MKTG Chapter 5

Business makes structure and demand

-Fewer but larger buyers -Derived demand: Business demand that comes from the demand for consumer goods -Inelastic and fluctuating demand

nature of the buying unit

-More decision participants -More professional purchasing effort

buying situations

-straight rebuy, the buyer reorders something without any modifications. It is usually handled on a routine basis by the purchasing department -modified rebuy, the buyer wants to modify product specifications, prices, terms, or suppliers. -new task, company buying a product or service for the first time -Systems selling (or solutions selling) refers to buying a packaged solution to a problem from a single seller, thus avoiding all the separate decisions involved in a complex buying situation.

psychological- motivation

A motive (or drive) is a need that is sufficiently pressing to direct a person to seek satisfaction. Many companies employ teams of psychologists, anthropologists, and other social scientists to carry out motivation research.

social- opinion leader

An opinion leader is a person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others. Opinion leaders are also referred to as influentials or leading adopters. Buzz marketing involves enlisting or even creating opinion leaders to serve as brand ambassadors who spread the word about a company's products

social- online social networks

are online communities where people socialize or exchange information and opinions.

Cultural factors affecting buying behavior

culture: Set of basic values, perceptions, wants, and behaviors learned by an individual from family and other important institutions

psychological- learning

describes changes in an individual's behavior arising from experience. The practical significance of learning theory for marketers is that they can build up demand for a product by associating it with strong drives by using motivating cues and providing positive reinforcement.

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.

relative advantage

advantage is the degree to which the innovation appears superior to existing products.

psychological- beliefs & attitudes

A belief is a descriptive thought that a person holds about something. Marketers are interested in the beliefs that people formulate about specific products and services because these beliefs make up product and brand images that affect buying behavior. Attitudes put people into a frame of mind of liking or disliking things, of moving toward or away from them.

personal- occupation

A person's occupation affects the goods and services bought. Marketers try to identify the occupational groups that have an above-average interest in their products and services. A company can specialize in making products needed by a given occupational group.

social- role & status

A person's position in each group can be defined in terms of both role and status. People usually choose products appropriate to their roles and status.

business markets and how they differ from consumer markets

Business markets are huge and involve more money and items than consumer markets. Differ from consumer markets in terms of -Market structure and demand -Nature of the buying unit -Types of decisions and the decision process

buying center

Buying center: All the individuals and units that play a role in the purchase decision-making process -Actual users of the product or service -People who make the buying decision -People and units influencing the buying decision -People who do the actual buying -Individuals and units controlling the buying information

social- family

Family members can strongly influence buyer behavior. Marketers are interested in the roles and influence of the husband, wife, and children on the purchase of different products and services.

subculture

Group of people with shared value systems based on common life experiences and situations -Total market strategy integrates ethnic themes and cross-cultural perspectives within a brand's mainstream marketing

social factors-groups

Groups that have a direct influence and to which a person belongs are called membership groups. Reference groups serve as direct or indirect points of comparison or reference in forming a person's attitudes or behavior. An aspirational group is one to which the individual wishes to belong.

personal- lifestyle

Lifestyle is a person's pattern of living as expressed in his or her psychographics. It involves measuring consumers' major AIO dimensions - activities, interests, and opinions. The lifestyle concept can help marketers understand changing consumer values and how they affect buyer behavior.

psychological- perception

Perception is the process by which people select, organize, and interpret information to form a meaningful picture of the world. Selective distortion describes the tendency of people to interpret information in a way that will support what they already believe. Selective retention means that consumers are likely to remember good points made about a brand they favor and forget good points made about competing brands. Some consumers worry that they will be affected by marketing messages without even knowing it—through subliminal advertising.

personal- self concept & personality

Personality refers to the unique psychological characteristics that distinguish a person or group. It can be useful in analyzing consumer behavior for certain product or brand choices. A person's self-concept is also made use of by marketers. The idea is that people's possessions contribute to and reflect their identities.

social class

Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors

personal- age and family life cycle

Tastes in food, clothes, furniture, and recreation are often age related. Buying is also shaped by the stage of the family life cycle. One of the leading life-stage segmentation systems is the Nielsen PRIZM Lifestage Groups system. PRIZM classifies every American household into one of 66 distinct life-stage segments, which are organized into 11 major life-stage groups.

stages in adoption process

The first stage is awareness. In this stage the consumer becomes aware of the new product but lacks information about it. The second stage is interest, which involves the consumer seeking information about the new product. The third stage is evaluation, where the consumer considers whether trying the new product makes sense. The fourth stage is trial. In this stage, the consumer tries the new product on a small scale to improve his or her estimate of its value. The final stage is adoption where the consumer decides to make full and regular use of the new product.

social-word of mouth

influence refers to the impact of the personal words and recommendations of trusted friends, associates, and other consumers on buying behavior. Rather than leaving it to chance, marketers can help to create positive conversations about their brands.

complexity

refers to the degree to which the innovation is difficult to understand or use.

characteristics influence rate of adoption

relative advantage, compatibility, complexity, divisibility, communicability

personal- economic

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

compatibility

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