Buyer Behaviour o

8/9/2019 Buyer Behaviour o

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Demands of marketing

Marketers need to understand

What INDIVIDUALS OR GROUPS buy

Who buys as an individual or in the group When the individual or group buys

Where they buy

Why they buy

How they buy


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StimulusYou should have

ResponseUse/Dont use

Individual Behaviour


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Stimulus Response

PsychologicalExplanations

Physical

Explanations

Contextual

Explanations

Individual Behaviour


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Individual behavior: explanations Psychological explanations

Motivation

Perception

Affect-feelings

Beliefs-information

Decision making-cognition

Composite: values/ attitudes/ identity


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Physical explanations

Sensory capabilities

Skills Physical Attributes

Contextual explanations

Physical-Resources

Social-networks/ Contacts-Family/ Work/

Advisors

PEST

Individual behavior: explanations


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People respond differently

Dealing with diversity in marketing


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Classifying generic behavior Personality (Activities)

Lifestyle (AI)

Psychographics (AIO)


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Classifying and describing

specific behaviors Interaction behaviors

Shopping behaviors

Purchase behaviors

Complex buying behavior

Dissonance-reducing buying behavior

Habitual buying behavior

Variety-seeking buying behavior


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Classifying and describing

specific behaviors


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Group behaviors Roles-Authority and responsibility

Processes-inputs and outputs

Specific group purchase behaviors Families

Businesses

Critical issues in group purchasing

Role fragmentation Types of roles


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Roles in Group Buying

Decider

Buyer

User

Influencer

Initiator

Purchase


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Participants in the Buying

Process

Buying Centre

Users

Gatekeepers

Deciders Influencers

Buyers


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Participants in the Buying

Process1. Users are members of the GROUP who will use

the product or service

2. Influencers affect the buying decision. They oftenhelp to define specifications and also provideinformation for evaluating alternatives

3. Buyers have formal authority to select the supplierand arrange terms of purchase

4. Deciders have formal or informal power to selector approve the final suppliers

5. Gatekeepers control the flow of information toothers


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Changes in groups:

Changes in behaviour


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Business Buyers Business-to-business buyers are characterised by

complex product requirements and complex group

structures.

Although, strictly speaking, institutional andgovernment buyers are non-business, much of the

discussion on business-to-business buying also

applies in marketing and selling to government and

institutional buyers.


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Business Buyer Behaviour Marketers want to know how business buyers will respond

to various marketing stimuli. Marketing and other stimuliaffect the buying organisation and produce certain buyerresponses.

As with consumer buying, the marketing stimuli forbusiness buying consist of the marketing mix elements(FourPs) or

extended marketing mix elements in the case of service

organisations: product, price, place, promotion, peopleand processes and physical evidence.

Other stimuli include major forces in the environment:

economic, technological, political, cultural andcompetitive.


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Characteristics of

Business PurchasingNature of buying unit

1. Professional purchasing

2. Several buying influences

Types of decisions and decision processes

1. More complex and formalised decisions

2. Direct purchasing3. Reciprocity

4. Leasing


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Business and Consumer Buying

Situations


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A Model of Business Buying

Behaviour


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Major Influences on Business

Buying


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Three Types of Buying

Situations


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Major Types of Business

Buying Situations

Where a straight rebuy occurs, the buyer re-orders

items without any modifications. It is usually handled on a

routine basis by procurement officers.

In a modified rebuy, the buyer wants to modify productspecifications, prices, terms or suppliers. The modified

rebuy usually involves more decision participants than

the straight rebuy.

Anew task situation is an industrial buying situation in

which the buyer purchases a product or service for the

first time.


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Classification of business

buyers Business markets are characterised by a wide

diversity in customer types and products.

ISIC Industries are classified according to the International

Standard Industrial Classification (ISIC).

Many countries have their own classification scheme e.g.Australian and New Zealand Standard IndustrialClassification (ANZSIC).

Function in value added network Manufacturer/ Wholesaler/ Retailer

Type of value propositions delivered Service/ FMCG


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Characteristics of Business

MarketsMarket Structure and Demand

1. Fewer buyers

2.Larger Buyers

3. Close supplier-customer relationships

4. Geographically concentrated buyers

5. Derived demand

6. Inelastic demand7. Fluctuating demand


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Institutional and Government

Markets

InstitutionalMarkets: consists of schools, TAFE

colleges, polytechnics, universities, hospitals,

nursing homes, prisons and other institutions that

provide goods and services to people in their care.

Government Markets: in every country, the

government market comprises a significant portion of

business activity.

Government BuyerDecision Process:

Government practices are often bureaucratic withregulations, low bid prices, delays and policy

changes. Yet, the government is often helpful in

providing information on buying needs and

procedures.

Buyer Behaviour o

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