Understanding Consumer and Business Buyer Behavior

Chapter 5

Rest Stop: Previewing the Concepts

Understand the consumer market and the
major factors that influence consumer buyer behavior Identify and discuss the stages in the buyer decision process Describe the adoption and diffusion process for new products

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Rest Stop: Previewing the Concepts

Define the business market and identify the
major factors that influence business buyer behavior List and define the steps in the business buying decision process

First Stop: Apple: The Keeper of All Things Cool

Apple customers are intensely loyal Apples products work better and are simpler to use because Apple has deep understanding of consumer behavior Apples obsession with understanding customers and deepening their Apple experience shows in everything the company does It gives a life-feels-good experience to its consumers
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Consumer buying behavior The buying behavior of individuals and households who buy goods and services for personal consumption

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Figure 5.1 - Model of Buyer Behavior

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Figure 5.2 - Factors Influencing Consumer Behavior

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Culture
Culture is the most basic cause of a persons wants and behavior
Culture is learned from the society, family, and other institutions Culture reflects basic values, perceptions, wants, and behaviors Cultural shifts create opportunities for new products or may otherwise influence consumer behavior
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Subculture
Groups of people with shared value systems based on common life experiences and situations

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Subculture
Major subculture groups in the U.S.
Hispanic consumers African-American consumers Asian-American consumers Mature consumers

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Social class

Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors

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Figure 5.3 - The Major American Social Classes

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Social Factors
Groups and social networks
Membership, reference, and aspirational groups
Marketers attempt to reach opinion leaders within groups important to target market Opinion leaders are recruited as brand ambassadors or for buzz marketing

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Opinion Leaders at JetBlue

JetBlue CrewBlue program

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Social Factors
Groups and social networks:
Online social networks allow marketers to interact with consumers
Mountain Dews DEWmocracy campaign
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Marketing at Work
BlendTec developed a cult following after releasing several Will it Blend videos on YouTube Resulted in a stunning five-fold increase in sales
BlendTec puts iPhones, Silly Putty, Golf Balls, Marbles and more to the test

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Social Factors
Family
Strongly influences buying behavior Gender stereotypes for certain types of purchases are relaxing in the U.S. Children are very influential, and have substantial disposable income of their own

Roles and status

Role = Expected activities Status = Esteem given to role by society
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Lifestyle
A persons pattern of living as expressed in his or her activities, interests, opinions

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Personal Factors
People within the same subculture, social class, and occupation may have different lifestyles People buy the lifestyles represented by products or services

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Personal Factors
PersonicX 21 life-stage groupings lets marketers see customers as they really are and target them precisely

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Marketing at Work
Triumph doesnt just sell motorcycles; it sells an independent, Go your own way lifestyle

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Personal Factors
Personality
Refers to the unique psychological characteristics that distinguish a person or group Generally defined in terms of traits Can be useful in analyzing consumer behavior for certain product or brand choices Brands may also have personalities

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Motivation
A motive is a need that is sufficiently pressing to direct the person to seek satisfaction

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Figure 5.4 - Maslows Hierarchy of Needs

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Perception
Process by which people select, organize, and interpret information to form a meaningful picture of the world

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Psychological Factors
Learning
Changes in an individuals behavior arising from experience Occurs due to an interplay of drives, stimuli, cues, responses, and reinforcement Strongly impacted by the consequences of an individuals behavior Behaviors with satisfying results tend to be repeated
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Belief

A descriptive thought that a person holds about something

Attitude A persons consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea

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Beliefs and Attitudes

Beliefs and attitudes: By matching todays attitudes about life and healthful living, the SoBe brand has become a leader in the New Age beverage category

Figure 5.5 - Buyer Decision Process

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Need Recognition and Information Search

Need recognition can be triggered by internal or external stimuli
Advertising can be very helpful in stimulating need recognition

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Need Recognition and Information Search

Several sources of information may be used as part of the information search
Personal sources Commercial sources Public sources Experiential sources

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Evaluation of Alternatives and Purchase Decision

Evaluation process is dependent upon the specific buying situation and the individual consumers Purchase decision - Two factors may interfere with realization of purchase intentions:
Attitudes of others Unexpected situational factors

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Post-Purchase Behavior
Consumer satisfaction is a function of consumer expectations and perceived product performance
Performance < Expectations --- Disappointment Performance = Expectations --- Satisfaction Performance > Expectations --- Delight

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Stages in the Adoption Process

Awareness Interest:
Consumer becomes aware of the new product, but lacks information about it Consumer seeks information about new product Consumer considers whether trying the new product makes sense

Evaluation
Trial Adoption

Consumer tries new product on a small scale to improve his or her estimate of its value
Consumer decides to make full and regular use of the new product
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Figure 5.6 - Adopter Categorization

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Product Characteristics That Influence the Rate of Adoption

Relative advantage
Is the innovation superior to existing products? Does the innovation fit the values and experience of the target market?

Compatibility
Complexity Divisibility Communicability

Is the innovation difficult to understand or use?

Can the innovation be used on a limited basis?

Can results be easily observed or described to others?

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Business Buyer Behavior Refers to the buying behavior of 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

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Business Markets
Involve far more dollars and items than do consumer markets Market structure and demand differs from consumer markets:
Contains far fewer but larger buyers Business demand is derived from consumer demand Business markets have more fluctuating demand
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Business Markets
Nature of the buying unit:
Business purchases involve more decision participants Business buying involves a more professional purchasing effort

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Business Markets
Key differences exist between business and consumer buying situations:
Business buyers usually face more complex buying decisions The business buying process tends to be more formalized Buyers and sellers are much more dependent on each other in business markets

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Figure 5.7 - A Model of Business Buyer Behavior

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Types of Buying Situations

Straight rebuy

Buyer routinely reorders something without any modifications

Modified rebuy Buyer wants to modify product specifications, prices, terms, or suppliers New task

Buyer purchases a product or service for the first time

Systems (solution) selling

Becoming more common among companies

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Participants in the Business Buying Process

Buying center: All the individuals and units that participate in the business buyingdecision process
The buying center is not a fixed or formally identified unit It is a set of buying roles assumed by different people for different purchases

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Figure 5.8 - Major Influences on Business Buyer Behavior

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Figure 5.9 - Stages of the Business Buying Process

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E-procurement
Online purchasing (e-procurement) can be implemented in many ways:
Reverse auctions Trading exchanges Company buying sties Extranet links with key suppliers

E-procurement presents several benefits and problems

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Marketing at Work
The Shaw Floors site
builds strong links with Shaws retailers It provides marketing ideas and tools that make retailers more effective in selling Shaws products to final customers
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Rest Stop: Reviewing the Concepts

Understand the consumer market and the
major factors that influence consumer buyer behavior Identify and discuss the stages in the buyer decision process Describe the adoption and diffusion process for new products

5 - 48

Rest Stop: Reviewing the Concepts

Define the business market and identify the
major factors that influence business buyer behavior List and define the steps in the business buying decision process

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Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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