Buyer Behavior

Model of Buyer Behavior

Marketing and Other Stimuli

MarketingProductPricePlacePromotionOtherEconomicTechnologicalPoliticalCultural

Buyer’s Black Box

Buyer CharacteristicsBuyer Decision Process

Buyer Responses

Product ChoiceBrand ChoiceDealer Choice

Purchase TimingPurchase Amount

Approaches to Study of Buyer Behavior

Economic model Learning theory model Psycho-analytic model Information processing model

Factors Affecting Consumer Behavior: Culture

Subculture• Group of people with

shared value systems based on common life experiences.

• Hispanic Consumers

• African American Consumers

• Asian American Consumers

• Mature Consumers

Culture is the Most Basic Cause of a Person's Wants and Behavior.

Factors Affecting Consumer Behavior: Culture

Culture is the Set of Values, Perceptions, Wants & Behavior Learned by a Member of

Society from Family. Social Class• Society’s relatively

permanent & ordered divisions whose members share similar values, interests, and behaviors.

• Measured by: Occupation, Income, Education, Wealth and Other Variables.

Groups• Membership• Reference

Groups• Membership• Reference

Family (most important)• Husband, wife, kids• Influencer, buyer, user

Family (most important)• Husband, wife, kids• Influencer, buyer, user

Roles and StatusRoles and Status

Social FactorsSocial Factors

Factors Affecting Consumer Behavior: Social

Family Buying Influence

Children can exert astrong influence onfamily buying decisions.Johnson & Johnson remindscustomer’s of its commitmentto the American Family.

What other companies usechildren to influencefamily buying decisions?

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Personal InfluencesPersonal Influences

Age and Life Cycle Stage

Age and Life Cycle Stage OccupationOccupation Personality &

Self-ConceptPersonality & Self-Concept

Economic Situation

Economic Situation

ActivitiesActivities InterestsInterests

Lifestyle IdentificationLifestyle Identification

OpinionsOpinions

Factors Affecting Consumer Behavior: Personal

High Resources High Innovation

AchieversAchievers

ActualizersActualizers

StrugglersStrugglers

StriversStrivers

FulfilledsFulfilleds

BelieversBelievers

ExperiencersExperiencers

MakersMakers

Values and Lifestyles

Low Resources Low Innovation

Factors Affecting Consumer Behavior: Psychological

PsychologicalFactors

AffectingBuyers Choices

Motivation

Perception

Learning

Beliefs andAttitudes

Physiological Needs(hunger, thirst)

Safety Needs(security, protection)

Social Needs (sense of belonging,

love)

Esteem Needs (self-esteem)

Self Actualization

(Self-development)

Maslow’s Hierarchy of Needs (Fig. 5.4)

Consumer Evaluation

What criteria do consumers use to make evaluations? What do consumers care about?

Values Benefits Attributes Means-End Value Chains

Means-End Value Chains•Power•Status•Self esteem

•$$ security•Family•Environment

•Peer admiration•Speed•Exclusivity

•Protection•Value•Reliability•Low emissions

•Horse power•Prestige brand•Styling•Extras

•Air bags•High mpg•Price/resale•Japanese

•BMW•Lexus•Mercedes

•Honda•Toyota•Nissan

Buyer Decision Process

PostpurchaseBehavior

Purchase

Decision

Information

SearchNeed

Recognition

Evaluationof

Alternatives

Buyer Decision ProcessStep 1. Need Recognition

State Where the Buyer’s Needs are Fulfilled and the Buyer is Satisfied.

Needs Arising From:

Internal Stimuli –

Hunger

External Stimuli-

Friends

Buyer Recognizes

a Problem

or a Need.

•Family, friends, neighbors•Most effective source of information

•Advertising, salespeople•Receives most information from these sources

•Mass Media•Consumer-rating groups

•Handling the product•Examining the product•Using the product

Personal Sources Personal Sources

Commercial SourcesCommercial Sources

Public SourcesPublic Sources

Experiential SourcesExperiential Sources

The Buyer Decision ProcessStep 2. Information Search

Consumer May Use Careful Calculations & Logical Thinking

Consumers May Buy on Impulse and Rely on Intuition

Consumers May Make Buying Decisionson Their Own.

Consumers May Make Buying DecisionsOnly After Consulting Others.

Marketers Must Study Buyers to Find Out How They Evaluate Brand

Alternatives

The Buyer Decision ProcessStep 4. Evaluation of Alternatives

Purchase IntentionDesire to buy the most preferred brand

Purchase Decision

Unexpected

Situational Factors

Attitudes of Others

The Buyer Decision ProcessStep 5. Purchase Decision

The Buyer Decision ProcessStep 6. Postpurchase Behavior

Consumer’s Expectations of Product’s Performance.

Product’s Perceived Performance.

Dissatisfied Customer

Satisfied Customer!

Cognit

ive D

isso

nan

ce

Role of Consumer Involvement

Sometimes consumers make evaluations/choices very carefully

Sometimes consumers make evaluations/choices with little care

Involvement—strength of motivation, importance

High involvement—B X I model

Low involvement evaluations Cognitive shortcuts (heuristics)

Habit

Affective responses

Awareness: Consumer is aware of

product, but lacks information.

Interest: Consumer seeks Information about new product.

Evaluation: Consumer considerstrying new product.

Trial: Consumer tries new product on a small scale.

Adoption: Consumer decides to make regular use of product.

Stages in the Adoption Process

DivisibilityCan the innovation

be used on a trial basis?

ComplexityIs the innovation

difficult tounderstand or use?

Communicability Can results be easily

observed or described to others?

CompatibilityDoes the innovation

fit the values and experience of the

target market?

Relative AdvantageIs the innovation

superior to existing products?

Influence of Product Characteristics on Rate of Adoption

What is a Business Market?

A business market comprises all the organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others.

The business market is huge and involves many more dollars and goods than do consumer markets.

Contain fewer, but larger buyers

Contain fewer, but larger buyers

Customers are more geographically concentrated

Customers are more geographically concentrated

Buyer demand is derived from final consumer demand

Buyer demand is derived from final consumer demand

Demand is often more inelastic

Demand often fluctuates more, and

more quickly

Characteristics of Business Markets

Marketing Structure and Demand

Business buyers

usually face more

complex buying

decisions.

Characteristics of Business Markets

Business buying

process is more

formalized.

Types of Decisions and the Decision Process

In business buying,

buyers and sellers work more closely

together.To developlong-term partnerships,businessmarketers workclosely with their customers.

Fujitsu promises high-end support to go along with its high-tech products.

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Model of Business Buyer Behavior (Fig. 6.1)

This Unisys ad offers services from technological consulting to database setup and maintenance.

The Environment

MarketingStimuli:•Product•Price•Place•Promotion

Other Stimuli:•Economic•Technological•Political•Cultural•Competitive

The Buying Organization

The buying center

Buying decision process

(Interpersonal and individual influences)

(Organizational Influences)

Buyer Responses

Product or service choice

Supplier Choice

Order Quantities

Delivery terms and times

Service terms

Payment

Organizational Buying

Professional purchasingFewer buyersLarger purchasesCloser, longer relationships/ reciprocityGeographic concentrationDerived demandLower price sensitivityBuying center

UnexpectedSituational

Factors

UnexpectedSituational

Factors

Attitudes of

Others

Attitudes of

Others

Participants in the Business Buying Process

EthicalDecision-Making

Unit of a Buying

Organization is

Called Its Buying Center.

UsersInfluencer

s

Buyers

DecidersGatekeepe

rs

Roles Include