In current trend, each and every person is engaged with the buying and consumption process and those persons are consumers. The consumer behavior can be described as the actions and related activities of the customers who are involved in buying and consuming the goods and services. It includes both physical as well as mental actions. In the simple words, consumer behavior describes the decisions of the consumers in terms of consumption, purchasing and disposition of the products and services and the time and idea of decision making process. The understanding of the consumer behavior is helpful to understand the various market segments and the strategies to effect penetration in these markets (Mooradian, Matzler & Ring, 2012). Along with this, it is also helpful in analyzing the gaps and solving the daily problems of the customers in purchasing. The consumer behavior and consumer decision making process are affected by the various number of factors. There are some personal influences which affect the purchasing decisions of the consumers. There are internal factors which are known as personal influences of the customers. The factors include motivation, attitude, lifestyle, perception, roles and learning. These internal factors impact on the purchasing decisions of the customers (Ferrell & Hartline, 2011).
The internal factors and influences generally depend upon the lifestyles and way of thinking of the customers. These are basically personal thoughts, self concepts, attitude, lifestyle, feelings, memory and motivation and thoughts of the customers. The internal factors can be known as psychological influences of the consumers. These factors reveal the way by which customers identify their feelings develop ideas and beliefs and take some actions. The aim of this report is to identify the two influences which affect the consumer decision making. Further, the aim is to describe the implementation of individual influences by a company to improve the marketing strategies (Lindgreen, 2010).
The aim of this report is to analyze the impact of consumers’ internal factors on their buying and consumption behavior towards the specific products or services. For the discussion, the famous company Starbucks has taken. This report analyzes how Starbucks made the use consumers’ internal forces to achieve in the market and to achieve high customer base. To understand the mind status of the customers, the fast food chain or stores are beneficial to analyze. The customers who order for coffee have the option of choosing regular, large or extra large. This is the similar case of Starbucks, the company has introduced Trenta cup of coffee which is costlier as compared to the normal coffee (Starbucks Corporation, 2017). The company has to understand various internal and external factors while launching this new type of product in the market. There are many psychological factors which are involved in the consumer decision making process in the market i.e. understanding the needs of the customers, choosing various alternatives to satisfy those needs, making final decision about product or service etc. in present time, consumers gather data, devise plan, and focus on that before making purchases for the specific product (Hajarrahmah, 2011). So, there is the need of effective marketing messages to appeal and understand the customers who in turn will value and mean the product and services. In case of Starbucks coffee, consumers may have various opinions having some information about the different aspects of the product. These aspects and the perception of the customers based on these aspects, the customers decide how they will perceive the product. All these factors affect the marketing strategy of Starbucks to promote the coffee among the consumers (Solano & Arquiza, 2009).
Consumer needs & Motivation
The consumer needs and motivation are inter-connected. The market researchers agree that every human has some basic needs and needs turn into different wants and then resulting into various motives. Each and every customer is different and unique to each other so it is important for the marketers to understand the different needs of the customers and provide appropriate product and services based on their requirements (D'Souza, 2010). Consumer motivation can be considered as the drive to satisfy the various needs and wants of the customers by the purchasing and consumption of the products. Basically, customers are motivated by many things in the market. So, motivation can be defined as the driven force which impels the individuals to the action. It is a goal oriented behavior which is based on various theories. There is the model of motivational process and by following the motivational process, individual can get properly motivated (Michael, 2013).
It is understood that buying motives push the customers towards buying products and goods in the market. The inner motives of the customers direct them to behave for the particular product or service. Motivation is the inner striving condition which can be described as desires, wishes, drives and needs. Consumer purchase any kind of project based on certain economic or mental forces which create wants and desires and those can be satisfied by the products offered for purchase. There are many theorizes of motivation which reveal the importance of motivation in the consumer buying process. The Maslow Hierarchy of needs is the famous theory of motivation which depicts the importance of motivation based on various human needs. This theory is based on various motivation training exercises (Hornik & Giulia, 2009).
Biological and Psychological needs- These needs include thirst, hunger, sleep etc. these are the most basic needs of the human and other needs are have no importance until these needs are not satisfied. In the basic needs, food clothes and shelter are most popular.
Safety needs- These needs include the protection from the accidents i.e. financial security and family stability. These needs are for social and economic security rather than physical safety.
Belongingness needs- This is the need for the various relations in the society. it is full of clubs, family associations and religious organizations. These needs are based on the desire of love, group acceptance, affiliation and identification.
Esteem needs- It includes the high evaluation of self and esteem of others in the society. Fulfillment of these needs provide the self-confidence. These needs are basically related to the feeling of usefulness and accomplishment of the customers.
Self-actualization needs- This is considered as the highest level of needs. It means identifying the potentials and achieving them. In simple words, it is the need to achieve maximum capabilities by the individuals.
Further, there are some more theories of motivation which explain the importance motivation in the buying process of the consumers. Those theories are cognitive theory, psychoanalytic theory and Gestalt theory. According to these theories, by the motivation, customers are able to develop a purchasing behavior in the market. Motivation is the expression of the need which is important to satisfy by the required product or service. The level of motivation affects the buying behavior of the customers. Based on the various needs of the individuals, motives take place to seek the satisfaction. So, motivation is directly connected to the various needs and can be defined in the various stages in the buying and decision process of the consumers. The purchasing motivation is helpful is helpful in increasing sales, and encouraging the customers to purchase the products and services.
Motivation is the crucial factor which is helpful in deciding the market strategy of the specific product such as coffee at Starbucks. There are some customers who are naturally motivated for comparing the prices of the products at various places. Every person is influenced or motivated by various perspectives. Many customers are motivated by their relatives and friends on what coffee to drink. Basically, motivation is considered as the motive behind the attitude and perception itself. For the product such as the Trenta cup of coffee in Starbucks, efficient marketing strategy plays an important role in the purchasing decision process based on the motivation and attitude of the consumers (St?vkov? et al, 2007). There are the needs to be sense of urgency in the advertisements and promotional activities with the attractive offers and coupons. Along with this, consumers can also be motivated by offering and implementing the discount programs (Cadogan, 2009). These kinds of programs enable the customers to use the Starbucks credit card, to avail cash back on the purchasing and redeem the rewards points to make further purchasing. By this approach, Starbucks is able to motivate the customers and gain the customer loyalty for long term basis. Customers of the Starbucks are motivated for drinking coffee because of adding value and developing a strong by the customer card services. Starbucks is much known about the impact of the external factors such as demography, culture and society. So, company is focused on the importance of the internal factors such as perception, motivation and attitudes. Starbucks is focused on meeting all the needs and requirements of the customers by the effective strategies and expanding its customer’s base and production in the market. In the consumer decision making process, motivation is the factor which helps in formulating a better way to understand the behavior of the consumers in the market. Motivation is helpful for Starbucks in developing the new products and new of coffee for the customers.
Motivational Resons behind consumer choice of Starbucks
There are some reasons based on the theories motivations, by which consumer make purchasing for e particular product. Those motivations are visitor motivation, branding, and social influence which push the customers towards the products. There are some social factors i.e. social classes, family, references group and culture which determine the behavior of the customers towards the coffee (Schultz, H. & Gordon, 2012). Along with this, consumers have perceived the marketing of Starbucks as the green marketing. Starbucks is now operating in the global scale having the priority to secure the supply chain system for the purchasing of fresh coffee. By adopting quality management, Starbucks is able to improve the brand equity, quality performance and efficiency in the market. Consumers choose the coffee of the Starbucks over the competitors because Starbucks always wants to satisfy the customers deeper with focusing on their emotional needs the customers of the company choose to pay a premium as they always search for prestige form the company. Further, Starbucks satisfies the customers by self esteem and belongingness and creating experience for every customer. Starbucks stores create a pleasant atmosphere which motivates the customers and to be socialized and get inspired (Krikorian, 2014).
Consumer Perception is also an effective internal factor which affect the decision making process of the customers while buying the products. Perception can be described as the process by which individuals gather process and analyze the information from the surroundings and environment. It is based on the point that how a customer perceives a specific product. It is important for marketers to understand the buying perceptions of the customers in the market. So, it is crucial to understand the concept of consumer perception in the consumer behavior. Once the customer is aware about his or her needs then it is important to gather the information regarding products and the solution of their needs. In present time, consumers are becoming more aware about the stores and product information by the magazines, newspaper and other media. On the basis of information of products, they interpret the data which is called perception. It is basically a process by which people select, gather and interpret the information to make a picture of the product them. There are variations in the behaviors of the buyers in the market towards the products and services. Perception is basically the process to find the meaning or importance of the stimulus get by the social and commercial environment (Kazmi, 2012). By the definitions, it has analyzed that perception is the three step process. Although consumers receive various information regarding specific products and services, but only few information improve the awareness regarding the products. There are some theories of perception by which the level of importance of the organization can be analyzed. There are Gestalt theory of perception, and cognitive theory of perception which are helpful in understanding the concept of perception deeply. By the theories of perception, it is observed that perception is basically the first impression drawn by the individual based on his or her selection and interpretation of the information. That is the reason it is believed that customer perception affect the level of the satisfaction of the customers along with their buying and usage decisions. In the perception by the customers, there are three parts i.e. perceived price, perceived quality and perceived value.
Perceived Price- Consumers have both positive and negative perception on the buying behavior with respect to price. Having low income, consumers are price conscious and they shift their preferences towards private label brand rather than selecting the national brand. Along with this, some consumers are price seekers who always look for low price products. For these kinds of customers, having expensive product means achieving high value. On the other hand, there are some customers who are associated with low piece and low quality. For them, high prices are the signal of better quality product. So, there is the price-quality relationship in the perceived price (Monika, Nancy & Kent, 2012).
Perceived Quality- Quality can be described as the evaluation of superiority and excellence of the specific product. The aim of the quality is to evaluate of the product based on its physical characteristics. The national label brands always produce the products with high technology and sophisticated process and on the other hand, private label brand use less technology and unsophisticated process while producing the products for the customers. The different products create various kind of perception among the customers. So, marketers must focus on the consumer perception by the promotional strategies and products align.
Perceived risk- Risk can be considered as the doubt of the customers about their decision of purchasing. Consumers’ risk perception is an important factor which affects the buying decisions of the consumers in the market. Sometimes, risk during the buying and consumption process may have negative impact on the attitude of the customers. To reduce the risk, consumers prefer to buy more expensive products. There are various types of risk perceived by the consumer i.e. social risk, financial risk, physical risk and functional risk (Yusuf, Fatih & Hayrettin, 2013).
The above given figure describes the relationship between perceived value, perceived price, perceived risk and perceived quality. It is clear that the quality, price and value is positively related and perceived risk is negatively related. Higher perception of price is the sign of low perceived risk and high perceived quality. On the other hand, lower perception of price and quality are the sign of the higher perceived risk. Now, higher perception of price and value has the positive impact on the value of the product perceived by the consumers. Consumers who perceive the value of price is high, the product will show a better value in the market (Schiffman, Kanuk & Hansen, 2012).
Perception is the crucial part in the internal influence of the product. People receive various sensations such as sound, smell, taste, texture and sight and select, organize and interpret them. In case of Starbucks, the marketing decisions are related to the environmental factors because of the presence of Starbucks in global market. There are many distribution channels and have different associated constraints. Although Starbucks has very flexible marketing plan with the innovative strategies depends upon the locations to meet the various requirements of the customers. The stores of Starbucks have uniform store culture in all over the world. Along with this, the quality of product is consistent in the Starbucks. The customers’ perception is affected by the economies, demography and unique culture which come under the environmental factors (Dahlstron, 2010).
Despite of focusing on the college students to expand the business, Starbucks have vision to attract the working professionals as well. This came from the realization that the costlier and high quality coffee would be appreciated by the customers and sought by the working professionals as compared to the students. From a survey, it is observed that number of male customers prefer rich coffee and high calorie treats as compared to female customers.
Consumers’ perception for Starbucks
Consumer basically focuses on some steps in their decision making process i.e. recognition, information search, identification of alternatives, purchasing and post purchasing behavior. The customers of Starbucks rely on the recognition step if they are existing customers. If the customers are new then they rely on information search about the product. For the customers, Starbucks’ coffee can be the morning treat. There are many loyal customers of the Starbucks who speak very highly about the brand and its quality of coffee. Starbucks is perceived the best coffee provider company due to having most convenient location for the customers (Burge, 2013).
In the Starbucks Company, the decision making process of the consumers is as follows:
Need Recognition- In case of Starbucks, need recognition is coffee Starbucks is known for one of the top coffee provider so, customers think about the coffee when it comes to satisfy the customers’ need. For the Starbucks, customers need is the coffee to stay en energetic during their work so they purchase the coffee in mid-day.
Information search- Customers always need information to make purchasing. So, they always start to find from the external sources i.e. asking to the friend or family, and searching from the internet for blogs and news. These are the way of non-controlled information. Along with this, consumers are attracted by the advertising and the Starbucks’ advertising is well known in the market including ads on TV, newspaper and internet. One of the famous ad of Starbucks is the printed green logo on the cup of coffee.
Evaluation of alternatives and purchases- Some customers evaluate the purchases based on the taste of coffee along with the variety, customers’ services, environment, brand rating and convenient. Sometimes, they evaluate the product based on the location with the taste. Taste is the most significant attributes which is preferred by the customers (Semejin, Van & Ambrosini, 2004)..
Purchase decision- In the decision making process, perception is the specific factor in the daily life of the consumer. In this context, Starbucks focuses on the employees and their impact on the consumers and their decisions. Starbucks has modeling guidelines to shape the corporate perception for the success in the market.
Post purchase decision- The post purchasing behavior is also the most important process to make the customer loyal so that they buy the product again and again. Starbucks basically provides good motive to the customers to come back (Tam, 2008). If they are not satisfied with the drink then they will be offered another drink and a coupon for free one. Starbucks has excellent customer service which provides unique experience to the customers. The company makes sure that customer receive those products which they ask for. The CEO of Starbucks Howard Schultz stated that ‘Starbucks is not in the coffee business, serving people. Starbucks is in the people business, serving coffee.’
Although Starbucks is perceived as the good company among the consumers in terms good taste of coffee but there is the need to increase more customers’ base by the company in the market. To ensure that all the customers are satisfied, company should engage in the collection of opinions of the customers. Along with this, dealing personally with the customers will improve the satisfaction of customers. Company should conduct training and seminars to provide best customers services to its customers. Further, company should focus on the immediate response to increase emotional satisfaction of the customers. Customers always express brand association by their behavior. Consumers always perceive the product based on that quality which they receive. So, Starbucks should focus on the relationship between the product quality and consumer perception which they receive (Zikmund et al, 2010). Further, company should understand and implement service profit chain as the basic satisfaction of the customers is coffee. High level of satisfaction always turns into customer loyalty. Company should encourage the employees to serve effectively to the customers.
This report has described the importance of various internal factors of the consumer behavior on the buying process of the consumers. From the above discussion, it has observed that consumer behavior is the decision of the consumers in terms of consumption, purchasing and disposition of the products and services and the time and idea of decision making process. The internal factors of consumers are basically personal thoughts, self concepts, attitude, lifestyle, feelings, memory and motivation and thoughts of the customers. In the report, two main factors motivation and perception has taken. From the analysis, it has observed that consumer motivation is drive to satisfy the various needs and wants of the customers by the purchasing and consumption of the products. Motivation is the inner striving condition which can be described as desires, wishes, drives and needs. There are various theories given by researchers in the consumer motivation i.e. Maslow hierarchy theory, cognitive theory, psychoanalytic theory and Gestalt theory. Further, in present time, consumers are becoming more aware about the stores and product information by the magazines, newspaper and other media. On the basis of information of products, they interpret the data which is called perception. For the discussion, the company Starbucks has taken. In Starbucks, consumers are motivated by offering and implementing the discount programs.
Above discussion reveals that Starbucks has innovative e marketing strategies for its customers because company knows that customers are very well aware about each and every product because of information available on newspaper, magazines and social media. So, it is important for the marketers to understand the needs and wants of the customers to satisfy them. There are also some theories of perception i.e. Gestalt theory of perception, and cognitive theory of perception which are helpful in understanding the concept of perception deeply. The quality of the products is the strength of Starbucks which are perceived by the customers as the best coffee over the competitors. There are some recommendations for the Starbucks to understand the concept of consumer behavior. To conclude, it can be said that it is important for the marketers to understand the concept of consumer behavior for the success in the market.
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