Ins ppt ch06

Understanding Consumer
and Business
Buyer
Behaviour
Chapter 6
6-1

Copyright © 2012 Pearson Canada Inc.

Previewing the Concepts
1. Understand the consumer market and the major
factors that influence consumer buyer behavior
2. Identify and discuss the stages in the buyer
decision process
3. Describe the adoption and diffusion process for
new products
4. Define the business market and identify the major
factors that influence business buyer behavior
5. List and define the steps in the business buying
decision process
6-2


Consumer Buying Behavior
• Consumer buying behavior:
– The buying behavior of individuals and
households 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?

6-3


Influences on Consumer
Behaviour
Psychological

Personal
Consumer

Social

Marketing Mix
• Product
• Price
• Marketing
Communications
• Distribution
Company
• Image
• Reputation

Cultural

4
6-4

Copyright © 2012© 2010 Pearson
Copyright Pearson Canada Inc.

Consumer Buying Behavior
• Factors influencing consumer behavior:

6-5


Culture
• Culture is the most basic cause of a
person’s wants and behavior
– It 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
6-6


6-7


6-8


Subculture
• Subculture:
– Groups of people with shared value systems
based on common life experiences

• Major subculture groups:
– Regional subcultures
– Founding nations
– Ethnic subcultures
– Mature consumers
6-9


Social Class
• 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
– People within a given social class tend to
exhibit similar buying behaviour
6 - 10


Social Factors

• Groups and social networks:
– Membership, reference, and aspirational
groups
• Marketers attempt to reach opinion leaders, people
who exert social influence on others
• Opinion leaders are recruited as brand
ambassadors or for buzz marketing

– Online social networks allow marketers to
interact with consumers
•
•

IKEA and Buzz Marketing
http://www.youtube.com/watch?v=zdd7-kHrvps

6 - 11


Reference Groups
“A group of people with a common interest that
influences its members’ attitudes and behaviour.”
Reference groups (peers) are a strong
influence among young people.

The hip hop community (hip hop
musicians) is one of the biggest brand
building communities in the world.

12
6 - 12


Characteristics Affecting
Consumer behaviour
Groups and Social Networks

6 - 13


Social Influences on Consumer
Decisions
• Green Marketing
– Growing -70% of
Canadians buying
more
environmentally
friendly products
than they did one
year ago
– Becoming
mainstream
6 - 14


Social Factors
• Family:
– Strongly influences buying behavior
– Gender stereotypes for certain types of
purchases are changing
– Children have strong influence on family
buying decisions

• Roles and status:
– Role = Expected activities
– Status = Esteem given to role by society
6 - 15


Family
The changing roles of adults means marketers
can no longer make assumptions about who
the primary buyer is.
1.
2.

Major retailers are reconfiguring to appeal more to women.

3.

Wal-Mart Supercentres are specifically designed for women
30 to 45 with 2 or 3 children, a husband and a career.

4.

16
6 - 16

Major decisions are shared decisions.

Children influence $20 billion in family spending each year in
Canada.

Cultural Influences
Culture refers to “behaviour learned from external
sources such as family, the workplace, and education—
that help form the value systems an individual lives by.
 Gen X, Gen Y, Boomers
 Ethnic Groups
 French Quebec

6 - 17
17

Marketing strategies must be
tailored to the unique needs
of different groups.

Personal Factors
• Age/life-cycle stage:
– People change the goods they buy over their
lifetimes

• Occupation:
– Occupation affects the goods and services
bought

• Economic situation:
– A person’s economic situation affects store
and product choices
6 - 18


Personal Factors
• People within the same subculture, social
class, and occupation may have different
lifestyles
• Lifestyle:
– Pattern of living as expressed in his or her
activities, interests, opinions

• People buy the values and lifestyles
products represent
6 - 19


Lifestyle
A person’s pattern of living expressed in terms of
activities, interests, opinions and values.
Independent research companies
conduct surveys and place people in
lifestyle segments.
Each segment is motivated by a
unique set of attitudes and
beliefs.

• Protective Providers
• Up an Comers
• Les “Petite Vie”
• Mavericks
• Contented
Traditionalists
• Joiner Activists
• Passive Malcontents
• Tie-Dyed Greys

Source: Millward Brown Goldfarb

20
6 - 20


Personal Factors
• Personality:
– The unique psychological characteristics that
distinguish a person or group
– Generally defined in terms of traits
– Self-concept theory suggests that people’s
possessions contribute to and reflect their
identities
– Brands may also have personalities

6 - 21


Psychological Factors
• Motivation:
– 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

6 - 22


• Maslow’s hierarchy of needs:
– Physiological needs
– Safety needs
– Social needs
– Esteem needs
– Self-actualization

• Hierarchy implies that lower level needs
(physiological) must be satisfied first
6 - 23


Maslow’s Hierarchy of Needs

6 - 24



• Perception:
– Process by which people select, organize, and
interpret information to form a meaningful picture of
the world
– Perception can be influenced by:
• Selective attention is the tendency for people to
screen out most of the information to which they are
exposed
• Selective distortion is the tendency for people to
interpret information in a way that will support what
they already believe
• Selective retention is the tendency to remember good
points made about a brand they favor and forget good
points about competing brands
6 - 25


• Learning:
– Changes in an individual’s behavior arising
from experience
– Occurs due to an interplay of drives, stimuli,
cues, responses, and reinforcement
– Behaviors with rewarding results tend to be
repeated

6 - 26


Beliefs and Attitudes
• Belief:
– A descriptive thought that a person holds
about something

• Attitude:
– A person’s consistently favorable or
unfavorable evaluations, feelings, and
tendencies toward an object or idea

6 - 27


Buyer Decision Process
• There are five stages in the buyer decision
process:
1.
2.
3.
4.
5.

6 - 28

Need recognition
Information search
Evaluation of alternatives
Purchase decision
Postpurchase behavior


Need Recognition/
Information Search
• Need recognition can be triggered by
internal or external stimuli
• Several sources of information may be
used during information search:
– Personal sources
– Commercial sources
– Public sources
– Experiential sources
6 - 29


Situational Influences on Consumer Decisions

• Physical environment
dimensions such as
décor, smells, and
lighting
• Arousal and pleasure
determine consumers’
reaction to store
environment

• Time
6 - 30


Evaluation of Alternatives /
Purchase Decision
• Evaluation of alternatives depends upon
the specific buying situation and the
individual consumer
• Two factors may come between the
purchase intention and purchase decision:
– Attitudes of others
– Unexpected situational factors

6 - 31


Post Purchase Behavior
• Consumer satisfaction is a function of
consumer expectations and perceived
product performance
– Performance < Expectations = Disappointment
– Performance = Expectations = Satisfaction
– Performance > Expectations = Delight

• Cognitive dissonance:
– Discomfort caused by postpurchase conflict
6 - 32


Stages in the Adoption
Process
•
•
•
•
•
6 - 33

Awareness: Consumer becomes aware of the
new product, but lacks information
Interest: Consumer seeks information about
new product
Evaluation: Consumer considers whether
trying the new product makes sense
Trial: Consumer tries new product on a small
scale to determine its value
Adoption: Consumer decides to make regular
use of the new product

Adopter Categorization
• Individual differences influence the speed
people will try new products, yielding five
adopter categories:
– Innovators
– Early adopters
– Early majority
– Late majority
– Laggards
6 - 34


Rate of Adoption
• Relative advantage: Is the innovation superior
to existing products?
• Compatibility: Does the innovation fit the
values and experience of the target market?
• Complexity: Is the innovation difficult to
understand or use?
• Divisibility: Can the innovation be used on a
limited basis?
• Communicability: Can results be easily
observed or described to others?
6 - 35


Business Markets and
Buyer Behavior
• Business buyer behavior:
– The buying behavior of organizations that buy
goods and services for the production of other
products/services or to resell or rent them to
others for a profit

• Business market is huge and involves far
more dollars and items than consumer
markets
6 - 36


Business Markets
• Market structure and demand:
– Contains far fewer but larger buyers
– Business demand is derived from consumer
demand
– Business markets have more fluctuating
demand

• Nature of the buying unit:
– Business purchases involve more decision
participants and a more professional
purchasing effort
6 - 37


Business Markets
• Key differences exist between business
and consumer buying situations:
– Business buyers usually face more complex
buying decisions
– The business buying process tends to be
more formalized
– Buyers and sellers are much more dependent
on each other in business markets

6 - 38


Types of Buying Situations
• Straight rebuy: Buyer routinely reorders
something without any modifications
• Modified rebuy: Buyer modifies product
specifications, prices, terms, or suppliers
• New task: Buyer purchases a product or
service for the first time
• Systems (solution) selling is becoming
more common
6 - 39


Participants in the Business
Buying Process
• A buying center is all the individuals and
units that participate in the purchase
decision-making process
– The buying center is not a fixed or formally
identified unit
– The size and makeup will vary for different
products and different situations

6 - 40


Influences on Business Buyers
• Major influences on business buyer
behaviour:

6 - 41


The Business Buying Process
• Stages of the business buying process:

6 - 42


E-procurement
• Online purchasing (e-procurement) can be
implemented in many ways:
– Reverse auctions
– Trading exchanges
– Company buying sites
– Extranet links with key suppliers

• E-procurement presents several benefits
and problems
6 - 43


Reviewing the Concepts
1. Understand the consumer market and the major
factors that influence consumer buyer behavior
2. Identify and discuss the stages in the buyer
decision process
3. Describe the adoption and diffusion process for
new products
4. Define the business market and identify the major
factors that influence business buyer behavior
5. List and define the steps in the business buying
decision process
6 - 44


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