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By Ali Satchu - Might be useful to friends who want to understand purchasing behavior and just to be vary of
how we make decisions. As a student you want to minimize expenses and learning about the purchase
behavior would be beneficial to that end.
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ability of sound and visual elements to create mood and settings that fit best with their target audience.
Marketers are able to allow consumers to interact and create custom preferences based on each individual
customer. We consistently see the development of apps and custom tailored mediums to make the shopping
experience safer, convenient and exciting. Hardware and Software giants continue to benefit from a very fast
paced digital age which will make purchasing goods and service over the air a lot more favorable and
therefore reaching a large number of audiences.
Memory and Time
Planned purchases are very similar to impulse purchasing since they both use memory recall and make a
buying decision. Planned purchases may have a longer research cycle before they are made while an impulse
purchase may take just a few minutes before the product or service is purchased. This may be due to the fact
that sometimes planned purchases require a much higher investment than an impulse buy. A consumer will
probably not spend the same time purchasing a chocolate bar as purchasing a motor vehicle or a big screen
TV. This is changing very quickly as young consumers have more disposable income and organizations find
better ways of creating value for the end consumer. The end consumer may not have a need or desire to own
a product but through creative marketing organizations are able to secure a brand loyalty moment within a
consumers mind and move them from prospect to buyer/user/customer.
Income and Consumer Behavior
Income plays a significant role in consumer buying behavior. Consumers with higher disposable income may
spend a lot more than an individual with a tighter budget. Generally consumers that have a specific budget
may conduct significant research before buying. Consumers with higher disposable income have less risk
versus consumers that have to chose or compromise before making a buying decision due to priorities and
limited resources. The impulse trigger from marketers may directly target a certain income group due to its
positive response towards that particular product or service. Consumers actively refer to memory and
research either the long term memory generally in large investments or short term memory for impulse
purchases. A favorable image about a product or service may be the key decision factor for a purchase
decision if its not entirely a necessity.
Cultural Influences on Purchasing Behavior: Collectivists vs. Individualists
The Theory
The notion of collectivists and individualists often arise when considering cultural influences in purchasing
behavior. For example, a person who is in a store to purchase a beverage in the presence of others, whether
they are strangers, family, or friends, is faced with a decision. The buyer, whom would normally purchase a
low-priced drink, may or may not opt for the more prestigious and expensive beverage; determined
exclusively by the fact that the purchase is being observed by the witnesses. The dilemma is whether the
consumer should buy the fancier drink to appear as one who is not thrifty for the sake of status, or not. To
further explore this phenomenon, we will explore the theory of collectivists and individualists relative to
impulse and planned purchases.
Collectivists and Individualists
As the name suggests, collectivists are people who view themselves as an important part of a collective such
as family, friends, colleagues, and so forth. People from more collectivist areas, such as Asia, tend to be
motivated by the norms of their collective as well as prioritizing the collectives goals. These individuals also
take pride in being recognized as part of their collective.
f ast edu. ca/ br anding- and- consum er - behavior /
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Individualists are those who view themselves apart from collectives because they wish to be unique. They
desire distinctiveness from others while striving to meet their own personal needs, preferences, and goals.
Geographically, North Americans are likely individualists who place more emphasis on brands that set them
apart as individuals.
Impulse versus Planned Purchases
People from a collectivist culture will be more satisfied with an impulse purchase in the presence of another
person of significance as opposed to the same purchase made when they are alone. People from an
individualist culture, however, have no difference in their levels of satisfaction on impulse purchases when
bought in the presence of an important other; compared to when they are alone when purchasing.
B2B (Planned) vs B2C (Impulse)
Comparison
B2C (Business to Consumer) customers often make purchases which can either be a planned purchase or a
purchase based on impulse behavior. A B2C purchase is always made by an individual who is looking for the
best price and will do so by researching the product and alternatives from the competition. However these
customers may sometimes skip the researching phase and react to B2C tactics such as promotional
campaigns, and discount coupons, impulsively purchasing these products. On the other hand, B2B (Business
to Business) buyers will never make purchases on impulse behavior but instead a planned purchase. B2C
buyers purchase products for personal benefits while B2B buyers solely focus on product that benefits the
company. This type of purchase is more often considered an investment decision. The B2B benefits could be
cost savings, profit increasing or time saving. The decision to purchase through B2B is always done by a
group of buyers also known as purchasing agents who must consult with the company executives to approve
of the transaction so the decision process takes longer and goes through more channels when completing a
purchase. The business buying process can typically be summarized into several steps such as problem
recognition, determining product specifications, finding qualified suppliers, requesting and evaluating
proposals, selecting an order process and conducting performance evaluation. (Harrison-Walker, Neely,
2004) Because a B2B purchase can determine whether the business succeeds or fails, B2B buyers spend
more time making a purchase than a B2C buyer would and must have a clear rationale on why they made
their choice.
B2B vs B2C Values
Branding plays an important role in both B2B and B2C markets. In B2C, if the company is a familiar and
strong brand to the customer, the customer is most likely to remain loyal to the company, purchase the
product and pay a higher price because of the trust factor. Similar to B2C, branding plays an important part
in building relationships with B2B consumers in respect to quality and pricing of the product. However
branding in B2B is much more complex such as maintaining personal interactions between buyers and sellers,
both companies performing to their expected obligations of their contracts, and the given track record the
company builds with the customer over the years. Public relations also play a role in B2B relationships, more
so than the traditional advertising because of the credibility and trust that can be gained. Outsider perspective
may appraise one of the two companies, thus justifying the decision to working with the other. Personal
business relationships, excellent performance and company reputation is a part of the branding that B2B
companies use to strengthen their working relationships. (Spark, 2006)
So while the consumer is more interested in obtaining status and desire through branding, business buyers are
motivated by making money, saving money and increasing productivity.
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Cognitive Dissonance
Definition
Cognitive dissonance is a feeling of post purchase psychological tension or anxiety which comes from holding
two conflicting thoughts in the mind at the same time. It is caused by inconsistency among ones belief,
attitude or actions that an individual subconsciously attempts to eliminate by modifying his or her beliefs.
Impulse purchase is defined as a novelty or escape purchase that breaks the normal buying pattern. When
people make impulse purchases, they are likely to experience cognitive dissonance at some point in time in
order to make sure whether their expectations are satisfied or dissatisfied.
One feels cognitive dissonance with impulse buying when the amount of conflict involved depends on the
initial evaluations of the alternatives, since the purchase was hurried and unplanned, and because they may not
have considered other choices which might have been better than the one that they chose. The suddenness of
the purchase precludes thoughtful information search and careful deliberation.
Relativity to Impulse and Planned Purchases
Impulse purchase occurs especially when people feel like there is something in it for them like cost saving
when a sale is going on, when there is free shipping included and when there are seasonal and holiday
promotions going on. People do not plan to buy such items in these situations to save some money, over
some missed promotional opportunities and then experience cognitive dissonance or regret of buying after.
During the planned purchase, one intends to make the purchase even before reaching the store. The risk
associated with buying is minimized by planning a purchase. Planning helps build confidence and assures that
one has made the best, safest and informed decision in his/her purchase by taking time to examine available
options. Planning eliminates uncertainty and risks by gathering information and by talking to friends or
relatives. Although post purchase regret may still be experienced with a planned or searched purchase, the
focus is on minimizing it by thoughtful search and deliberating in advance.
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