Chapter 4: Consumer Behaviour

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 Learning Objective

• Outline the characteristics of the consumer

1 market and the consumer behavior model.

• Identify the factors that influence the behavior

2 and decision-making processes of consumers.

• Know the types of buying behavior and the

3 buyer's decision process.

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 Learning Objective
• Determine the organizational market, explain the
difference between the organizational market and the
4 consumer market.

• Identify the factors that influence your organization's

5 buying behavior and your buying process.

• Know the market organizations and state agencies.

6

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 Content

General consumer behavior

Model of Consumer Behavior

Factors affecting personal consumption behavior

Types of shopping behavior

Buyer's decision-making process

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 Content

Organizational Market

Purchase behavior of customer organizations

The decision-making process of the organization

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Part 1: General Consumer Behaviors

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 Consumer Markets and Buyer Behavior

Consumer buyer behavior is the buying

behavior of final consumers—individuals
and households that buy goods and
services for personal consumption.

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 Consumer market

Consumer markets are made up of all the

individuals and households that buy or acquire
goods and services for personal consumption.

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Part 2: Model of consumer behavior

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 Model of Consumer Behavior

Figure 5.1 The Model of Buyer Behavior

We can measure the what, where, and when

of buyer behavior. But it’s difficult to “see”
inside the consumer’s head and figure out the
why(s) (that’s why it’s called the black box)

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Part 3:
Characteristics Affecting Consumer
Behavior

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 Characteristics Affecting Consumer
Behavior
• Factors Influencing Consumer Behavior

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 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.

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 Cultural Factors

Subcultures are
groups of people
within a culture
with shared value
systems based on
common life
experiences and
situations.

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 Cultural Factors

Social classes are society’s relatively

permanent and ordered divisions whose
members share similar values, interests,
and behaviors.

• Measured as a combination of
occupation, income, education, wealth,
and other variables
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 Cultural Factors

Major American Social Classes

• Upper Class
• Middle Class
• Working Class
• Lower Class

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 Social Factors

• Groups and Social Networks

Membership Aspirational Reference

Groups Groups Groups
• Groups with • Groups an • Groups that
direct individual form a
influence wishes to comparison
and to which belong to or reference
a person in forming
belongs attitudes or
behavior

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 Social Factors
• Groups and Social Networks

• Online social
networks
• Buzz marketing
• Social media sites
• Virtual worlds
• Word of mouth
• Opinion leaders
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 Social Factors

• Family is the most important consumer-

buying organization in society.

• Role and status can be defined by a

person’s position in a group.

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 • Personal Factors

• Age and life-cycle stage

• PRIZM Lifestage Groups system

– 66 segments
– 11 life-stage groups

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 Personal Factors

Occupation affects the goods and

services bought by consumers.

Economic situations include trends in:

Personal Interest
Spending Savings
income rates

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 Personal Factors

Lifestyle is a
person’s pattern
of living as
expressed in his
or her
psychographics.
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 Personal Factors

Personality refers to the

unique psychological
characteristics that
distinguish a person or
group.

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 Personal Factors
Brand Personality Traits

Sincerity Excitement Competence

Sophistication Ruggedness

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 • Psychological Factors

Motivation

Perception

Learning

Beliefs and attitudes

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 Psychological Factors

A motive (or drive) is a need that is

sufficiently pressing to direct the person
to seek satisfaction of the need.

Motivation research refers to qualitative

research designed to probe consumers’
hidden, subconscious motivations.
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 Psychological Factors
• Figure 5.4 - Maslow’s Hierarchy of Needs

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 Psychological Factors
Perception is the process by which people
select, organize, and interpret information to
form a meaningful picture of the world.

Perceptual Processes

Selective Selective Selective

attention distortion retention

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 Psychological Factors

Selective attention is the tendency for people to

screen out most of the information to which they are
exposed.

Selective distortion is the tendency for people to

interpret information in a way that will support what
they already believe.

Selective retention is the tendency to remember good

points made about a brand they favor and forget
good points about competing brands.
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 Psychological Factors

• Learning is the change in an individual’s

behavior arising from experience and
occurs through the interplay of:

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 Psychological Factors

A belief is a descriptive thought that a person

has about something based on:
– knowledge
– opinion
– faith

An attitude describes a person’s relatively

consistent evaluations, feelings, and
tendencies toward an object or idea.
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Part 4: Types of Buying Decision
Behavior

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 Types of Buying Decision Behavior

Complex buying behavior

Dissonance-reducing buying behavior

Habitual buying behavior

Variety-seeking buying behavior

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 Types of Buying Decision Behavior

FIGURE | 5.5 Four Types of Buying Behavior

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 Part 5: The Buyer Decision Process

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 The Buyer Decision Process

FIGURE | 5.6 Buyer Decision Process

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 The Buyer Decision Process

• Need Recognition

Need recognition is the first stage of

the buyer decision process, in which
the consumer recognizes a problem or
need triggered by:
– Internal stimuli
– External stimuli

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 The Buyer Decision Process
• Information Search

Information search is 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
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 The Buyer Decision Process

• Evaluation of Alternatives

Alternative evaluation is the stage of the

buyer decision process in which the
consumer uses information to evaluate
alternative brands in the choice set.

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 The Buyer Decision Process
• Purchase Decision

Purchase decision is 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

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 The Buyer Decision Process
Postpurchase Behavior

Postpurchase behavior is the stage of

the buyer decision process in which
consumers take further action after
purchase, based on their satisfaction
or dissatisfaction.

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 The Buyer Decision Process
Postpurchase Behavior

Cognitive
dissonance is
buyer discomfort
caused by
postpurchase
conflict.

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The Buyer Decision Process for New Products

The adoption process is the mental

process an individual goes through from
first learning about an innovation to final
regular use.

• Stages in the adoption process include:

Awareness Interest Evaluation Trial Adoption

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The Buyer Decision Process for New Products
Individual Differences in Innovativeness

• Innovators
• Early Adopters
• Early Mainstream
• Late Mainstream
• Lagging Adopters

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The Buyer Decision Process for New Products
Individual Differences in Innovativeness
FIGURE | 5.7 Adopter Categories Based on Relative Time of Adoption of Innovations

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Part 6: Business Market

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 Business Markets and Business
Buyer Behavior
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.

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 Business Markets and Business
Buyer Behavior

• 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

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 Business Markets

• Market Structure and Demand

Fewer but larger buyers

Derived demand

Inelastic demand

Fluctuating demand

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 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

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 Business Markets
• Decision Process

Supplier development is 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.

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Part 7: Business buyer behavior

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 Business Buyer Behavior
Major Types of Buying Situations

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 • Major Types of Buying Situations

Straight rebuy is a buying situation in which the

buyer routinely reorders something without any
modifications.
Modified rebuy is a buying situation in which
the buyer wants to modify product specifications,
prices, terms, or suppliers.
New task is a buying situation in which the
buyer purchases a product or service for the first
time.
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 • Major Types of Buying Situations

Systems
selling is
buying a
complete
solution to a
problem from
a single seller.

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• Participants in the Business Buying
Process

• Buying center consists of all the

individuals and units that play a role in the
business purchase decision-making
process.
• Users
• Influencers
• Deciders
• Purchasers
• Gatekeepers
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 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.

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 Participants in the Business Buying Process

• The buying center concept presents a

major marketing challenge given the
varied groups involved in the decision.

• Who participates in the decision?

– Relative influence on decision by various participants
– Evaluation criteria used by various participants
– Are there Informal participants involved in decision

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 Major Influences on Business Buyers

• FIGURE | 6.2 Major Influences on Business Buying Behavior

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 • Major Influences on Business
Buyers

Economic Personal
Factors Factors

Price
Emotion
Service

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 Major Influences on Business Buyers

• Environmental Factors
Demand for Economic Cost of
product outlook money

Supply of
Technology Culture
Materials

Politics Competition

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 Major Influences on Business Buyers
• Organizational Factors

Objectives
Strategies
Structure
Systems
Procedures

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 Major Influences on Business Buyers

• Interpersonal Factors

Influence Expertise

Authority Dynamics

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 Major Influences on Business Buyers

• Individual Factors

Motives Perceptions Preferences Age

Attitude
Income Education
toward risk

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 • The Business Buying Process

FIGURE | 6.3 Stages of Business Buying Behavior

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 The Business Buying Process

Problem recognition occurs when

someone in the company recognizes a
problem or need.
• Internal stimuli
– Need for new product or production
equipment
• External stimuli
– Idea from a trade show or advertising

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 The Business Buying Process

General need description describes the

characteristics and quantity of the needed item.

Product specification describes the technical

criteria.

Value analysis is an approach to cost

reduction where components are studied to
determine if they can be redesigned,
standardized, or made with less costly methods
of production.
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 The Business Buying Process

Supplier search involves compiling a list of

qualified suppliers to find the best vendors.

Proposal solicitation is the process of

requesting proposals from qualified suppliers.

Supplier selection is when the buying center

creates a list of desired supplier attributes and
negotiates with preferred suppliers for
favorable terms and conditions.
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 The Business Buying Process

Order-routine specifications includes the final

order with the chosen supplier and lists all of
the specifications and terms of the purchase.

Performance review involves a critique of

supplier performance to the order-routine
specifications.
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 Key terms

• Groups.

• Social class.

• Life cycle stages. • Motivation.

• Lifestyle. • Awareness.
• Character. • Belief

• Viewpoint
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 Q&A

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