Consumer

1
Consumer Business Buyer Behavior
2
Perception

• Process by which an individual selects,
  organizes, and interprets information to form a
  cohesive picture about an entity
• Perceptions affect consumer behavior
• However, remember that individuals can perceive
  the same entity in different ways

3
Perception

• Selective Attention Receive some messages and
  screen out the rest
• An average person is exposed to 1500 ads or brand
  messages a day
• Most of these are screened out So, how do
  marketers capture mind space?
• People are more likely to notice stimuli that
  relate to current needs
• People are more likely to notice stimuli they
  anticipate
• People are more likely to notice stimuli that
  deviate relatively larger than others
• Marketers must bypass attention filters provide
  unexpected stimuli (salesperson, sudden offers)

4
Perception

• Selective Distortion Tendency to
  interpret/distort information to be consistent
  with prior brand and product beliefs
• Taste tests Blind taste tests showed equal
  split Open tests showed preferences
• Can work to the advantage of marketers of strong
  brands
• A car may seem to drive smoother
• A beer may taste better

5
Perception

• Selective Retention Though people fail to
  register much information, they retain
  information that supports their attitudes and
  beliefs
• Remember good points about products we like and
  forget good points about competing products
• Works to the advantage of strong brands
• Explains why marketers repeat messages for
  reinforcement

6
Consumer Buying Decision Process
Marketers Must Identify and Understand
Who Makes the Buying Decision
Types of Buying Decisions
Stages in the Buying Process
7
Consumer Buying Decision Process

• Understand
• Buying roles
• Buying behavior
• Buying decision process

• Initiator
• Influencer
• Decider
• Buyer
• User

8
Consumer Buying Decision Process

• Understand
• Buying roles
• Buying behavior
• Buying decision process

• Complex buying behavior
• Dissonance-reducing buying behavior
• Habitual buying behavior
• Variety-seeking buying behavior

9
Consumer Buying Decision Process

• Understand
• Buying roles
• Buying behavior
• Buying decision process

• Five stages in the consumer buying process
• The amount of time spent in each stage varies
  according to several factors

10
Consumer Buying Decision Process
Five-Stage Model of the Consumer Buying Process
11
Need Recognition

• Need/Problem Recognition
• Can be triggered by internal or external stimuli
• Needs become wants, which lead to behavior
• Marketing stimuli can stimulate a desire for
  information

12
Information Search (1 of 2)

• Sources of information
• Internal Sources
• Personal Sources
• External Sources
• Time, effort and expense dedicated to information
  search depends on
• Degree of risk involved in the purchase
• Amount of expertise with the product category
• Actual cost of the search
• Evoked set
• A narrowed down set of alternatives that the
  customer is considering

13
Consumer Buying Decision Process
Successive Sets Involved in Consumer Decision
Making
14
Evaluation of Alternatives

• Customers evaluate products as bundles of
  attributes
• Brand attributes
• Product features
• Aesthetic attributes
• Price
• Customers place different levels of importance on
  attributes
• Important considerations in the evaluation stage
• Products must be in the evoked set
• Consumers choice criteria must be understood
• Marketing programs must be designed to influence
  consumers opinions about product or brand image

15
Purchase Decision

• Purchase intention and the act of buying are
  distinct concepts
• Potential intervening factors between intention
  and buying (car example)
• Unforeseen circumstances
• Angered by the salesperson or sales manager
• Unable to obtain financing
• Customer changes mind
• Key issues in the purchase decision stage
• Product availability
• Possession utility

16
Postpurchase Evaluation

• Four possible outcomes in the postpurchase stage
• (1) Delight
• (2) Satisfaction
• (3) Dissatisfaction
• (4) Cognitive Dissonance
• Firms ability to manage dissatisfaction and
  cognitive dissonance is
• A key to creating customer satisfaction
• A major influence on word-of-mouth communication

17
Business Markets and Behavior
18
Organizational Buying
Compared to Consumer Markets, Business Markets
Have
Fewer buyers
Larger buyers
Geographically concentrated buyers
Closer relationships with suppliers/customers
19
The Business Buying Process

• Problem/Need Recognition
• Develop Product Specifications
• Vendor Identification and Qualification
• Solicitation of Proposals or Bids
• Vendor Selection
• Order Processing
• Vendor Performance Review

20
Understanding Business Buying Behavior

• Unique Characteristics of Business Markets
• The Buying Center
• Hard and Soft Costs
• Reciprocity
• Mutual Dependence
• Four types of Business Markets
• Producer markets (a.k.a. commercial markets)
• Reseller markets
• Government markets
• Institutional markets

21
Organizational Buying

• Buying Situations
• Straight rebuy
• Modified rebuy
• New task

• Routine reorders from approved vendor list
• Low involvement, minimal time commitment
• Example copier paper

22
Organizational Buying

• Buying Situations
• Straight rebuy
• Modified rebuy
• New task

• Specifications, prices, delivery terms or other
  aspects require modification
• Moderate level of involvement and time commitment
• Example desktop computers

23
Organizational Buying

• Buying Situations
• Straight rebuy
• Modified rebuy
• New task

• Purchasing a product or service for the first
  time
• High level of involvement and time commitment
  multiple influences
• Example selecting a web site design firm or
  consultant

24
Participants in Business Buying
Roles Played in a Buying Center
Initiators
Approvers
Users
Deciders
Influencers
Buyers
Gatekeepers