Chapter 5 Marketing: Understanding Consumer and Business Buyer Behavior

2. Information Search

Consumers can obtain information from any of several sources, which include personal sources, commercial sources, public sources, and experimental sources.

Cultural Factors

Cultural factors expert a broad and deep influence on consumer behavior. Marketers need to understand the role played by the buyer's culture, subculture, and social class.

Cultural

Culture Subculture Social Class

Early Mainstream Adopters

Deliberate - Although they are rarely leaders they adopt new ideas before the average person

Age and Lifestyle

People change the goods and services they buy over their lifetimes.

Family

The family is the most important consumer buying organization in society, and it has been researched extensively.

Group

Two or more people who interact to accomplish individual or mutual goals.

Innovators

Venturesome - they try new ideas at some risk.

Divisibility

The degree to which the innovation may be tried on a limited basis

Communicability

The degree to which the results of using the innovation can be observed or described to others

New Task

A business buying situation in which the buyer purchases a product or service for the first time

Straight Rebuy

A business buying situation in which the buyer routinely reorders something without any modificaitons

Modified Rebuy

A business buying situation in which the buyer wants to modify product specifications, prices, terms, or suppliers

Personal Factors

A buyer's decision also are influenced by personal characteristics such as the buyer's occupation, age and life-cycle stage, economic situation, lifestyle, and personality and self-concept.

Social Factors

A consumer's behavior also is influenced by social factors, such as the consumer's small groups, social networks, family, and social roles.

Belief

A descriptive thought that a person holds about something.

New Product

A good, service, or idea that is perceived by some potential customers as new.

Subculture

A group of people with shared value systems based on common life experiences

Motive (drive)

A need that is sufficiently pressing to direct the person to seek satisfaction

Selective Retention

Consumers are more likely to remember good points made about a brand they favor and forget good points made about a brand they favor and forget good points made about competing brands

Opinion Leader ( Influentials or Leading Adopters)

A person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others.

Psychological Factors

A person's buying choices are further influenced by four major psychological factors: motivation, perception, learning, and beliefs and attitudes

Economic Situation

A person's economic situation will affect his or her store and product choices. Marketers watch trends in spending, personal income, savings, and interest rates.

Lifestyle

A person's pattern of living as expressed in his or her activities, interests, and opinions.

Attitude

A person's relatively consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea.

Roles and Status

A role consists of the activities people are expected to perform according to the people around them.

Drive

A strong internal stimulus that calls for action. A drive becomes a motive when it is directed toward a particular stimulus object.

Occupation

Affects the goods and services bought. Blue-collar workers tend to buy more rugged work clothes, whereas executives buy more business suits. Marketers try to identify the occupational groups that have an above average interest in their products and services.

Personal

Age and Lifecycle stage Economic situation Lifestyle Personality and self-concept

Consumer Market

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

Buying Center

All the individuals and units that play a role in the purchase decision making process

Evaluation of Alternatives

Alternative evaluation is how consumers process information to choose among alternative brands.

Stages in Adoption Process

Awareness: The consumer becomes aware of the new product but lacks information about it. Interest: The consumer seeks information about the new product. Evaluation: The consumer considers whether trying the new product makes sense. Trial: The consumer tries the new product on a small scale to improve his or her estimate of its value. Adoption: The consumer decides to make full and regular use of the new product.

Derived Demand

Business demand that ultimately comes from the dead for consumer goods

Cognitive Dissonance

Buyer discomfort caused by post purchase conflict

Systems Selling

Buying a complete solution to a problem from a single seller, thus avoiding all the separate decisions involved in a complex buying situation

Buyer

Buying decisions are affected by an incredibly complex combination of external and internal influences

Learning

Changes in an individual's behavior arising from experience

Personality and Self-Concept

Each person's distinct personality influences his or her buying behavior.l

Social

Groups and social networks Family Roles and Status

Membership Groups

Groups that have a direct influence and to which a person belongs

Early Adopters

Guided by respect - They are opinion leaders in their communities and adopt new ideas early but carefully.

General Need Description

Having recognized a need, that describes the characteristics and quantity of the needed item.

Total Market Strategy

Integrating ethnic themes and cross-cultural prospectives within a brand's mainstream marketing, appealing to consumer similarities across subcultural segments rather than differences.

Buzz Marketing

Involves enlisting or even creating opinion leaders to serve as "brand ambassadors" who spread the word about a company's products.

Order-Routine Specification

It includes the final order with the chosen supplier or suppliers and lists items such as technical specifications quantity needed, expected delivery time, return policies, and warranties.

Performance Review

May lead to the buyer to continue, modify, or drop the arrangement

Psychological

Motivation Perception Learning Beliefs and Attitudes

Aspirational Group

One to which the individual wishes to belong, (ex. a young basketball player hopes to someday emulate basketball star Lebron James and play in the NBA).

Online Social Networks

Online communities - blogs, social networking Web sites, and other online communities - where people socialize or exchange information and opinions

African Americans

Population is growing in affluence and sophistication. The nations more than 42 million black consumers wield almost $1.2 trillion in annual buying power.

Social Class

Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors. Social class is not determined by a single factor, such as income, but is measured as a combination of occupation, income, education, wealth, and other variables. Marketers are interested in social class because people within a given social class tend to exhibit similar buying behavior.

Hispanics

Represent, large, fast growing market. The nations more than 55 million Hispanic consumers have a total annual buying power of $1.7 trillion.

Reference groups

Serve as direct (face to face interactions) or indirect points of comparison or reference is forming a person's attitudes or behavior. Marketers try to identify reference groups of their target markets. They expose a person to new behaviors and lifestyles, and influence the person's attitudes and self concept, and create pressures to conform that may affect the person's product and brand choices.

5 Brand Personality Traits

Sincerity Excitement Competence Sophistication Ruggedness

Late Mainstream Adopters

Skeptical - They adopt an innovation only after a majority of people have tried it

Supplier Development

Systematic development of networks of supplier-partners to ensure a dependable supply of products and materials for use in making products or reselling them to others.

The Buyer Decision Process

The actual purchase decision is part of a much larger buying process - from recognizing a need through how you feel after making the purchase. Marketers want to be involved throughout the entire process

Proposal Solicitation

The buyer invites qualified suppliers to submit proposals

1. Need Recognition

The buyer recognizes a problem or need. Can be triggered by internal stimuli when one of the person's normal needs.

Consumer Buyer Behavior

The buying behavior of final consumers-individuals and households that buy goods and services for personal consumption.

Business Buyer Behavior

The buying behavior of organizations that buy goods and services for use in the production of other products and services that are sold, rented or supplied to others

Supplier Selection

The buying center often will draw up a list of the desired supplier attributes and their relative importance

Product Specification

The buying organization next develops the items's technical product specification

Relative Advantage

The degree to which the innovation appears superior to existing products.

Compatibility

The degree to which the innovation fits the values and experiences of potential consumers

Complexity

The degree to which the innovation is difficult to understand or use

Purchase Decision

The first factor is Attitudes of Others: If someone important to you thinks that you should buy the lowest priced product, the chances of you buying the expensive product are reduced. The second factor is Situational Factors: The consumer may form a purchase intention based on factors such as expected income, expected price and expected product benefits.

Self Concept (Self Image)

The idea is that people's possessions contribute to and reflect their identities - that is, "we are what we consume"

Word of Mouth Influence

The impact of the personal words and recommendations of trusted friends, family, associates, and other consumers on buying behavior.

Adoption Process

The mental process through which an individual passes from first hearing about an innovation to final adoption.

Asian Americans

The most affluent U.S. demographic segment. A relatively well-educated segment, they now number more than 18 million with annual buying power expected at $1 trillion by 2017.

Business Buying Process

The process by which business buyers determine which products and services their organizations need to purchase and then find, evaluate, and choose among alternative suppliers and brands.

Perception

The process by which people select, organize, and interpret information to form a meaningful picture of the world

Culture

The set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions.

Brand Personality

The specific mix of human traits that may be attributed to a particular brand.

Selective Attention

The tendency for people to screen out most of the information to which they are exposed - means that marketers must work especially hard to attract the consumer's attention

Selective Distortion

The tendency of people to interpret information in a way that will support what they already believe

Personality

The unique psychological characteristics that distinguish a person or group. Usually described in terms of traits such as self confidence, dominance, sociability, autonomy, defensiveness, adaptability, and aggressiveness.

Supplier Search

To find the best the best vendors

Lagging Adopters

Traditional bound - They are suspicious of changes and adopt the innovation only when it has become something of a tradition itself

Vendor Managed Inventory

in which they turn over ordering and inventory responsibilities to their suppliers