Question

Answer
1. Explain Economic Model of Consumer Behavior.
Answer:-
The Economic Model of Consumer Behavior is based on the fundamental assumption that consumers
are rational decision-makers who aim to maximize their utility (satisfaction) from limited resources,
usually money. This model suggests that buying decisions are made after careful evaluation of product
prices, benefits, and income levels.
According to this model, the consumer compares different product options based on their prices and
features, and chooses the one that gives the maximum value for money. The main influencing factors in
this model are:
• Price of the product
• Consumer income
• Product availability
• Substitute products
This model is built on the concepts of utility theory, where each product provides a certain level of
satisfaction, and the consumer selects products in such a way that the total utility is maximized within
their budget. It includes laws such as:
• Law of Diminishing Marginal Utility: The satisfaction from each additional unit of a product decreases.
• Equi-Marginal Utility: Consumers distribute their spending in a way that the last rupee spent on each
product gives equal satisfaction.
Example: If a person has ₹100 and two options — buying a T-shirt or two meals — they will analyze
which option gives them more utility or satisfaction and then make a rational choice.
Limitations:
This model ignores emotional, psychological, and social factors. In real life, consumers often make
impulsive or emotionally driven purchases, which are not always rational.

2. Explain Psychoanalytical Model of Consumer Behavior.

Answer:- The Psychoanalytical Model of consumer behavior is based on Sigmund Freud's theory of
personality. According to this model, a consumer's buying decision is influenced by deep psychological
forces, many of which operate at an unconscious level. These inner motives, fears, desires, and
emotions are often not visible on the surface but play a powerful role in shaping choices.
Freud divided the human personality into three parts:
1. Id – The unconscious mind that seeks pleasure and avoids pain. It represents instinctual desires.
2. Ego – The rational self that balances the demands of the id and the superego.
3. Superego – The moral part of the personality that reflects societal values and norms.
Consumers often buy products not just for utility, but also for symbolic reasons like status, self-image,
or emotional satisfaction. Marketers using this model aim to create ads and branding that appeal to
hidden desires and emotional triggers.
 Example:
A luxury car brand like Mercedes-Benz doesn’t just sell a car — it sells a symbol of success, prestige,
and power. The buyer might not be aware of it, but the urge to feel superior or respected could be
influencing the purchase decision.

3.Explain Sociological Model of Consumer Behavior.

Answer:-
The Sociological Model of consumer behavior explains how a consumer's decisions are influenced by their
social environment. This model emphasizes that an individual's buying behavior is not just a personal choice
but is shaped by social groups, culture, family, social class, and roles in society.

According to this model, consumers are part of a society and their preferences, attitudes, and behaviors are
affected by the norms and expectations of the groups they belong to. It focuses on external factors that
surround the consumer and drive their decisions.

Key Factors in the Sociological Model:

1. Culture:
The set of values, beliefs, customs, and behaviors shared by a society. For example, in Indian culture,
gifting sweets during festivals is common, which boosts sweet and snack sales during Diwali.

2. Social Class:
Society is divided into classes based on income, education, occupation, etc. A consumer from an upper
class may prefer luxury brands, while one from a lower class may focus on price and affordability.

3. Family Influence:
Family plays a crucial role in buying decisions, especially in Indian households where joint decisions are
common. Children, spouses, and elders all influence purchases.

4. Reference Groups:
People or groups that influence an individual's behavior, such as friends, colleagues, or celebrities.
Consumers may buy products endorsed by influencers or people they admire.

5. Roles and Status:

Every individual plays different roles in life (e.g., student, employee, parent). Each role has expectations
and influences buying behavior. A working woman might choose clothing suitable for her office role.

Example:

A teenager may choose to buy the same smartphone brand that their friends are using, not just because of its
features but to feel accepted and maintain their social identity.

Importance in Marketing:

Marketers analyze sociological factors to target specific groups. For example:

• Advertising wedding jewelry to families.

• Promoting smartphones to youth through social media influencers.

• Launching eco-friendly products for socially responsible consumers.

4 Explain Learning Model of Consumer Behavior .

Answer :- The Learning Model of consumer behavior is based on the idea that consumer decisions
are formed and changed through learning. It suggests that a person’s behavior is not only based on
instincts or rational calculations, but also on past experiences, habits, and interactions with products or
brands.
Learning is a continuous process that occurs as consumers respond to marketing stimuli and gain
experience. When consumers are satisfied with a product, they are likely to buy it again. If the
experience is negative, they may avoid it in the future. This repeated behavior forms buying habits.

Elements of the Learning Model:

1. Drive (Motivation):
It refers to the internal force or urge that stimulates behavior. For example, hunger drives a person to
look for food.
2. Cue (Stimulus):
Cues are signs or triggers that guide consumer behavior. These can be advertisements, packaging, or
even the smell of food.
3. Response:
This is the consumer’s action or decision, such as buying a specific brand.
4. Reinforcement:
If the consumer is satisfied with their purchase, it reinforces the behavior and increases the chance of
repeat purchases.

Types of Learning:
• Classical Conditioning:
This is when consumers associate two stimuli together. For example, if a soft drink ad always shows
people having fun, viewers begin to associate the drink with enjoyment.
• Operant Conditioning:
Behavior is influenced by rewards or punishments. For example, discounts or cashback offers
encourage consumers to buy more.
• Cognitive Learning:
This occurs through thinking, reasoning, and problem-solving rather than just experience. For example,
reading reviews before purchasing a laptop.
Example:
A customer tries a new detergent and finds it cleans clothes better and smells good. This positive
experience (reinforcement) leads to repeated purchase and eventually brand loyalty.
5. Discuss any two models of consumer behavior.
Answer:-
(A) Economic Model of Consumer Behavior
The Economic Model is based on the idea that consumers are rational decision-makers. It assumes that a
consumer always wants to get the maximum value or utility from the money they spend. The decision is made
based on price, income, and product utility.
Key Features:
• Consumers compare alternatives and select the one that gives the most satisfaction.
• Influenced by factors like price, income, and substitute products.
• This model focuses purely on financial and logical reasoning.
Example:
If a person has ₹100 and two products to choose from, they will calculate which one gives better quality or
quantity for the money.
Limitation:
It ignores emotional and social factors.
(B) Psychoanalytical Model of Consumer Behavior
The Psychoanalytical Model, developed from Freud's personality theory, suggests that consumer behavior is
influenced by deep unconscious desires, such as the need for status, love, or identity.
Key Features:
• Divides personality into Id (desires), Ego (balance), and Superego (morals).
• Consumers often make choices based on hidden psychological needs.
• Useful in emotional and image-based marketing strategies.
Example:
A person buying an expensive perfume may not need it but buys it to feel special or attractive.
Limitation:
Unconscious motives are difficult to measure or predict accurately.

6. Explain in detail the Nicosia Model of Consumer Behavior with a suitable example.
Answer:- The Nicosia Model of consumer behavior, developed by Francesco Nicosia in 1966, is one of the
earliest models that explains the complex relationship between a firm and its consumers. Unlike other models
that focus only on internal psychological factors, the Nicosia Model focuses on how communication from the
firm (such as advertising) influences consumer attitudes and leads to a purchase decision.
It is a dynamic model that views the consumer decision-making process as a flow of activities and interactions
between the company and the consumer.

Structure of the Nicosia Model:

The model is divided into four major fields:
Field 1: The Firm’s Attributes and the Consumer’s Attitude
• This field deals with how a consumer is exposed to a firm's communication (like ads or branding).
• Based on this exposure, the consumer forms attitudes or beliefs about the product.
• The consumer’s personality and past experiences also play a role in interpreting the message.
Example: A consumer sees a smartphone ad that highlights its battery life. If the ad is clear and trustworthy
the consumer may form a positive attitude.

Field 2: Consumer's Search and Evaluation Process

• After forming an initial attitude, the consumer starts searching for more information.
• They compare alternatives, read reviews, check prices, and evaluate whether the product meets their needs.
Example: The consumer starts comparing the advertised smartphone with other models, reading reviews,
and checking YouTube comparisons.
Field 3: Purchase Decision
• Based on the evaluation, the consumer decides whether or not to make a purchase.
• This is the actual decision-making phase, and it's influenced by the results of Field 1 and Field 2.
Example: After careful analysis, the consumer decides to purchase the smartphone because it offers the
best value.
Field 4: Feedback from the Purchase
• After the purchase, the consumer forms an experience-based opinion.
• If the experience is good, it results in positive reinforcement and brand loyalty.
• If not, the consumer may avoid the brand in the future.
Example: If the smartphone performs well, the consumer will likely recommend it to others and consider
the same brand again.

7. Explain Howard Seth Model of with a suitable example in Consumer Behavior.

Answer: -
The Howard-Sheth Model, developed by John Howard and Jagdish Sheth, is one of the most detailed
models of consumer behavior. It explains the complex decision-making process, especially when the
consumer is buying high-involvement products (expensive or unfamiliar goods like vehicles,
electronics, etc.).
This model integrates psychological, social, and marketing inputs to describe how consumers process
information, form attitudes, and make decisions. It recognizes that buying behavior is influenced by
internal learning processes and external environmental factors.
Main Components of the Model:
The model consists of four main sets of variables:
1. Input Variables (Stimuli):
These are the external factors that influence consumer decision-making.
• Significative stimuli: Physical product attributes like price, quality, features.
• Symbolic stimuli: Brand image, advertising, and other symbolic cues.
• Social stimuli: Influence of family, reference groups, peers, and culture.
Purpose: These stimuli provide raw information for decision-making.
2. Perceptual and Learning Constructs:
 These are the internal psychological processes that help interpret the input.
• Perceptual Variables: Selective attention and perception bias (consumers may focus only on certain
information based on past experiences).
• Learning Variables: Includes motivation, brand comprehension, attitude formation, confidence, and
purchase intention.
Purpose: This part explains how the consumer understands and evaluates the stimuli.
3. Output Variables (Actual Behavior):
These are the consumer’s responses, including:
• Attention to brand
• Attitude toward the brand
• Intention to buy
• Actual purchase
Purpose: This is the final step where the consumer decides which product or brand to buy.

8. Explain Engel-Kollat-Blackwell Miniard Model of Consumer Behavior.

Answer:- The Engel-Kollat-Blackwell Model (also known as the EKB Model) is one of the most widely
accepted models of consumer behavior. It was developed by James Engel, David Kollat, and Roger
Blackwell in the late 1960s and later revised by Miniard. This model explains the decision-making process
that a consumer goes through before, during, and after purchasing a product.

It focuses on the rational and structured buying behavior of consumers and is especially useful in
understanding how consumers deal with information and alternatives when making decisions —
particularly for high-involvement purchases like electronics, cars, or insurance.

Five Key Stages of the EKB Model:

1. Problem Recognition (Need Identification):

The buying process begins when a consumer recognizes a need or a problem. This need could arise from
an internal factor (like hunger or thirst) or an external trigger (like seeing a friend's new phone).

Example: You see your phone battery dying quickly every day and realize you need a new phone.

2. Information Search:

Once the problem is recognized, the consumer actively looks for information about possible solutions.
Information can come from:

• Internal sources (memory, past experiences)

• External sources (advertisements, internet, reviews, word-of-mouth)

Example: You start comparing phone models online, reading reviews, and asking friends.

3. Evaluation of Alternatives: Here, the consumer evaluates all the available options based on various
attributes like price, features, quality, and brand reputation.
 Example: You narrow down your choice to 3 phone models and compare their battery life, camera
quality, and cost.

4. Purchase Decision:

After evaluating alternatives, the consumer chooses the most suitable option and proceeds to buy the
product.

Example: You decide to buy a Samsung smartphone because it meets your needs and fits your budget.

5. Post-Purchase Behavior:

After using the product, the consumer evaluates their experience. If satisfied, they may develop brand
loyalty. If not, they may feel cognitive dissonance (doubt about the decision) and avoid that brand in the
future.

Example: If your new phone works perfectly, you might recommend it to others. If not, you may regret
the purchase.

Additional Components of the EKB Model:

• Information Processing:
Explains how the consumer receives, stores, and recalls product information.

• Environmental Influences:
Includes family, culture, social class, and peer influence.

• Individual Differences:
Refers to psychological factors like personality, motivation, values, lifestyle, and knowledge.

Importance in Marketing:

• Helps marketers understand each stage of consumer decision-making.

• Useful for identifying the best time and place to target customers.

• Allows development of personalized marketing strategies.

Example Scenario:

A student looking to buy a laptop for online classes:

1. Recognizes the need due to poor performance of the old laptop.

2. Searches online and asks peers about the best laptops under ₹50,000.

3. Evaluates Lenovo, HP, and Dell based on features.

9. Explain Webster and Wind Model of Consumer Behavior.
Answer:- The Webster and Wind Model is specifically designed to explain organizational (industrial or
business-to-business) buying behavior rather than individual consumer behavior. It was introduced by
Frederick E. Webster and Yoram Wind and is widely used to understand how companies, institutions, and
government agencies make purchasing decisions.

This model acknowledges that in organizational buying, the decision-making process is more complex,
involves multiple participants, and is influenced by internal and external factors such as company policies,
objectives, environment, and interpersonal dynamics.

Key Features of the Webster and Wind Model:

The model highlights that organizational buying is affected by four major categories of variables:

1. Environmental Variables:

These are external forces that influence the organization's buying behavior.

• Economic conditions

• Technological changes

• Political and legal factors

• Cultural and competitive environment

Example: A company may avoid purchasing from a foreign vendor due to new import regulations.

2. Organizational Variables:

These refer to the internal structure and goals of the organization.

• Company size

• Nature of the business

• Organizational structure

• Purchasing policies

• Objectives and strategies

Example: A cost-focused organization may always go for the lowest bidder, while a quality-focused
company may choose premium suppliers.

3. Interpersonal Variables:

In an organization, purchase decisions are rarely made by one person. Multiple individuals and
departments influence the decision:

• Managers

• Technical staff
• Finance team

• End users

Each person involved may have different interests, power levels, and communication styles, which affects
the final decision.

Example: In buying office software, the IT team may look at features, the finance team at cost, and the
HR team at usability.

4. Individual Variables:

These are the personal characteristics of the people involved in the decision-making process:

• Age

• Education

• Personality

• Risk-taking behavior

• Job roles

Example: A young, tech-savvy employee may prefer cloud-based solutions, while an older employee
might favor traditional software.

Buying Center Concept:

The model introduces the idea of a "buying center", which is a group of individuals involved in the
purchase decision. It includes:

• Users – Who will use the product

• Buyers – Who manage the procurement process

• Influencers – Who influence the decision with technical input

• Deciders – Who have the final authority

• Gatekeepers – Who control the flow of information

10.Discuss the limitations of Nicosia Model of Consumer Behavior.

Answer:- The Nicosia Model of Consumer Behavior, developed by Francesco Nicosia, is a structured and
dynamic model that explains how marketing communication influences consumer attitudes and leads to
decision-making. While it introduced a new perspective by focusing on the interaction between the firm
and the consumer, it also has several limitations that reduce its practical applicability.
 Limitations of the Nicosia Model:

1. Complexity of the Model

• The model is highly complex and includes many stages and flows of information.

• For beginners or marketers in small businesses, it may be difficult to understand and apply in real
marketing strategies.

• The interconnections between different fields and subfields are not always clearly defined.

2. Lack of Clarity in Process Flow

• The transitions between the four fields of the model are not always clear or realistic.

• It assumes a linear and logical flow, whereas in real life, consumers may jump back and forth between
stages or skip some entirely.

• The model doesn't explain what happens if the consumer rejects the product after evaluation.

3. Limited Focus on Emotional and Psychological Factors

• The model focuses heavily on rational decision-making and company-consumer communication.

• It does not consider emotional influences, subconscious desires, or psychological motives like fear,
love, or status, which are central to many other models (e.g., psychoanalytical model).

4. No Emphasis on Post-Purchase Behavior

• The model gives little attention to what happens after the purchase.

• It does not explain customer satisfaction, feedback, word-of-mouth, or brand loyalty, which are
crucial in modern marketing.

5. Ignores External Influences

• The model largely overlooks external influences like culture, family, peer pressure, social class, and
economic conditions.

• These are important in shaping consumer decisions, especially in diverse societies like India.

6. Assumes High Involvement

• The Nicosia Model is more suitable for high-involvement products (cars, laptops, etc.).

• It doesn’t effectively explain routine, low-involvement, or impulse purchases (like snacks, soaps, etc.).
11.Discuss the limitations of the Howard-Sheth Model of Consumer Behavior.
Answer :- The Howard-Sheth Model, developed by John Howard and Jagdish Sheth, is one of the most
comprehensive models designed to explain complex consumer decision-making, especially for high-
involvement purchases. It combines elements of psychology, sociology, and marketing.

Although it is a well-structured and theoretical model, it has several limitations that affect its practical
usability.

Limitations of the Howard-Sheth Model:

1. Overly Complex and Theoretical

• The model includes many variables (inputs, perceptual and learning constructs, outputs, and
exogenous factors).

• For marketers, especially in small businesses or simple markets, the model is too detailed and
academic to implement practically.

• It can be hard to apply or visualize in day-to-day consumer studies.

2. Assumes Rational Decision-Making

• The model is based on the assumption that consumers behave rationally — carefully analyzing
information before making a decision.

• In reality, many consumers make emotional, impulsive, or habitual purchases that are not explained by
this logical process.

3. Not Suitable for Low-Involvement Products

• The model is effective for explaining the purchase of expensive or unfamiliar products (cars,
electronics, etc.).

• But it does not apply well to routine or low-involvement items (like groceries, soft drinks, soaps),
where decisions are quick and influenced by habit or branding.

4. Difficult to Measure Internal Variables

• The model includes many psychological factors like perception, motivation, and attitude.

• These variables are hard to observe and measure directly, which makes it difficult to validate the
model empirically.

5. Ignores Post-Purchase Behavior

• While it explains purchase intention and brand choice, the model gives limited attention to post-
purchase behavior, such as satisfaction, complaint behavior, or repeat purchases — which are critical
for customer retention.

6. Exogenous Variables Not Clearly Defined

• The model includes “exogenous variables” like culture, personality, or social class, but it does not
explain how exactly these influence the decision-making process.

• These external factors are too general and lack clear pathways in the model.

12.Discuss the limitations of Engel-Kollat-Blackwell Miniard (EKB or EKBM) Model of

Consumer Behavior.
Answer :-

The Engel-Kollat-Blackwell Miniard Model (EKB or EKBM) is a widely recognized model that explains
the decision-making process of consumers. It includes five major steps: problem recognition,
information search, evaluation of alternatives, purchase decision, and post-purchase behavior. It also
considers factors like individual characteristics, environmental influences, and information processing.
While it offers a structured and logical view of consumer decision-making, it also has some limitations
that affect its accuracy and usefulness in real-world scenarios.

Limitations of the EKBM Model:

1. Overemphasis on Rational Behavior

• The model assumes that consumers are rational thinkers who make decisions logically after analyzing
information.
• In reality, many purchases are emotional, impulsive, or habitual — influenced by mood, peer pressure,
or brand loyalty, which the model fails to fully explain.
2. Not Suitable for Low-Involvement Products
• The EKBM model is most applicable to high-involvement purchases (cars, laptops, appliances), where
consumers go through all five stages.
• For routine or low-cost items (like snacks, soap, soft drinks), consumers often skip steps, making the
model too detailed for such cases.
3. Complexity in Real-Life Application
• The model includes many factors (psychological, social, personal, cultural), making it difficult to
implement practically.
• Marketers may find it hard to apply the full model in dynamic or fast-changing markets.
4. Lack of Flexibility
• Consumer behavior is not always linear as shown in the model. People often jump back and forth
between stages, repeat steps, or make decisions instantly.
• The model does not capture this non-linear, flexible, and evolving nature of modern buying behavior
— especially in online and digital environments.

5. Hard to Measure Internal Factors

• Variables like motivation, personality, values, and attitudes are included in the model, but they are
subjective and difficult to measure accurately.
 • This makes it challenging to conduct precise consumer research using the model.
6. Post-Purchase Behavior is Limited
• Although the model includes post-purchase evaluation, it doesn’t deeply explore areas like:
o Cognitive dissonance
o Customer feedback and reviews
o Word-of-mouth influence
o Long-term brand loyalty

13.Discuss the limitations of the Webster and Wind Model of Consumer Behavior.
Answer:- The Webster and Wind Model is designed to explain organizational (industrial or B2B) buying
behavior. It highlights how environmental, organizational, interpersonal, and individual factors influence
the complex decision-making process within a company or institution. Although this model provides a
comprehensive framework for understanding industrial buying, it has several limitations.

Limitations of the Webster and Wind Model:

1. Too General and Broad

• The model identifies four major categories of influence but does not clearly explain how these factors
interact in real situations.

• Because of its broad and general structure, it becomes difficult to apply the model to specific business
cases without more detailed guidelines.

2. Lacks Detailed Decision Process

• Unlike other models (e.g., EKB or Howard-Sheth), the Webster and Wind model doesn’t include a step-
by-step decision-making process like problem recognition, search, evaluation, and post-purchase
behavior.

• It focuses more on influencing variables than the actual buying steps.

3. No Emphasis on Post-Purchase Behavior

• The model does not address what happens after the purchase — such as feedback, product
performance evaluation, vendor satisfaction, or repurchase intentions.

• In B2B marketing, post-purchase relationships are extremely important, but this model overlooks them.

4. Difficult to Apply in Fast-Changing Environments

• The model assumes a stable and structured organizational environment, but modern businesses
operate in dynamic, technology-driven, and uncertain markets.

• It doesn’t explain how companies make quick or emergency purchases, or how decisions are made
during crises.

5. Neglects Emotional and Political Factors

• Although it talks about interpersonal dynamics, it fails to consider office politics, power struggles, or
emotional decisions that may influence purchases within organizations.

• It assumes that decisions are mostly rational, while real organizational behavior can often be irrational
or biased.

14.What are the psychological factors that influence consumer behavior?

Answer:- Psychological factors play a vital role in shaping how and why a consumer decides to buy a
product or service. These factors are internal and originate from the mind and emotions of the consumer.
They influence the way people perceive products, develop preferences, form buying decisions, and behave
after purchase.

These factors are often unseen but powerful and differ from person to person.

1. Motivation

• Motivation refers to the inner drive or desire that pushes a person to satisfy a need.

• According to Maslow’s Hierarchy of Needs, human needs are categorized into:

o Physiological needs (food, water)

o Safety needs (security, insurance)

o Social needs (friendship, belonging)

o Esteem needs (status, respect)

o Self-actualization (personal growth)

Example: A person may buy a gym membership to fulfill their esteem need of looking fit and gaining
confidence.

2. Perception

• Perception is the process by which a person selects, organizes, and interprets information to make
sense of the world.

• Different people can perceive the same product in different ways, depending on their experience,
knowledge, and beliefs.

Example: One customer may see an iPhone as a status symbol, while another may see it as overpriced.

3. Learning

• Learning refers to the changes in consumer behavior that result from past experiences.

• If a consumer has a positive experience with a brand, they are more likely to buy from it again.

• Learning can be intentional (active research) or incidental (influenced by ads or peers).

 Example: If someone buys a detergent and it cleans clothes well, they will remember that brand and
likely buy it again.

4. Beliefs and Attitudes

• A belief is a person's knowledge or opinion about a product or brand.

• An attitude is a person’s consistent feeling or tendency (positive or negative) toward a brand or

product.

• These are built over time and influence buying behavior.

Example: A person may have a positive attitude towards Amul as a trusted dairy brand due to years of
good experience.

15. Explain Perception and Theories of Perception.

What is Perception?

Perception is the process by which a person selects, organizes, and interprets sensory information (like
sight, sound, smell, touch, etc.) to create a meaningful picture of the world around them.

In consumer behavior, perception refers to how a customer views a product, service, or brand — not
necessarily how it actually is, but how it appears in their mind.

Example: Two people may taste the same coffee — one says it's too bitter, and the other says it's
perfect. That’s perception — it differs person to person.

Three Main Processes of Perception:

1. Selection: The brain selects certain stimuli (ads, packaging, price tags) to pay attention to.

2. Organization: It organizes these stimuli based on patterns, past experiences, or expectations.

3. Interpretation: The brain gives meaning to the organized information and forms a perception (positive
or negative).

Why is Perception Important in Consumer Behavior?

• Consumers don't always buy based on reality; they buy based on perception.

• Good packaging or brand image can change how people view even a simple product.

• Marketers work to create positive perceptions through advertising, branding, pricing, and product
design.
16 . Define Motivation and Explain Any Three Theories of Motivation
Answer:- Definition of Motivation
Motivation is the internal force or drive that pushes a person to act in a certain way to satisfy a need or desire.
In consumer behavior, motivation explains why a customer decides to buy a product — to fulfill some personal
or emotional need.

Example: A person may buy a water purifier due to the motivation of staying healthy and safe.

Motivation acts as the starting point of the decision-making process.

Three Important Theories of Motivation:

1. Maslow’s Hierarchy of Needs Theory

Proposed by Abraham Maslow, this is the most popular theory of motivation. Maslow arranged human needs
in a five-level pyramid, from basic to advanced needs.

The five levels are:

1. Physiological Needs – Basic survival needs like food, water, shelter.

2. Safety Needs – Security, insurance, health, job stability.

3. Social Needs – Love, friendship, relationships, group belonging.

4. Esteem Needs – Respect, recognition, status, self-confidence.

5. Self-Actualization Needs – Personal growth, achieving potential, creativity.

Example:

• A person may buy food (physiological need),

• Then invest in health insurance (safety need),

• Then join a social club (social need), and so on.

As one need is fulfilled, the next becomes the motivator.

2. Herzberg’s Two-Factor Theory

Developed by Frederick Herzberg, this theory divides motivation into two sets of factors:

a) Hygiene Factors (Maintenance needs):

• These do not motivate people but must be present to avoid dissatisfaction.

• Examples: Salary, job security, working conditions, company policy.

b) Motivational Factors:
 • These truly motivate people to perform better.

• Examples: Achievement, recognition, responsibility, personal growth.

Example in consumer behavior:

A consumer may buy from a brand not only because of fair pricing (hygiene) but also because the brand offers
new technology, innovation, and status (motivators).