Consumer and Business Buyer Behavior Chapter Five Consumer and Business Buyer Behavior

Identify and discuss the stages in the buyer decision process. 3/25/2017 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. 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. Copyright 2007, Prentice Hall, Inc. Copyright 2005 Brainy Betty, Inc.

Case Study Copyright 2007, Prentice Hall, Inc.

Harley-Davidson – Devoted Consumers Case Study Harley-Davidson – Devoted Consumers Building Success Offers good bikes, upgraded showrooms and sales tactics. Research has helped to understand customers’ emotions and motivation. Consumer emotions, motivations, and lifestyle have been translated into effective advertising. Measuring Success Currently has 23% of all U.S. bike sales and 50% of heavyweight segment. Demand above supply with waiting lists up to 2 years. Sales doubled in the past six years while earnings have tripled. 2005: 19th straight year of record sales and income. Copyright 2007, Prentice Hall, Inc.

Consumer Buying Behavior Refers to the buying behavior of people who buy goods and services for personal use. These people make up the consumer market. The central question for marketers is: “How do consumers respond to various marketing efforts the company might use?” Copyright 2007, Prentice Hall, Inc.

Model of Buying Behavior Buyer responses influence choice of the product, brand, vendor, as well as the timing and amount of purchase. Copyright 2007, Prentice Hall, Inc.

Stimulus Response Model Copyright 2007, Prentice Hall, Inc.

Copyright 2007, Prentice Hall, Inc.

Culture Culture is the most basic cause of a person's wants and behavior. Culture is learned from family, church, school, peers, colleagues. Culture reflects basic values, perceptions, wants, and behaviors. Cultural shifts create opportunities for new products or may otherwise influence consumer behavior. Copyright 2007, Prentice Hall, Inc.

Culture Subculture Groups of people with shared value systems based on common life experiences. Major Groups in US Hispanic Consumers African-American Consumers Asian-American Consumers Mature Consumers THAI SUBCULTURE Major groups: CHINESE CULTURE INDIAN CULTURE YOUNG GENERATION OLDER GENERATION TOURIST/WESTERN CULTURE Copyright 2007, Prentice Hall, Inc.

Social Class Society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors. Measured by a combination of: occupation, income, education, wealth, and other variables. Copyright 2007, Prentice Hall, Inc.

Social Factors Groups: Family: Roles and Status: Membership, Reference (Opinion Leaders), Aspirational Family: Most important consumer buying organization Roles and Status: Role = Expected activities Status = Esteem given to role by society Copyright 2007, Prentice Hall, Inc.

Personal Factors Age and Life-Cycle Stage Occupation People change the goods they buy over their lifetimes. Occupation Occupation influences the purchase of clothing and other goods. Economic Situation Some goods and services are especially income-sensitive. Copyright 2007, Prentice Hall, Inc.

Personality factors Lifestyle: Pattern of living as expressed in psychographics Activities Interests Opinions Copyright 2007, Prentice Hall, Inc.

Personality & Self-Concept Personality refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to one’s own environment. Generally defined in terms of traits. Self-concept suggests that people’s possessions contribute to and reflect their identities. Copyright 2007, Prentice Hall, Inc.

Psychological factors A person’s buying choices are further influenced by four major psychological factors. They are motivation, perception, learning, beliefs and attitudes. Copyright 2007, Prentice Hall, Inc.

Motives and Needs A motive (or drive) is a need that is sufficiently pressing to direct the person to seek satisfaction. Maslow’s hierarchy of needs explains why people are driven by needs at particular times. Maslow’s hierarchy of needs implies that lower level needs must be satisfied prior to higher level needs. Physiological needs Safety needs Social needs Esteem needs Self-Actualization Copyright 2007, Prentice Hall, Inc.

Maslow’s hierarchy of needs Copyright 2007, Prentice Hall, Inc.

Need for a Car Copyright 2007, Prentice Hall, Inc.

Buying Decision Process Copyright 2007, Prentice Hall, Inc.

Step-1:Need recognition The buying process starts with need recognition. The buyer recognizes a problem or need. Marketers may use sales personnel, advertising, and packaging to trigger recognition of needs or problems. Copyright 2007, Prentice Hall, Inc.

Step-II: Sources of Information Copyright 2007, Prentice Hall, Inc.

Step-III: Alternative Evaluation Consumer is now confronted with a number of options Choice involves element of risk Consumer will evaluate product options based on different “evaluative criteria” or attributes Copyright 2007, Prentice Hall, Inc.

Alternative Evaluation Copyright 2007, Prentice Hall, Inc.

Step-IV: Purchase Decision Factors that influence purchase decision: Attitudes of others Unexpected situational factors Copyright 2007, Prentice Hall, Inc.

Step V: Post Purchase Consumer could experience satisfaction, dissatisfaction or dissonance. Marketers job is to reduce customers fear of negative outcomes and provide post purchase (after sales) services Copyright 2007, Prentice Hall, Inc.

Post Purchase Consumer satisfaction is a function of consumer expectations and perceived product performance. Performance < Expectations ----- Disappointment Performance = Expectations ----- Satisfaction Performance > Expectations ----- Delight Copyright 2007, Prentice Hall, Inc.

Buying Decision Process Cognitive dissonance: a buyer’s doubts shortly after a purchase about whether it was the right decision. Copyright 2007, Prentice Hall, Inc.