer behavior will help you implement strategies to improve customer service.
4) Improve Consumer Feedback
Once you start making the necessary changes that influence positive consumer behavior, you can see these changes manifest in the consumer feedback left for your company online. Suddenly, you’ll notice more positive comments and star ratings left for your company on Google Reviews and Yelp because you are now considering the feelings and opinions of your consumers. As a result, your company will receive more loyal and intrigued customers after reading the positive feedback left online.
Learn More
Do you want to learn more about using behavioral science to analyze the marketplace and study consumer decision-making? Qafqaz Research Company has a team of highly professional market researchers who can help explain this technique in greater detail and provide market research services to help your company understand its customers better.
