Buyer Behavior Regarding Coca-Cola Products
Consumer behavior is a branch of organizational study where the concentration is given on the preference of individuals, groups, or firms about goods and services. The mental, behavioral, and emotional state of a consumer or buyer gets the maximum priority for justifying the behavior. The buyer behavior study is becoming popular because of its relatable success with the competitive advantage. If a firm or an organization can investigate the key to drive a consumer toward purchasing their products or using services, the overall organizational profitability will increased. This report is going to discuss and showcase of buyer behavior in case of availing products from Coca-Cola. The organization has been influencing customers’ preferences for a long time.
Coca-Cola was founded 133 years ago and still one of the largest beverage companies in the world. The company has a long tradition of producing carbonated beverages. It has a strong customer pool with an enormous amount of loyalty. Coca-Cola has been implicating several and most established buyer behavior theories to attract customers. Because of successful implication, the company has successively earned a massive amount of profit. Also, people have created a mental and emotional attachment with the brand. Since 1886, Coca Cola has managed to bring the perfect taste in beverage making for their respected customers.
Buyer behavior refers to the response of consumers during purchasing a product. In management study, buyer behavior is the key mental, emotional, and behavioral state of individuals, organizations, communities, or groups during making a purchase (Peter and Olson, 2010). For example, consumers have grown a natural habit of looking for Coca Cola while eating snacks. A loyal customer of the company will ask for the beverage whenever he or she orders for snacks. Considering this attitude or behavior, Coca-Cola has to increase their participation as a vendor in food chains and restaurants. It will ensure the buyer can get whatever he or she wants and the company can provide the necessary product through the investigation of consumer’s behavior.
To define the perspective, the responsive reaction of individual consumers or group consumers for purchasing a good or service is known as the buyer behavior.
Consumer behavior or consumer buying behavior has four different types. Coca-Cola finds out which type is more influential for customers. Based on the result, the change is brought (Peter and Olson, 2010). The typology of buyer behavior is the first step of Coca Cola to supply their products in particular areas.
Coca Cola has effectively used the typology of buyer behavior in over the few years. To reach customers with every type of behavior, the company has appointed their sales funnel. Also, for dragging customers toward the selling point, all justified types have been considered. The positive or advantageous sides of applying buyer behavior is getting as much customer’s attraction as possible (Runyon, 2002). The negative side of using typology is the odds of competitors’ strategic confliction. If competitors apply the same technique, the field will shrink. As a result, Coca Cola will lose some competitive advantage in the field.
Richard Thaler is an American economist who has explored the mental and emotional selection of utility maximization among consumers. He is a speaker for the behavioral economics. He gave idea of economical behavior of consumers. Apart from this, there are four major pillars for buyer behavior. Coca-Cola successful implements these according to the situation or contingent. The major four theories are as follow:
Fishbein and Ajzen developed this theory. This theory is based on outcome or expectation. The aftermath of consuming a product or service is the first part of applying the model. Coca-Cola has implemented the reasoned action theory while developing their Diet Coke for people who want to avoid sugar or sweet. Diet Coke is free from cholesterol and other health dangers. Whenever a diabetes patient or a patient of cardiovascular disease goes to purchase a beverage, the outcome from a Diet Coke is less severe than the other beverages. This will provoke the consumer to purchase the Diet Coke.
EKB model is a model with the concept of external influence in buyer’s decision making. Reasoned action theory provides rationale for purchasing. EKB is an extension of it. Rather than processing the information, the consumer is influenced from advertisements and offers (Blackwell, Miniard and Engel, 2007). Each company including Coca-Cola uses the external influence for increasing buyer’s attachment with the product. For example, Coca Cola spend a plenty of money in sponsoring sports and other global events. This increases their brand appearance among consumers. The continuous flow of information regarding the product becomes influential for consumers. Buyer is deeply concerned of the product feature after experiencing it visually through advertisements.
Maslow came up with the idea of psychological influence among buyers in 1943 through his hierarchy of needs model. The priority of customers justifies the preference while buying a product. Five main elements determine the priority; such as psychological instincts, safety issues, affection, esteem, and self-actualization. Consumers can be tailored to purchase a product by bringing changes in these elements. For example, Coca Cola recently opened a campaign to help African Children suffering from malnutrition. Buyers find it affectionate and purchase not only for reasoned action but also for advancing with the element; affection.
Impulsive buying behavior is also common among buyers. Previous plans or information may not be the actual requisites for taking decision on purchasing a product or availing a service. Rather, instant or impulsive buying can be a useful decision-making process. Impulse buying has previously discussed in the typology of consumer behavior. The sudden purchase is also a motivated and influenced approach. The only reason is its indirect approach for purchasing. For example, Coca Cola knows people will get thirsty during a journey. So, they supply products to filling stations. Though there was no plan of purchasing, the impulse action is provoked from the execution of Hawkins Stern’s model.
Coca Cola has influenced its customers using different theories. To provoke and create a reason for purchasing, theoretical framework is necessary. Buyer behavior depends on executing the theory practically with an enormous creation of supplies.
Reasoned action theory is a common way for getting into the grocery list of a household person. Coca-Cola has created a trustworthy position among buyers to advance with this consent. The advantageous side of reasoned action implication is creating a loyal customer pool. The only disadvantageous side is not having enough option of creating a mental or emotional attachment with consumers. No particular psychological trait is usable for applying this model.
However, the EKB model supports the current global perspective of consumer behavior. Information generation or getting an appropriate influential position for consumers is the most suitable option of selling Coca Cola. The buyer gets idea through television, social media, and other sources. These sources generate a pile of information. As a result, the consumer is getting a chance to decide on buying the item for household. The positive side of the process is updating the customer about the appearance in the market (Kruger, Ramphal and Maritz, 2013). The negative side of the theory is potential risk of losing customers for lack of information generation. For example, if Coca Cola loses the thread of information to its competitor, this will create consequence in losing a group of consumers.
Third, Maslow stated his theory on the basis of psychological influence over consumers rather than provoking through information. When the buyer feels the happiness of consumption, the model becomes applicable. Maslow stated that buyers’ behavior can be changed through continuous change in the need generation. Whenever value is added, the consumer will be convinced about the purchasing scenario. The positive side of Maslow’s theory is creating a chain to influence buyers for making a purchase. The negative side is not being able to convince the whole consumer’s pool about the product or service. A large part may remain in the dark because of this need-motivation context.
Fourthly, impulsive action is used only to psychologically influence a certain group. Rather than considering the aftermath, the organization chooses to imply an odd of the decision. It can or cannot be purchased depending on the condition or situation. The positive side is spending less on applying this theory. The negative part of the model is a lack of confidence in applying the model. There might not be enough space for Coca Cola to make the sell in a filling station as discussed before.
In a nutshell, theories of consumer behavior or buyer behavior are specifically applied by Coca Cola and other organizations depending on the uses and usefulness of products and services.
Consumer behavior or buyer behavior study is dependable on the interaction between buyers and seller. When the organization manages to provide reasonable condition to avail the product or service, the customer will consume. The major reasons consumers are attracted to Coca Cola are as follow:
Each customer requires knowing whether the product is going to give utility or not. As for customer’s perspective, the utility refers to the happiness or fulfillment or the advantages gained from a product. For a long period of time, Coca Cola is providing required utility through their products (Moskowitz, Beckley and Resurreccion, 2012).
The loyalty is a dependable variable. Both consumer and seller requires being loyal to each other. Over the years, Coca Cola increased its trustworthiness among people. Also, it has enhanced the psychological attachment with buyers. Consumers are now automatically attached to Coca Cola’s business process. This has been a major impactful reason for consumer behavior towards the company.
Coca Cola is recognized for ensuring the maximum consumer preference of its target market. Consumers are highly encouraged to provide feedback about a newly introduced product. Whenever a typical group of customer can avail the particular taste from a certain product category, the buyer behavior gets changed.
Coca Cola has a preplanned strategy of occupying their customers through continuous market study and analyzing the situation. However, the consequence of consumer preference continues until receiving a viable standpoint (Spiegler, 2014).
Coca Cola uses the maximum R&D possible as a beverage company. Product development and researching customer requirements are the key effective areas for the company. To increase the brand appearance in the market, the company has successfully revamped its appearance continuously. From the beginning of the business, the product has gone through changes and customers enjoyed the innovation.
One of major reasons for attracting customers toward Coca Cola product is its way of advertising. The organization has managed to advertise with the maximum appearance on media. In case of advertisement, the company follows a certain guideline. Celebrity-sponsorship for becoming a brand ambassador has been a great tool for advertising. Consumers get influenced through these techniques easily.
In short, reasons that are influential for bringing change in the consumer preferences are the driving forces for applying the buyer behavior theory for Coca Cola.
Consumers of carbonated beverage are attracted towards a variety of brands. Though Coca Cola has a certain group of consumers, the competition in the industry is very high. Its major five competitors are as follow:
To conclude the assignment report, we can understand the effectiveness of creating a different branding strategy for influencing buyers. Also, winning the trust of buyers depend on the actual making of product. During any period of product development and distribution, the buyer behavior theory is highly applicable. The more it can create and influence the emotional and mental state of a buyer, the more the firm will be able to earn profit and recognition. The betterment in branding and product creation will bring success for Coca Cola. Its competitors have to identify strengths and add value for acquiring the competitive advantage. The appropriate execution of buyer behavior theory can be the key to create a sustainable position in the beverage industry.
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