Selling and Sales Management

Lecture 2
Consumer & Organizational Buyer Behaviour

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 Selling and Sales Management

In this Lecture, you will be able to:

• Identify the different motivations of consumer and

organizational buyer
• Formulate strategies for approaching these buyers

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Difference between consumer & organizational buying

Fewer organizational buyers

Close, long-term relationships btw organizational buyers & sellers
Organizational buyers are more rational
Organizational buying may involve specific requirements
Organizational selling/buying may be more risky
Organizational buying is more complex
(for details, pls refer to the textbook…)

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I) Consumer Buyer Behaviour

Main Concern:
1. Who is important in the buying decision?
2. How do they buy?
3. What are their choice criteria?
4. When do they buy?

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1. Who is important in the buying decision
i) Initiator—the person who starts the process of
considering a purchase
ii)Influencer—The person who attempts to influence the
choice criteria on the decision
iii)Decider—the person who has the power/financial
authority to make the ultimate choice
iv)Buyer—the person who conducts the actual transaction
v)User—the actual user of the product.
e.g. In a milk powder purchase, mother may be the initiator.
Mother’s friends who had experience raising babies may be the
influencers to persuade her to buy a certain brand. Mother again
may be the decider; the buyer may be the Philippino maid, and
the user is the baby.
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2. How the consumers buy?

The consumer decision-making process

Need Identification

Information Gathering

Evaluation of alternative
solution

Selection of an appropriate
solution

Post-Purchase evaluation

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The consumer decision-making process (con’d)
Needs--- May arise from a natural process of life, i.e. larger car is required
for a family.Needs may also arise because of stimulation from sales or
advertisement. Identify the needs of customer is part of successful selling.

Information Gathering--- Needs can only be satisfied after a period of

information search. In the consideration of car purchase may involve
visiting car, reading magazines, talking with friends or sales persons.

Evaluation of alternatives and selection of the best products---These are the

dimensions used by consumers to compare or evaluate products or brands.
i.e fuel economy, price, reliability, consumer’s own beliefs/attitudes on the
products. It’s important for a salesperson to find out the evaluation criteria
being used to judge alternative products. Also, it can be effective to try to
change the evaluative criteria.
Post-purchase evaluation of decision---Salesperson should ensure the
product consumers buys best matches their needs/satisfaction for the repeat
purchasing. The quality of the products and the level of after-sales service
play an important role in creating customer goodwill.
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II) Factors affecting the consumer
decision-making process
3 Factors affecting consumer decision-making process:

The buying situation

Personal influences

Social influences

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 The buying situation
Howard and Sheth (1969) identified 3 types of buying situation:
1. Extensive problem-solving
 When the need is new, the consumer may conduct extensive problem
solving, including high degree of information search and evaluation
of alternatives. In this case, salesperson can create immense goodwill
by providing information and assessing alternatives in terms of how
well the product’s advantages meet the consumer’s needs. This may
be rewarded by a repeat purchase.

2. Limited problem-solving
 The consumer may have some experience/knowledge about the
product and may intent to stay loyal to the brand previously purchase.
However a certain information search or evaluation of some
alternatives may still be needed for sure of making the right decision.
Salesperson may be difficult to persuade the consumer to switch the
product. Salesperson could only provide risk-reducing guarantees, e.g
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free replacement of any defective parts.
 The buying situation (con’d)
Automatic response
 the consumer has always stuck to the product with a large
brand name. Personal selling is not as effective as
advertisement, which keeps the brand in the consumer’s
mind and reinforces the already favorable attitudes towards
the brand

Conclusion:
A key factor deciding whether a consumer conducts extensive or
limited problem-solving or automatic response is closely related
to involvement with the purchase: high involvement means
important purchaseextensive problem solving, and vice versa.
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 Personal Influences

Personal Influences means the PSYCHOLOGY of the

individual affecting the consumer decision-making process.
So sellers need to aware the personality of the consumer:
• Brand personality related to individual characteristics:
“for young people” (Levis)
“intelligent”(Guinness)
“casual and comfortable”(Giordano)
• The characteristics of the consumer
•Motivation of the consumer

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Personal influence- Life Styles

Life styles refers to the pattern of living which includes

consumers beliefs, activities, values and demographic
characteristics such as education and income. Life style
analysis is important for marketing. A company may target
to a particular life-style group with a product offering, and
use the advertising to enhance the vales, beliefs of this group
of people. i.e media advertisement is effective on the
consumers who has the information on reading habit life-
styles.

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 Social Influences
Social influences such as social class, reference group, culture
and the family are the major influences in the consumer
decision-making.
e.g. Social class: consumers have difference consumption
pattern: skilled-workers spend larger proportion of income on
buying house, furniture but less on entertainment.
e.g. Reference group:A group of people that influence a
person’s attitude/manner. Such as the group (family, friends,
colleagues…) may affect the decision on a consumer’s certain
preference on a branch choice.
GIVE EXAMPLES!!!!!!!!
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