Revel Flashcards - Chapter 3 Buyer behaviour.

Question 1

What are the 4 influencing factors on the consumer decision buying process…

Answer 1

• Individual influences (personality, attitude)
• Group influences (sociocultural/ethical)
• Marketing Mix (4p’s)
• Situational influences (social class, family)

Question 2

Problem recognition?

Answer 2

• Realising the current position or feeling is not a desired one, so decide to do something to change this through purchases.

Question 3

Willingness and ability to fulfill emerging need?

Answer 3

• If problem recognition is to lead anywhere it requires both willingness and the ability to fulfil the emerging need.

Question 4

Information search?

Answer 4

• What kind of purchase will solve the problem?

To find this out consumers will actively search relevant information which will be used to aid their decision making.

Time pressure can interfere with information search.

Question 5

Information evaluation (how marketers can affect it?)

Answer 5

• Use communication campaigns (implant images of products in the consumer’s mind so they seem familiar.
• Stress a particular product attribute in the consumers mind and to ensure that the consumer believes that a particular brand is unsurpassed in terms of that attribute.
• reinforce through displays, leaflets

Question 6

Decision:

Answer 6

• Suppliers can make it difficult or easy for potential customers to make their purchases.

Question 7

Post purchase evaluation:

Answer 7

• Where consumers are trying to balance out the choice made against the doubts they still held about it.
• To reduce the consumer’s psychological discomfort marketers can respond to the need for post-purchase reassurance which may be done through advertising.

Question 8

What is a routine problem solving?

Answer 8

Is a purchasing situation that the consumer is likely to experience on a regular basis.

Question 9

What is impulse purchasing?

Answer 9

An impulse may be triggered by the realisation of a need or by external stimuli.

There is no conscious pre planning or information searches for these products.

Question 10

How do retailers encourage unplanned purchase?

Answer 10

• The rise of internet shopping/ads online.
• Much promotion is based on buying on impulse.

Question 11

What is limited problem solving?

Answer 11

• A buying situation which occurs less frequently.
• It is likely to occur in the choice of service products, e.g. holidays/dentists where the consumer has the opportunity to make the right choice.
• Necessity is to get it right the first time.

Question 12

Extended problem solving?

Answer 12

• Represents a very serious investment of money, time and effort. So therefore the purchases are much higher risk. e.g. houses and cars.
• These purchases occur infrequently, the purchaser is motivated to gather as much information as possible.

Question 13

what does STEEPLE stand for?

Answer 13

• Social
• Technological
• Economic
• Environmental
• Political
• Legal
• Ethical

7 external factors that businesses consider when analysing their external environment.

Question 14

What are the influences on consumer buying behaviour:

Answer 14

• Family
• Sociocultural influences
• Social class
• Culture
• Subculture
• Perception

Question 15

Sociocultural influences may help an individual to …

Answer 15

• Differentiate between essential and non-essential purchases.
• Prioritise purchases where resources are limited.
• Define the meaning of a product and its benefits in the context of their own lives.

Question 16

Social class influences:

Answer 16

• Social class is a form of stratification that attempts to structure and divide a society.

However linking consumer behaviour with social class has limited usefulness. They rely on the main income earner but fail to put that into context of the rest of the household.

Question 17

Culture influencing consumer buyer behaviour:

Answer 17

Culture = the personality of the society within which an individual lives. It manifests itself through the built environment, art, language, literature, music and the products that society consumes.

3 influences on culture are the individual, institutions and societal environment.

Marketers therefore have to understand culture so they have to allow it and support it and the marketing has to act within boundaries set by society and culture.

Question 18

Subcultures influencing consumer buyer behaviour:

Answer 18

• Language may be an important determinant of subculture.

Question 19

Reference groups influencing consumer buying behaviour:

Answer 19

• Reference groups are any groups to which an individual either belongs or aspires to belong e.g. professional bodies.

Different types of reference groups: Membership groups, aspirant groups and dissociative groups.

Membership: individual already belongs
Aspirant: desire to be in group, may make purchases to get into group.
Dissociative: move further away from groups they don’t want to be a part of.

Question 20

Psychological influences on the individual:

Answer 20

Personality: marketers try to define particular personality traits within the target market and then base the marketing around these traits.

Perception (represents the way in which individuals analyse and interpret and make sense of info): unconscious filtering of info, perception may be coloured by previous experience and existing attitudes. Advertising is key for selective retention.

Learning: Marketers want consumers to learn why a consumer is buying a product.

Motivation: Maslows hierarchy of needs.

Attitudes ( is a stance an individual takes on a subject): Attitude affects consumer judgement. 3 components of attitude are cognitive (beliefs), affective (feelings) and conative (relates to the link with behaviour).

Question 21

What are the 3 main classes of B2B customers:

Answer 21

• commercial enterprises (profit organisations which produce and re-sell goods and services.
• government bodies (local and national governments purchase a lot e.g. army)
• institutions (largely non-profit making organisations such as universities, churches and independent schools.

Question 22

Characteristics of B2B markets: demand and derived demand.

Answer 22

• Difference between consumer and B2B markets lies in the marketing mix and interaction between the buyer and seller.
• All demand in B2B markets is derived demand (derived from some kind of consumer demand)

Question 23

Boeing aircrafts in China:

Answer 23

• Boeing aircrafts account for more than 50% of China’s commercial fleet.
• Boeing has the largest share of this market.

Question 24

What is joint demand:

Answer 24

• B2B is often joint demand. As it is often closely linked with demand for other B2B products.

Example: demand for casings for computers is linked with demand for disk drives.

Question 25

What is inelastic demand and elastic demand:

Answer 25

• Extent to which quantity of a product demanded changes when its price changes.
• Elastic demand means the product has a great deal of price sensitivity in the market.
• Inelastic demand means an increase in price will have little affect on quantity demanded.

Question 26

Industrial concentration and the structure of demand:

Answer 26

• B2B markets have a smaller number of easily identifiable customers compared to consumer markets.

Question 27

Geographic concentration:

Answer 27

• Some industries have a strong geographic bias. This may be due to resource availability, available infrastructure or government laws/incentives.

Question 28

Buying-process complexity in B2B markets.

Answer 28

• B2B purchasers are always buying on behalf of other people, which implies certain differences from the consumer situation.

The marketer must appreciate these differences when designing strategies for encouraging trial and reordering.

Question 29

Various dimensions of complexity:

Answer 29

B2B purchasing policy:
- Guidelines on favoured suppliers.
- How much can be spent on certain budgets.
- Ethical codes of practice

Professional purchasing:
- Risk and accountability of B2B purchasing means it has to be done professionally.
-

Question 30

Purchase significance:

Answer 30

Routine re-buy: low risk, buying process quick involving few people

Modified re-buy

New task purchasing

Question 31

2 models of organisational buying decision making are by …

Answer 31

Robinson eta al (1967).

Hilla nd Hillier (1977).

Question 32

Robinson et al (1967) model of organisational buying decision making:

Answer 32

1) Anticipation of need

2) Determination of quality of required item.

3) Specification of quality of required item

4) Search for and qualification of potential suppliers.

5) Analysis proposals

6) Evaluation proposals and supplier selection.

7) Selection of order routine

8) Performance feedback and evaluation.

Question 33

Hill and Hillier (1977) model of organisation buyer decision making.

Answer 33

1) Precipitation

2) Product specification

3) Supplier selection

4) Commitment

Question 34

Precipitation (Hill and Hillier 1977):

Answer 34

• start of the process is the realisation that there is a need and a purchase can solve that problem. May be driven by internal or external influences.

Question 35

Product specification (Hill and Hillier, 1977)

Answer 35

• Firms need to identify precisely what is required.
• Supplier evaluation looking at quality.

Question 36

Supplier selection (Hill and Hillier 1977):

Answer 36

• Finding a supplier who can best meet specified criteria.
• If existing suppliers can do the job they are likely to be favoured as they are usually known and trusted.
• Depends on the nature of the purchasing task. As low risk purchasing may not warrant extensive supplier research, but for high risk purchasing as they are infrequent more lengthy procedures will be inplace to make sure the suppliers can deliver within strict time limits.

Question 37

Commitment (Hill and Hillier 1977):

Answer 37

• Some buyers adopt formal appraisal procedures for their suppliers, covering key elements of performance, results will be discussed with suppliers concerned in the interests of improving their performance and maintaining relationship.

Question 38

Evaluation of Hill and Hillier model (1977):

Answer 38

+ useful framework for discussing complexities in B2B buying.

• Difficult to generalise, stages may be merged together and the process may end at any stage.

Question 39

Roles within the buying centre:

Answer 39

• Buying centre can be formally constituted (major capital project) or loosely informal.
• The roles in the B2B buying centre cover users.