Chapter 5

Understanding
Consumer
Chapter 1

and
Business Buyer
Behavior

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 Rest Stop: Previewing the Concepts

 Describe the consumer market and the major factors

that influence consumer buyer behavior.
 Identify and discuss the stages in the buyer decision
process.
 Describe the adoption and diffusion process for new
products.
 Define the business market and identify the major
factors that influence business buyer behavior.
 List and define the steps in the business buying
decision process.
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 Case Study
Harley-Davidson – Devoted Consumers
Building Success Measuring Success
 Offers good bikes, upgraded  Currently has 26% of all U.S.
showrooms, and revised bike sales and 50% of
sales tactics.
heavyweight segment.
 Consumer emotions,
motivations, and lifestyle  Demand outstripped supply
research has been translated for several years; waits of up
into effective advertising. to 2 years for popular models.
 Harley riders are fiercely  Annual revenues/earnings
loyal to the brand, older, have grown at 14% to 23%
better educated, affluent. over past 10 years.
2007: 21st straight year of
record sales and income.
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 Consumer Buying Behavior

 Consumer buying behavior:

►Refersto the buying behavior of people who buy
goods and services for personal use.
►These people make up the consumer market.

 The central question for marketers is:

►“How do consumers respond to various
marketing efforts the company might use?”

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 Model of Buying Behavior

 Marketing mix factors and other

external stimuli are inputs into the
“buyer’s black box.”
►Stimuli are evaluated in light of the buyer
decision process and the buyer’s
characteristics.
►Buyer responses influence attitudes and
choice of the product, brand, vendor, as
well as the timing and amount of purchase.
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 Consumer Buying Behavior
 Factors influencing consumer behavior:
► Cultural factors:
• Culture, subculture, social class
► Social factors:
• Reference groups, family, roles, and status
► Personal factors:
• Age/life-cycle, occupation, economic situation,
lifestyle, personality, and self-concept
► Psychological factors:
• Motivation, perception, learning, beliefs, attitudes
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 Culture
 Culture is the most basic cause of a
person’s wants and behavior.
►Culture is learned from family, church,
school, peers, colleagues.
►Culture reflects basic values, perceptions,
wants, and behaviors.
►Cultural shifts create opportunities for new
products or may otherwise influence
consumer behavior.
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 Subculture
 Subculture:
►Groups of people with shared value systems
based on common life experiences.
 Major subculture groups:
►Hispanic consumers
►African-American consumers
►Asian-American consumers
►Mature consumers

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 Social Class
 Social class:
► Society’s relatively permanent and ordered
divisions whose members share similar values,
interests, and behaviors.
► Measured by a combination of occupation,
income, education, wealth, and other variables.

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 Social Factors
 Groups and social networks:
► Membership, reference, and aspirational groups.
• Marketers attempt to reach opinion leaders.
► Online social networks.
 Family:
► Most important consumer buying organization.
 Roles and status:
► Role = Expected activities.
► Status = Esteem given to role by society.

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 Personal Factors
 Age and life-cycle stage:
► People change the goods they buy over their
lifetimes.
 Occupation:
► Occupation influences the purchase of clothing and
other goods.
 Economic situation:
► Some goods and services are especially income-
sensitive.

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 Personal Factors
 People within the same subculture, social
class, and occupation may have different
lifestyles.
 Lifestyle:
► Pattern of living as expressed in psychographics.
• Activities
• Interests
• Opinions

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 Personal Factors
 Personality:
►Refers to the unique psychological
characteristics that lead to relatively
consistent and lasting responses to one’s
own environment.
►Generally defined in terms of traits.
►Self-concept theory suggests that people’s
possessions contribute to and reflect their
identities.
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 Psychological Factors
 A motive (or drive) is a  Maslow’s hierarchy of
needs implies that lower
need that is sufficiently level needs must be
pressing to direct the satisfied prior to higher
person to seek level needs.
► Physiological needs
satisfaction. ► Safety needs
 Maslow’s hierarchy of ► Social needs

needs explains why ► Esteem needs

► Self-actualization
people are driven by
needs at particular
times.
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 Psychological Factors
 Perception:
►Process by which people select, organize,
and interpret information to form a
meaningful picture of the world.
►Perception can be influenced by:

• Selective attention
• Selective distortion
• Selective retention
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 Psychological Factors
 Learning:
► Defined as a relatively permanent change in behavior
due to experience.
► Occurs due to an interplay of drives, stimuli, cues,
responses, and reinforcement.
► Is strongly influenced by the consequences of an
individual’s behavior.
• Behaviors with satisfying results tend to be repeated.
• Behaviors with unsatisfying results tend not to be
repeated.

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 Beliefs and Attitudes
 Belief:
►A descriptive thought that a person holds
about something.
 Attitude:
►A person’s consistently favorable or
unfavorable evaluations, feelings, and
tendencies toward an object or idea.

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 Buying Decision Process
 Need recognition
 Information search
 Evaluation of alternatives
 Purchase decision
 Postpurchase behavior

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 Need Recognition and
Information Search
 Need recognition can be triggered by
internal or external stimuli.
 Several sources of information may
used during information search:
►Personal sources
►Commercial sources
►Public sources
►Experiential sources

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 Evaluation of Alternatives and
Purchase Decision
 Evaluation process is dependent upon
the specific buying situation and the
individual consumers.
 Two factors that may interfere with
realization of purchase intentions:
►Attitudes
of others
►Unexpected situational factors

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 Post Purchase Behavior
 Consumer satisfaction is a function of
consumer expectations and perceived
product performance.
► Performance < Expectations ----- Disappointment
► Performance = Expectations ----- Satisfaction
► Performance > Expectations ----- Delight

 Cognitive dissonance:
►A buyer’s doubts shortly after a purchase about
whether it was the right decision.
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 Stages in the Adoption Process
1. Awareness: Consumer becomes aware of the
new product, but lacks information about it.
2. Interest: Consumer seeks information about
new product.
3. Evaluation: Consumer considers whether
trying the new product makes sense.
4. Trial: Consumer tries new product on a small
scale to improve his or her estimate of its value.
5. Adoption: Consumer decides to make full and
regular use of the new product.
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 Adopter Categorization
 Individual differences influence the speed
with which people will try to new products,
yielding five adopter categories:
► Innovators

► Early adopters
► Early majority

► Late majority

► Laggards

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 Product Characteristics That
Influence the Rate of Adoption
 Relative advantage:
► Is the innovation superior to existing products?
 Compatibility:
► Does the innovation fit the values and experience of the
target market?
 Complexity:
► Is the innovation difficult to understand or use?
 Divisibility:
► Can the innovation be used on a limited basis?
 Communicability:
► Can results be easily observed or described to others?
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 Business Markets and Business
Buyer Behavior
 The business market is vast and involves far
more dollars and items than do consumer
markets.
 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 or for the purpose of
reselling, or renting them to others for a profit.

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 Business Markets
 Market structure and  Nature of the
demand: buying unit:
► Contains far fewer but ► Business purchases
larger buyers.
► Buyers are more
involve more
geographically decision participants.
concentrated. ► Business buying
► Business demand involves a more
is derived from professional
consumer demand. purchasing effort.

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 Business Markets
 Key differences exist between business and
consumer buying situations:
►Business buyers usually face more complex buying
decisions.
►The business buying process tends to be more
formalized.
►Buyers and sellers are much more dependent on each
other in business markets.

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 Types of Buying Situations
 Straight rebuy:
► Buyer routinely reorders something without any
modifications.
 Modified rebuy:
► Buyer wants to modify product specifications,
prices, terms, or suppliers.
 New task:
► Buyer purchases a product or service for the first
time.
► Systems (solution) selling is becoming more
common.
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 Participants in the Business
Buying Process
 A buying center is all the individuals
and units that participate in the
business buying-decision process.
►This is not a fixed or formally identified
unit.
►Membership will vary for different products
and different tasks.

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 Major Influences on Business Buyers

 Environmental factors:
►Economic environment, shortages, culture
and customs.
 Organizational factors
 Interpersonal factors
 Individual factors

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 The Business Buying Process

1. Problem 5. Proposal
recognition solicitation
2. General need 6. Supplier selection
description 7. Order-routine
3. Product specification
specification 8. Performance
4. Supplier search review

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 e-Procurement
 Online purchasing (e-procurement)
can be implemented many ways:
►Reverse auctions
►Trading exchanges
►Company buying sties
►Extranet links with key suppliers

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 e-Procurement
 Advantages for buyers:
► Accessto new suppliers
► Lowers purchasing costs
► Hastens order processing and delivery

 Advantages for vendors:

► Share information with customers
► Sell products and services
► Provide customer support services
► Maintain ongoing customer relationships

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 e-Procurement
 Key benefits:
► Reduces transaction costs to buyers and sellers,
and makes for more efficient purchasing.
► Reduces the time between order and delivery.

► Frees purchasing staff to focus on more strategic

issues.
 Key problems:
► May erode long-standing customer relationships.
► May create potential security disasters.
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 Rest Stop: Reviewing the Concepts

 Describe the consumer market and the major factors

that influence consumer buyer behavior.
 Identify and discuss the stages in the buyer decision
process.
 Describe the adoption and diffusion process for new
products.
 Define the business market and identify the major
factors that influence business buyer behavior.
 List and define the steps in the business buying
decision process.
Prentice Hall, Copyright 2009 5-35
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Publishing as Prentice Hall
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