Buying Behaviour

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Buying Behaviour  An important part of the marketing marketing process is to understand why a customer or  buyer makes a purchase. Without such an understanding, businesses find find it hard to respond to the customer's needs and wants. Marketing theory traditionally splits analysis of buyer or customer behaviour into two broad groups for analysis  !onsumer "uyers and #ndustrial "uyers !onsumer buyersare those who purchase items for their personal consumption #ndustrial buyersare those who purchase items on behalf of their business or organisation "usinesses now spend considerable sums trying to learn about what makes $customers tick%. &he uestions they try to understand are( ) Who buys* ) +ow do they buy* ) When do they buy* ) Where do they buy* ) Why do they buy* For a marketing manager, the challenge is to understand how customers might respond to the different elements of the marketing mi that are presented to them. #f management can understand these customer responses better than the competition, then it is a potentially significant source of competitive advantage.

THE BUYER BEHAVIOUR MODEL Marketing stimuli -ther timuli


"uyer's !haracteristics "uyer's /ecision 0rocess "uyer's decisions

0roduct 0rice 0lace 0romotion 1conomic &echnological 0olitical !ultural !ultural ocial 0ersonal 0sychological 0roblem recognition #nformation search 1valuation /ecision 0roduct !hoice "rand choice /ealer !hoice


0urchase timing 0urchase Amount

MAJOR FACTORS INFLUENCIN BUYER BEHAVIOUR  &he factors influencing buyer behaviour can be broadly classified into( !ultural, ocial, 0ersonal and 0sychological. 2et us see each one in detail.

!"# Cu$%ura$ Fa&%or '( 3 !ultural factor divided into three sub factors 4i5 !ulture 4ii5 ub !ulture 4iii5 ocial !lass

o Cu$%ure'( 6 &he set of basic values perceptions, wants, and behaviours learned by a member of society from family and other important institutions. !ulture is the most basic cause of a person's wants and behaviour. 1very group or society has a culture, and cultural influences on buying behaviour may vary greatly from country to country.

o Su) Cu$%ure '( 6 A group of people with shared value systems based on common life eperiences and situations. 6 1ach culture contains smaller sub cultures a group of people with shared value system based on common life eperiences and situations. ub culture includes nationalities, religions, racial group and geographic regions. Many sub culture make up important market segments and marketers often design products.

o So&ia$ C$a**'( 6 Almost every society has some form of social structure, social classes are society's relatively permanent and ordered divisions whose members share similar values, interests and behaviour.

!+# So&ia$ Fa&%or* '( 3 A consumer's behaviour also is influenced by social factors, such as the 4i5 7roups 4ii5 Family 4iii5 8oles and status

o rou,* '(


6 &wo or more people who interact to accomplish individual or mutual goals. 6 A person's behavious is influenced by many small groups. 7roups that have a direct influence and to which a person belongs are called membership groups. 6 ome are primary groups includes family, friends, neighbours and coworkers. ome are secondary groups, which are more formal and have less regular interaction. &hese includes organi9ations like religious groups, gro ups, professional association and trade unions.

o Fa-i$y'( 6 Family members can strongly influence buyer behaviour. &he family is the most important consumer buying organi9ation society and it has been researched etensively. Marketers are interested in the roles, and influence of the husband, wife and children on the purchase of different products and services.

o Ro$e* an. S%a%u* '( 6 A person belongs to many groups, family, clubs, organi9ations. 6 &he person's position in each group can be defined in terms of both role and status. 6 For eample. M : $;% plays the role of father, in his family he plays the role of husband, in his company, he plays the role of manager, etc. A 8ole consists of the activities people are epected to perform according to the persons around them.

!/# 0er*ona$ Fa&%or*'( 3 #t includes 3 i5 Age and life cycle stage 4ii5 -ccupation 4iii5 1conomic situation 4iv5 2ife tyle 4v5 0ersonality and self concept.

o Age an. Li1e &y&$e S%age'( 6 0eople change the goods and services they buy over their lifetimes. &astes in food, clothes, furniture, and recreation are often age related. "uying is also shaped by the stage of the family life cycle.

o O&&u,a%ion '(


6 A person's occupation affects the goods and services bought. "lue collar workers tend to buy more rugged work clothes, whereas whitecollar workers buy more  business suits. A !o. can even speciali9e speciali9e in making products needed by a given occupational group. &hus, computer software companies will design different products for brand managers, accountants, engineers, lawyers, and doctors.

o E&ono-i& *i%ua%ion '( 6 A person's economic situation will affect product choice

o Li1e S%y$e '( 6 2ife tyle is a person's 0attern of living, understanding these forces involves measuring consumer's ma<or A#- dimensions. 6 i.e. activities 4Work, hobbies, shopping, support etc5 interest 4Food, fashion, family recreation5 and opinions 4about themselves, "usiness, 0roducts5

o 0er*ona$i%y an. Se$1 &on&e,% '( 6 1ach person's distinct personality influence his or her buying behavior. 0ersonality refers to the uniue psychological characteristics that lead to relatively consistent and lasting responses to one's own environment.

!2# 0*y&ho$ogi&a$ Fa&%or*'( 3 #t includes these Factors. 3 i5 Motivation 4ii5 0erception 4iii5 2earning 4iv5 "eliefs and attitudes

3 Mo%iva%ion '( o Motive 4drive5 a need that is sufficiently pressing to direct the person to seek satisfaction of the need

3 0er&e,%ion '( o &he process by which people select, -rgani9e, and interpret information to form a meaningful picture of the world.

3 Learning'( o !hanges in an individual's behavior arising from eperience.


3 Be$ie1* an. a%%i%u.e* '( o "elief is a descriptive thought that a person holds about something o Attitude, a 0erson's consistently favorable or unfavorable evaluations, feelings, and tendencies towards an ob<ect or idea.

TRENDS IN BUYIN BEHAVIOUR  #n the natural : organic food segment, 8ick terling, founder and president of terling8ice 7roup 4"oulder, !olo.5 sees =big food' entering the natural retail channel with their natural and organic brands>less for volume than for the pedigree and eperience in marketing to an unfamiliar consumer group. $#t is more important that food companies learn how to engage a valuesbased consumer that shops across natural and conventional outlets than it is for these companies to capture their =fair share' of sales in the natural channel.% terling believes this to be true for ?raft with their "ack &o ature brand, 7eneral Mills with !ascadian Farms, and ?ellogg's with ?ashi. All three of these brands involve a consumer segment that the food companies have not traditionally engaged. terling also sees more brands taking aim at sports clubs and spas, again for positioning. $!lif "ar is good at getting into nontraditional locations with philosophically aligned people.%

THE NATIONAL 0OR4 COUNCIL "y BCD pork consumption had dropped to DB pounds per capita from a high of EC pounds in BC. &he nation was on a anti beef and anti pork kick, favouring leener, less cholesterol laden poultry. While pork products were actually improved as a result of new feeding and breeding methods, the public still considered pork an unhealthy choice. &he ational 0ork 0roducers !ouncil called up an ad agency "o9ell #nc. to change the image of pork, and it put some GH million into a national marketing campaign. &he new campaign centered on the slogan, $0ork, &he other  white meat%. "etween BCE, when when the campaign began, and BCC, pork sales rose I about eual to the gain for chicken, and far ahead of the HI increase for beef in the same period.

TY0ES OF BUYIN BEHAVIOUR  The 1our %y,e o1 &on*u-er )uying )ehavior are'


3 8outine 8esponseJ0rogrammed "ehaviorbuying low involvement freuently purchased low cost itemsK need very little search and decision effortK purchased almost automatically. 1amples include soft drinks, snack foods, milk etc. 3 2imited /ecision Makingbuying product occasionally. When you need to obtain information about unfamiliar brand in a familiar product category, perhaps. 8euires a moderate amount of time for information gathering. 1amples include !lothesknow product class but not the brand. 3 1tensive /ecision MakingJ!omple high involvement, unfamiliar, epensive andJor infreuently bought products. +igh degree of economicJperformanceJpsychological risk. 1amples include cars, homes, computers, education. pend alot of time seeking information and deciding. #nformation from the companies MMK friends and relatives, store personnel etc. 7o through all si stages of the buying process. 3 #mpulse buying, no conscious planning. &he purchase of the same product does not always elicit the same "uying "ehavior. 0roduct can shift from one category to the net. For eample( 7oing out for dinner for one person may be etensive decision making 4for someone that does not go out often at all5, but limited decision making for someone else. &he reason for the dinner,  whether it is an anniversary celebration, or or a meal with a couple of friends will also also determine the etent of the decision making.

BUYER DECISION 0ROCESS #n general there are three ways of analysing consumer buying decisions. &hey are( 3 1conomic models  &hese models are largely uantitative and are based on the assumptions of rationality and near perfect knowledge. &he consumer is seen to maimi9e their utility. !onsumer theory, 7ame theory can also be used in some circumstances. 3 0sychological models  &hese models concentrate on psychological and cognitive processes such as motivation and need recognition. &hey are ualitative rather than uantitative and build on sociological factors like cultural influences and family influences.


3 !onsumer behaviour models  &hese are practical models used by marketers. &hey typically blend both economic and psychological models.

Mo.e$* o1 )uyer .e&i*ion -a5ing enera$ -o.e$  A general model of the buyer decision process consists of the the following steps( . 0roblem recognitionK H. 7athering #nformation L. Alternative education . 0urchase decision D. 0ostpurchase behaviorJbuyer's remorse 4cognitive dissonance5 &here are a range of alternative models, but that of A#NA08, which most directly links to the steps in the marketingJpromotional process is often seen as the most generally usefulK 3 AWA811  before anything else can happen the potential customers must  become aware that the product or service eists. &hus, the first task must be to to gain the attention of the target audience. All the different models are, predictably, agreed on this first step. #f the audience never hears the message, they will not act on it, no matter how powerful it is 3 #&181&  but it is not sufficient to grab their attention. &he message must interest them and persuade them that the product or service is relevant to their needs. &he content of the message4s5 must therefore be meaningful and clearly relevant to that target audience's needs, and this is where marketing research can come into its own. 3 N/18&A/#7  once an interest is established, the prospective customer must be able to appreciate how well the offering may meet his or her needs, again as revealed by the marketing research. &his may be no small achievement where the advertiser has <ust a few words, or ten seconds, to convey their message.


3 A&&#&N/1  but the message must go even furtherK to persuade the reader to adopt a sufficiently positive attitude towards the product or service that he or she will purchase it, albeit as a trial. &here is no adeuate way of describing how this may be achieved. #t is simply down to the magic of the advertiser's art, or based on the strength of the product or services itself. 3 0N8!+A1  all the above stages might happen in a few minutes while the reader is considering the advertisementK in the comfort of his or her favorite armchair. &he final buying decision, on the other hand, may take place some time laterK perhaps  weeks later, when the prospective buyer actually actually tries to find a shop which stocks the the product. 3 8101A& 0N8!+A1  but in most cases this first purchase is best viewed as <ust a trial purchase. -nly if the eperience is a success for the customer will it be turned into repeat purchases. &hese repeats, not the single purchase which is the focus of most models, are where the vendors focus should be, for these are where the profits are generated. &he earlier stages are merely a very necessary prereuisite for thisO &his is a very simple model, and as such does apply uite generally. #ts lessons are that you cannot obtain repeat purchasing without going through the stages of  building awareness and then obtaining obtaining trial useK which has to be successful. #t #t is a pattern which applies to all repeat purchase products and servicesK industrial goods  <ust as much as baked beans. &his simple theory theory is rarely taken any further  to look look at the series of transactions which such repeat purchasing implies. &he consumer's growing eperience over a number of such transactions is often the determining factor in the later  and future  purchases. All the succeeding transactions are, thus, interdependent  and the overall decisionmaking process may accordingly be much more comple than most models allow for.

Cogni%ive an. ,er*ona$ )ia*e* in .e&i*ion -a5ing #t is generally agreed that biases can creep into our decision making processes, calling into uestion the correctness of a decision. "elow is a list of some of the more common cognitive biases. 3 elective search for evidence  We tend to be willing to gather facts that support certain conclusions but disregard other facts that support different conclusions. 3 0remature termination of search for evidence  We tend to accept the first alternative that looks like it might work.


3 !onservatism and inertia  Nnwillingness to change thought patterns that we have used in the past in the face of new circumstances. 3 1periential limitations  Nnwillingness or inability to look loo k beyond the scope of our past eperiencesK re<ection of the unfamiliar. 3 elective perception  We actively screenout information that we do not think is salient. 3 Wishful thinking or optimism  We tend to want to see things in a positive light and this can distort our perception perc eption and thinking. 3 8ecency  We tend to place more attention on more recent information and either ignore or forget more distant information. 3 8epetition bias  A willingness to believe what we have been told most often and by the greatest number of different of sources. 3 Anchoring  /ecisions /ec isions are unduly influenced by initial information that shapes our o ur  view of subseuent information. information. 3 7roup think  0eer pressure to conform to the opinions held by the group. 3 ource credibility bias  We re<ect something if we have a bias against the person, organi9ation, or group to which the person belongs( We are inclined to accept a statement by someone we like. 3 #ncremental decision making and escalating commitment  We look at a decision as a small step in a process and this tends to perpetuate a series of similar decisions. &his can be contrasted with 9erobased decision making. 3 #nconsistency  &he unwillingness to apply the same decision criteria in similar situations. 3 Attribution asymmetry  We tend to attribute our success to our abilities and talents, but we attribute our failures to bad luck and eternal factors. We attribute other's success to good luck, and their failures to their mistakes. 3 8ole fulfillment  We conform to the decision making epectations that others have of someone in our position.


3 Nnderestimating uncertainty and the illusion of control  We tend to underestimate future uncertainty because we tend to believe we have more control over events than  we really do. 3 Faulty generali9ations  #n order to simplify an etremely comple world, we tend to group things and people. &hese simplifying generali9ations can bias decision making processes. 3 Ascription of causality  We tend to ascribe causation even when the evidence only suggests correlation. Pust because birds fly to the euatorial regions when the trees lose their leaves, does not mean that the birds migrate because the trees lose their leaves.

BRAND 0OSITIONIN it is the $added value% or augmented elements that determine a brand's positioning in the market place. 0ositioning can be defined as follows( 0ositioning is how a product appears in relation to other products in the market "rands can be positioned against competing brands on aperceptual map.  A perceptual map defines the market in terms of the way buyers perceive key characteristics of competing products. &he basic perceptual map that buyers use maps products in terms of their price and uality, as illustrated below(

6ua$i%y  Lo7 High ECONOMY BRANDS "A87A# "8A/ !-W "-Q "8A/ 081M#NM "8A/


0rice( 2ow 

High -nce you determine the way in which you can reach your market, the net thing to look at is how you are going to lure your customer to try your brand. +ere is a list of nine positioning types you can think of before deciding on which one  you will attach to your brand( brand( . Ruality positioning H. Salue positioning L. Featuredriven positioning . 8elational positioning D. Aspiration positioning E. 0roblemJsolution positioning T. 8ivalrybased positioning C. Warm and fu99y positioning B. "enefitdriven positioning

COMMUNICATION TOOL !hildhood obesity has become a nationwide epidemic. &elevision food advertising is a known contributor to this problem but little research has eamined newer marketing venues such as the #nternet. Accordingly, a content analysis of online food marketing practices was conducted for four popular children's websites( !artoon, , , and ! !onsistent  with patterns in television advertising, advertising, results indicate that the the food products marketed online are high in calories and low in nutrients. !andy, sweetened  breakfast cereals, snacks, and uick serve restaurants restaurants dominated. !, a foodbased website, ehibited the greatest amount of food marketing. &he types of marketing appeals used to promote these foods ranged from clearly delineated advertisements, to more immersive marketing techniues such as product placements, =advergames,' and integrated marketing pages. !ommon to all marketing appeals was the use of attentiongetting features, such as dynamic images,  boldJcolorful tet, and animation, animation, as well as childdirected branded characters. "ecause the foods marketed online are not consistent with a healthy diet, it is recommended that additional steps be taken to regulate online marketing practices.



-nce the company has developed a clear positioning strategy, it must communicate that positioning effectively. uppose a company chooses the best in uality strategy. Ruality is communicated by choosing those physical signs and cues that people normally use to <udge uality. +ere are some eamples(  A lawn mover manufacturer claims its lawn mover is powerful powerful and uses a noisy motor because buyer think noisy lawn movers are more powerful. &ruck manufacturer undercoats the chassis not because bec ause it needs undercoating but  because undercoating suggests concern for uality. uality. Ruality is also communicated through other marketing elements. A high price usually signals a premium product to the buyers. &he products uality image is also affected by the packaging, distribution, advertising and promotion. +ere are a few cases were the brands uality image was hurt.  A well known fro9en food brand lost its prestige prestige image by being on sale too often.  A premium beers image was hurt when it switched switched from bottle to cans.  A highly regarded television receiver lost its uality image when mass merchandise outlets began to carry it. For an organic food manufacturing company, its important that the uality aspect is given due importance. &he highlighting of the uality of food product, packaging and the freshness it provides along with the highlighting of the nutrient contents will be of great help to the promotion of the product. 1specially when the product is a baby food, health will be the main concern of the buyer. &he communication message will  be attractive if the content carries something related to purityK for for eample, the image of a baby, nature etc.

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