1. Marketing: An Introduction Armstrong, Kotler
Chapter five
Consumer and Business Buyer Behavior

2. Consumer and Business Buyer Behavior
After studying this chapter, you should be able to:
Define the consumer market and construct a simple model of consumer buyer behavior
Name the four major factors that influence consumer buyer behavior
List and understand the major types of buying-decision behavior and the stages in the buyer decision process
Describe the adoption and diffusion process for new products

3. Model of Buyer Behavior
Consumer buying behavior:
Refers to the buying behavior of people who buy goods and services for personal use.
The central question for marketers is:
“How do consumers respond to various marketing efforts the company might use?”

4. Marketers must figure out what is in the buyers black box

5. Consumer Buyer Influences
Cultural factors.
Culture, subculture, social class.
Social factors.
Reference groups, family, roles, status.
Personal factors.
Age, lifecycle, occupation, income.
Psychological factors.
Motivation, perception, learning, beliefs, attitudes. Figure 1

6. Figure 1

7. Culture
Cultural is the most basic cause of a person's wants and behaviour.
Culture is learned from family, church, school, peers, colleagues.
Culture includes basic values, perceptions, wants and behaviours.
Chapter 6, page 204

8. Sub-Culture
Groups of people with shared value systems based on common life experiences.
Major groups:
Native, immigrants, visitors…..etc
Ethnic consumers.
Internet users.
Chapter 6, page

9. Social Class Relatively permanent, ordered divisions.
Members share similar values, interests and behaviours.
Determined by a combination of:
Occupation.
Income.
Education.
Wealth.
Other variables.
Chapter 6, page

10. Social Factors Groups. Family. Roles and status.
Reference groups, aspirational groups.
Importance of opinion leader.
Family.
Most important consumer buying organization.
Roles and status.
Expect activities and esteem given by society to those roles.
Chapter 6, page 212

11. Personal Factors Occupation.
What we do affects what we need and how much we have to spend.
Trend towards more part-time employment and multiple jobs.
Economic situation.
Affects real spending and consumer confidence in borrowing.
Chapter 6, page 212

12. Personal Factors Age and family life-cycle stage. Lifestyle.
Consumer needs change over time.
Difference between chronological and perceived age.
Lifestyle.
a person’s pattern of living as expressed in his or her activities, interests and opinions.
Also known as psychographics, can capture more detail than personality or social class.
Chapter 6, page

13. Psychological Factors
Motivation: Maslow’s Hierarchy of Needs
Perception: The process of selecting, organizing and interpreting information inputs to produce meaning
Learning: A relatively permanent change in behavior due to experience.
Beliefs: descriptive thought that a person holds about something
Attitudes: describes a person’s consistently favorable or unfavorable evaluations, feelings and tendencies toward
Chapter 6, page 215

14. The Buyer Decision Process
Need recognition
Information search
Evaluation of alternatives
Purchase decision
Postpurchase behavior
Figure 2

15. The Buyer Decision Process
Figure 2

16. Need recognition:
Triggered by internal or external stimuli
Must reach an intensity high enough to become a drive
Marketers may use sales personnel, advertising and packaging to trigger recognition of needs or problems
Information search:
Memory (internal) search
External search: personal, commercial, public, experiential sources of information
Word-of-mouth sources are most influential

17. Evaluation of alternatives:
The consumer compares different brands or choices.
May be logical or emotional, depending on the situation
Purchase decision:
Attitudes of others and unexpected situational factors
May come between purchase intention and decision
Postpurchase behavior:
Relationship between consumer expectation and perceived performance.
Level of satisfaction will influence repeat purchase
Customer satisfaction is key to customer loyalty

18. Adoption of New Product Innovations
Stages in the adoption process:
1- Awareness; aware of new product with lack info
2- interest; seeks info about new product
3- evaluation; is it make sense to try it
4- trial; try able and test the new product
5- Adoption; full and regular use of the product.

19. Individual Differences in Innovativeness
Innovators; risk takers
Early adaptors; leaders, careful
Early majority; deliberated
Late majority; skeptical
Laggards; tradition bound

20. Influence of product characteristics on rate of adoption:
Relative advantage; superior to existing products, like quality
Compatibility; fits values, life-style, income
Complexity; degree of difficulty to understand
Divisibility; try before buy, or lease
Communicability; degree to be described to others

21. Business markets and business buyer behavior
Vast and involves far more dollars and items than do consumer markets.
Business buyers are organizations that buy goods and services for use in the production of other products and services that are sold, rented or supplied to others.

22. Business Buyer behavior
A model of Business Buyer behavior
The Environment
The buyer organization
Buyer responses
Product or
Services choice
Supplier choice
Order quantities
Delivery time
Service terms
Payment
Marketing
Stimuli
Product
Price
Place
Promotion
Other stimuli
Economic
Technological
Political
Culture
competitive
The buyer center
Interpersonal and
Individual influences
Buying
Decision
process

23. Major types of Buying situations;
1- Straight rebuy; routinely reorders without any modifications.
2- Modified rebuy; The buyer wants to modify products specifications , price, terms…etc
3- New buy; a buyer purchases a product or service for the first time.
Participants in the business buying process;
- The unit of a buying organization is called “ buying center”

24. Business Buying Process
New or first-time purchase – new task.
Problem recognition.
General need description.
Product specification.
Supplier search.
Proposal solicitation.
Supplier selection.
Order-routine specification.
Performance review.
Figure 3

25. The Business Buying process
Figure 3

26. Business Buying Influences
Environmental-- primary demand, economics, supply conditions, laws, etc.
Organizational -- Objectives, policies, procedures, organizational structure and systems.
Interpersonal -- Authority, status, empathy and persuasiveness.
Individual -- Age, education, job position, personality and risk attitudes. Figure 3

27. Major Influences on Business Buyer;
Figure 3 1
Environmental
-Economic
Developments
-Supply conditions
-Technological
Changes
-Political and
Regulatory develop
-Competitive
-Cultural and
Customers 2 3 4
Organizational
Objectives
Policies
Procedures
Culture
systems
Interpersonal
Authority
Status
Empathy
persuasiveness
Individual
Age
Income
Education
Job position
Personality
Risk attitudes
Buyer

28. e-Procurement Advantages for buyers. Advantages for vendors.
Access to new suppliers.
Lowers purchasing costs.
Hastens order processing and delivery.
Advantages for vendors.
Share information with customers.
Sell products and services.
Provide customer support services.
Maintain ongoing customer relationships.