consumer markets & consumer buyer behavior
TRANSCRIPT
CONSUMER MARKETS & CONSUMER BUYER
BEHAVIORTOPIC 3
Copyright © 2015 Pearson Education Ltd.
CONSUMER MARKETS AND CONSUMER BUYER BEHAVIOR
Consumer buyer behavior
Buying behavior of final consumers
Consumer market
All the individuals and households that buy or acquire goods and services for personal consumption
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Consumer Behaviour Model
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Factors Affecting Consumer Behavior
• Cultural
• Social
• Personal
• Psychological
• Buyer
Characteristics Affecting Consumer Behavior
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Cultural
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• Set of basic values, perceptions, wants, and behaviors learned by an individual from family and other important institutions
Culture
• Group of people with shared value systems based on common life experiences and situations
• Cross-cultural marketing: Including ethnic themes and cross-cultural perspectives within a brand’s mainstream marketing
Subculture
• Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors
• Measured as a combination of occupation, income, education, wealth, and other variables
Social class
Social
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Groups and Social network
• Small groups influence a person’s behavior• Membership group - Groups with direct influence and to which a person belongs
• Aspirational Groups - Groups an individual wishes to belong to
• Reference Groups - Groups that form a comparison or reference in forming attitudes or behavior
• Word-of-mouth
• Opinion Leader
• Buzz Marketing
• Online Social Networks
Family
• the most important consumer-buying organization in society.
Roles and Status
• can be defined by a person’s position in a group
Personal
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Age and Life-Cycle Stage
• Taste in Food, clothes etc are often age related
• Life-cycle stage – life changing event. Marriage, having children.
Occupation• Blue-collar workers
• Executives
Economic Situation• Personal Income, savings and
interest rates.
Lifestyle• is a person’s pattern of living as
expressed in his or her psychographics
Personality and Self-Concept
• Sincerity
• Excitement
• Competence
• Sophistication
• Ruggedness
Psychological
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Motivation
• A motive (or drive) is a need that is sufficiently pressing to direct the person to seek satisfaction of the need.
• Motivation research refers to qualitative research designed to probe consumers’ hidden, subconscious motivations.
Perception
• Perception is the process by which people select, organize, and interpret information to form a meaningful picture of the world.
Learning
•Learning is the change in an individual’s behavior arising from experience and occurs through the interplay of:
•Drives
•Stimuli
•Cues
•Responses
•Reinforcement
Beliefs and attitudes
•A belief is a descriptive thought that a person has about something based on:
•knowledge
•opinion
•Faith
•An attitude describes a person’s relatively consistent evaluations, feelings, and tendencies toward an object or idea.
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Buyer Decision Process
Buyer Decision Process
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PROBLEM RECOGNITION
Awareness of Problem/Need
Raised by:
• Routine depletion
• Change in circumstances
Problem
• Perceived as the difference between currentand desiredsituation
The Role of Advertising
• Sometimes, potential customers become aware of their problem through advertising.
The first stage of the buyer decision process, in which the consumer recognizes a problem or need triggered by:
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INFORMATION SEARCH
Involves the Identification of Alternative Solutions by
SearchingInternal search
Relevant information from memory
Role of advertising and branding
External search
Friends, family, work colleagues
Commercial sources –adverts, brochures salespeople
Third party reports – media.
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EVALUATION OF ALTERNATIVES
• Reduction of solutions to a manageable shortlistFirstly
• A shortlist of brands for careful evaluationEvoked set
• Cost
• Availability
• Suitability.
Secondly: Ranking of the Evoked Set
the stage of the buyer decision process in which the consumer
uses information to evaluate alternative brands in the choice set.
CHOICE CRITERIA
Reliability
Durability
Performance
Format
Technical
Price
Value for money
Running costs
Residual value
Economic
Status
Social belonging
Convention
Fashion
Social
Self-image
Risk reduction
Ethics
Emotions
Personal
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PURCHASE AND POST-PURCHASE
Selection of:
• Quantity
• Quality
• Exact product characteristics
• Brand
• Vendor and method of payment
The Transaction Outcome
• Satisfaction or dis-satisfaction?
• Reliability?
• Performance?
• Durability?
Purchase decision is the buyer’s decision about which brand to purchase.
Post-purchase behavior is the stage of the buyer decision process in which
consumers take further action after purchase, based on their satisfaction or
dissatisfaction.
BUSINESS MARKETS & BUSINESS BUYER
BEHAVIORTOPIC 3
Business Buyer Behavior
• Buying behavior of organizations • Purchased goods and services are used in the production of other
products and services that are sold, rented, or supplied to others.
• Business buying process: Determining which products and services an organization needs to purchase • Finding, evaluating, and choosing among alternative suppliers and brands
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Business Markets
• Business markets are huge and involve more money and items than consumer markets.
• Differ from consumer markets in terms of:• Market structure and demand
• Nature of the buying unit
• Types of decisions and the decision process
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Market Structure and Demand and Nature of the Buying Unit
• Market structure and demand• Fewer but larger buyers
• Derived demand: Business demand that comes from the demand for consumer goods
• Inelastic and fluctuating demand
• Nature of the buying unit• More decision participants
• More professional purchasing effort
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Types of Decisions
• Business purchases • More complex buying decisions
• Large sums of money
• Complex technical and economic considerations
• Interactions among people at many levels of the buyer’s organization
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Decision Process
• Buying processes • Longer and more formalized procedures
• Buyer and seller more dependent on each other
• Supplier development: Systematic development of networks of supplier-partners• To ensure a dependable supply of products and materials
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Figure 5.7 - A Model of Business Buying Behavior
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Types of Buying Situations
• Buyer routinely reorders something without any modifications
Straight rebuy
• Buyer wants to modify product specifications, prices, terms, or suppliers
• New task: Buyer purchases a product or service for the first time
Modified rebuy
• Buying a packaged solution to a problem from a single seller
• Avoids the separate decisions involved in a complex buying situation
Systems selling (or solutions selling)
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Participants in the Business Buying Process
• Buying center: All the individuals and units that play a role in the purchase decision-making process• Actual users of the product or service
• People who make the buying decision
• People and units influencing the buying decision
• People who do the actual buying
• Individuals and units controlling the buying information
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Figure 5.8 - Major Influences on Business Buying Behavior
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Figure 5.9 - Stages of Business Buying Behavior
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E-Procurement
• Purchasing through electronic connections between buyers and sellers–usually online
• E-procurement occurs through:• Reverse auctions
• Online trading exchanges
• Company buying sites
• Extranet links with key suppliers
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Benefits and Problems of E-Procurement
Benefits
• Cuts transaction costs
• Results in efficient purchasing for both buyers and suppliers
• Reduces the time between order and delivery
• Helps an organization keep better track of all purchases
• Frees buyers from a lot of work and paperwork
Problems
• Can affect the customer-supplier relationship
• Can create potential security concerns
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