MKT 701 CHapter 5

7. Usage, post purchase evaluation, and vendor feedback.

Just as consumers go through an evaluation period after they purchase and use goods and services, so do businesses. The buying unit might survey users of the product to gauge their level of satisfaction and ask for specific comments. The feedback is shared with the vendor as well as the buying center

Personal Factors That Vary by Individual

Mood Personality and Self concepts Gender age and stage of life Lifestyle

Family

Most market researchers consider a person's ________________ to be one of the most important influences on their buying behavior.

Types of business buyers

Producers Resellers Governments Institutions

Types of B2B situations

Straight rebuy situations New-buy selling situation A modifier rebuy

Perception - Repetition

To be sure their advertising messages get through to you, and you remember them, companies use

User

are the people and groups within the organization that actually use the product

Institutions

include nonprofit organizations such as the American Red Cross, churches, hospitals, charitable organizations, private colleges, civic clubs, and so on. many non-profits seek donations of goods and services that are used in operating their business or providing services to their target market a smart B2B marketer will look at all the markets we have mentioned to see if they represent potential opportunities.

Social Class

is a group of people who have the same social, economic, or educational status in society While income helps define __________________, the primary variable determining _____________________ is an occupation. To some degree, consumers in the same social class exhibit similar purchasing behavior.

Subculture

is a group of people within a culture who are different from the dominant culture but have something in common with one another such as common interests, vocations or jobs, religions, ethnic backgrounds, and geographic locations.

Sell side site

is a site in which a single seller/vendor sells products to many different buying organizations.

Learning - classical conditioning

occurs by associating a conditioned stimulus (CS) with an unconditioned stimulus (US) to get a particular response. The more frequently the CS is linked with the US, the faster learning occurs, and this is what advertisers and businesses try to do.

A modified rebuy

occurs when a company wants to buy the same type of product it has in the past but make some modifications to its specifications.

New buy selling situation

occurs when a firm purchases a product for the first time the most time consuming for both the vendor and the purchasing firm and selling cycle can be very drawn out. New-to-an-organization buying situations rarely occur but may take place in some situations.

Learning - operant or instrumental conditioning

which is what occurs when researchers can get a mouse to run through a maze for a piece of cheese. In other words, learning occurs through repetitive behavior that has positive or negative consequences.

Factors that Influence Consumer Behavior

- Situation Factors - Social Situation - Time - Reason for the Purchase

6. Establishing an order routine.

. It is at this stage that the actual order created. The order includes the agreed-upon price, quantities, expected time of delivery, return policies, warranties, and any other terms of negotiation

Need Recognition

. Someone recognizes a need within the organization that the purchase of a good or service can solve

Straight in the B2B buying process

1. Needs recognition 2. Need description and quantification 3. Vendor/supplier search. 4. Qualified potential suppliers requests for proposals (RFP). 5. Proposal evaluation and selection. 6. Establishing an order routine 7. Usage, post purchase evaluation, and vendor feedback.

Mood

A sour ____________ can spoil a consumer's desire to shop or make them extremely difficult to please.

Perception - Selective distortion

Another potential problem that advertisers (or your friends) may experience is __________________or misinterpretation of the intended message.

Perception - Selective retention

At other times, people forget information, even if it's quite relevant to them, which is called

Stage 4 - Purchase Decision

At the end of the evaluation stage, consumers form an intention to buy a specific product offering. Whether or not that purchase intention translates into real behavior depends on many factors, some of which stem from the consumer, the environment, and the actions of the firm itself.

Stage One - Need Recognition

At this stage of the consumer buying process, marketers must engage in research that allows them to identify and understand consumer wants. Why? "Wants" play a role in the market segmentation process and are critical to the development of the marketing mix, especially the product component While wants are important, to create valid demand forecasts, marketers must balance wants against the consumer's willingness and ability to pay

Cognitive dissonance (Buyer's Remorse).

Called _________________, or more commonly, ____________________, this phenomenon is more likely to occur when purchasing decisions are complex, when the price paid is high, when the decision is emotionally involving, and when the opportunity costs associated with the rejected alternatives are high

Delight

Consumers are delighted when the offering greatly exceeds expectations. This experience is likely to generate positive word-of-mouth and positive online reviews and often results in brand loyal consumers and long-term relationships. To develop customer delight, it is essential that marketers not make promises that the product cannot deliver; in fact, under-promising and over-delivering are the keys to consumer delight.

Satisfaction

Consumers are satisfied when the product delivers what was promised and thus meets their expectations. Satisfied customers can also develop into long-term relationships.

Stage 3 - Evaluation of Alternatives

Consumers evaluate the brands comprising the evoked set against their needs and desires (wants). HOW they go about this process is often a mystery, and understanding how consumers come to their decisions is typically the most difficult aspect of consumer behavior to comprehend and influence. Quantifying or measuring how consumers make decisions is extraordinarily difficult. These criteria are related to benefits, and to characteristics of the offering referred to as attributes. Products bought for prestige purposes are expected to have higher price tags.

Societal Factors

Culture Subculture Social Class Reference groups and opinion leaders Family

Consumers will experience one of four outcomes following the purchase of a firm's offering: Name the Four

Delight Satisfaction Dissatisfaction Cognitive Dissonance (buyers remores)

5. Proposal evaluation and selection.

During this stage, review of the RFPs takes place, and the vendor or vendors are selected. Selecting Single versus Multiple Suppliers. Sometimes organizations select a single supplier to provide the good or service

4. Qualified potential suppliers requests for proposals (RFP).

Each vendor that qualifies receives a request for proposal (RFP), which is an invitation to submit more information about how the firm can satisfy the business's needs.

Stage 5 - Post Purchase Evaluation

Marketing activities and attention to customers don't stop once the purchase is complete. Monitoring consumer's reactions and product performance and communicating with customers is essential to retaining them and building long-term relationships.

Situational factor

Marketing professionals take physical factors such as a STORE'S DESIGN AND LAYOUT into account when they are designing their facilities STORE'S LOCATIONS also influence behavior. While McDonald's has long been acknowledged as the King of retail site selection, Starbucks has done a good job selecting store locations. PHYSICAL FACTORS that firms can control, such as the layout of a store, music played at stores, the lighting, temperature, and even the smells you experience are called ATMOSPHERICS. Take WEATHER, for example. Rainy weather can be a boon to some companies, like umbrella makers such as Totes, but a problem for others CROWDING is another situational factor. Have you ever left a store and not purchased anything because it was just too crowded?

Psychological Factors

Motivation Perception Learning Attitude

e-commerce

Not all B2B vendors and sellers meet face-to-face with one another today, though; _____________, or commerce conducted electronically, such as over the Internet, has made locating local vendors less important in many industries.

Consumer Behavior and Pricing in E-commerce Markets

One of the consequences of e-commerce is that B2B customers can easily shop around from the convenience of their cubicles or offices, bid on products, and read blogs about products from industry experts

Who Makes the Purchasing Decisions in Business Markets?

Other Players Initiators Influencers Gate keepers Deciders

Personality and self concepts

Personality describes a person's disposition, helps show why people are different, and encompasses a person's unique traits. Marketers have had better luck linking people's self-concepts to their buying behavior. Your self-concept is how you see yourself—be it positive or negative. Your ideal self is how you would like to see yourself—whether it's prettier, more popular, more eco-conscious, or more "goth," and others' self-concept, or how you think others see you, also influences your purchase behavior. Marketing researchers believe people buy products to enhance how they feel about themselves—to get themselves closer to their ideal selves.

Other Players

Purchasing agents don't make all the buying decisions in their companies, though. As we explained, other people in the organization often have a say, as well they should

Perception - self exposure

Selecting information we see or hear (e.g., television shows or magazines) is called

types of B2B websites

Sell-side site buhy side site B2B auctions Buy side auctions Reverse auctions

What are the five stages of the consumer buying process

Stage 1: Need RecognitionInformation Stage 2: SearchAlternative Stage 3: EvaluationPurchase Stage 4: DecisionPost Stage 5: Purchase Evaluation

Social Situation

The ____________________ you're in can significantly affect your purchase behavior. Perhaps you have seen Girl Scouts selling cookies outside grocery stores and other retail establishments and purchased nothing from them, but what if your neighbor's daughter is selling the cookies? Are you going to turn her down or be a friendly neighbor and buy a box (or two)?

Reason for the Purchase

The reason you are shopping also affects the amount of time you will spend shopping. What if you need something for an important dinner or a project and only have an hour to get everything? Are you shopping for a gift or a special occasion? Are you buying something to complete a task/project and need it quickly? Are you making an emergency purchase?

Time

The________ of day, ________ of year, and how much time consumers feel like they have to shop affect what they buy. Researchers have even discovered whether someone is a "morning person" or "evening person" affects shopping patterns.

Soceital Factors

They have broad influences on your beliefs and the way you do things

Lifestyle

To better understand and connect with consumers, companies interview or ask people to complete questionnaires about their lifestyles or their activities, interests, and opinions (often referred to as AIO statements)

Perception - Shock advertisement

Using surprising stimuli or shock advertising is also a technique that works.

straight rebuy situation

Vendors (sellers) like________________________________ because the buying organization doesn't consider any alternative products or search for new suppliers. ___________________________ are appropriate when there are no changes to the product or service specifications, and the firm is simply reordering an existing item for inventory or for use within their business

Dissatisfaction

When the product's performance falls below buyer's expectations, ________________ occurs. Marketers must monitor online reviews and reach out to _________________ customers who have legitimate complaints. It is also necessary to acknowledge those who have unworthy complaints, to show that you are listening.

Gender, age, and stage of life

While demographic variables such as income, education, and marital status are important, we will look at___________________and how they influence purchase decisions.

Interpersonal factors

among the people making the buying decision often have an impact on the products chosen, good or bad

Attitude

are "mental positions" or emotional feelings, favorable or unfavorable evaluations, and action tendencies people have about products, services, companies, ideas, issues, or institutions. _______________tend to be enduring, and because they are based on people's values and beliefs, they are hard to change

B2B auction

are Web-based auctions that occur between businesses. The auctions can be either sell-side or buy-side.

Producers

are companies that purchase goods and services that they transform into other products.

Resellers

are companies that sell finished goods and services produced by other firms without materially changing them

Reference groups and opinion leaders

are groups (social groups, work groups, family, or close friends) a consumer identifies with and may want to join. They influence consumers' attitudes and behavior. are people with expertise in certain areas. Consumers respect these people and often ask their opinions before they buy goods and services.

Gate Keepers

are people such as buying assistants, personal assistants, administrative assistants and other individuals who have some say about which sellers get a foot in the door. They generally have a lot of information about what's going on behind the scenes and a certain amount of informal power

Influencer

are people who may or may not use the product but have experience or expertise that can help improve the buying decision

Initiator

are the people within the organization who first see the need for the product, but they don't stop there; whether they can make the final decision on what to buy or not, they get the ball rolling

The Consumer Buying Process

consumer buying process presupposes a rational, logical, and sequential set of activities. The process begins when buyers recognize a need and wish to fulfill the need. For many common items, such as food, beverages, and over the counter medicine, consumers need recognition occurs as a result of internal feelings of hunger, thirst or illness.

Stage 2 - Information Search

consumers speak with family, friends, and other important personal sources of information, including opinion leaders who have expertise in particular product categories. Personal sources offer word-of-mouth recommendations based on their experience or other information that they have learned Most consumers use the information search to weed out less desirable solutions so that the decision-making process can be simplified, and narrow choices to a few brands referred to as the evoked set.

Perception

is how you interpret the world around you and make sense of it in your brain. You do so via stimuli that affect your different senses—sight, hearing, touch, smell, and taste.

Motivation

is the inward drive we have to get what we need.

Perception - Subliminal advertisement

is the opposite of shock advertising and involves exposing consumers to marketing stimuli such as photos, ads, and messages that cannot be perceived by the conscious mind by stealthily embedding them in movies, ads, and other media.

Decider

is the person who makes the final purchasing decision. In B2B buying, the purchase decision may be the domain of a single decider or a few deciders who reach consensus.

Perception - Selective attention

is the process of filtering out information based on how relevant it is to you. has been described as a "suit of armor" that helps you filter out information you don't need.

Personal factors

play a part in the buying process. B2B buyers are overwhelmed with choices, features, benefits, information, data, and metrics. They often have to interview dozens of potential vendors and ask them hundreds of questions

Learning

refers to the process by which consumers change their behavior after they gain information or experience. It's the reason you don't buy a bad product twice

Culture

refers to the shared beliefs, customs, behaviors, and attitudes that characterize a society.___________ is a handed down way of life and is often considered the broadest influence on a consumer's behavior.

Buy side site

site is one in which a business buys products from multiple sellers that go there to do business with the firm. Some government agencies have buy-side sites.

Governments

the biggest purchaser of goods and services in the world? It is the U.S. government. many government entities specify that their agencies must award a certain amount of business to small businesses, minority- and women-owned businesses, and businesses owned by disabled veterans. Other businesses, though, realize that learning the ins and outs of government purchases can become a sustainable competitive advantage.

Buyer side auction

the buyer initiates the auction to find the cheapest supplier of a product. Sellers then bid against one another, offering the lowest prices they can for their products, to get the buyer's business.

2. Need description and quantification

the buying center creates a set of criteria and parameters to guide the evaluation process. In other words, they describe what they believe is needed, the features it should have, how much of it is needed, where, and so on.

Business-to-Business Markets and Buying Behavior

the more high-dollar and complex the item, the longer it takes to complete the sale. , most business buyers demand that the products they buy meet strict standards.

3. Vendor/supplier search

the people involved in the buying process seek out information about the products they are looking for and the vendors that can supply them