5 Powerful Factors Influencing Consumer Behavior + Decisions (2024)

Studying and analysing consumerbehaviourallows brand builders and marketers tounderstand what influences their target market to buy.

Having a solution to a want or need quite simply, isn’t enough.

More often than not, it’s not the product or service on offer that influences the decision to buy, but the right combination of the buyer’s psychological requirements that are met.

Brand leaders who study thebehavioursof their customers candetermine:

What consumers think or feel about market alternatives (products, services, brands etc)

The most influential factors in the buying decision

The impact of consumers environment on their purchases

The more brandsunderstand the pattern ofbehavioursof their target market, the more likely they are to influence those patterns.

Every market is different and to go one further, everymarket segment is different.

While the most important buying decision factors for one market might include price and quality, for another market, they might be convenience and value.

Many businesses and brands become fixated on being “The best”, though that’s subjective.

Being the best on price and quality won’t influence the buying decisions as much in a market where the priority is convenience and value.

In other words, psychological buying factors influence decisions based ontheirimportance to the target market.

Show Me

The brand of car you bought is different to your friend’s.

The brand of TV you bought is different to your neighbor’s.

But what causes exactly causes your friend and your neighbor to make different choices to you.

Or more specifically, what are thefactors influencing their decision to buyand why are they different to yours?

Typically, there are five core factors that influence the decision to buy which are:

Psychological Factors

Social Factors

Cultural Factors

Economic Factors

Personal Factors

Solet’s dive deep into each one so we can understand them better.

How motivated we are to do something has a high degree of influence on whether we do it or not.

InMaslow’s Hierarchy of Needshe outlines 5 different levels of human needs.

At the bottom are the basics like food and shelter, while at the top is self-actualisation.

If someone is worried about making rent to keep a roof over their head, then that will be the focus of their efforts rather than finding the purpose of their lives.

Likewise,If I’m unhappy with my body weight, then I’m far more motivated to get myself booked into a weight loss bootcamp than my neighbour who’s as thin as a rake.

How motivated we are to do something is the point of tension between where we are now and where we want to me.

What we learn through our experiences can change our buyingbehaviorsand influence our future buying decisions.

For example, if you bought a pair of jeans that lost their shape after a few wears, then you’d be far less likely to buy that product or even that brand in the future.

This is why thebrand experience plays such an important rolein retaining customers long-term.

The better the brand experience, the more they learn to associate a positive experience with your brand and the more likely they will be to purchase again in the future.

The worse the experience is, the more likely your customer will learn from the brand experience and change their purchasing decision in the future.

Attitudes and beliefs are powerful buying decision factors because they tend to be born from deep experiential, emotional, and traditional enduring principles which are often unshakeable.

In other words, these attitudes and beliefs are next to impossible to change and the products and brands they buy either align with these beliefs or they don’t

Because attitudes and beliefs are so strong and emotionally charged, brands that understandtheircustomer’s beliefs can align with them through their brand messaging.

As humans, we are social creatures.

We’ve learned to survive as a species by working together and the impact of our peers and their perceptions of us is important.

We all want to feel a sense of belonging. That we have our place and we’re part of something bigger so rightly or wrongly, we place a high level of importance on our social standing.

Our purchasing decisions reflect this with factors including:

For most people, their family is their foundation and reference point for anything from a choice of partner to a choice of lipstick.

If the new partner gets the thumbs up from the fam, it’s game-on.

The same is true for brands, especially in the food & beverage category.

Someheritage or traditional brandsmake it into the coveted“Family brand”status. Offspring from a “family brand” household, will likely continue to use the brand throughout their lives.

Getting the family tick of approval is a common factor influencing buying decisions.

Reference groups or peer groupsare groups of people that we associate with.

These groups could be from school, work, clubs, social, sports or even groups of friends or acquaintances.

People within these groups often have a similar pattern of purchasing behaviour and may be influenced by a popular leader of the group.

For example, growing up, my group of childhood friends were all into the same music, and the same style as most childhood friends are.

The kicks of choice for us…Converse All Star… and the purchasing decision for my bright red high-tops was directly influenced by my group of mates.

Human behaviour is largely the result of learning.

We learn from our teachers, our families our friends and for the most part, in the early years anyway, these learning experiences tend to come from the same culture.

In other words, the values, preferences and behavioural patterns we adopt, are passed down through tradition and culture.

Culture & Traditions therefore influence our purchasing decisionswith factors including:

Our culture shapes our basic values, requirements, beliefs, wants,preferencesandbehaviors.

In other words, our culture shapes who we are and who we are determines what’s important to us in life and in purchasing decisions.

Every culture consists of smaller sub-cultures that people identify with more specifically.

Although sub-cultures share the same overarching beliefs as the culture it’s formed under, they also have more specified beliefs that often differ from the rest.

Messaging speaking to sub-cultures will likely resonate more with that sub-culture than messaging to the overarching culture.

This is the exact same as messaging to market segments vs an overarching market.

The social class of a person often influences what they buy

Social-classisn’t determined by a single factor such as income, rather a combination of factors including occupation, education, power, lifestyle etc.

Many purchasing decisions ofMercedes Benzcarshave as much to do with the social class association it provides as thequalityengineering it offers.

Economic factors are hugely influential when it comes to purchasingbehaviouras thedetermine the means available to consumers.

There are some purchases consumers simply cannot make, not because of their desires but due to their economic factors which include

How much income a consumer earns in a year is a direct determinant of how much discretionary and disposable income they have.

In other words, how much someone earns determines the means they have to spend and the freedom they have within their buying decisions.

The more financial freedom a consumer has within their buying decisions, the more their decisions can appeal to their desires.

Family income and personal income are often interconnected but not always.

The more people within the family that are working the more likely the cost of living will besharedand individual spending capabilities will be enhanced.

This means more disposable income as a family and as individual consumers.

Expectations of increased income can influence buying decisions.

Any expected increase in income often becomes mentally available to thebuyertbefore the funds are physically or digitally available.

For example, a woman might see a nice pair of shoes that she wouldn’t ordinarily buy because of the high-price, but with her expected salary increase around the corner, she’s happy to put it on the credit-card and wear the cost later

Savings in the bank or the contribution to savings can play a major role in the buying decision.

A decision to save now rather than spend will reduce the amount of available income in the buying decision.

If this savings is part of a longer-term plan, purchasingbehaviourand the person’s overall purchasing profile will be affected.

Personal factors influencing the buying decision process are circ*mstantial,situationaland behavioural.

They set the scene and provide an insight into the life of the consumer which together play a role in how decisions are made. These factors include:

The age of the customer or consumer is an overarching personal factor in influencing the buying decision.

We all have buyingbehaviourpatterns which arelikeddirectly to our age.

Forexamplea 13 year old teenage boy is less likely to spend money on shaving products that he will when he’s 23.

The occupation of a person often influences the buying decisions of individuals.

For example, ablue-collarprofessional working in downtown in the finance district will be far more likely to invest in professional and formal wear than an engineer consultant working onsite.

A person’s lifestyle tells you abouttheyway they live their lives which includes their activities,interestsand hobbies and ultimately how they engage with the world around them.

Lifestyle brandingthat promotes a person’s ideal lifestyle aim to influence the buying decisions of their target market by aligning with the lifestyle they’re passionate about.

Although every individual is different and their buying decision factors are different, the more specific you become with your target market and market segments, the more likely they are to share important buying decision factors.

Categorizing yourmarket segmentsis simply the first step.

Once you’ve determined who you’re audience is and the important buying decision factors they share, you can tailor your offering to appeal to the factors that matter most.

But it doesn’t stop there. You can also create environments and situations that stimulate these factors as you’ll see with theIKEAexample.

When it comes to household furniture, there are plenty of market segments.

IKEA have become an iconic brand by appealing to two very specific buying decision factors in both price and convenience.

Their budget prices and their convenient flat-pack designs allow for low-cost purchases that you can take-home and build yourself in the same day.

No overpriced pieces with long waiting periods and expensive delivery.

But IKEA didn’t just appeal to the important buying decision factors, they stimulated them by creating the perfect buying environment.

Every IKEA store requires you to walk through a journey of furnished rooms and sections with everything you could need for a new household at a low cost and convenient design.

Chances are, if you’re in the market for a new sofa, you might just be in the market for a new coffee table, and plant, and cushions.

This model shows us that influencing consumer behaviours is not just about appealing to their existing buying decision considerations, it’s also about designing an experience to stimulate their behaviour.

Building a brand is about understanding your customer.

Where do they come from?
What’stheir sub-culture?
What’stheir economic situation?

What are their social factors?
What are their motivations?

When youidentifythe buying decision factors that are most important to them, do this

1. Speak to those factors

1. Create an environment to stimulate them

Comment below to share your thoughts or your favourite strategies to influence consumer behaviour.