Economics/Business

Consumer behavior model/Importance/4 models/How to build

Knowing the model of consumer behavior can be of great importance for the success of a company’s commercial and marketing strategies, as it allows developing actions based on what customers need to satisfy their needs. 

In this article you will find what it consists of, what is its importance, what are the 4 classic models of consumer behavior and what strategies you can take into account for its development.

What is the consumer behavior model?

A consumer behavior model is a mathematical or psychological construct to represent the common behaviors observed among certain groups of customers, in order to predict how similar customers will behave in similar circumstances.

Consumer behavior models are often based on the extraction of customer data, and each model is designed to answer a question at a given time. 

For example, a behavior model can be used to predict what a certain group of customers will do in response to a certain marketing action. 

If the model is robust and the recommendations that have been generated are followed, then it will be observed that the majority of the clients in the group have responded as expected by the model.

Importance of having a customer behavior model

Behavioral models contextualize the results of consumer behavior analysis , as they explain why and how customers make purchasing decisions, helping to understand what makes a consumer buy a product.

In this way, consumer behavior models help to understand and retain the customer base. They are also useful for marketers as they can understand customer expectations . In this way, they can influence the identification of marketing objectives and campaigns and the optimization of predictive analytics .

4 models of customer behavior

These are 4 of the most popular behavior models:

Economic model of consumer behavior

The economic model of consumer behavior focuses on the idea that a consumer’s purchasing pattern is to obtain the greatest benefits while minimizing costs 

Thus, consumer behavior can be predicted based on indicators such as the purchasing power of the buyer and the price of competing products.

Maslow’s Hierarchy of Needs

The model hierarchy of needs Maslow argues that consumer behavior is based on meeting basic needs and learned. Maslow argued that people base their actions on the satisfaction of certain needs, and that they first have to satisfy lower-level needs before reaching higher ones. 

Lower-level needs include food, clothing, and shelter, while higher-level needs include having a feeling of prestige. Thus, a consumer will have a tendency to buy things that satisfy his needs and provide him with satisfaction.

Sociological model of consumer behavior

This model considers that a consumer’s purchasing pattern is influenced by his role and influence in his society. That is, both for the people with whom it relates, as well as the culture in which it is immersed. 

Psychoanalytic model of consumer behavior

The psychoanalytic model takes into account the fact that consumer behavior is influenced by both the conscious and the unconscious mind. The three levels of consciousness that Sigmund Freud speaks of (the id, the ego and the superego) influence the types of buying behavior . 

For example, a hidden symbol in a company name or logo can have an effect on a person’s subconscious mind and may influence them to buy that product rather than a similar one from another company.

How to build a model of customer behavior?

Now that you know what a consumer behavior model is, what its importance is and what types exist, we will present you how to build a model based on the following strategies

1. Segment customers into small groups

Performing a customer segmentation into small groups and addressing them in a personalized way based on real behaviors is one of the best strategies to build a behavior model more attached to reality.

This instead of coding for any preconceived notions or assumptions of what makes customers similar to each other, and instead of looking only at aggregated or averaged data that hides important facts about individual customers.

2. Perform a dynamic segmentation

Dynamic segmentation is about tracking customers and how they move between different segments over time, including the context of the customer lifecycle , rather than just determining which segments customers are in. this moment regardless of how they got there .

3. Carry out predictive models of behavior

Accurately predict future customer behaviors (e.g. convert, drop out, spend more, spend less) using predictive modeling techniques of customer behavior, rather than simply looking in the rearview of historical data.

4. Calculate the lifetime value of the customer

Another strategy you can use is advanced calculations to determine the customer lifetime value (LTV) of each customer and make decisions based on these, instead of looking only at the short-term income that a customer can bring to the company .

5. Use automated marketing technology

The use of automated marketing technologies can help you disclose information and make recommendations to improve your marketing to your customers.

This way, you can know exactly what marketing actions to take based on objective metrics for each customer, rather than trying to figure out what to do based on a bunch of hard-to-understand reports.

6. Conduct consumer surveys

Applying a consumer survey periodically will allow you to know the levels of customer satisfaction in relation to existing products, their opinions and expectations regarding new products and services, as well as being a key source of information.

Develop a model of the behavior of your consumers!

Developing a consumer behavior model can be a complex task, but if you have the right tools to collect, systematize, analyze and interpret all the data you have at your fingertips, it can become a differential factor that helps you successfully achieve the goals of your organization.

At QuestionPro we have multiple tools that can help you create accurate models of your consumers’ behavior, from using free online surveys to advanced market research features and services 

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