Transcript Chapter 5 Consumer Markets and Consumer Buying Behavior 1

Chapter 5
Consumer Markets and Consumer
Buying Behavior
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Consumer Buying Behavior
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Consumer Buying Behavior refers to the
buying behavior of final consumers individuals & households who buy goods
and services for personal consumption.
All these consumers make up the
consumer market.
The central question for marketers is:
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“How do consumers respond to various
marketing efforts the company might use?”
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Model of Buyer Behavior
(Fig. 5.1)
Marketing and
Other Stimuli
Buyer’s Black Box
Buyer Responses
Marketing
Buyer Characteristics
Buyer Decision Process
Product Choice
Brand Choice
Dealer Choice
Product
Price
Place
Promotion
Other
Economic
Technological
Political
Cultural
Purchase Timing
Purchase Amount
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Understanding Consumer
Behavior
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Characteristics of consumers
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what needs (solutions) they seek?
personal and interpersonal characteristics
affecting consumer behavior
The Buying Process
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Who makes the decision?
Decision-Making Process
Buying Context (Impulse vs Planned)
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Factors Influencing
Consumer Behavior (Fig. 5.2)
Cultural
Social
Culture
Reference
groups
Subculture
Family
Social
class
Roles
and
status
Personal
Age and
life-cycle
Occupation
Economic
situation
Lifestyle
Personality
and
self-concept
Psychological
Motivation
Perception
Learning
Beliefs and
attitudes
Buyer
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Factors Affecting Consumer
Behavior: Culture
Culture is the Most Basic Cause of a Person's
Wants and Behavior.
Subculture
• Group of people with shared
value systems based on
common life experiences.
• Hispanic Consumers
• African American Consumers
• Asian American Consumers
• Mature Consumers
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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.
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Factors Affecting Consumer
Behavior: Social Groups and reference groups:
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Groups
•Membership
•Reference
Family (most important)
•Husband, wife, kids
•Influencer, buyer, user
serve as a point of reference in
forming a person’s attitudes and
behaviors.
Roles and status: activities that a
person is expected to perform
according to the persons around
him or her, and the esteem (status)
given to the roles by society.
Social Factors
Family Buying Influence
Roles and Status
Children can exert a
strong influence on
family buying decisions.
Johnson & Johnson reminds
customer’s of its commitment
to the American Family.
What other companies use
children to influence
family buying decisions?
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Factors Affecting Consumer
Behavior: Personal
Personal
Personal Influences
Influences
Age
Age and
and Life
Life
Cycle
Cycle Stage
Stage
Occupation
Occupation
Economic
Economic
Situation
Situation
Personality
Personality &&
Self-Concept
Self-Concept
Lifestyle
Lifestyle Identification
Identification
Activities
Activities
Interests
Interests
Opinions
Opinions
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Factors Affecting Consumer
Behavior: Psychological
Baloglu, S (1998). An
Empirical Investigation
of Attitude Theory for
Tourist Destinations.
Journal of Hospitality &
Tourism Research,
22(3), 211-224.
Beliefs and
Attitudes
Motivation
Psychological
Factors
Affecting
Buyers
Choices
Perception
Learning
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Maslow’s Hierarchy of Needs
(Fig. 5.4)
Self
Actualization
(Self-development)
Esteem Needs
(self-esteem)
Social Needs
(sense of belonging, love)
Safety Needs
(security, protection)
Physiological Needs
(hunger, thirst)
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- Perception is
selective.
- Perception is
reality
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Types of Buying Decision
Behavior (Fig. 5.5)
Significant
differences
between
brands
Few
differences
between
brands
High
Involvement
Low
Involvement
Complex
Buying
Behavior
VarietySeeking
Behavior
DissonanceReducing Buying
Behavior
Habitual
Buying
Behavior
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Buyer Decision Process
(Fig. 5.6)
Purchase
Decision
Evaluation
of Alternatives
Postpurchase
Behavior
Information
Search
Need
Recognition
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Buyer Decision Process
Step 1. Need Recognition
State Where the
Buyer’s Needs
are Fulfilled and
the Buyer is
Satisfied.
Buyer
Recognizes
a
Problem
or a
Need.
Needs Arising
From:
Internal Stimuli –
Hunger
External Stimuli-
Friends
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The Buyer Decision Process
Step 2. Information Search
Personal Sources
Commercial Sources
Public Sources
Experiential Sources
•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
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The Buyer Decision Process
Step 4. Evaluation of Alternatives
Consumer May Use Careful
Calculations & Logical Thinking
Consumers May Buy on Impulse and
Rely on Intuition
Consumers May Make Buying Decisions
on Their Own.
Consumers May Make Buying Decisions
Only After Consulting Others.
Marketers Must Study Buyers to Find Out
How They Evaluate Brand Alternatives
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Alternative Evaluation
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Value
Convenient Location
Fast Service
Menu Variety
Food Quality
Employee Attitude
Atmosphere
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The Buyer Decision Process
Step 5. Purchase Decision
Purchase Intention
Desire to buy the most preferred brand
Attitudes
of Others
Unexpected
Situational
Factors
Purchase Decision
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The Buyer Decision Process
Step 6. Postpurchase Behavior
Consumer’s
Expectations of Product’s Performance.
Product’s Perceived
Performance.
Dissatisfied Customer
Cognitive Dissonance
Satisfied Customer!
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Discussion Connections
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Form small groups to discuss a specific
major purchase that one of you has
made recently.
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What type of buying decision was it?
Discuss the Buyer Decision Process and
what major factors influenced your
decisions.
Stages in the Adoption
Process
Awareness: Consumer is aware of
product, but lacks information.
Interest: Consumer seeks
Information about new product.
Evaluation: Consumer considers
trying new product.
Trial: Consumer tries new
product on a small scale.
Adoption: Consumer decides
to make regular use of product.
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Early Majority
Innovators
Percentage of Adopters
Adopter Categories (Fig. 5.7)
Early
Adopters
34%
Late Majority
16%
13.5%
2.5%
Early
Laggards
34%
Time of Adoption
Late
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Influence of Product Characteristics
on Rate of Adoption
Communicability
Relative Advantage
Can results be easily
observed or described
to others?
Is the innovation
superior to existing
products?
Compatibility
Divisibility
Can the innovation
be used on a
trial basis?
Complexity
Does the innovation
fit the values and
experience of the
target market?
Is the innovation
difficult to
understand or use?
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Review of Concept
Connections
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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 stages in the buyer
decision process.
Describe the adoption and diffusion process
for new products.
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Chapter 6
Business Markets and Business
Buyer Behavior
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What is a Business Market?
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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.
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Characteristics of Business
Markets
Contain fewer, but
Marketing Structure
larger buyers
and Demand
Customers are more
geographically concentrated
Buyer demand is derived from
final consumer demand
Demand is often more
inelastic
Demand often fluctuates
more, and more quickly
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Characteristics of Business
Markets
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Nature of the Buying
Unit
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Business purchases
involve more buyers.
Business buying
involves a more
professional purchasing
effort.
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Characteristics of Business
Markets
Business
buyers
usually face
more
complex
buying
decisions.
Types of Decisions and the
Decision Process
Business
buying
process is
more
formalized.
In business
buying,
buyers and
sellers work
more closely
together.
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To develop
long-term
partnerships,
business
marketers work
closely with
their customers.
Fujitsu promises high-end
support to go along with
its high-tech products.
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This Unisys ad offers services from technological consulting to
database setup and maintenance.
Model of Business Buyer
Behavior (Fig. 6.1)
The Environment
Marketing
Stimuli:
•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
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Discussion Connections
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Although business markets are similar in
many ways to consumer markets, there are
also significant differences.
What similarities and differences might
Bilkent Hotel encounter in selling to the
business market versus the consumer
market.
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Major Types of Buying
Situations
Involved Decision
Making
New Task Buying
Modified Rebuy
Straight Rebuy
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Participants in the Business
Buying Process
Users
Ethical
DecisionMaking Unit
of a Buying
Roles Include Organization
is Called Its
Attitudes
Buying
of
Center.
Others
Influencers
Unexpected
Situational
Factors
Buyers
Gatekeepers
Deciders
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Major Influences on Business
Buyer Behavior (Fig. 6.2)
Environmental
Economic
developments
Supply
Conditions
Technological
change
Political and regulatory
developments
Organizational
Objectives
Policies
Procedures
Organizational
Structure
Systems
Interpersonal
Authority
Status
Empathy
Individual
Age
Education
Job Position
Personality
Risk Attitudes
Buyers
Persuasiveness
Competitive
Developments
Culture and customs
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The Business Buying Process
Stage 1. Problem Recognition
Stage 2. General Need Description
Stage 3. Product Specification
Stage 4. Supplier Search
Stage 5. Proposal Solicitation
Stage 6. Supplier Selection
Stage 7. Order-Routine Specification
Stage 8. Performance Review
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Business Buying on the
Internet
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Business buyers may
purchase electronically by:
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Electronic data interchange
links (EDI)
The Internet
Connecting to customers to:
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Share marketing information,
Sell products & services,
Provide customer support, and’
Maintain on-going relationships.
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Benefits and Problems Created
by Buying on the Internet
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Benefits:
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Shave transaction costs
Reduce time between
order and delivery
Create more efficient
purchasing systems
Forge more intimate
relationships
Level the playing field
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Problems:
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Cut purchasing jobs
Erode supplier-buyer
loyalty
Create potential
security disasters
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Institutional and Government
Markets
Institutional Markets
Low Budgets
Captive Patrons
Government Markets
Public Review
Negotiated
Contracts
Red Tape is
Common
Noneconomic
Criteria
Some Buying
Online
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Review of Concept
Connections
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Define the business market and explain how
business markets differ from consumer markets.
Identify the major factors that influence business
buyer behavior.
List and define the steps in the business buying
decision process.
Compare the institutional and government markets
and explain how institutional and government
buyers make their buying decisions.
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