Chapter 3
Buyer Behavior
Prepared by
Bùi Ngọc Tuấn Anh (PhD)
Introduction to buyer behavior
• Consumer vs. Business buyer behavior
– Distinction between consumer markets (individuals and
households) and business markets (organizations)
– The different motivations and processes involved in each
• Complexity of buyer behavior
– Acknowledging the difficulty of understanding the “black box” of
the consumer's mind
– The influence of both external and internal factors on buying
decisions
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Consumer markets and Consumer buyer behavior
• The consumer market consists of individuals and
households that purchase goods and services for
personal consumption
– The study of how they select, buy, use, and dispose of goods,
services, ideas, or experiences to satisfy their needs or wants.
• Model of Consumer behavior:
– The stimulus-response model where marketing and other
stimuli enter the consumer's "black box"
– The two components of the black box: buyer characteristics
and the buyer's decision process
Model of consumer behavior
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Consumer Behavior
Personal Factors
Cultural Factors
Social Factors
Cultural Factors
Social Class
Culture
Subculture
3
Social Factors
Reference Groups
Family
Role and Status
Personal Factors
Personality
Age
Life Cycle Stage
4
Personal Factors
Occupation Values
Lifestyle
Economic situation
Psychological Factors
5
Motivation
Freud
Maslow
Herzberg
Maslow’s Hierarchy of Needs
6
Perception
Selective Attention
Selective Retention
Subliminal Perception Selective Distortion
Learning
Driver
Cues
Discrimination
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Emotions
Memory
Memory Processes
Mental Maps
Encoding Association Association
Retreival Association
Association
Association
Brand Associations Brand
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The Buying Decision Process
Problem Recognition
“I’m Hungry”
Stimulus
• Internal
• External
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Information Search
Commercial Public
Personal Experiential
Successive Sets Involved in
Consumer Decision Making
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Evaluation of Alternatives
Beliefs
Attitudes
Expectancy-Value Model
Attribute
Memory Graphics Size and
Price
Capacity Capacity Weight
Model Weight: 40% Weight: 31% Weight: 20% Weight: 10%
A 8 9 6 9
B 7 7 7 7
C 10 4 3 2
D 5 3 8 5
Model A = 0.4 (8) + 0.3(9) + 0.2(6) + 0.1(9) = 8.0
Model B = 0.4 (7) + 0.3(7) + 0.2(7) + 0.1(7) = 7.0
Model C = 0.4(10) + 0.3(4) + 0.2(3) + 0.1(2) = 6.0
Model D = 0.4 (5) + 0.3(3) + 0.2(8) + 0.1(5) = 8.0
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Steps between Evaluation of
Alternatives and Purchase Decision
Purchase Decision
Noncompensatory Models
Choice Heuristics:
• Conjective
• Lexicographic
• Elimination-by-aspect
Brand
Dealer
Purchase
Quantity
subdecisions
Timing
Payment method
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Postpurchase Behavior
Postpurchase Satisfaction Delighted
Satisfied
Dissatisfied
Loyal
Stay or Go
Defect Postpurchase Actions
How Customers
Use or Dispose of Products
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Moderating Effects
Low-involvement
Variety seeking
Behavioral Decision Theory
Decision Framing
Decision Heuristics
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The adoption process for new products
• Stages: Awareness, interest, evaluation, trial, and
adoption
• Individual differences in innovativeness: innovators, early
adopters, early mainstream, late mainstream, and lagging
adopters
The adoption process for new products
• Stages: Awareness, interest, evaluation, trial, and
adoption
• Individual differences in innovativeness: innovators, early
adopters, early mainstream, late mainstream, and lagging
adopters
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Analyzing Business Markets
Business markets and business buyer behavior
• Defining the business market
– Organizations that buy goods and services for use in
production, resale, or rental
– The nature of business markets with fewer but larger buyers,
and geographic concentration
– Business demand is derived demand
– B-to-B marketers need to engage business customers and
build relationships by creating superior customer value
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Business Markets
Transportation &
Distribution
Agriculture Construction
Forestry
Manufacturing
Communications
Banking & Finance
Business Markets
Differences to the Consumer Market Geographically
Concentrated
Fewer, Larger
Buyers
Professional
Buyers
Multiple Personal
Sales Calls Relationships
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Business Markets
Differences to the Consumer Market
Derived Demand
Inelastic Demand
Demand
• Derived
• Inelastic
• Fluctuating
Fluctuating Demand
Characteristics of business buyer behavior
• More decision participants and a more professional
purchasing effort
• The role of trained purchasing agents and buying
committees
• The importance of well-trained marketing and sales
personnel
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Model of business buyer behavior
• Marketing stimuli and other factors affect the buying
organization
• The buying center and the buying decision process, with
influences from internal, interpersonal, and external
factors
Types of buying situations
• How different buying situations affect the decision process
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Business Buying Participants
Initiator/ Influencer Decider
Users
Gatekeeper Approver
Buyers
Stages in the Buying Process
Problem
Description and
Recognition
Characteristics Supplier
Search
Proposal
Solicitations
Performance Order Supplier
Review Specification Selection
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Stages in the Buying Process
Problem
Recognition Internal stimuli
• New product being developed
• Broken machine
• Low stock level
External stimuli
• Trade show visit
• Advertisement
Stages in the Buying Process
Description and Technical specifications
Characteristics
• Reliability
• Durability
• Price
Product value analysis
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Stages in the Buying Process
Supplier
Search
Trade directories
Trade advertisements
Trade shows
E-Procurement Lead generation
Stages in the Buying Process
Proposal
Solicitations
Formal presentation
Written
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Stages in the Buying Process
Supplier
Selection
Supplier-evaluation model
Number of suppliers
Stages in the Buying Process
Order
Specification Stockless
purchase
plan
Technical specifications
Quantity
Delivery time
Return policy
Warranties
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Stages in the Buying Process
Performance
Review
End user evaluations
Weighted-score
method
7 9 4
Buygrid Framework
Table 7.1
Buyclasses
Modified Straight
New Task
Rebuy Rebuy
1. Problem Recognition Yes Maybe No
2. General need description Yes Maybe No
3. Product specification Yes Yes Yes
Buyphases
4. Supplier search Yes Maybe No
5. Proposal solicitation Yes Maybe No
6. Supplier Selection Yes Maybe No
7. Order-routine specification Yes Maybe No
8. Performance review Yes Yes Yes
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Managing B2B Relationships
Online social media
One-to-one Marketing
Managing B2B Relationships
Vertical Coordination
Relationship Factors
Availability of alternatives
Importance of supply
Complexity of supply
Supply market dynamism
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Buyer-Seller Relationship Categories
Cooperative systems
Collaborative
Customer is king
Contractual transaction Mutually adaptive
Institutional and Governments Markets
Prisons
Government
agencies
Schools
Hospitals
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