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Chapter - 3 Consumer and Organizational Buyer Behavior
Chapter - 3 Consumer and Organizational Buyer Behavior
Consumer and
Organizational Buyer
Behavior
1
Difference between Consumer and
Organizational Buying
Fewer organizational buyers
requirements
Reciprocal buying may be important in
organizational buying
2
Organizational selling/ buying may be more
risky
Organizational buying is more complex
Negotiation is often more important in
organizational buying
Consumer Buyer Behavior
An understanding of customers can only be
obtained by answering the following
questions
Who is important in the buying decision?
How do they buy?
What are their choice criteria?
Where do they buy?
When do they buy?
3
Blackwell, Miniard and Engel describe five
roles:
Initiator
Influencer
Decider
Buyer
User
4
The evaluation system
5
Choice Criteria
Choice criteria can be economic, social,
or personal
Economic criteria include performance,
reliability, price
Social criteria include status and the need
for social belonging
Personal criteria concern how the product
or service relates to the individual
psychologically
6
The buying situation:
Howard and Sheth identified three types of
buying situation
Extensive problem solving: When a problem or
need is new, the means of solving that problem
is expensive and uncertainty is high, a
consumer is likely to conduct extensive
problem solving
Limited problem solving occurs when the
consumer has some experience with the
product in question and may be inclined to stay
loyal to the brand previously purchased
Automatic response happens when companies
who have built up a large brand franchise will
wish to move their customers to the state of
automatic response
7
Level of purchase involvement and the buying
situation
8
Personal influences: A second group of factors
that influences the consumer decision making
process concerns the psychology of the
individuals
Relevant concepts include
Personality
Motivation
Perception
Learning
Lifestyle patterns have attracted much attention
from marketing research practitioners
Lifestyle refers to the patterns of living as
expressed in a person’s activities, interests and
opinions
9
Dimensional model of buying behavior
10
Social influences: Most social influences on
consumer decision making include
Social class
Reference groups
Culture and
Family
11
Organizational Buyer Behavior:
Organizational buyer behavior has usefully been
13
Process: Need or problem recognition
Determination of characteristics,
sources
Acquisition and analysis of proposals
suppliers
Selection of an order routine
14
Content: This aspect of organizational buyer
behavior refers to the choice criteria used by the
members of DMU to evaluate supplier proposals
Quality
Continuity of supply
Perceived risk
Office politics
retention
15
Factors affecting Organizational buyer
behavior:
Cardozo identified three factors:
organization
The buy class:
Straight re-buy
Modified re-buy
New task
16
The product type:
Products can be classified according to four types
Materials
Components
17
Development in Purchasing Practice:
A number of trends have taken place within the
purchasing function which have marketing
implications for supplier firms
They are
Just in time purchasing (JIT)
The just in time (JIT) concept aims to minimize
stocks by organizing a supply system which
provides materials and components as they are
required
Centralized purchasing
Where several operating units within a company
have common requirements and there is
opportunity to strengthen a position by bulk buying,
centralized purchasing is an attractive option
18
Reverse marketing
Purchasing is taking on a more proactive,
aggressive stance in acquiring the products and
services needed to compete.
This process whereby the buyer attempts to
persuade the supplier to provide exactly what the
organization wants is called reverse marketing
It provides an opportunity to develop a stronger
and longer relationship
It could be a source of new product
opportunities that may be developed to a broader
customer base.
19
Leasing
A lease is a contract by which the owner
of an asset grants the right to use the
asset (e.g. a car ) for a period of time to
another party in exchange for payment of
rent
There are two main types of lease
20