Marketing: An Introduction Armstrong, Kotler

1
Marketing An Introduction Armstrong, Kotler

• Chapter five
• Consumer and Business Buyer Behavior

2
Consumer and Business Buyer Behavior

• After studying this chapter, you should be able
  to
• Define the consumer market and construct a simple
  model of consumer buyer behavior
• Name the four major factors that influence
  consumer buyer behavior

• List and understand the major types of
  buying-decision behavior and the stages in the
  buyer decision process
• Describe the adoption and diffusion process for
  new products

3
Model of Buyer Behavior

• Consumer buying behavior
• Refers to the buying behavior of people who buy
  goods and services for personal use.

• The central question for marketers is
• How do consumers respond to various marketing
  efforts the company might use?

4
Marketers must figure out what is in the buyers
black box
5
Consumer Buyer Influences

• Cultural factors.
• Culture, subculture, social class.
• Social factors.
• Reference groups, family, roles, status.
• Personal factors.
• Age, lifecycle, occupation, income.
• Psychological factors.
• Motivation, perception, learning, beliefs,
  attitudes. Figure 1

6
Figure 1
7
Culture

• Cultural is the most basic cause of a person's
  wants and behaviour.
• Culture is learned from family, church, school,
  peers, colleagues.
• Culture includes basic values, perceptions, wants
  and behaviours.

8
Sub-Culture

• Groups of people with shared value systems based
  on common life experiences.
• Major groups
• Native, immigrants, visitors..etc
• Ethnic consumers.
• Internet users.

9
Social Class

• Relatively permanent, ordered divisions.
• Members share similar values, interests and
  behaviours.
• Determined by a combination of
• Occupation.
• Income.
• Education.
• Wealth.
• Other variables.

10
Social Factors

• Groups.
• Reference groups, aspirational groups.
• Importance of opinion leader.
• Family.
• Most important consumer buying organization.
• Roles and status.
• Expect activities and esteem given by society to
  those roles.

11
Personal Factors

• Occupation.
• What we do affects what we need and how much we
  have to spend.
• Trend towards more part-time employment and
  multiple jobs.
• Economic situation.
• Affects real spending and consumer confidence in
  borrowing.

12
Personal Factors

• Age and family life-cycle stage.
• Consumer needs change over time.
• Difference between chronological and perceived
  age.
• Lifestyle.
• a persons pattern of living as expressed in his
  or her activities, interests and opinions.
• Also known as psychographics, can capture more
  detail than personality or social class.

13
Psychological Factors

• Motivation Maslows Hierarchy of Needs
• Perception The process of selecting, organizing
  and interpreting information inputs to produce
  meaning
• Learning A relatively permanent change in
  behavior due to experience.
• Beliefs descriptive thought that a person holds
  about something
• Attitudes describes a persons consistently
  favorable or unfavorable evaluations, feelings
  and tendencies toward

14
The Buyer Decision Process

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior
• Figure 2

15
The Buyer Decision Process
Figure 2
16

• Need recognition
• Triggered by internal or external stimuli
• Must reach an intensity high enough to become a
  drive
• Marketers may use sales personnel, advertising
  and packaging to trigger recognition of needs or
  problems

• Information search
• Memory (internal) search
• External search personal, commercial, public,
  experiential sources of information
• Word-of-mouth sources are most influential

17

• Evaluation of alternatives
• The consumer compares different brands or
  choices.
• May be logical or emotional, depending on the
  situation
• Purchase decision
• Attitudes of others and unexpected situational
  factors
• May come between purchase intention and decision
• Postpurchase behavior
• Relationship between consumer expectation and
  perceived performance.
• Level of satisfaction will influence repeat
  purchase
• Customer satisfaction is key to customer loyalty

18
Adoption of New Product Innovations

• Stages in the adoption process
• 1- Awareness aware of new product with lack info
• 2- interest seeks info about new product
• 3- evaluation is it make sense to try it
• 4- trial try able and test the new product
• 5- Adoption full and regular use of the product.

19
Individual Differences in Innovativeness
Innovators risk takers Early adaptors leaders,
careful Early majority deliberated Late
majority skeptical Laggards tradition bound
20
Influence of product characteristics on rate of
adoption

• Relative advantage superior to existing
  products, like quality
• Compatibility fits values, life-style, income
• Complexity degree of difficulty to understand
• Divisibility try before buy, or lease
• Communicability degree to be described to others

21
Business markets and business buyer behavior

• Vast and involves far more dollars and items than
  do consumer markets.
• Business buyers are organizations that buy goods
  and services for use in the production of other
  products and services that are sold, rented or
  supplied to others.

22
Business Buyer behavior

• A model of Business Buyer behavior

The Environment
The buyer organization
Buyer responses Product or Services
choice Supplier choice Order quantities Delivery
time Service terms Payment
Other stimuli Economic Technological Political C
ulture competitive
Marketing Stimuli Product Price Place Promoti
on
The buyer center Interpersonal
and Individual influences
Buying Decision process
23

• Major types of Buying situations
• 1- Straight rebuy routinely reorders without any
  modifications.
• 2- Modified rebuy The buyer wants to modify
  products specifications , price, termsetc
• 3- New buy a buyer purchases a product or
  service for the first time.
• Participants in the business buying process
• - The unit of a buying organization is called
  buying center

24
Business Buying Process

• New or first-time purchase new task.
• Problem recognition.
• General need description.
• Product specification.
• Supplier search.
• Proposal solicitation.
• Supplier selection.
• Order-routine specification.
• Performance review.
• Figure 3

25
The Business Buying process
Figure 3
26
Business Buying Influences

• Environmental-- primary demand, economics, supply
  conditions, laws, etc.
• Organizational -- Objectives, policies,
  procedures, organizational structure and systems.
• Interpersonal -- Authority, status, empathy and
  persuasiveness.
• Individual -- Age, education, job position,
  personality and risk attitudes. Figure 3

27

• Major Influences on Business Buyer

Figure 3
1
Environmental -Economic Developments -Supply
conditions -Technological Changes -Political
and Regulatory develop -Competitive
Developments -Cultural and Customers
2
3
4
Organizational Objectives Policies Procedures
Organizational Culture systems
Interpersonal Authority Status Empathy persuas
iveness
Individual Age Income Education Job
position Personality Risk attitudes
Buyer
28
e-Procurement

• Advantages for buyers.
• Access to new suppliers.
• Lowers purchasing costs.
• Hastens order processing and delivery.
• Advantages for vendors.
• Share information with customers.
• Sell products and services.
• Provide customer support services.
• Maintain ongoing customer relationships.