Contents

• Introduction 3
• Background of the product 3
• Explanation of five individual factors 4
• Psychological factors 4
• Social factors 4
• Cultural factors 4
• Economic factor 5
• Personal factors 5
• Application of individual factors 5
• Psychological factors 5
• Social factors 6
• Cultural factors 6
• Economic factors 6
• Personal factors 6
• Conclusion 6
• References 8

Description

Consumer behavior is the study conducted on individuals, groups, organizations to determine their choice, selection criteria and preferences of the products and services offered in the market. The study helps to generate ideas to satisfy the needs of consumer and society. Considering the macroeconomic aspect, understanding the process of consumer behavior creates an impact on the world economy. Studying and researching the process of consumer behavior is complex but it is essential for each company to formulate proper marketing strategy. The theory of consumer behavior contains four applications which are listed as follows:
• Formulate marketing strategy to attract more customers
• Social marketing which helps to generate ideas across individuals instead of selling product.
• Studying consumer behavior helps to create better consumers by developing their common sense.
• It also helps to analyze own firm’s strength and weakness compared to its competitors (Dr. Al-Jeraisy, 2008).