Consumer Markets & Buyer Behavior Analysis

Consumer Markets & Consumer Markets & Buyer BehaviorBuyer Behavior

Analysis Analysis

Parva Soltani Parva Soltani & & Ali GolshaniAli Golshani

Content Content

Kinds of Markets Kinds of Markets Consumer Buying BehaviorConsumer Buying Behavior Factors Affecting Consumer BehaviorFactors Affecting Consumer Behavior Types of DecisionTypes of Decision Decision StepsDecision Steps How To Adopt a New Product How To Adopt a New Product

What is a Market ?What is a Market ?

PEOPLEPEOPLEBut not just any People, they have to But not just any People, they have to

have : have :

Willingness to buy Willingness to buy Purchasing Power ( Money)Purchasing Power ( Money) Authority Authority

Different Kinds Of MarketDifferent Kinds Of Market

B2BB2B : Business to Business which : Business to Business which

refers to doing Business mostly trading refers to doing Business mostly trading between companies and organizations . between companies and organizations .

B2CB2C : Business to Consumer is : Business to Consumer is referring to sell a service or a product to referring to sell a service or a product to the end user or consumer which is the the end user or consumer which is the main purpose of this presentation .main purpose of this presentation .

Bases for Segmenting Consumer Bases for Segmenting Consumer MarketsMarkets

Geography Geography Region of the worldRegion of the world CountryCountry Region of the countryRegion of the country StateState CityCity CountyCounty

Bases for Segmenting Bases for Segmenting Consumer MarketsConsumer Markets

DemographyDemography ageage

gendergender

family sizefamily size

family life cyclefamily life cycle

incomeincome

occupationoccupation

educationeducation

ethnicityethnicity

nationalitynationality


PsychographicsPsychographics

social classsocial class

lifestylelifestyle

personalitypersonality


BehaviorBehavior purchase occasionspurchase occasions benefits soughtbenefits sought user statususer status usage rateusage rate loyalty statusloyalty status readiness stagereadiness stage

Consumer Buying Consumer Buying BehaviorBehavior Consumer Buying BehaviorConsumer Buying Behavior refers to refers to

the buying behavior of final consumers the buying behavior of final consumers (individuals) who buy goods and (individuals) who buy goods and services for personal consumption.services for personal consumption.

Studying Buyer behavior is to answer:Studying Buyer behavior is to answer: ““How do consumers respond to How do consumers respond to

marketing efforts the company might marketing efforts the company might use?” use?”

But understanding Buyer Behavior is not But understanding Buyer Behavior is not easy at all .easy at all .

He says something …..He says something ….. He does something else .He does something else . In fact a wrong understanding of Motives , In fact a wrong understanding of Motives ,

Needs and Priorities of Buyers may leads Needs and Priorities of Buyers may leads to priceless mistakes . to priceless mistakes .

Model of Buyer BehaviorModel of Buyer BehaviorMarketing andOther Stimuli

Buyer’s Black Box

Buyer’s Response

ProductPricePlacePromotion

EconomicTechnologicalPoliticalCultural

Characteristics Affecting Consumer Behavior

Buyer’s Decision Process

Product ChoiceBrand ChoiceDealer Choice

Purchase TimingPurchase Amount

Characteristics Affecting Characteristics Affecting Consumer BehaviorConsumer Behavior

BuyerPsychological

Personal

Social

Culture

Factors Affecting Consumer Behavior:Factors Affecting Consumer Behavior:CultureCulture

Social Class• People within a social class tend to exhibit similar buying behavior.• Occupation• Income• Education• Wealth

Most basic cause of a person's wants Most basic cause of a person's wants and behavior.and behavior.

ValuesValues PerceptionsPerceptions

Subculture• Groups of people with shared value systems based on common life experiences.• Nationalist Consumers• Religious Consumers• Geographic based Consumers• Mature Consumers

Factors Affecting Consumer Factors Affecting Consumer Behavior:Behavior:Social Social

Groups

• Membership

• Reference

Family• Husband, wife, kids• Influencer,

Roles and Status

Social Factors

Factors Affecting Consumer Factors Affecting Consumer Behavior:Behavior:PersonalPersonal Personal Influences

Age and Family Life CycleStage Occupation

Economic Situation

Lifestyle Identification

Activities Opinions

Interests

Personality & Self-Concept

Factors Affecting Consumer Behavior:Psychological

Psychological Factors

Motivation

Perception

Learning

Beliefs and Attitudes

Maslow’s Hierarchy of NeedsMaslow’s Hierarchy of Needs

Esteem Needs(self-esteem, status)

Social Needs(sense of belonging, love)

Safety Needs(security, protection)

Physiological Needs(hunger, thirst)

Self Actualization

(Self-development)

Different types of needs drive Different types of needs drive behaviour to satisfy those behaviour to satisfy those needs in an order of needs in an order of precedence.precedence.

Most basic needs fulfilled first.Most basic needs fulfilled first.

Internal (psychological)

External(sociological)

culture

social class

reference groups

family

marketing mix

needs

motives

wants

awareness perception attitude preference

behavior

learning

personality

Buyer Behavior Model

Model of Buyer BehaviorModel of Buyer Behavior

Buyer BehaviorBuyer Behavior

Attitudes are anchored in behavior.Attitudes are anchored in behavior.

There are two ways to change attitudes:There are two ways to change attitudes:

……directly through awareness and perceptiondirectly through awareness and perception

… …indirectly through learning and the feedback loop.indirectly through learning and the feedback loop.

Attitude change is a key goal in marketingAttitude change is a key goal in marketing

Buyer BehaviorBuyer BehaviorMotivationMotivation

weight or importance of a needweight or importance of a need

- rational motives- rational motiveseconomy, efficiency, dependabilityeconomy, efficiency, dependabilityOf a ProductOf a Product

- emotional motives- emotional motivesattract opposite genderattract opposite gendercare of loved onescare of loved onesfear of rejectionfear of rejection


Motivation Motivation (cont..)(cont..)

use of emotional motives in marketing is one of use of emotional motives in marketing is one of the smart ways .the smart ways .


AwarenessAwareness

enter information searchenter information search

can come from internal or external Sourcescan come from internal or external Sources

more receptive to marketing information more receptive to marketing information flowsflows


PerceptionPerception

process by which one receives, interprets, process by which one receives, interprets, responds to stimuliresponds to stimuli

selective perceptionselective perception

cross-sensory perceptioncross-sensory perception

subliminal perceptionsubliminal perception


Sociological InfluencesSociological Influences

CultureCulture

set of learned responses from a societyset of learned responses from a society

enculturation versus acculturation enculturation versus acculturation


Sociological Influences Sociological Influences (cont..)(cont..)

Social ClassSocial Class

lifestyle divisions of society based on lifestyle divisions of society based on occupation, wealth, power, educationoccupation, wealth, power, education

in Iran, largest class is not the lowestin Iran, largest class is not the lowest


Sociological Influences (cont...)Sociological Influences (cont...)

reference groupsreference groupsinfluence attitudes, perceptions, motivesinfluence attitudes, perceptions, motivesreduce riskreduce riskprimary versus secondaryprimary versus secondaryformal versus informalformal versus informalFamily versus FriendsFamily versus Friends

Think about a specific major Think about a specific major purchase you’ve made recently.purchase you’ve made recently.

What buying process did you follow? What buying process did you follow?

What major factors influenced your What major factors influenced your decision?decision?

Types of Buying DecisionsTypes of Buying Decisions

ComplexBuying

BehaviorDissonance-

Reducing BuyingBehavior

Variety-SeekingBehavior

HabitualBuying

Behavior

HighInvolvement

Significantdifferences

betweenbrands

Fewdifferences

betweenbrands

LowInvolvement

The Buyer Decision The Buyer Decision ProcessProcess

Need Recognition

Information Search

Evaluation of Alternatives

Purchase Decision

Postpurchase Behavior

The Buyer Decision ProcessStep 1. Need Recognition

External Stimuli

• TV advertising

• Magazine ad

• Radio slogan

•Stimuli in the environment

Internal Stimuli

• Hunger

• Thirst

• A person’s normal needs

Need RecognitionDifference between an actual state and a desired state

The Buyer Decision ProcessStep 2. Information Search

•Family, friends, neighbors•Most influential 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

Commercial Sources

Public Sources

Experiential Sources

The Buyer Decision ProcessStep 3. Evaluation of Alternatives

Product AttributesEvaluation of Quality, Price, & Features

Degree of ImportanceWhich attributes matter most to me?

Brand BeliefsWhat do I believe about each available brand?

Total Product SatisfactionBased on what I’m looking for, how satisfied

would I be with each product?

Evaluation ProceduresChoosing a product (and brand) based on one

or more attributes.

The Buyer Decision ProcessThe Buyer Decision ProcessStep 4. Purchase DecisionStep 4. Purchase Decision

Purchase IntentionDesire to buy the most preferred brand

Purchase Decision

Attitudes of others

Unexpected situational factors

The Buyer Decision ProcessStep 5. Postpurchase Behavior

Consumer’s Expectations of Product’s Performance

Dissatisfied Customer

Satisfied Customer!

Product’s Perceived Performance

Cognitive Dissonance

Post purchase EvaluationPost purchase Evaluation

Evaluation of product performance.Evaluation of product performance.

Cognitive dissonance.Cognitive dissonance.

Impacts future purchases.Impacts future purchases.

Impacts word-of-mouth communications.Impacts word-of-mouth communications.

Stages in the Adoption ProcessStages in the Adoption Process

Awareness

Interest

Evaluation

Trial

Adoption

Adoption of InnovationsAdoption of InnovationsPe

rcen

tage

of A

dopt

ers

Time of AdoptionEarly Late

Inno

vato

rs

Early Adopters

Early Majority

2.5%13.5%

34% 34%

16%

Laggards

Late Majority

IInfluences on the Rate of Adoptionnfluences on the Rate of Adoptionof New Productsof New Products

Try abilityCan the innovation

be used on a trial basis?

CompatibilityDoes the innovation

fit the values and experience of the

target market?ComplexityIs the innovation

difficult tounderstand or use?

Relative AdvantageIs the innovation

superior to existing products?

Communicability Can results be easily

observed or described to others?

ProductCharacteristics

ConclusionConclusion

To Have a successful Sales and Marketing it is To Have a successful Sales and Marketing it is necessary to have a clear idea of your Target necessary to have a clear idea of your Target Market .Market .

With a very aggressive market researching find With a very aggressive market researching find out how consumers in your target market may out how consumers in your target market may react and decide about buying a new product or react and decide about buying a new product or service .service .

Try to influence very intelligently in to different Try to influence very intelligently in to different steps of decision making of consumers in your steps of decision making of consumers in your Target Market .Target Market .

AcknowledgmentsAcknowledgments Dr. Ehteshami for her valuable advices. Dr. Ehteshami for her valuable advices. Mr. Azadi and other colleagues of IMI for Mr. Azadi and other colleagues of IMI for

their great supports. their great supports.

ReferencesReferences

- Kotler Philip, a frame work for Marketing Management ,2003Kotler Philip, a frame work for Marketing Management ,2003- Birn Robin J ,The effective Use of Market research,2004Birn Robin J ,The effective Use of Market research,2004- D. Michman Ronald & M. Mazze Edward , Lifestyle Marketing ,2003D. Michman Ronald & M. Mazze Edward , Lifestyle Marketing ,2003- Jobber David, Priciples and practice of Marketing,2004Jobber David, Priciples and practice of Marketing,2004- www.statmarkgroup.com/html_english/consumer-buying-behavior.htm - www.statmarkgroup.com/html_english/consumer-buying-behavior.htm - www.lib.washington.edu/business/guides/cons.html www.lib.washington.edu/business/guides/cons.html - Webmarketingrecources.orgWebmarketingrecources.org

Consumer Markets & Buyer Behavior Analysis

Documents

Transcript of Consumer Markets & Buyer Behavior Analysis