Smart organizations realize that there are many ways in which they can influence consumer behavior.

Companies like L L Bean, Amazon, and Zappos.com are super beloved by their customers because they have a customer-focused culture. Tony Hseih, the founder of Zappos, even wrote a book called Delivering Happiness, which was all about creating a culture of happiness for its customers and employees alike.

Guess who bought Zappos in 2009 for $900 odd million? Amazon! Because they know the value of a company that ‘wows’ its customers so much that they can influence their behavior.

What is Consumer Behavior?

Let’s dive into the basics, shall we?

Consumer behavior – which is also called consumer behavior analytics – is the study of individuals and companies on their rationale behind choosing products and services. It studies their motivation, behavior, and psychology.

Learning how to influence consumer behavior helps you understand what drives them to choose product A over B. With customer behavioral data like this, you would be able to persuade them to buy from you.

For instance, imagine you are about to buy a new smartphone. Why would you choose one brand over another at the time of purchase? Consumer behavior is all about understanding why people pick certain products. Maybe you tried it before and liked it, or your friends said it’s great. Businesses study these choices to make products and ads that match what people like. So, consumer behavior is like unraveling the mystery behind our shopping decisions!

Importance of Understanding Consumer Behavior

Understanding consumer behavior is crucial for businesses for several reasons. Here are five key points:

1. Product Development

Consumer behavior insights guide businesses in developing products that align with customer needs and preferences. By understanding what customers want, companies can innovate and create products that are more likely to succeed in the market.

2. Effective Marketing Strategies

Consumer behavior analysis is essential in creating effective marketing campaigns. It enables businesses to understand the factors that influence customer purchasing decisions, so they can tailor their promotions to resonate with their target audience, leading to higher engagement and sales.

3. Enhanced Customer Experience

Studying consumer behavior enables businesses to enhance customer service and experience. By grasping customer preferences, businesses can personalize interactions, offer relevant recommendations, and provide a seamless buying journey, ultimately fostering customer loyalty.

4. Competitive Advantage

Companies that understand the pattern can differentiate themselves by adapting products, services, and marketing strategies to consumer preferences, gaining a competitive edge, attracting more customers, and retaining existing ones.

5. Market Expansion and Diversification

Businesses can identify new market segments and diversify their offerings. Understanding different consumer groups allows businesses to expand their product lines or services to meet diverse customer needs, opening up new revenue streams and broadening their market presence. This can be crucial for a company’s success and reputation.

Methods to Collect Consumer Behavior Data

As we’ve seen, a lot of factors can influence the customer’s behavior. Hence, it requires you to sift through data from different types and channels to help you make an informed customer behavior analysis. Here are some of the most effective methods to collect consumer data.

Surveys

Surveys help you ask specific questions directly to the consumer. It is a goldmine of information. You can easily create surveys by using advanced survey tools such as SurveySparrow.

Try it out for free!

Q&A sites

Customers lurk on websites where they share their peeves and other thoughts about your business, competitors, and so on. Use it wisely to collate data that is relevant to you.

Focus Groups

Ask questions directly to consumers by bringing them together like a group discussion where the topics are intensely discussed. You will get detailed answers since you have a lot of time to engage with your customers in Focus Group Discussions.

Review sites

Another place where a lot of customers pour out their hearts is review sites. It will give you a lot of insight since the customers are honest about their opinions of the products that they use.

Analytics tools

There are a lot of tools that tell you where your customers come from, what they did on the site, and their behavior. If you have access to Artificial Intelligence tools or teams, you can leverage link tracking that can analyze how customers move on your site. These are gold, and they tell a lot about your website, UI, and UX, including customer behavior.

Competitor analysis

While there are tools to analyze the activities of customers, manually understanding the strategies that your competitors use will help you. Track their social media, marketing communications, outreach campaigns, and so on.

Reading comments

The comments on your and your competitor’s blog are also an eye-opener, with a lot of valuable data seeped into it.

Twitter, Reddit & Facebook

These are three social media marketing websites that have a lot of customers who mention the brands they use. This can help you unearth patterns as well.

Strategies to Decode Consumer Behaviour

Consumers decide where you stand in the competitive market. Here are some tips to influence their choices effectively:

1. Help Customers Choose You:
When customers face a plethora of options, it’s essential to influence their decision-making in your favor. Understand their preferences and needs to stand out among the choices they have.

2. Address Customer Challenges:
Identify the problems or challenges your customers face. Solving these pain points not only enhances their experience but also strengthens your relationship with them.

3. Decoding Consumer Choices:
Dive deep into understanding how consumers make decisions when selecting a service or product. Recognize the factors that sway their choices, be it quality, price, or brand reputation.

4. Learning from Rejections:
Analyze the products they reject and comprehend the reasons behind these rejections. This insight is invaluable as it guides your improvements, ensuring your offerings align better with customer expectations.

5. Optimize Product Presentation:
Present your product or service in a way that has the maximum impact. Highlight its unique features, benefits, and advantages clearly, making it compelling for customers to choose your offering over others.

The Five Proven Ways to Influence Consumer Behavior

#1. Be a boss on social media

• Sprout Social says that 74% of the buying decision is based on social media.
• HubSpot says that consumers are 71% more likely to purchase something based on referrals from social media.

However many companies are not able to leverage social media the way they should. Why? Because they use social media to change the way consumers think, not use them the way consumers want.

Your customers use social media for making connections and conversations. While most users are content with talking to friends and family on social media, brands do crop up here and there. But they try being a brand and are hell-bent on making a sale instead of connecting with customers.

Consumers are skeptical of businesses whose only intention is to sell. Especially on social media, it is easy to nitpick and find faults in trivial matters. The anonymity that social media gives people makes them act rashly. So it is wise to tread lightly while having a sound strategy in place.

Don’t:

…Keep talking about your business and your product. You must make a small shift with that sort of thinking. So tell your customers how your product helps them.

Show them quirky videos of your customers using your products. Engage with your customers on social media. Reply to all comments.

Do:

Engage with your customers in such a way that they become brand advocates. You can do this by being a giver! Offer as much value as possible to your customers.

Once there is a lot of content from your side, you will be considered a ‘brand authority,’ and this is when it is easy to make sales. You don’t even have to try hard when you have established your authority by offering a lot of value using social media.

#2. Offer unconditional support

One of the most stifling feelings for a customer is knowing that there is no way to solve an issue that cropped up when using your product.

Don’t…

…Leave your customers hanging. Get the answers to these 5 questions:

1. Is there no forum for redressal?
2. How long are customers made to wait for a complaint resolution?
3. Will there be a refund if the company is in the wrong?
4. Is your brand ready to solve all customer expectations?
5. Is there only one way in which your customers can contact you?

Take action immediately to ensure that your customers can reach you through different levels. Respond via social media, calls, emails, and whatnot! Using tools like SurveySparrow, you can proactively capture and respond to negative feedback from your main marketing channels.

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Do:

• Create a community of users that will help each other out. You will soon find customers within that community who will be engaged actively.
• Incentivize them with offers and recognize their contribution to making the community grow. When you keep acknowledging the excellent work done by your customers in such communities, they will go out of their way to be more helpful.
• Write an FAQ section that has every plausible situation that your customer might be in.
• Write how-to articles on your blog that help with understanding your product and how to use it to the fullest. These would reduce the instances of your customers having to talk to your customer support executive.

#3. Take baby steps

Imagine that you have a new company with a product that has the potential to revolutionize the industry. It would still be smart of you to take baby steps instead of announcing to the world that you are the next big thing in ‘X.’ Why?

Because it takes time to change consumer behavior. It’s vital that you prod customers, to make incremental changes in their attitude towards your brand.

Don’t…

…Go for the sales kill straightaway. Introduce your brand in bits and pieces instead with “Hey, buy our product A, which is better than X, Y, and Z.”

Have a crystal clear communication strategy that is focused on creating incremental steps for your customers. Don’t let the customer feel as if you want them to make drastic purchase decisions.

Your job is not to sell ice to an Eskimo. It is to make a user understand why they need your product.

Do:

Communicate how it is going to help them. Educate your customers. Get on a call with them to know what they want, and what is missing in the products that they use right now. Tell them if they would like, you can show them a better option (that is your product).

To pave the way for a significant behavioral change, you need to change one habit at a time. If you want customers to change their behavior, then you need to create an opportunity in such a way that you change the situation.

#4. Connect with customers

One of the points that we mentioned in this article was about giving different options for your customers to reach out to you, but it was only for them to solve a query. Go a step ahead and proactively reach out to your customers.

Do you know that Steve Jobs’ most efficient train of thought was not producing the most innovative phone or iPod? It was to design products that gave the ultimate customer experience. To have achieved something of that proportion, you need to understand the customer’s expectations, behaviors, and motivations.

Don’t…

…Just start campaigns that talk about the behemoth that you are. Tug at the emotions of your customers. Entertain them with stories, behind-the-scenes incidents, origin stories, pictures, testimonials, changes your product produced, and so on.

If you are an online business, do not entirely ignore the offline side of things. Organize virtual/hybrid meetups for your customers in areas that they frequent. On the online front, start conversations with your customers on social media platforms and engage with your audience.

The more your customers engage with you, the higher their fondness for you. They would realize that you are sincere and would even give you a chance with your products. When you engage with them on a deeper level, you can also expect them to be your brand advocates.

Do:

Meet your customer advocates. Find them based on the brand conversations and invite them to visit your office or fly them out to a place they love (if you can afford it). Find exciting ways to keep your brand advocates feeling loved.

#5. Understand the needs of your customers

The above point would easily be one of the first statements that would make the most sense for any business, right? Find out what appeals to your customers, understand their requirements by talking to them, and communicate the same in your marketing messaging.

Don’t…

…Focus on just short-term selling. Many businesses believe that it is easy to change the buying patterns of customers with a few social media posts. But their present buying decisions are a result of years of messaging, either through society or their circumstances.

You can only make your customers make better choices by creating content in different forms that appeal to their basic necessities. It is all right not to know the exact strategy to inspire your customers. But, it would be terrible if you don’t approach them directly for a tête-à-tête with them.

Do:

• Be authentic with your customers. Understand their needs like how a friend would talk to them rather than communicating with them in dull and repulsive corporate language.
• Make sure that the interactions you have with your customers are genuine. Have an open dialogue with your customers instead of trying to sell with each message.

No one likes to be sold to, but everyone wants to be talked to.

Top 3 Factors that Influence Consumer Behaviour

#1. Personal Factors

Probably one of the most challenging factors would be to analyze each customer trait thoroughly. Each individual would have different personal factors over others, and putting them into a segment might be difficult. It comprises their likes, dislikes, interests, peeves, preferences, and sub-factors like age, gender, and personal issues.

#2. Psychological Factors

The way a problem is perceived is unique to every individual. It can be influenced by present circumstances, past experiences, needs, problems, lack, or an overdose of information, and their own attitudes. It will help if marketers know what part of their product they showcase to the customer or learn more about the ‘How-to’ showcase part.

#3. Socio-Cultural Factors

The society that we live in, the income we earn, the company that we keep and our surroundings have a substantial influencing power on who we end up as. This is why influencers and advertisements contribute a huge factor in our buying decisions.

What is the Scope of Consumer Behavior?

In other words: how does consumer behavior work? While we have outlined a lot of factors that contribute to consumer behavior, if you look at it closely, most of these decisions are governed by perception. So let’s take a look at perceptions and how it works.

Perception is the method by which we do things by selecting, analyzing, and interpreting data in a way that seems fair to us. Marketers have known, for a long time, how creating ideal perceptions can help gain the favor of customers.

The study of consumer behavior includes:

• The way consumers think about different brands, products, and services that are offered.
• How consumers research products while shopping.
• The way the surrounding environment influences consumers.
• How they choose between alternatives.
• How marketing campaigns can effectively influence the customer.

Wrapping Up

Why would your customers choose your company over a competitor’s? A better question would be: “What can you do to make your customers choose you over your competitors?”

Companies will give an arm and a leg if they know that there is a right formula to influence consumer behavior. Unfortunately, there isn’t one, but you can follow a bunch of steps consistently to ensure that your customers are always vouching for you and purchasing from you.

In this article, we have outlined ways in which you can influence consumer behavior. But if there is a time-tested way that can keep your customers with you, it is by providing excellent customer service.

The initial step in understanding customer behavior is collating data that will lead to remarkable insights. Why not use SurveySparrow’s free online survey tool to get started?

Even if it is a company that is your customer, remember that there are people on the other side. Treat them with respect and integrity, and success will come to you.

Mathew Maniyamkott

Guest Blogger at SurveySparrow

Regular contributor to various magazines. Passionate about entrepreneurship, startups, marketing, and productivity.