MPK713 Consumer Behaviour: Theories and Strategic Application

This report provides a comprehensive analysis of consumer behavior, focusing on the theory of planned behavior and diffusion of innovation, highlighting their applications and limitations in marketing. It also includes strategic recommendations for McDonald's based on consumer behavior theories such as the Trait Theory and the EKB Model, suggesting the launch of a new franchise, Mc-Organic, to target health-conscious consumers. The report emphasizes the importance of understanding consumer traits and decision-making processes to develop effective marketing strategies.

Running Head: Consumer Behaviour
Consumer Behavior

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Table of Content
Question 1-Taking a position...................................................................................................................................... 2
Answer 1............................................................................................................................................................................. 2
Theory of Planned Behaviour................................................................................................................................ 2
Limitation of the Theory.......................................................................................................................................... 3
Diffusion of Innovation.................................................................................................................................................. 4
Conclusion.......................................................................................................................................................................... 5
Question 2........................................................................................................................................................................... 5
Answer................................................................................................................................................................................. 6
Consumer Behaviour Theories................................................................................................................................... 6
Trait Theory.................................................................................................................................................................. 6
EKB Model...................................................................................................................................................................... 8
Conclusion.......................................................................................................................................................................... 9
References........................................................................................................................................................................ 10

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Question 1-Taking a position
Answer 1
The world is changing at the blink of an eye and so is the consumer behaviour.
Consumer behaviour is the behaviour of the end consumers who purchase the product
for personal and household consumption and not for the business purposes. It becomes
extremely essential for the marketers to delve into the minds of ever evolving
customers and reason out their behaviour in buying a particular product (Solomon, et.
al., 2014). Consumers in the present day context are subjected to plethora of products
which have different aspiring values and attributes related to them, at times it becomes
difficult for the consumers to make the best choice. Their brain is conditioned to
advertising and marketing campaigns which helps them in making the correct choice
without any prejudice (East, et. al., 2016). Every consumer is different from other;
therefore the companies form a cluster, in which they arrange the customers in an array
according to their buying behaviour, purchasing habits, their aspiration, social media
usage and demographics. Further, theories of planned behaviour are used to predict the
behaviour of the consumers.
Theory of Planned Behaviour
Within the purview of planned behaviour a couple of theories have been highly useful
for the marketers in predicting the consumer behaviour, the prominent ones being the
theory of planned behaviour, the theory of reasoned action and the attitude theory.
However the basis of the discussion will be focussed on the usage of theory of planned
behaviour to predict the behaviour of the consumers.
The theory of planned behaviour relies on the additional determinant of consumer
intention to act-consumer perception of their control over their behaviour (Horner &
Swarbrooke, 2016). The theory of planned behaviour has three major attributes
attached to it, viz. Personal factor, social factor and issues of control. The planned
behaviour for e-commerce buying can be seen as a two-step process, the first one being,

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searching for the information online about the product and then making the purchase
(Foxall, 2014).
Amazon for example knows and understands the behaviour of its consumers using data
analytics, cache memory, IP tracking and analysing his behaviour online. Based on the
data study, the company markets and remarkets the product to the consumers. Planned
behaviour theory is used here by showing the product to the consumers at every stage
of his buying process, may be it gathering information about the product, looking for an
alternate product, evaluating the price etc., the company will target him based on his
personal interest which is reflected through his online behaviour and his buying history
(Yadav & Pathak, 2016).
Amazon uses radius targeting and shows similar advertisement to people in the nearby
area; this helps the company in targeting the people with not only same interest, but
also controls and influences their decision with the advent of Google targeting (Paul,
Modi & Patel, 2016). This helps in giving a strong control in the hands of the marketers,
as they have the ability to show adverts to the customers. Customers thus based on the
advert enquire about the product through online channels or through their peers
(Amaro & Duarte, 2015). Thus, Amazon ensures that it encompasses the sentiments of
the large consumer audience and controls their behaviour. This way the company is not
only able to tap the consumers on the basis of their personal factors, but also has a
sufficiently high control over their social factors and the issues of control in their buying
behaviour (Chen & Tung, 2014).
Limitation of the Theory
The planned behaviour theory in implementation is plagued by a number of limitations,
such as inability to account for the factors such as behavioural intention and motivation
such as fear, threat, mood or past experience. The planned behaviour theory does not
take into account the time frame between the intent and behavioural action of the
consumers (Yadav & Pathak, 2017). The theory of planned behaviour fails to take into
account the effect of the environmental and the economic condition which affects the
purchasing power parity of the consumers (Erkans & Evans, 2016).

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Keeping all the above points in mind, the theory still holds high relevancy in
understanding and predicting the behaviour of the consumers.
Diffusion of Innovation
The theory of diffusion of innovation was propounded in the year 1962 by Everett
Rogers, it seeks to explain how, why and the rate at which new ideas and technology is
spread.it shows how over a period of time an idea or a product diffuses and gains
momentum through a specific population or a social system. The result of the diffusion
is the adoption of the idea or the product amongst the people and the section of the
society (Zhai, Ding & Wang, 2018).
The theory of diffusion is divided into 5 categories of adoption; these are categories
where marketers use different strategies to target the consumers in tandem with the
theory of planned behaviour.
(Source: Rogers, 2012)
 Innovators- These are the group of people who first want to try out the product.
They also form the category of Beta testing consumers who provide valuable
information to the marketers. For example Apple Watch Series 3 was picked up
as soon as it rolled out in the market by the innovators; they use the personal
factor of people in making them buy the product. As this group of people are
brand loyalists of Apple.
 Early Adopters-These can be seen as the group of people who are the opinion
leaders and enjoy the opportunities for change. Amazon uses customer reviews

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and blogs for early adopters which are an extension of theory of planned
behaviour.
 Early Majority-These are the people who need to see the evidence of the success
of the product before buying it. This is related to the social factor in theory of
planned behaviour. This is ensured by the usage of testimonials, word of mouth
advertising and radius targeting of the consumers.
 Late Majority- These are the people who are late adopters and try the product
only after majority of people have already used the product. E-Commerce
companies uses remarketing techniques to show the product to the consumers
and also post the number of products the company has already sold to inculcate
the desire to buy the product.
 Laggards- These are the people who are bound by tradition and are very
difficult to get on board. According to the theory of planned behaviour such
customers can be tried to gain control of by controlling the issues of control.
However, the theory of planned behaviour fails to target these customers
effectively because of its limitation to predict the behaviour and mood of
consumers in situation of fear, appeals and pressure (Berry & Berry, 2018).
Conclusion
Theory of planned behaviour is used by marketers to predict the behaviour of the
consumers. The theory stands on the pillars of personal factors, social factors and issues
of control which the marketers use at different stages of consume buying, viz,
information gathering and purchasing the product. The theory is extremely important
in predicting the behaviour of consumers, more so with the advent of online advertising,
the theory has become more pervasive in its approach. Theory of planned behaviour
has a strong role to play in the diffusion of innovation by bringing in the elements of
relative advantage, complexity and compatibility to the model of diffusion of innovation.
Question 2: Developing strategic recommendation based on consumer behaviour
theories

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Answer
McDonald is a US Fast Food chain which has presence in more than 118 countries and
has more than 30,000 stores world-wide. The fast food chain believes in Franchise
model and invests in advertising to pull the customers to its stores. The Fast Food chain
provides quality products to its customers in a very clean environment (McDonald,
2016). The USP of McDonald is its fast delivery at affordable prices. The positioning of
McDonald is providing quality fast food, which is supposedly unhealthy containing a lot
of gluten and unhealthy oil.
McCafe is another franchise model of McDonald which offers pastries, sandwiches, cold
beverages, coffee, shakes and many more products which are usually not found in the
product line of McDonald. Looking at the success of the McCafe, it makes much of a
sense to open up a new restauraunt franchise by the name of Mc-Organic to target the
health conscious people and not diluting the brand at the same time.
Consumer Behaviour Theories
Trait Theory
Trait theory is one of the most important and distinguishing theory of consumer behaviour
emphasizing how one individual varies strong from the other. The theory focuses on identifying
and quantatively measuring the traits to form a picture of an individual’s personality. The
underlying application of the theory is based on two important assumptions:
 Personality is comprised of multiple traits.
 People have plethora of dimensions to their personality (Meihami & Meihami, 2014).
The theory is extremely helpful in evaluating the strategic recommendation for opening up a
new franchise in the name of Mc-Organic. This can be further explained by the five dimensions
of the personality.
Openness to experience-This category of people has high level of intellectual curiosity and
seeks to a variety of experiences. They are thus categories by high imagination, active
judgement, variety seeker and curious minds. Low openness to experience are most likely to
stick with one restaurant, while high openness to experience are most likely to try out variety of

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restaurant. Thus, Mc Organic can cater to both the audience by its new franchise model
(Montano & Kasprzyk, 2015).
Conscientiousness
These types of consumers have the tendency to control their impulses and pursue their goals in
their life. Consumers with High Conscientiousness are reliable, purposeful, strong willed and
punctual, whereas those with low conscientiousness are just the opposite. Thus people with
high conscientiousness can be easily the customers of Mc-Organic (Sheeran & Abraham,
2017)
Extraversion
This is the tendency of the consumers to actively interact with the world. Extraverts are people
who like and prefer large gathering of people, while introverts have low extraversion and prefer
solitude. This behaviour can be used by Mc Organic in creating different architecture to appeal
both the segment of consumers.
Agreeableness
This is the trait of consumer which is linked with moving towards the people. People with high
agreeableness are altruist by nature, while those with low agreeableness are ego centric. Mc
Organic can use this trait of consumers by creating different advertising campaigns attracting
both the section of the consumers.
Neuroticism
This is the tendency of the consumers to experience negative effects from the product. People
with low Neuroticism are more calm and relaxed in comparison to the people with high
neuroticism, who have more affinity to experience negative emotions. Mc Organic will appeal
more to people with low Neuroticism due to its health benefits.
The learning from the trait theory relate specific with the product so that customers can attach a
positive attribute when buying the product. For example AXE in its campaign linked the product
to desirability with the women. In the similar manner, McDonald has to attach good health and a
fit body with its organic product offering via its franchise Mc-Organic

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EKB Model
Engel, Kollet & Blackwell (EKB) model is an extension of Theory of reasoned action and
an important theory in consumer behaviour. The model uses a five step process which
consumers use while making a purchase. The first step is where consumers absorb most
of the information about the product via television, social media ads, bill boards and
other channels. Mc-Organic has to ensure that it uses both traditional and contemporary
tools of marketing to provide information to the consumers and create an interest about
the product (O’Brien, 2015).
Once the consumer has consumed the information, he evaluates the information with
his past experiences. In this case, as Mc-Organic is a new outlet, he would have to go into
the store to create an experience for himself before evaluating his options of organic
food. The third step is the decision making stage, in this the consumer is influenced by
his rational insight. The rational insight suggests that organic food is healthy, and a
separate franchise of a brand means more value and trust on the new product offering.
The customer also envisions himself differently after consuming the product (Ashman,
Solomon & Wolny, 2015).
EKB model thus uses input and external influences to make the customers interested in
the product and then influence them by the use of external variables to buy the product.
Marketers have a strong role to play first as the input variable, where they provide
sufficient information about the product to the consumers. The marketing material and
information must have the ability to drive the interest of the consumers towards the
product, so much that they look out for more information on different communication
channels. Marketing also plays an important role in driving external influences in the
customers by making them envision their future state after trying the product (Chung &
Lai, 2017). Here Mc-Organic can use a sports celebrity or an entertainment celebrity as
the brand ambassador to create a desire in its potential customers. The customers will
connect with the celebrity and envision them to develop healthy and a fit body by
consuming the organic offering provided by the separate franchise of McDonald.

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The strategic option of Opening a new franchise by the name of Mc-Organic will help
McDonald to succeed because it is not diluting its parent brand, at the same time giving
consumers an option of healthy eating for sustained living. The new franchise model is
in tandem with the theory of EKB as it evaluates step by step process of consumer
buying process. Marketers by evaluating the best option can increase and develop the
brand awareness of Mc-Organic, further helping in creating an interest on the product
offering of the new franchisee. This can be further translated into desire to purchase the
product and lastly action to call and purchase the product.
Conclusion
McDonald is a US fast food chain which has presence in more than 118 countries; the
fast food chain is the leading provider of Fast food which is considered to be unhealthy
due to its ingredients. The company is looking forward to do a brand extension by
launching Mc-Organic as a separate franchise to offer healthy organic food to its millions
of consumers. The franchise model is the best option in the hands of the company as it
will not dilute the existing brand value of McDonald, at the same time, create a new
customer segments that are focussed on healthy eating habits. The trait theory is in
resonance with the strategic option because the consumer will act on his behaviour to
achieve a desired outcome, in this case being healthy. The consumers also envisions an
image for himself after making the purchase, Mc-Organic here will offer them with
healthy option to eat which would give them a fit body and longer sustainability. EKB
model is another consumer behaviour model which strongly supports the franchise
model for Mc-Organic. The model uses five step approaches to targets consumers at
each step of buyer behaviour. By providing him relevant information on the product, he
creates the awareness of the brand in the market, further using the marketing
information as the input variable and external influences to make the product go
pervasive in the market. Thus, the theories of consumer behaviour are extremely
relevant for evaluating the strategic option of McDonald.

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