Chapter 3 Class Notes
What is Consumer Buying Behavior?
Definition of Buying Behavior:
Buying Behavior is the decision processes and acts of people involved in buying and
using products.
Need to understand:
why consumers make the purchases that they make?
what factors influence consumer purchases?
the changing factors in our society.
Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A
firm needs to analyze buying behavior for:
Buyer’s reactions to a firms marketing strategy has a great impact on the firms
success.
The marketing concept stresses that a firm should create a Marketing Mix (MM)
that satisfies (gives utility to) customers, therefore need to analyze the what,
where, when and how consumers buy.
Marketers can better predict how consumers will respond to marketing
strategies.
Stages of the Consumer Buying Process
Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual
purchasing is only one stage of the process. Not all decision processes lead to a
purchase. All consumer decisions do not always include all 6 stages, determined by
the degree of complexity...discussed next.
The 6 stages in consumer decision making process are:
1. Problem Recognition (awareness of need)--difference between the desired state
and the actual condition. Deficit in assortment of products. Hunger--Food.
Hunger stimulates your need to eat.
Can be stimulated by the marketer through product information--did not know
you were deficient? I.E., see a commercial for a new pair of shoes, stimulates
your recognition that you need a new pair of shoes.
2. Information search--
o Internal search, memory.
o External search if you need more information. Friends and relatives
(word of mouth). Marketer dominated sources; comparison shopping;
public sources etc.
A successful information search leaves a buyer with possible alternatives,
the evoked set.
Hungry, want to go out and eat, evoked set is
o chinese food
o indian food
o burger king
o klondikekatesetc
3. Evaluation of Alternatives--need to establish criteria for evaluation, features
the buyer wants or does not want. Rank/weight alternatives or resume search.
May decide that you want to eat something spicy, indian gets highest rank etc.
If not satisfied with your choice then return to the search phase. Can you think
of another restaurant? Look in the yellow pages etc. Information from different
sources may be treated differently. Marketers try to influence by "framing"
alternatives.
4. Purchase decision--Choose buying alternative, includes product, package,
store, method of purchase etc.
5. Purchase--May differ from decision, time lapse between 4 & 5, product
availability.
6. Post-Purchase Evaluation--outcome: Satisfaction or Dissatisfaction. Cognitive
Dissonance, have you made the right decision. This can be reduced by
warranties, after sales communication etc.
After eating an Indian meal, may think that really you wanted a Chinese meal
instead.
Types of Consumer Buying Behavior
Types of consumer buying behavior are determined by:
Level of Involvement in purchase decision. Importance and intensity of interest
in a product in a particular situation.
Buyers level of involvement determines why he/she is motivated to seek
information about a certain products and brands but virtually ignores others.
High involvement purchases--Honda Motorbike, high priced goods, products visible
to others, and the higher the risk the higher the involvement. Types of risk:
Personal risk
Social risk
Economic risk
The four type of consumer buying behavior are:
Routine Response/Programmed Behavior--buying low involvement
frequently purchased low cost items; need very little search and decision effort;
purchased almost automatically. Examples include soft drinks, snack foods,
milk etc.
Limited Decision Making--buying product occasionally. When you need to
obtain information about unfamiliar brand in a familiar product category,
perhaps. Requires a moderate amount of time for information gathering.
Examples include Clothes--know product class but not the brand.
Extensive Decision Making/Complex high involvement, unfamiliar, expensive
and/or infrequently bought products. High degree of
economic/performance/psychological risk. Examples include cars, homes,
computers, education. Spend alot of time seeking information and deciding.
Information from the companies MM; friends and relatives, store personnel etc.
Go through all six stages of the buying process.
Impulse buying, no conscious planning.
The purchase of the same product does not always elicit the same Buying Behavior.
Product can shift from one category to the next.
For example:
Going out for dinner for one person may be extensive decision making (for someone
that does not go out often at all), but limited decision making for someone else. The
reason for the dinner, whether it is an anniversary celebration, or a meal with a couple
of friends will also determine the extent of the decision making.
BUYING ROLES
A buying centre makes joint purchase decisions as an informal group. Its task
consists of information acquisition, search processes, the development of choice
criteria and decision making among alternatives.
The buying center has three principal aspects:
1. composition: the size, hierarchical levels and functional areas involved;
2. influence: those individuals with the most influence in the buying
process;
3. roles: the identification of different roles played by buying center
members.
A buying centre includes all members of the purchasing organisation who play any
of six roles in the purchase process: BUYING ROLES are as follows
1. INITIATOR first identifies the need to buy a particular product or service to
solve an organizational problem;
2. INFLUENCER (their) views influence the buying centre's buyers and
deciders;
3. DECIDER ultimately approves all or any part of the entire buying decision -
- whether to buy, what to buy, how to buy, and where to buy;
4. BUYER holds the formal authority to select the supplier and to arrange
terms of condition;
5. USER consumes or uses the product or service;
6. GATEKEEPER controls information or access or both, to decision makers
and influencers.
Thus we can distinguish five roles people might play in a buying
decision: in family.
i. Initiator:
A person who first suggests the idea of buying the particular product or
service.
ii. Influencer:
A person whose view or advice influences the decision.
iii. Decider:
A person who decides on any component of a buying decision; whether to
buy, what to buy, how to buy, or where to buy
iv. Buyer:
The person who makes the actual purchase.
v. User:
A person who consumes or uses the product or service.
Difference between Organizational and Consumer Buying Behavior
Consumer Buying Behavior Organizational Buying
Point of Difference
Behavior
Consumers purchase goods Organizations purchase
for their personal use. goods to use in their
Buying Motive
ongoing operations and to
resell to consumers
Consumers purchase final Organizations purchase
product for personal more raw materials, such as
Type of Products
consumption. wood, steel and other items
used in manufacturing or
final products for reselling
to its consumers.
Consumer purchases Organizations generally purchase
Buying Volume
products in small quantities goods in larger volumes
Consumer s are spread Organizations on the other
across a large area and are hand are few in numbers.
huge in numbers
Consumer decision making Organizational buying
process is simple as involves complex decision
Decision making
compared to organizational making process as
process
decision making process. compared to consumer
decision making process.
Demand in consumer Demand of organizational
market is elastic type of goods is derived demand
demand. and is dependent on demand
Types of demand
of products in consumer
markets. The demand is
inelastic.
Consumers are needed to be Trained professionals
Purchasers educated by marketers experts in buying industrial
about utility/USP . products.
