Lesson 3.
4
Consumer and Business
Markets
CHERRY- ANN A. GUAVIS
Teacher II
Principles of Marketing
Accountancy, Business, and Management
1
Do you want to edit this presentation?
Make a copy and edit in Download an offline copy
Google Slides. and edit in Microsoft
PowerPoint.
1. On the menu bar, click File and then
Make a copy and Entire 1. On the menu bar, click File and then
Presentation. Download as.
2. Type a name for the file. 2. Choose a file type. Select Microsoft
3. Choose where to save it on your PowerPoint (.pptx).
Google Drive. 3. Wait for the file to be downloaded to
4. Click Ok. your local disk.
5. A new tab will open. Wait for the file 4. Once completely downloaded, open
to be completely loaded on a new the file and edit it using Microsoft
tab. PowerPoint or any offline presentation
6. Once the file has loaded, edit this program.
presentation using Google Slides.
2
Observe a coffee shop near
your school or residence. You
will see that the enterprise
serves customers looking for
a good cup of coffee and
some pastries.
3
Occasionally, inventories needed
by the business are delivered to
the coffee shop.
4
The coffee shop is
both a provider and
receiver of products
and services.
5
The products and services
created and offered by
businesses do not only target
individual consumers, but
also other businesses.
6
In this lesson, you will learn
about the difference between
consumer and business
markets, and their respective
buyers’ journey.
7
Quick Look
Constructing Meanings
In this activity, you will construct the meaning of two important concepts
that will be discussed in this lesson: consumer markets and business
markets.
8
Quick Look
Consumer goods
Constructing Meanings Business goods
Individuals and households
1. Examine the phrases found Firms and organizations
inside the box. Purchases involve large sum of money
2. Create a Venn diagram that Purchases involve lesser sum of money
compares and contrasts More people participate in the buyers’
consumer markets and decision
business markets. One person or few people are involved in
3. Decide which part of the Venn buyers’ decision
diagram each phrase belongs Responds to market stimuli
to. Influenced by political, cultural, and
economic factors
9
Quick Look
Consumer markets Business markets
10
Quick Look
Questions to Ponder
1. How will you define consumer markets using the concepts provided in
the activity?
2. How will you define business markets using the concepts provided in the
activity?
3. Based on the activity, what is the major difference between consumer
markets and business markets?
11
Learning Competencies
This lesson aims to target the following DepEd competencies:
● Describe the consumer and business markets (ABM_PM11-le-i-
12).
● Differentiate the buying behavior and decision making of
individual/household customers versus the business
(organizational) customers (ABM_PM11-Ie-i-13).
12
Learning Objectives
At the end of this lesson, you should be able to do the following:
● Define the consumer and business markets.
● Analyze business situations concerning the decision process
of individual and business customers.
● Explain the difference between individual buyers behavior
and business buyers situations.
13
How do differences between
consumer markets and business
markets affect the marketing plans
and strategies?
14
Consumer and Business Markets
Consumers and businesses are both economic units in
society.
○ Both have needs and wants to be satisfied.
○ Both undergo a buying decision process.
15
Consumer and Business Markets
Understanding the buyers’ decision process and their
behaviors is important in identifying business opportunities.
16
Consumer Markets
● consists of people who buy
products and services for
their own consumption
and not for resale
● final consumers of a
product or service
17
Consumer Markets
Types of
consumer
products
Convenience Shopping Specialty Unsought
goods goods goods goods
18
Types of Consumer Products
Convenience Goods
purchased more frequently,
inexpensively, and do not
require much effort and
evaluation
19
Types of Consumer Products
Shopping Goods
purchased less frequently,
relatively more expensive, and
require some amount of
information search and
evaluation before purchasing
20
Types of Consumer Products
Specialty Goods
● more difficult for consumers
to acquire
● more expensive that
consumers are willing to
spend more and would be
willing to travel distances to
obtain these goods
21
Types of Consumer Products
Unsought Goods
● Purchased for extraordinary
reasons. Consumers seldom
actively look for these goods.
● Commonly marketed goods
by highly skilled salespeople.
22
Check Your Progress
1 Provide examples of consumer goods that you have
purchased. Name one for each type.
Answer area
23
The Individual Buyer Decision Process
Consumers are affected
by internal and external
factors such as cultural,
social, personal, and
psychological factors.
24
The Individual Buyer Decision Process
Cultural Factors Social Factors
● culture
● family
● subculture
● reference groups
● social classes
25
The Individual Buyer Decision Process
Personal Factors Psychological Factors
● age ● motives
● life cycle stage ● perception
● occupation
● learning
● economic situation
● lifestyle ● beliefs
● personality ● attitudes
26
The Individual Buyer Decision Process
The buyer’s decision process (Kotler 2017)
This process occurs before purchase and continues long after.
27
The Individual Buyer Decision Process
Need Recognition Information Search
the consumer gathers
information from personal,
the buyers recognizes a
public, and experiential
problem or a need
sources to satisfy his/her
needs
28
The Individual Buyer Decision Process
Evaluation of Purchase Decision
Alternatives
the consumer processes
the consumer made a choice
information and choose
after evaluating all available
from among the alternative
options
brand they found
29
The Individual Buyer Decision Process
Postpurchase
Decision
the consumer will evaluate
the product after purchase
(whether it satisfies his/her
needs)
30
Buying Roles
Initiators Users
Those who use the product
Those who start the buying Those who either have a
process say in the buying process or
not
31
Buying Roles
Influencers Deciders
Those who affect the Those who are empowered
purchase decision by to make the purchase
convincing individuals that decision
the product is needed.
32
Buying Roles
Buyers
Those who have the money
to give for the product
33
Types of Buying Decision Behaviors
34
Types of Buying Decision Behaviors
Complex buying Dissonance-reducing
behavior buying behavior
a lot considerations before relatively quick decisions
arriving at a purchase based on price and
decision convenience
35
Types of Buying Decision Behaviors
Variety-seeking Habitual buying
buying behavior behavior
a lot of brand switching sticking with the brand they
takes place were used to
36
Examples of Consumer Buying Behaviors
When buying a new car, consumers tend to be highly involved.
They consider the model, attributes, accessories, price, and
appropriateness of the product to their lifestyle. Consumers
also exert effort into learning more about the alternatives; this
is an example of complex buying behavior.
37
Examples of Consumer Buying Behaviors
When buying a new television, customers are also highly
involved. They read some reviews and learn about the product
and other alternatives. However, since most smart television
brands have slight differences in capabilities and features,
customers respond to factors such as price and convenience;
this is a dissonance-reducing buying behavior.
38
Examples of Consumer Buying Behaviors
When buying cereals, customers tend to be less involved.
Typically, there is no prolonged evaluation of a brand. They
decide quickly, purchase the product, then try it out. Next time
they go to a grocery store, they might try a different brand
without much consideration; this is an example of variety-
seeking behavior.
39
Examples of Consumer Buying Behaviors
When buying a pack of sugar, consumers simply go to the store
and reach for a brand. Since they do not perceive significant
differences between sugar brands, they tend to purchase the
same brand out of habit; this is an example of habitual buying
behavior.
40
Check Your Progress
Why is it important to understand the tendencies of
2 consumers and their behaviors? Explain your answer by
providing an example.
Answer area
41
Business Markets
● not the final consumers of
products
● business-to-business
(B2B): transaction between
firms and business
customers
42
Business Markets
Types of
products in
business
markets
Materials and Supplies and
Capital items
parts services
43
Types of Industrial Products
Materials and Parts
Industrial products that become
a part of the business
customer’s product through
further processing or
components.
44
Types of Industrial Products
Capital Items
These are industrial products
that aid in the buyer's
production or operations.
45
Types of Industrial Products
Supplies and Services
● Industrial products that do
not enter or are used in the
finished product.
● Firms in their other business
operations need these to
function effectively.
46
Participants in the Business Buying Process
Gatekeepers
Users
Participants
Influencers Approvers or
Deciders
Buyers
47
The Business Buyer Decision Process
Unlike the consumer buying process, the buying activity of
businesses (organizations) consists of two major parts:
○ buying center – composed of all the people involved in
the buying decision
○ buying decision process
48
The Business Buyer Decision Process
Business buying decision process (Kotler 2017)
49
Types of Business Buying Situation
organizational buying a
precisely exact specifications
Straight rebuy of a product previously
purchased
50
Types of Business Buying Situation
● buying with some
changes in the required
specification
● may change due to
Modified rebuy changes in supplier, end
of supplier contract, and
new decisions in business
operations
51
Types of Business Buying Situation
● purchasing products that
the organization has
never purchased before
or has not purchased for
New task a long time
● typically longer process
than compared to other
buying situations
52
Examples of Business Buying Situations
When a coffee shop regularly purchases an exact amount and
a particular kind of coffee beans from a supplier, it is an
example of a straight rebuy.
53
Examples of Business Buying Situations
When the same coffee shop finds a supplier that offers the
same kind of coffee beans for a more reasonable price and
better terms, the coffee shop might change suppliers and do a
modified rebuy. Modifications can be in terms of quantity,
frequency of deliveries, and terms of payment.
54
Examples of Business Buying Situations
When the coffee shop decided to offer a new product that
needed raw materials and capital items that it had never
purchased before, the company‘s buying situation was a new
task. The buying decision might take longer, as the participants
in the buying process would want to discuss the different
alternatives and options.
55
Check Your Progress
3 How does the business buying process differ from the
consumer buying process?
Answer area
56
Keep in Mind
● Individual consumers and businesses have needs and problems to be
satisfied. Thus, marketers cater to both consumer and business
markets. Marketers effectively identify and determine the needs of
these markets by providing consumer products and industrial
products.
57
Keep in Mind
● Both the individual customers and business customers go through a
buying decision process. Their respective processes are stimulated by
the marketing environment and influenced by certain factors before
arriving at a purchase decision.
58
Keep in Mind
59
Keep in Mind
● Before arriving at a purchase decision, individual customers are
affected by personal, social, cultural, and psychological factors. On
the other hand, business or organizational customers are influenced
by the internal and external environmental factors of the
organization.
60
Keep in Mind
● Individual customers exhibit various buying behaviors based on the
degree of buyer involvement and differences among brands:
complex, dissonance-reducing, variety-seeking, and habitual buying
behavior.
61
Keep in Mind
● Business customers also face different buying situations depending
on the complexity of the problem being solved, the newness of the
buying requirement, the number of people involved, and the time
required. These buying situations include straight rebuy, modified
rebuy, and new tasks.
62
