Transcript Consumer Markets and Consumer Buying Behavior

Consumer Markets and Consumer
Buying Behavior
What is Market
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A Market is
 a social arrangement that allows
buyers and sellers to discover
information and carry out a voluntary
exchange
Consumer market
All the individuals and households who
buy or acquire goods and services for
personal consumption
Requirements of a Market
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Must need or desire a particular product
Must have the ability to purchase the
product
Must be willing to use their buying power
Must have the authority to buy specific
products
Types of Markets
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Consumer markets
Industrial Markets
International Markets
What to Ask in the Market
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What do the customers buy?
Why do the customers buy?
Who are the buyers?
How do they buy?
How much do they buy?
Where do they buy from?
Consumer Behavior
Consumer behavior - the actions a
person takes in purchasing and using
products and services, including the
mental and social processes that come
before and after these actions
Consumer Buying Behavior
Refers to the buying behavior of final
consumers (individuals & households)
who buy goods and services for personal
consumption
Studying consumer behavior answers to:
“How do consumers respond to marketing
efforts the company might use?”
Model of Consumer Buying Behavior
Product
Price
Marketing and
Other Stimuli
Place
Product Choice
Brand Choice
Dealer Choice
Technological
Political
Promotion
Buyer’s
Decision
Process
Economic
Cultural
Buyer’s Black Box
Buyer’s Response
Characteristics
Affecting
Consumer
Behavior
Purchase
Timing
Purchase
Amount
Need Recognition
Perceiving a value
Factors
Cultural,
Social
Personal
Psychological
Information Search
Seeking a value
Evaluation of Alternatives
Assessing value
Purchase
Buying value
Post-purchase Behavior
Assess value in consumption
Cultural Factors
Culture
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Most basic cause of a person's wants
and behavior.
Values
Perceptions
Subculture
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Groups of people with shared value
systems based on common life
experiences.
Hispanic Consumers
African American Consumers
Asian American Consumers
Mature Consumers
Social Class
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People within a social class tend to
exhibit similar buying behavior.
Combination of Occupation, Income,
Education, Wealth
Social Factors
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Reference Groups
Family
Roles and Status
Personal Factors
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Age and Family Life Cycle Stage
Occupation
Economic Situation
Lifestyle
Personality & Self-Concept
Psychological Factors
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Motivation
Perception
Learning
Beliefs and Attitudes
Maslow Needs Hierarchies
Consumer Decision Process
Need Recognition
Marketing helps consumers recognize
an imbalance between present status
and preferred state
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Information Search: Seeking
Value
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Internal SearchRecall information from memory
External Search
information from outside environment
Alternative Evaluation
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Analyze product attributes
Use cutoff criteria
Rank attributes by importance
Purchase Decision
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Buying the most preferred brand
Intention
Unexpected situational factors
Post-purchase Behavior
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Inner tension that a consumer
experiences after recognizing an
inconsistency between behavior and
values or opinions
 Did I make a good decision?
 Did I buy the right product?
 Did I get a good value?
Involvement and Problem-Solving
Variations
Routine
Response
Behavior
Less
Involvement
Limited
Decision
Making
Extensive
Decision
Making
More
Involvement
Routine Response Behavior
• Little involvement in selection process
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Frequently purchased low cost goods
May stick with one brand
Buy first/evaluate later
Quick decision
Limited Decision Making
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Low levels of involvement
Low to moderate cost goods
Evaluation of a few alternative brands
Short to moderate time to decide
Extensive Decision Making
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High levels of involvement
High cost goods
Evaluation of many brands
Long time to decide
May experience cognitive dissonance
Comparison of problem-solving
variations
Total Set Awarness Consideration
Set
Set
A
A
A
B
C
D
C
D
E
D
E
E
F
F
G
Choice
Set
A
D
Decision
?
Brand
Quality
Price
After Sales
Services
Weight
A
10
5
7
6
D
7
8
5
7
Quality: %40, Price:%30, Services: %20, Weight: %10
For Brand A: (0.4 x10) + (0.3 x 5) + (0.2 x 7) + (0.1 x 6) = 7.5
For Brand D: (0.4 x 7) + (0.3 x 8) + (0.2 x 5) + (0.1 x 7) = 6.9
Buyer Decision Process for
New Products
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Stages
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Awareness
Interest
Evaluation
Trial Adoption
Business Markets
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Individuals or groups that purchase a
specific kind of product for resale, direct
use in producing other products, or use
in general daily operations.
Characteristics of Business
Markets
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Market Structure and Demand
Nature of Buying
Types of Decisions and the Decision
Process
Market Structure and Demand
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Business markets contain fewer but
larger buyers
More geographically concentrated
Demand in business markets is derived
from final consumer demand
Demand is more inelastic
Demand fluctuates more and more
quickly
Nature of the Buying Unit
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Business purchases involve more buyers
Buying involve more professional
purchasing effort
Types of Decision and the
Decision Process
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Business buyers usually face more
complex buying decision
Business buying process is more
formalized
Buyers and sellers work more closely
together and build close relationships