© 2004 Mark H. Hansen Buyer Behavior

2 A purchase is an exchange the parties to that exchange are the consumer and the marketer the interests of the parties must be satisfied if the exchange is to occur the marketer needs to understand the interests of the consumer so as to anticipate the behavior of the consumer

Buyer Behavior 3 Consumer behavior is really just problem solving an unmet need is a problem to be solved the problem will be solved by the consumer’s filling of that need effective marketers will help the consumer solve the problem the marketer that offers the ‘best’ solution will get the ‘sale’

Buyer Behavior 4 Consumers have needs, but… …they want to satisfy those needs in a certain way. consumer needs clothing—wants Levi’s Why does the consumer want Levi’s?

Buyer Behavior 5 Consumers wants lead them to have preferences in filling their needs effective marketers align their product offerings with consumers’ preferences alignment can occur in two ways: 1 – change the product 2 – change the preferences

Buyer Behavior 6 Buyer behavior can be modeled in multiple ways a process model identifies stages a consumer goes through in filling a need marketers benefit by understanding each stage - influence the stage - respond to the stage

Buyer Behavior 7 Complex vs. Simple Decision Making complex presents more opportunity for marketer to influence or respond marketers want to make complex become simple due to loyalty complex – new or significant purchase simple – habit or routine

Buyer Behavior 8 A Process Model Need Identification Information Search Evaluate Alternative Product Selection Purchase Decision Postpurchase Behavior Complex Process

Buyer Behavior 9 A Process Model Need Identification Product Selection Purchase Decision Postpurchase Behavior Simple Process

Buyer Behavior 10 Complex vs. Simple Decision Making information search and evaluation of alternatives drop out in a simple process either the buyers knows or doesn’t care which product

Buyer Behavior 11 Information Search & Processing Exposure Attention Perception Retention Retrieval and Application

Buyer Behavior 12 Influencing Factors Situational Influences External Influences Internal Influences

Buyer Behavior 13 Situational Influences high vs. low involvement available market offerings demographics

Buyer Behavior 14 External Influences Culture (beliefs, values, customs) Social Class Reference Groups -- opinion leaders Family

Buyer Behavior 15 Internal Influences Learning and Socialization --experiential & non-experiential --modeling (peer pressure) --reinforcement

Buyer Behavior 16 Motivation Internal Influences --Maslow’s Hierarchy --introvert vs. extrovert 1 - physiological 2 - safety & security 3 - love 4 - esteem 5 - self-fulfillment

Buyer Behavior 17 Internal Influences Lifestyle --attitudes --interests --opinions Can marketers: 1 – influence? 2 – exploit?

Buyer Behavior 18 Organizational Buying more formal than consumer 1 – Problem Recognition 2 – General Need Description 3 – Product Specification 4 – Supplier Search 5 – Proposal Solicitation 6 – Supplier Selection 7 – Order routine 8 – Performance Review

Buyer Behavior 19 Summary understanding buyer behavior allows marketers to either: 1 – influence behavior 2 – respond with the product recognize the links between buyer behavior, segmentation, & market research