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A Model of Buyer BehaviorA Model of Buyer Behavior
Buyer’s Characteristics
Buyer’sDecisionProcess
Buyer’s Decisions
Product choiceBrand choiceDealer choice
Purchase timingPurchase amount
Marketing Stimuli
The Four P’s
Other StimuliEconomic
TechnologyPoliticalCultural
Buyer’s Characteristics - Cultural
• Culture– most fundamental determinant of a person’s
wants and behavior.
• Subculture– nationalities, religions, racial groups, and
geographical regions.
• Social Class– income, occupation, education, & area of
residence.
Buyer’s Characteristics - Social
• Reference Groups– all groups having a direct or indirect influence
on person’s attitudes or behavior.
• Family– single most important consumer-buying
organization in society
– family of orientation vs. family of procreation.
• Roles & Statuses
Buyer’s Characteristics - Personal
• Age & Life Cycle Stage
• Occupation
• Economic Circumstances
• Lifestyle
• Personality & Self-Concept
Buyer’s Characteristics - Psychological
Motivation
• Biogenic needs– needs arising from physiological states of
tension such as hunger, thirst, discomfort.
• Psychogenic needs– needs arising from psychological states of
tension such as the need for recognition, esteem, or belonging.
Buyer’s Characteristics - Psychological
Perception
• The process by which an individual selects, organizes, and interprets information inputs to create a meaningful picture of the world.
• Types of Selective Perception:– Selective Attention
– Selective Distortion
– Selective Retention
Buyer’s Characteristics - Psychological
• Learning– changes in an individual’s behavior arising
from experience.
• Beliefs– descriptive thoughts that a person holds
about some object/issue.
• Attitudes– relatively enduring un/favorable evaluations,
emotional feelings, and action tendencies toward some object/issue.
Psychographics According to VALS
• VALS: Values and Lifestyles Framework.
• Intended to yield insights into:– why people believe/behave as they do, and
– how internal values & attitudes are expressed externally.
• Primarily based upon consumers’ orientations and level of resources.
VALS Higher Resources Groups
• Actualizers– successful, sophisticated, active, “take-charge”
types– cultivated tastes for upscale, niche-oriented
products– generally status-oriented
• Achievers– successful, career/work oriented– prefer established, prestige products to impress
peers– status-oriented
VALS Higher Resources Groups• Fulfilleds
– mature, satisfied, comfortable, reflective– prefer durability, functionality, & value in products– principle oriented
• Experiencers– young, enthusiastic, impulsive, rebellious– high proportion of income spent on clothing, fast
food, music, movies, & video.– Action oriented
VALS Lower Resources Groups
• Believers– conservative, conventional, traditional– favor familiar products & established brands– principle oriented
• Strivers– uncertain, insecure, approval-seeking– prefer stylish products to emulate purchases of
those with greater resources– status oriented
VALS Lower Resources Groups• Makers
– practical, self-sufficient, traditional, family-oriented.– Prefer practical, functional products– action oriented
• Strugglers– typically elderly, resigned, passive, concerned– cautious consumers who are loyal to favorite brands– status oriented
Types of Buying Behavior
• Significant Differences Between Brands– High involvement: complex buying behavior
– Low involvement: variety-seeking buying behavior
• Few Differences Between Brands– High involvement: dissonance-reducing
behavior
– Low involvement: habitual buying behavior
Consumer Purchase Decision Process
1. Problem Recognition
2. Information Search
3. Evaluation of Alternatives
4. Purchase Decision
5. Postpurchase Behavior
• Those activities that facilitate exchanges involving products and customers in business markets
• A business transaction between– a professional seller (representing a selling company)
and
– a professional buyer (representing a buying company)
• Activities in which goods or services are sold for any use other than personal consumption
• Note: It is notnot the nature of the product; it is
the nature of the transactiontransaction.
What Is Business Marketing?
B2B versus B2C MarketingCharacteristic B2B Market B2C Market
Sales volume Greater Smaller
Purchase volume Greater Smaller
Number of buyers Fewer Many
Size of individual buyers Larger Smaller
Location of buyers Concentrated Diffuse
Buyer-seller relationship Closer More Impersonal
Nature of channel More direct Less direct
Buying influences Multiple Single/Multiple
Type of negotiations More complex Simpler
Use of reciprocity Yes No
Use of leasing Greater Less
Key promotion method Personal Selling Advertising
• Derived Demand
• Inelastic Demand
• Fluctuating Demand
• Joint Demand
Characteristics of Business Demand
–“Derived demand” says that demand for a business product is linked to demand for a consumer good.
• This means consumer demand affects business marketing up a vast network of channels.
Classifying Business Goods & Services
3 Main Categories of ProductsEntering Goods
Become part of the finished productCost assigned to the manufacturing process
Foundation GoodsCapital ItemsTypically depreciated over time
Facilitating ProductsSupport organizational operationsHandled as overhead expenses
Classifying Business Goods & Services
Entering Goods Raw Materials
Farm products & natural productsOnly processed as necessary for handling & transportRequire extensive processing
Manufactured Materials & PartsAny product that has undergone extensive processing
prior to purchaseComponent Materials require additional processingComponent Parts generally do not require additional
processing
Classifying Business Goods & Services
Foundation GoodsInstallations
Major long-term investment itemsBuildings, land, fixed equipment, etc.
Accessory EquipmentLess expensive & short-livedNot considered part of fixed plantPortable tools, PC’s, etc.
Classifying Business Goods & Services
Facilitating ProductsSupplies
Any supplies necessary to maintain the organization’s operations
ServicesMaintenance & Repair supportAdvisory supportLogistical support
Categories of B2B Customers
• Commercial enterprises–Indirect channel members and
facilitators
–OEMs (original equipment manufacturers)
–Users = customers
• Governmental organizations
• Institutions
Major Uses of B2B Products
For additional production (e.g., components are combined into subassemblies and become part of the finished product)
For use in operations, but not part of the finished product
For resale
Steps in the Business Buying Process
1. Recognizing the need
2. Developing product specifications
3. Soliciting bids from potential suppliers
4. Making the purchase decision
5. Issuing the contract
6. Inspecting delivered goods for quality
7. Evaluating vendor performance
Types of Business Buying Situations• New-task buy:
– Business buying situation that is new and very different from anything that the buyer has faced previously.
• Straight rebuy:– Most common type of business buying situation; buyer
purchases a part, material, or service routinely, with little thought going into buying process.
• Modified rebuy:– Reevaluation of alternatives; necessary because buying
requirements have changed such that relatively routine buy or purchase no longer is routine.
Examples of Products Purchased Using the Buy-Class
Pureroutine
Completenegotiation
StraightRebuy
ModifiedRebuy
NewBuy
ElectricityGas/Water
OfficeSupplies
BulkChemicals
Vehicles ConsultingServices
ElectricalComponents
ComputerSystems
Installations
Moon ShotInsurance
Buygrid Analysis Framework
StraightStraight RebuyRebuy
ModifiedModified RebuyRebuy
NewNewBuyBuy
Need RecognitionNeed Recognition
Develop Product SpecificationsDevelop Product Specifications
Solicit BidsSolicit Bids
Make Purchase DecisionMake Purchase Decision
Issue the ContractIssue the Contract
Inspect Goods for QualityInspect Goods for Quality
Evaluate Vendor PerformanceEvaluate Vendor Performance
Complexity of Complexity of Buying SituationBuying Situation
Buygrid Analysis Framework
StraightStraight RebuyRebuy
ModifiedModified RebuyRebuy
NewNewBuyBuy
Need RecognitionNeed Recognition
Develop Product SpecificationsDevelop Product Specifications
Solicit BidsSolicit Bids
Make Purchase DecisionMake Purchase Decision
Issue the ContractIssue the Contract
Inspect Goods for QualityInspect Goods for Quality
Evaluate Vendor PerformanceEvaluate Vendor Performance
CreepingCreepingCommitmentCommitment
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