Consumer Vs.

Business Buying Behavior

Buying behavior varies greatly between consumers and businesses.
That's because while consumers purchase goods and services for
personal use, businesses buy these things either to manufacture other
goods or to resell them to other businesses or consumers. The
participants, characteristics, influences and the buying process are
different for both groups.

The Number of Participants

Consumer buying is usually limited to one or two participants, including the final user
of the product. For example, one person is usually involved in buying groceries and
basic home supplies. Business buying usually involves multiple participants, such as
the final users of the product, influencers who establish the need for certain
products, gatekeepers who screen potential suppliers and purchasing managers and
senior management who approve the funds for the purchases.

Differing Behavioral Characteristics

The consumer market consists of thousands of customers located in different
geographies and with different buying habits. However, their needs are usually the
same for a particular product
The business market usually consists of a few large buyers who are often
concentrated in specific geographic markets. Businesses generally form close and
long-term relationships with their suppliers. Different businesses might use the same
product differently.

Influencing Factors and Motivations

The influences on consumer buying behavior include basic needs, membership in
groups, family requirements, occupation, age, economic situation and lifestyle
choices.
The psychological influences include perception of certain products and brands,
beliefs and attitudes. Influences on business buying behavior include environmental
and organizational factors.
Competitive pressures, technological evolution and changing macroeconomic
conditions are some of the environmental influences, while corporate objectives,
policies and procedures are some of the organizational factors.
The Buying Process
The consumer buying process consists of five stages:
1.need recognition
2. information search
3. evaluation of alternatives
4. purchase decision
5. post-purchase outcomes.
Marketing stimuli can generate need, which leads to a search for information from
different sources.
The business buying process also starts with need recognition, followed by
development of product specifications. The company prepares a request for
proposal to elicit expressions of interest or bids from potential suppliers. It
selects one or more suppliers, issues purchase orders and monitors the
quality of the products supplied. Critical success factors in the business
market include customization capabilities, quality, performance, ease of use
and personal relationships.

Consumer Buying Decision Process

Every business owner needs to understand their customer. The consumer-buying
decision process is an important way to strengthen your company's sales function as
well as develop a sales and business development strategy that will continue to keep
your pipeline of prospects full. Simply put, understanding your consumer-buyer
behavior process will help you hone in on your customer's journey from the interest
in your product or service to purchasing.

A Five-Stage Consumer Buying Decision Process

1.Identifying the Pain Point

A customer must need to fill a gap or some other sort of need for them to
make a purchase.
2.Research
Buyers search internal and external business environments to identify and evaluate
information to support their central buying decision.
3.Evaluating the Best Option
The buyer will ask questions and decide which products, brands or service providers
will deliver what she needs most efficiently. A factor that influences this stage in the
buying process is the buyer's attitude. If the buyer has a positive attitude and is
engaged and enjoying the research process, it is likely she will have a large selection
of products to choose from. If she is disengaged and views the purchase-decision
process as a chore, it is likely only one company or brand will be evaluated.

4.Making the Decision

The decision-making process ends with the buyer making her decision.
At this stage, the research is done and choices evaluated – now it's time
to make a buying decision.
According to Philip Kotler, a well-known marketing consultant, the
final purchase decision may be "disrupted" by two factors: negative
feedback from other customers and the level of motivation to accept the
feedback.
5.Post-Purchase Behavior
customers will decide if their decision holds up to their expectations.
They will either be satisfied or dissatisfied. This is critical for a company
because if a customer is satisfied this will result in brand loyalty, which
will keep the customer coming back and spreading good reviews about
what they purchased.

Limitations of Consumer Buying Behavior

Consumer buying behavior is a psychological process that is important
to businesses and marketing professionals. Consumer buying behavior
relates to the identification of consistent stages of decision making used
in every purchase situation.
Marketers rely on an understanding of buyer behavior to effectively
position products and services. However, consumer buying behavior
does have limitations.

Inconsistency
One of the biggest drawbacks of relying too heavily on consumer buying behavior is
that consumers rarely apply the same steps in the same way for every product and
service purchase. This makes it more difficult for marketers trying to stimulate a need
or to offer messages that enhance the likelihood of a purchase for their brand.
Limited Buyer Interest
Another primary limitation for marketers using the consumer buying behavior model
is that consumers sometimes are much less involved in a purchase decision.
The ability of marketers to affect consumers by analyzing buyer behavior is
limited. Consumers that are less involved spend less time seeking or viewing
information about the purchase.

Consumer Buyer Matrix

is a visual graphic or table that explains consumer behavior in terms
of purchase decisions. It is also a marketing tool that assists with brand
building and development. The consumer buyer matrix tallies buyer
perceptions and classifies different purchasing decisions as being
related to specific types of products and consumer involvement.
The design of a consumer buyer matrix often consists of columns and
rows. In one kind of matrix, consumers compare two or more brands by
filling in matrix cells with quantified values such as usefulness, cost and
functionality.

Advantages
it evaluates product viability, measures brand value
elaborates consumer perceptions and reasoning
Disadvantages
cultural influences
product designs
Roles of a Consumer in a Society
Consumers, along with businesses, are the driving force of the economy.
When they spend, businesses reap the profit and consumers get a
quality product or service that will in some way enhance their lives.
Consumers play an important role in society from the methods they use
to research and review products to their decisions on which brands to
use and where to make purchases.
Initiator
Consumers determine the products and services they need, whether they are
shopping for themselves, friends, family members or business clients. Once a
consumer becomes interested in a product or service, regardless of the brand name
associated with it, he begins to gather information to determine if making the
purchase is a reasonable, wise-buying decision.

Influencer
Consumers undoubtedly look to family, friends and colleagues for opinions when
they're making a purchase. A referral for a business or a personal experience with a
product holds more weight with a consumer. Companies offer customers an
opportunity to review their services and products online, and consumers use this
information to gauge quality, service, features, benefits and pricing.

Decider
Children, for example, may initiate the idea of a purchase by mentioning a new
cereal to a parent. The parent decides whether or not to make the purchase after
researching the cereal to determine its price, its availability and how healthy it is.
Consumers who assume the role of a decider have the financial authority to decide
whether a good or service can be purchased.

Buyer
Consumers purchase products and services with their money, a spouse's money, or
by using a company credit card.

User
Consumers typically use the products they buy, unless they make the purchase for a
family member, friend or colleague. Regardless of who makes the purchase, the user
is the person who ultimately consumes the good or service that's purchased by the
buyer.

The Economic Model of Consumer Behavior

The economic model of consumer behavior focuses on the idea that a consumer’s
buying pattern is based on the idea of getting the most benefits while minimizing
costs. Thus, one can predict consumer behavior based on economic indicators such
as the consumer’s purchasing power and the price of competitive products.
Sources of Consumer Behavior
● motivation
● perceptions
● personality
● lifestyle
● knowledge

8 Steps of the Business Purchasing Process

it's helpful to follow a step-by-step process that ensures you get
what you need while also considering your budget and
expectations for the product or service. Such a process gives you
the opportunity to examine your company's specific needs in detail
and select products and vendors that are most effective for your
situation.
● determining a budget;
● selecting a purchasing team;
● defining specifications;
● searching for options;
● evaluating options;
● making the purchase; and
● re-evaluating the purchase.