1. Introduction to Buyer Behaviour Dr Brian Monger Copyright February 2014 This Power Point program and the associated documents remain the intellectual property and the copyright of the author and of The Marketing Association of Australia and New Zealand Inc.

2. MAANZ International MAANZ International, is a Not for Profit, internet based professional and educational institute which has operated for over 25 years. MAANZ International offers Professional Memberships; Marketing Courses (Formal and Short) And Marketing Publications www.marketing.org.au Marketing In Black and White2

3. Dr. Brian Monger Brian Monger is the CEO of MAANZ International and a Professional marketer and consultant with over 40 years experience. Marketing In Black and White3

4. Outline Buyer behaviour refers to the behaviour that buyers display in searching for, purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs. The study of buyer behaviour is the study of how individuals make decisions to spend their available resources - time, money, effort - on consumption-related items. 4

5. Buyer behaviour includes the study of: What they buy, Why they buy it, When they buy it, Where they buy it, How often they buy it, How they use it How often they use it. 5

6. Different products evidence different buying motivations Buyer researchers are able to provide marketers with buyer orientated information to enhance their product and marketing communication. 6

7. Personal Buyers and Organisational Buyers The Personal Buyer buys goods and services for his or her own use, or as a gift for a friend. The Organisational Buyer encompasses profit and not- for-profit businesses, government agencies, and institutions. The marketer must take account of who is the end-user of this consumption. 7

8. Buyers and Users (Consumers) The person who makes a product purchase is not always the user, or the only user, of the product in question. Buyers are not always the users, or the only users, of the products they buy, nor are they necessarily the persons who make the product selection decisions. 8

9. Buyers and Users (Consumers) Payers, that person who pays for the purchase is not necessarily either the buyer or buyer. Marketers must decide at whom to direct their promotional efforts: the buyer, payer or the user. 9

10. Buyers and Users (Consumers) Buyer behaviour research also considers the uses buyers make of the goods they buy and their subsequent post-purchase evaluations. 10

11. Buyers and Users (Consumers) Buyer researchers are also interested in how individuals dispose of their once-new purchases. 11

12. Buyer Behaviour as an academic discipline and an applied field The initial thrust of buyer research was from a managerial perspective. Marketing managers wanted to know the specific causes of buyer behaviour, and how people receive, store, and use consumption-related information, so that they could predict buyer behaviour and influence 12

13. Buyer research describes the process and tools used to study buyer behaviour. The two theoretical perspectives are: Positivist – objective and empirical, seeking causes for behaviour and conduct research that can be generalised to larger populations. This provides data for strategic managerial decisions. Interpretivist – qualitative, based on small samples that seek to find common patterns of operative values, meanings and behaviours across consumption situations. 13

14. The Interdisciplinary Nature of Buyer Behaviour Research There are a number of reasons why the study of buyer behaviour developed, such as: Marketers had long noted that buyers did not always act or react as economic theory would suggest. Buyer preferences were changing and becoming highly diversified. Other factors including: new product development, the buyer movement, growing consumerism, public policy, environmental concerns, non-profit marketing, and the development of international and global markets. 14

15. Buyer behaviour embraces concepts developed in other scientific disciplines, Such as psychology, sociology, social psychology, cultural anthropology, and economics. Buyer behaviour research enables marketers to develop new market segments and is undertaken by various marketing and constituted bodies. 15

16. Buyer behaviour Buyer researchers need to ask the right questions in order to design research that will address the needs of the marketer. Buyer research provides the basis for product development, and identifies target markets based on customer requirements. It does not guarantee commercial success but improves the chances of success. 16

17. Why Marketers Study Buyer Behaviour Marketers adopted a policy of market segmentation, which called for the division of their total potential market into smaller, homogeneous segments. Marketers also used promotional techniques to vary the image of their products to certain target segments (now known as positioning Technological advancement has resulted in the rapid introduction of new products at an ever increasing rate, resulting in shorter product lifecycles. 17

18. Why Marketers Study Buyer Behaviour Buyers placed increasing importance on the environment. Brands positioned to be environmentally friendly are considered favourably by buyers The growth of the buyer movement created an urgent need to understand how buyers make consumption decisions. Marketers needed to understand and work with the buyer protection laws developing at a Federal and State level

19. Why Marketers Study Buyer Behaviour The growth of services marketing forced marketers to deal with relatively intangible and perishable offerings to the public. Not-for-profit organisations are increasingly using marketing techniques, and so find the study of buyer behaviour relevant to them. An increased awareness on the part of business to market on a global basis in order to achieve major economies of scale. Australian marketers are now aware of the importance of international buyer research.

20. More About Buyer Behaviour The buyer’s goal is to obtain goods and services that meet their needs and wants buyers face varying problems associated with acquiring products to satisfy these needs and wants People engage in purchase activities for many purposes other than consumption buyers make specific types of decisions in order to obtain desired goods and services 20

21. For example, a research study may ask buyers... How they use the product 21

22. Benefits of Customer Retention Loyal customers Buy more products Are less price sensitive Pay less attention to competitor's advertising Spread positive word-of-mouth Are cheaper to service 22

23. Two Broad Types of Buyers Personal buyers The personal buyer buys goods and services for: His or her own use Use by the whole household, or a household member, or A gift for someone else In all contexts, the products are bought for final use by individuals (end-users) Organisational buyers Organisational buyer includes: Profit businesses Not-for-profit businesses Public sector agencies and Institutions (e.g. schools, churches) In all cases, they buy products to help run their organisations 23

24. Buyer Research: Two Perspectives POSITIVIST APPROACH Tends to be objective and empirical Seeks causes for behaviour Conduct studies that can be generalised to larger populations INTERPRETIVIST METHODOLOGY More qualitative Based on smaller samples View each consumption situation as unique and non- predictive Look for common patterns across consumption situations 24

25. The Interdisciplinary Nature of Buyer Behaviour Research Psychology The study of the individual Sociology The study of groups Social Psychology How individuals operate in groups Economics An important component of economics is the study of buyers Inputs to the study of buyer behaviour Cultural Anthropology The study of humans in society 25

26. Key Model Components Input  Process  Output Input = Various firms’ marketing activities + EXTERNAL social/culture influences Process = Decision steps + INTERNAL psychological factors (modified with experience) Output = Trial and repeat purchases and post-purchase evaluation 26

27. For more information about MAANZ International and articles about Marketing, visit: www.marketing.org.au http://smartamarketing.wordpress.com http://smartamarketing2.wordpress.com. http://www.linkedin.com/groups/MAANZ- SmartaMarketing-Group-2650856/abouthttp://www.linkedin.com/groups/MAANZ- SmartaMarketing-Group-2650856/about Email: info@marketing.org.auinfo@marketing.org.au Link to this site - - http://www.slideshare.net/bmonger for further presentationshttp://www.slideshare.net/bmonger Marketing In Black and White27

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