Chapter 7 Analyzing Consumer Markets and Buyer Behavior by

Chapter Objectives In this chapter, we focus on two questions: How do the buyers’ characteristics – cultural, social, personal, and psychological – influence buying behavior? How does the buyer make purchasing decisions?

Cultural Factors Culture Subculture Social Class Buyer

Social Factors Reference Groups Family Roles & Statuses

Influences on Consumer Behavior Personal Influences Influences on Consumer Behavior Age and Family Life Cycle Stage Lifestyle Occupation & Economic Circumstances Personality & Self-Concept

Psychological Factors Motivation Perception Beliefs & Attitudes Learning

Maslow’s Hierarchy of Needs Self- actualization (self-development and realization) 5 Esteem needs (self-esteem, recognition) 4 Social needs (sense of belonging, love) 3 Safety needs (security, protection) 2 Psychological needs (food, water, shelter) 1

The Buying Decision Process Buying Roles Initiator Influencer Decider Buyer User Buying behavior

Types of Buying Behavior Complex Buying Behavior Variety- Seeking Behavior High Involvement Low Involvement Significant differences between brands Few Dissonance- Reducing Buying Behavior Habitual Buying Behavior

Consumer Buying Process Problem recognition Information search Evaluation of alternatives Purchase decision Post purchase behavior

Model of Buying Behavior Marketing stimuli Product Price Place Promotion Other stimuli Economic Technological Political Cultural Buyer’s characteristics Cultural Social Personal Psychological Buyer’s decision process Problem recognition Information search Evaluation Decision Post purchase behavior Buyer’s decisions Product choice Brand choice Dealer choice Purchase timing Purchase amount

Decision Making Sets Total Set Aware- ness Consid- Set eration Set Choice Set Decision

Chapter 8 Analyzing Business Markets and Business Buying Behavior by

Objectives How Business & Consumer Markets Differ Organizational Buying Situations Participants in the Business Buying Process Major Influences on Organizational Buyers Business Buyer Decision Making Institutional & Government Buying

Business vs. Consumer Fewer buyers Larger buyers Close supplier-customer relationship Geographically concentrated Derived demand Inelastic demand Fluctuating demand

Business vs. Consumer Professional purchasing Several buying influences Multiple sales calls Direct purchasing Reciprocity Leasing

New Task Buying Modified Rebuy Straight Rebuy Custom furniture Installed components Buildings Weapon systems Involved Decision Making New vehicles Elec. Equip Consultants Computer equip. Modified Rebuy Straight Rebuy Utilities Office Supplies Bulk chemicals

Participants in the Business Buying Process Users Initiators Influencers Gatekeepers Buyers Deciders Approvers

Major Influences on Industrial Buying Behavior Level of demand Economic outlook Interest rate Rate of techno- logical change Political and regulatory developments Competitive Social responsi- bility concerns Environmental Objectives Policies Procedures Organizational structures Systems Interests Authority Status Empathy Persuasive- ness Interpersonal Age Income Education Job position Personality Risk attitudes Culture Individual Business Buyer

Info Search/ Eval Purchase Post Purchase Problem Recognition Need Recognition General Need Description Product Specification Info Search/ Eval Supplier Search Proposal Solicitation Supplier Selection Purchase Order Routine Specification Post Purchase Performance Review

Government Markets Domestic Suppliers Cost Minimization Paperwork Open Bids Public Review