Consumer markets and buyer behaviour Flashcards
Consumer buyer behavior
the buying behavior of final consumers—individuals and households that buy goods and services for personal consumption.
Consumer markets
are made up of all the individuals and households that buy or acquire goods and services for personal consumption.
Model of Consumer Behavior
The environment = marketing stimuli = product = price = place = promotion = economic = technological = social = cultural ↓ Buyer's black box = buyers characteristics = buyers decision process ↓ Buyer responses = buying attitudes and preferences = purchase behaviour: what the buyer buys, when, where, and how much = Brand engagements and relationships
Marketers must figure
out what is in the buyer’s
black box
Factors Influencing Consumer Behavior
= Cultural
= Social
= Personal
= Psychological
(Characteristics Affecting Consumer Behaviour)
Cultural Factors
Culture is the set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions.
(Characteristics Affecting Consumer Behaviour)
Social Factors
Membership Groups =
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
(Characteristics Affecting Consumer Behavior)
Personal Factors
Age and life-cycle stage
PRIZM Lifestage Groups system
= PRIZM classifications consider a host of demographic factors such as age, education, income, occupation, family composition, ethnicity, and housing; and behavioral and lifestyle factors, such as purchases, free-time activities, and media preferences.
Occupation affects the goods and services bought by consumers.
Economic situations include trends in: spending, personal income, savings, interest rates
Personality refers to the unique psychological characteristics that distinguish a person or group.
The idea is that brands also have personalities, and consumers are likely to choose brands with personalities that match their own. A brand personality is the specific mix of human traits that may be attributed to a particular brand e.g. Sincerity, excitement, competence, sophistication, ruggedness.
(Characteristics Affecting Consumer Behaviour)
Psychological Factors
= Motivation
= Perception
= Learning
= Beliefs and attitudes
(Psychological Factors)
Selective attention
the tendency for people to screen out most of the information to which they are exposed.
(Psychological Factors)
Selective distortion
the tendency for people to interpret information in a way that will support what they already believe.
(Psychological Factors)
Selective retention
the tendency to remember good points made about a brand they favor and forget good points about competing brands.
Types of Buying Decision Behavior
= Complex buying behavior
= Dissonance-reducing buying behavior
= Habitual buying behavior
= Variety-seeking buying behavior
The Buyer Decision Process
Need recognition ↓ Information search ↓ Evaluation of alternatives ↓ Purchase decision ↓ Postpurchase behaviour
(The Buyer Decision Process)
Need Recognition
the first stage of the buyer
decision process, in which the consumer recognizes a problem or need triggered by:
• Internal stimuli
• External stimuli
(The Buyer Decision Process)
Information Search
the stage of the buyer
decision process in which the consumer is motivated to search for more information.
Sources of information: •Personal sources •Commercial sources •Public sources •Experiential sources
(The Buyer Decision Process)
Evaluation of Alternatives
the stage of the buyer decision process in which the consumer uses information to evaluate alternative brands in the choice set.
(The Buyer Decision Process)
Purchase Decision
the buyer’s decision about
which brand to purchase.
The purchase intention may not be the purchase decision due to:
•Attitudes of others
•Unexpected situational factors
(The Buyer Decision Process)
Postpurchase behaviour
the stage of the buyer decision process in which consumers take further action after purchase, based on their satisfaction or dissatisfaction.
Business buyer behavior
refers to the buying behavior of the organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others.
The business buying process
is the process where business buyers determine which products and services are needed to purchase, and then find, evaluate, and choose among alternative brands.
(Business Markets)
Market Structure and Demand
= Fewer but larger buyers
= Derived demand
= Inelastic demand
= Fluctuating demand
(Business Markets)
Nature of the Buying Unit
Business buyers usually face more complex buying decisions than do consumer buyers. Compared with consumer purchases, a business purchase usually involves: • More decision participants • More professional purchasing effort • More buyer and seller interaction
(Business Markets)
Supplier development in the Decision Process
the systematic development of networks of supplier-partners to ensure an appropriate and dependable supply of products and materials for use in making products or reselling them to others.
(Business Buyer Behavior)
Participants in the Business Buying Process
Users are those that will use the product or service.
Influencers help define specifications and provide
information for evaluating alternatives.
Buyers have formal authority to select the supplier and
arrange terms of purchase.
Deciders have formal or informal power to select and
approve final suppliers.
Gatekeepers control the flow of information.
The Business Buying Process
Problem recognition ↓ General need description ↓ Product specification ↓ Supplier search ↓ Proposal solicitation ↓ Supplier selection ↓ Order-routine specification ↓ Performance review
E-Procurement and Online Purchasing advantages and disadvantages
= Online purchasing
= Company-buying
sites
= Extranets
Advantages • Access to new suppliers • Lowers costs • Speeds order processing and delivery • Enhances information sharing • Improves sales • Facilitates service and support
Disadvantages
• Erodes relationships as buyers search for new suppliers
Institutional markets
consist of schools, hospitals,
nursing homes, and prisons that provide goods and services to people in their care.
Characteristics
• Low budgets
• Captive patrons
Government markets
tend to favor domestic suppliers, require them to submit bids, and normally award the contract to the lowest bidder.
• Affected by environmental factors
- Non-economic factors considered
* Minority firms
* Depressed firms
* Small businesses
