Principles of Marketing

Chapter Three
BUYING BEHAVIOR
 1. Consumer buying behavior
Consumer buying behavior means the behavior consumers exhibit
when searching for information about product to buy, evaluate one
brand against another, and when they are using and exposing the
product after using it.
Buyer is also influenced by personal characteristics and the process by
which he/she makes decisions. A buyer’s cultural characteristics,
including values, perceptions, preferences, and behavior learned
through family or other key institutions, is the most fundamental
determinant of a person’s wants and behavior. Consumer markets and
consumer buying behavior have to be understood before sound
marketing plans can be developed.
 The consumer market buys goods and services for personal
consumption. It is the ultimate market in the organization of
economic activities. In analyzing a consumer market, one needs to
know the occupants, the objects, and the buyers’ objectives,
organization, operations, occasions and outlets.
The buyer’s behavior is influenced by four major factors: cultural
(culture, subculture, and social class), social (reference groups,
family, and roles and statuses), personal (age and life cycle state,
occupation, economic circumstances, lifestyle, and personality and
self-concept), and psychological (motivation, perception, learning,
and beliefs and attitudes). All of these provide clues as to how to
reach and serve buyers more effectively.
 3.1.1. The buyers decision process
The final consumer’s decision process is the way in which people gather
and assess information and make choices among alternative goods,
services, organizations, people, places, and ideas. It consists of the
process itself and factors affecting the process.
1.Need recognition: normally any purchase decision begins with the
recognition of needs or problem. The need may be triggered by internal
stimuli such as hunger, thirst. For e.g. before thinking about purchasing
something to eat a person first should be hungered. It may also be
triggered by external stimuli for e.g. a person passes a restaurant and smell
nice food that stimulates his hunger.
 2. Information Search: Information search involves listing
alternatives that will solve the problem at hand and a
determination of the characteristics of each. Search can be
internal and/or external. As risk increases; the amount of
information sought also increases.
3.Evaluation of Alternatives: The alternatives are evaluated on the
basis of the consumer’s criteria and the relative importance of these
criteria. They are then ranked and a choice made. Generally,
marketers should study buyers to find out how they actually evaluate
brand alternatives.
4. Purchase Decision: The purchase act involves the exchange of
money or a promise to pay for a product, or support in return of
ownership of a specific goods, the performance of a specific and so on.
Purchase decisions remaining at this stage center on
 The place of purchase
 Terms
 Availability
5. Post-purchase Behavior: Frequently, the consumer engages in
post-purchase behavior. Buying one item may lead to the purchase of
another.
3.1.2. Major factors influencing buying behavior
- Demographic, social, and psychological factors affect
consumer decision-making
1. Cultural Factors:
 Cultural factors a significant impact on customer
behavior. Culture is the most basic cause of a person’s
wants and behavior. Growing up, children learn basic
values, perception and wants from the family and other
important groups. Marketers are always trying to spot
“cultural shifts” which might point to new products that
might be wanted by customers or to increased demand
 2. Social Factors:
A customer’s buying behavior is also influenced by social
factors, such as the groups to which the customer belongs and
social status. In a group, several individuals may interact to
influence the purchase decision.
Reference Groups:- As a consumer, your decision to purchase and
use certain products and services, is influenced not only by
psychological factors, your personality and life-style, but also by the
people around you with whom you interact and the various social
groups to which you belong.
Family: The family, as a unit, is an important of all these groups and we
shall discuss it in detail. The family is an important consumer for
many products which are purchased for consumption by all family
members.
Roles: An individual may participate in many groups. His position
within each group can be defined in terms of the activities he is
expected to perform.
Status: Status is often measured by the degree of influence an
individual exerts in the behavior and attitude of others. People buy
and use products that reflect their status.
1. Personal Factors:
 Age and life cycle stage: Like the social class the human life cycle
can have a significant impact on consumer behavior. The life cycle
is an orderly series of stages in which consumer attitude and
behavioral tendencies evolve and occur because of developing
maturity, experiences, income, and status.
 Occupation and Income: The profession or the occupation a
person is in again has an impact on the products they consume.
 Life Style: Our life styles are reflected in our personalities and self-
concepts, same is the case with any consumer. We need to know what
a life-style is made of. It is a person’s mode of living as identified by
his or her activities, interest and opinions.
Personality: Personality is the sum total of an individual’s enduring
internal psychological traits that make him or her unique. Self-
confidence . People who have self-confidence have different
purchasing behavior than people who have no self-confidence.
 4. Psychological Factors:
Motivation: Motivation involves the positive or negative
needs, goals, and desires that impel a person to or away
from certain actions.
Consumer Needs and Motivations: We all have needs we consume
different goods and services with the expectation that they will
help fulfill these needs.
 3.2. Organizational buying behavior
Business market is the collection of buyers who are buying products and services for resale
purpose, or for using it in day to day operation or to use it to make another product.
1. Characteristics of business market
a. Organizational consumers purchase capital equipment, raw materials, semi-finished
goods, and other products for use in further production or operations or for resale to
others,
b. Organizational consumers are likely to require exact product specifications.
c. Organizational consumers often use multiple-buying responsibility, in which two or
more employees formally participate in complex or expensive purchase decisions.
d. Organizational consumers more frequently employ competitive bidding and
negotiation.
 3.2.2. Organizational Buying situations
There are three major types of buying situations.
 In a straight re-buy, the buyer reorders something without any
modifications. It is usually handled on a routine basis by the
purchasing department. Based past buying satisfaction, the buyer
simply chooses.
 In a modified re-buy, the buyer wants to modify product
specifications, prices, terms, or suppliers. The modified re-buy
usually involves more decision participants than does the straight
re-buy.
 A company buying a product or service for the first time faces a
new-task situation.
The new -task situation is the marketer’s greatest opportunity and
challenge. The marketer not only tires to reach as many key buying
influences as possible but also provides help and information.
Decision making process in organizational buying
Problem Recognition
 The buying process beings when someone in the company
recognizes a problem or need that can be met by acquiring a
specific product or service. Problem recognition can result from
internal or external stimuli.
 General Need Description
Having recognized a need, the buyer next prepares a general need
description that describes the characteristics and quantity of the needed
item. In this phase, the alert business marketer can help the buyers define
their needs and provide information about the value of different product
characteristics.
Product Specification
The buying organization next develops the item’s technical product
specifications, often with the help of a value analysis engineering team.
Value analysis is an approach to cost reduction in which components are
studied carefully to determine if they can be redesigned, standardized, or
made by less costly methods of production.


Supplier Search
The buyer now conducts a supplier search to find the best vendors.
The buyers can compile a small list of qualified suppliers by
reviewing trade directories
Proposal Solicitation
In the proposal solicitation stages of the business buying process,
the buyer invites qualified suppliers to submit proposals. In
response, some suppliers will spend only a catalog or a salesperson.
Supplier Selection
 The members of the buying center now review the proposals

and select a supplier or suppliers. During supplier selection,

the buying center often will draw up a list of the desired
supplier attributes and their relative importance.
Order-Routine Specification
 The buyer now prepares an order-routine specification. It

includes the final order with the chosen supplier or suppliers

and lists items such as technical specifications, quantity needed,
expected time of delivery
Performance Review
In this stage, the buyer reviews supplier performance. The
buyer may contract users and ask them to rate their
satisfaction. The performance review may lead the buyer
to continue, modify, or drop the arrangement. The seller’s
job is to monitor the same factors used by the buyer to
make sure that the seller is giving the expected
satisfaction.
 3.2.4. Factors influencing organizational buying Decision
Business buyers are subject to many influences when they make their buying
decisions. Some marketers assume that the major influences are economic.
Environmental Factors

Business buyers are influenced heavily by factors in the current and expected economic
environment, such as the level of primary demand, the economic outlook, and the cost
of money. As economic uncertainty rises, business buyers cut back on new investments
and attempt to reduce their inventories.
Organizational Factors
 Each buying organization has its own objectives, policies, procedures, structure, and systems,
and the business marketer must understand these factors well.
Interpersonal Factors
The buying center usually includes many participants who
influence each other, so interpersonal factors also
influence the business buying process.
Individual Factors
 Each participant in the business buying-decision process brings
in personal motives, perceptions, and preferences. These
individual factors are affected by personal characteristics such as
age, income, education, professional identification, personality,
and attitudes toward risk
THANK YOU!!!

END OF THE
3rd
CHAPTER!!!