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UT Knoxville BUAD 332 - Chapter 5 to post

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Slide 1Consumer Buying BehaviorSimple Model of Consumer Buyer BehaviorCultureCultureCultureSocial FactorsPersonal FactorsRemember Why These Are Important to Marketers!Buyer Decision ProcessBuying Decision ProcessBuyer Decision ProcessBuying Decision ProcessSources of InformationBuyer Decision ProcessBuying Decision ProcessBuyer Decision ProcessBuying Decision ProcessCognitive DissonanceBuyer Decision ProcessAdoption ProcessStages in the Adoption ProcessNew Product Adoption RateInfluence of Product Characteristics on Rate of AdoptionBusiness Markets & Business Buyer BehaviorBusiness MarketsTypes of Decisions and the Decision ProcessModel of Business Buyer BehaviorMajor Types of Buying SituationsParticipants in the Business Buying ProcessThe Business Buying ProcessBottom LineChapter 5Understanding Consumer and Business Buyer BehaviorConsumer Buying BehaviorRefers to 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?”Simple Model of Consumer Buyer BehaviorCultureCulture is the Most Basic Cause of a Person's Wants and Behavior. Culture is learned from _______, _______, _________, ___________, _____________, etc...Culture includes basic values, perceptions, wants, and behaviors.Culture Subculture•Groups of people with shared value systems based on common life experiences. Some U.S. Subcultures• Hispanic American • African American •Asian AmericanCulture Social ClassSociety’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors.Measured by a combination of: occupation, _________, education, _________, and other variables.Social Factors•Reference (opinion leaders)•Aspirational Groups Family Roles & Status Most important consumer buying organization Role =Expected activities Status = Esteem given to role by societyPersonal FactorsAge and Life-Cycle StageOccupationEconomic SituationRemember Why These Are Important to Marketers!Marketers want to understand how these characteristics affect the buyers’ responsesMarketers want to understand how these characteristics affect the buyers’ responsesBuyer Decision ProcessStep #1 = Need RecognitionBuyer becomes aware of a difference between a desired state and an actual condition. Individual may be unaware of the problem or need Marketers may use sales personnel, advertising, and packaging to trigger recognition of needs or problems.Buying Decision ProcessBuyer Decision ProcessStep #2 = Information SearchThis stage begins after the consumer becomes aware of the problem or need.There are various sources of information.Buying Decision ProcessSources of Information•Most effective source •Family, friends, neighbors• Personal Commercial Public•Advertising, salespeople• •Mass Media• Experimental •Handling the product•Examining the product • Using the productBuyer Decision ProcessBuying Decision ProcessConsumers May Use Careful Calculations & Logical Thinking consumers may buy on impulse and rely on intuition Consumers May Make Buying Decisions on Their Own consumers may make decision after talking with others Marketers must study buyers to find out how they evaluate brand alternativesBuyer Decision ProcessBuying Decision ProcessConsumer satisfaction is a function of consumer expectations and perceived product performance.Performance < Expectations Disappointment Performance = Expectations Satisfaction Performance > Expectations DelightCognitive DissonanceA buyer’s doubts shortly after a purchase about whether it was the right decision.Buyer Decision ProcessDon’t forget – Marketers want to INFLUENCE each of these steps, to the extent they can!Adoption ProcessThe mental process through which an individual passes from first hearing about an innovation to final adoption.Stages in the Adoption Process1. 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.New Product Adoption RateSome products catch on almost overnight. Others, such as HDTV, take a long time to gain acceptance.Influence of Product Characteristics on 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: The degree to which innovation can be tried on limited basis Communicability: Can results be easily observed or described to others?Business Markets &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.Just as is the case with consumer buyer behavior, marketers want to know how business buyers behaveBusiness MarketsMarket Structure and Demand:Contains far fewer but larger buyers.Customers are more geographically concentrated. Business demand is derived from consumer demand Nature of the Buying Unit:Business purchases involve more decision participants. Business buying involves more professional purchasing effortTypes of Decisions and the Decision ProcessBusiness buyers usually facemore complex buying decisions.Business buying processtends to be more formalized.Buyers and sellers are muchmore dependent on each other.Model of Business Buyer BehaviorMajor Types of Buying Situations The buyer routinely reorders something without considering alternative suppliers Straight Rebuy Modified Rebuy New Task The buyer wants to modify product specifications, prices, terms, or suppliers. The buyer purchases a product or service for the first time.Participants in the Business Buying ProcessDecision-making unit of a buying organization is called its buying center.Not a fixed and formally identified unit.Membership will vary for different products and buying situations.Buying Center Members:Users Deciders


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