CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

The last twenty five years have shown an effective development of intensive efforts and research oriented toward a better understanding of human behaviour concerning its consumption activity. The knowledge and understanding of consumer buying behaviour has become a basic task both at the entrepreneurial and institutional levels. Firms have realized that since consumers have adopted a-more aggressive and demanding role, they have to modify their attitudes. At an institutional level, every Government has necessarily to be aware about the quality standards of living and welfare of the people, being consumption a major issue of this awareness (Mooij, 2004). The emergence of the studies on consumer buying behaviour as an autonomous discipline is a phenomenon that, as we all know, takes place in the 60's. It can be asserted that ever since, a significant advance has been-made out, from an obscure and sporadic research toward a comprehensive effort in the study of all those aspects relevant to the knowledge of consumer buying behaviour. Whether from a scholar or business approach, theoretical or empirical, published or not, this cumulative effort has been a subject of different reviews. At present, there is a wide and varied literature on consumer buying behaviour and, in addition, it has become a subject widely included in University teaching program (Perner 2007).

Consumer buying behaviour is a psychological part of an individual which makes the difference in purchasing any goods, services and anything else. The behaviour of any consumer depends on many factors which are very important for any marketing management team in any business or any organization which deals in directly to consumers. The study of consumer buying behaviour involves search, evaluation, purchase, consumption and post purchase behaviour of the consumers and includes the disposal of purchased products keeping environment and personal characteristics in mind. It is the body of knowledge which studies various aspects of purchase and consumption of products and services by individual. The American Marketing Association (AMA) defines consumer buying behaviour as the dynamic interaction of cognition, behaviour & environmental events by which human beings conduct the exchange aspect of their lives with various social and psychological variables at play (Perner 2007).

The global marketplace is a study in diversity, diversity among consumers, producers, marketers, retailers, advertising media, cultures, and customs and of course the individual or psychological behaviour. However, despite prevailing diversity, there also are many similarities. The object of the study of consumer buying behaviour is to provide conceptual and technical tools to enable the marketer to apply them to marketing practice, both profit & non-profit. The study of consumer buying behaviour (CB) is very important to the marketers because it enables them to understand and predict buying behaviour of consumers in the marketplace; it is concerned not only with what consumers buy, but also with why they buy it, when and where and how they buy it, and how often they buy it, and also how they consume it & dispose it. Consumer research is the methodology used to study consumer buying behaviour; it takes place at every phase of the consumption process: before the purchase, during the purchase, and after the purchase. Research shows that two different buyers buying the same product may have done it for different reasons, paid different prices, used in different ways, have different emotional attachments towards the things and so on.

1.2 Statement of the Study

According to Professor Theodore Levitt of the Harvard Business School, the study of consumer buying behaviour is one of the most important in business education, because the purpose of a business is to create and keep customers (Shahina 2005). Customers are created and maintained through marketing strategies. And the quality of marketing strategies depends on knowing, serving, and influencing consumers. In other words, the success of a business is to achieve organisational objectives, which can be done by the above two methods (Shahina 2005). This suggests that the knowledge & information about consumers is critical for developing successful marketing strategies because it challenges the marketers to think about and analyse the relationship between the consumers & marketers, and the consumer buying behaviour & the marketing strategy.

1.3 Objectives of the Study

The main aim of this study is to examine the effect of consumer buying behavior on sales. Other objectives of this study are:

1. To determine whether consumers are relevant to marketing organizations.

2. To find out whether consumer buying behaviour affects the sales performance of marketing organizations.

3. To find out whether consumer buying behaviour affects the sales profitability of marketing organizations.

4. To find out whether consumer buying behaviour affects the growth of marketing organizations.

1.4 Research Questions

The following research questions will be answered in this study:

1. Are consumers relevant to marketing organizations?

2. Does consumer buying behaviour affect the sales performance of marketing organizations?

3. Does consumer buying behaviour affect the sales profitability of marketing organizations?

4. Does consumer buying behaviour affect the growth of marketing organizations?

1.5 Significance of the Study

This study may help service providers to appreciate the salient factors that influence users or customers and design fitting strategies and actions to draw customers to use this service. Furthermore, the research will also assist service providers to identify and comprehend the success factors that will drum in confidence among customers.

This study will also serve as a pilot study for further research and future reference.

1.6 Scope of the Study

This study focuses on the effect of consumer buying behavior on sales. Specifically, the study focuses on determining whether consumers are relevant to marketing organizations, finding out whether consumer buying behaviour affects the sales performance of marketing organizations, finding out whether consumer buying behaviour affects the sales profitability of marketing organizations and finding out whether consumer buying behaviour affects the growth of marketing organizations.

1.7 Limitations of the Study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. However, the researcher were able to manage these just to ensure the success of this study.

Moreover, the case study method utilized in the study posed some challenges to the investigator including the possibility of biases and poor judgment of issues. However, the investigator relied on respect for the general principles of procedures, justice, fairness, objectivity in observation and recording, and weighing of evidence to overcome the challenges.

1.8 Definition Of Terms

Consumer: A person who purchases goods and services for personal use

Consumer buying behaviour: Consumer buying behavior is the sum of a consumer's attitudes, preferences, intention, and decisions regarding their behavior in the marketplace when buying a product or service. Marketers use data to learn consumer buying behaviors in order to connect and market their products to consumers and increase revenue.

Sales: The exchange of a commodity for money; the action of selling something.

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