Chapter 5

Consumer and Business Buyer Behavior

Previewing the Concepts—Chapter Objectives

  1. Understand the consumer market and the major factors that influence buyer behavior.
  2. Identify and discuss the stages in the buyer decision process.
  3. Describe the adoption and diffusion process for new products.
  4. Define the business market and identify the major factors that influence business buyer behavior.
  5. List and define the steps in the business buying decision process.

Just the Basics

Chapter Overview

Buying behavior is at the core of marketing; the knowledge and understanding of why we buy and how we buy should be the bedrock of every marketing program. This chapter covers both consumer and business buying behavior.

Consumer behavior incorporates concepts from both sociology and psychology. To understand consumers and their buying processes, therefore, is to understand the myriad influences encountered day in and day out. Cultural, social, personal, and psychological factors affecting buying behavior are explained. These factors clarify the why of buying.

The chapter also details the how of buying, by covering the consumer buying process. This process includes the stages of need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior. The buyer decision process for new products and information on consumer behavior internationally are covered as well.

Business markets are also defined and analyzed. The differences between the consumer buying process and the business buying process are highlighted, as is the nature of the buying unit in business markets. Also discussed is business buying on the Internet.

Chapter Outline

  1. Introduction
  2. Buyers of Harley-Davidson motorcycles are intensely loyal and devoted to the brand. Because of this, Harley-Davidson is at the top of the heavyweight motorcycle market.
  3. Harley-Davidson’s marketing managers spend a lot of time studying their buyers—they want to know who their customers are, what they think, how they feel, and why they buy a Harley rather than another brand.
  4. Their research revealed seven core types: adventure-loving traditionalists, sensitive pragmatists, stylish status seekers, laid-back campers, classy capitalists, cool-headed loners, and cocky misfits. Yet all Harley owners appreciated their bikes for the same basic reasons—independence, freedom, and power.
  5. The example of Harley-Davidson shows that there are many factors that affect consumer buying behavior.
  1. Consumer Markets and Consumer Buying Behavior
  2. Consumer buying behavior refers to the buying behavior of final consumers—individuals and households who buy goods and services for their own consumption. All of these consumers make up the consumer market.
  3. The American consumer market consists of more than 296 million people who consume trillions of dollars’ worth of goods and services each year. The global market consists of almost 6.4 billion people.

Use Key TermsConsumer Market, Consumer Buyer Behavior here.

Use Chapter Objective1 here.

Model of Consumer Behavior

  1. Most large companies research consumer buying decisions in great detail to answer questions about what consumers buy, where they buy, how and how much they buy, as well as when and why they buy.
  2. Learning what, where, when, and how and how much consumers buy is easy, but understanding the why of buying is very difficult, because those reasons are usually locked deep inside the consumer’s mind.
  3. Understanding how consumers respond to varying marketing messages starts with the stimulus-response model of buyer behavior found in Figure 5-1.

Use Figure 5-1 here.

  1. Marketing stimuli consist of the four Ps of product, place, price, and promotion.
  2. Other stimuli include major forces and events in the buyer’s environment: economic, technological, political, and cultural.
  3. All these inputs enter the consumer’s black box and are then turned into responses such as product choice, brand choice, dealer choice, purchase timing and purchase amount.
  4. The buyer’s characteristics influence how he or she perceives and reacts to the stimuli, and the buyer’s decision process itself affects the buyer’s behavior.

Characteristics Affecting Consumer Behavior

  1. Figure 5-2 shows the factors influencing consumer purchases. For the most part, marketers cannot control these factors, but they must always keep them in mind.
  2. Cultural factors exert a broad and deep influence. Roles are played by the buyer’s culture, subculture, and social class.
  3. Culture is the most basic cause of a person’s wants and behaviors. This behavior is largely learned from families and other important institutions.

Use Key TermCulture here.

Use Figure 5-2 here.

  1. A child born in the United States generally learns the values of achievement and success; activity and involvement; efficiency and practicality; progress; material comfort; individualism; freedom; humanitarianism; youthfulness; and fitness and health.
  2. Marketers try to spot cultural shifts so that they can discover new wants and desires, and then develop new products to meet the new wants and desires. An example is the shift toward health and fitness, which created a huge industry.
  3. Subcultures are groups of people with shared value systems based on common life experiences and situations. They include nationalities, religions, racial groups, and geographic regions. Four important subculture groups in the United States include Hispanics, African Americans, Asians, and mature consumers.

Use Key TermSubculture here.

  1. The U.S. Hispanic market, which includes Americans of Cuban, Mexican, Central American, South American, and Puerto Rican descent, numbers 42 million consumers who bought more than $686 billion worth of goods and services. This group is expected to double in size in the next 20 years. They tend to buy more branded, higher-quality products, and are extremely brand loyal.
  2. African Americans number 39 million with a buying power of $723 billion. This population is growing in affluence and sophistication. They can be more price-conscious than other groups, but they are motivated by quality and selection. Black consumers are also the most fashion-conscious of the ethnic groups.
  3. Asian Americans are the fastest growing and most affluent segment in the Untied States. They number 12.5 million and have a disposable income of $363 billion annually. The largest group consists of the Chinese Americans, followed by Filipinos, Japanese Americans, Asian Indians, and Korean Americans. Asian Americans are the most tech-savvy segment, and they shop frequently and are the most brand-conscious of all the ethnic groups. But they are also the least brand loyal.
  4. Mature consumers number 75 million, and this groupwill more than double in size in the next 25 years. Mature consumers are better off financially than are the younger consumer groups.
  1. Social classes are society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors. There are seven American social classes, and they are outlined in Figure 5-3.

Use Key TermSocial Class here.

Use Figure 5-3 here.

Use Discussing the Issues 1 here.

  1. Social class is not determined by a single factor; rather, it is measured by a combination of occupation, income, education, wealth, and other variables.
  2. Marketers are interested in social class because people within a given class can exhibit similar buying behavior. Social classes have distinct product and brand preferences in areas such as clothing, home furnishings, leisure activity, and cars.
  3. Social Factors
  4. A consumer’s behavior is affected by social factors such as small groups, family, and social roles and status.
  5. Behavior can be influenced by small groups. These groups include membership groups to which a person belongs; reference groups, which are indirect points of comparison or reference; and aspirational groups, to which an individual would like to belong. These reference groups expose a person to new behaviors and lifestyles, influence the person’s attitudes and self-concept, and create pressures to conform that may affect a person’s product and brand choices.

Use Key TermGroups here.

Use Discussing the Issues 2 here.

  1. Opinion leaders are those people within a reference group who exert influence on others. Buzz marketing is used by enlisting or even creating opinion leaders to spread the word about specific brands.

Use Key TermOpinion Leaders here.

  1. Family members can influence buyer behavior. It is the most important consumer buying organization in society, and marketers study the roles of husbands, wives, and even children on the purchases of different products and services.
  2. Women make almost 85% of all purchases, totaling $6 trillion each year. Children also can have strong influence on family buying decisions.
  3. A person’s position in each group can be defined in terms of role and status. A role consists of the activities people are expected to perform according to the persons around them. Each role carries a status reflecting the general esteem given to it by society. People often choose products that show their status in society.
  1. Personal Factors
  2. Personal characteristics that affect what a consumer buys include age and life-cycle stage, occupation, economic situation, lifestyle, and personality and self-concept.
  3. People change the goods and services they buy over their lifetimes. The family life cycle consists of the stages through which families might pass as they mature over time. Traditional family life cycle stages include young singles and married couples with children. Other alternative stages include unmarried couples, singles marrying later in life, childless couples, same-sex couples, single parents, those recently divorced, and extended parents (those with young adult children returning home).
  4. A person’s occupation can also affect what he or she buys, as will his or her economic situation.
  5. A person’s lifestyle is his or her pattern of living as expressed in his or her psychographics. It involves measuring consumers’ major AIO dimensions—activities, interests, and opinions. Lifestyle profiles a person’s whole pattern of acting and interacting with the world.

Use Key TermLifestyle here.

  1. There are lifestyle classifications, the most popular of which was developed by SRI Consulting. It is called the Values and Lifestyles (VALS) typology. It classifies people according to how they spend their time and their money. It divides people up into eight groups based on two major dimensions: primary motivation and resources. Primary motivations include ideals, achievement, and self-expression. Resources are classified as either high or low, and include income, education, health, self-confidence, energy, and other factors.

Use Application Questions 1 here.

  1. Forrester research has also developed a “technographics” scheme, which segments consumers according to their motivation, desire, and ability to invest in technology.
  2. Personality refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to one’s own environment. Personality generally covers such traits as self-confidence, dominance, sociability, autonomy, defensiveness, adaptability, and aggressiveness. Personality influences buying behavior.
  3. It is posited that brands also have personalities, and consumers will buy brands whose personality matches their own. A brand personality is the specific mix of human traits that may be attributed to a particular brand.

Use Key Term Personality here.

  1. Psychological Factors
  2. There are four psychological factors that could influence buyer behavior. They are motivation, perception, learning, and beliefs and attitudes.
  3. A motive or drive is a need that is sufficiently pressing to direct the person to seek satisfaction. A person has many needs; some are biological, such as hunger and thirst; some are psychological, such as the need for recognition and esteem.

Use Key Term Motive (or Drive) here.

  1. There are several theories of human motivation, but two of the most popular were developed by Sigmund Freud and Abraham Maslow.
  2. Freud assumed that people are unconscious about the real psychological forces shaping their behavior, and that a person does not really understand his or her motivation.
  3. Maslow believed that people are driven by particular needs at particular times, and that needs are arranged in a hierarchy (see Figure 5-4). These needs include physiological needs, safety needs, social needs, esteem needs, and self-actualization needs. A person focuses on his or her most important needs, and as each level of needs ceases to be a motivator, he or she moves up the hierarchy.

Use Figure 5-4 here.

  1. Perception is the process by which people select, organize, and interpret information to form a meaningful picture of the world. How a person acts, or buys, is influenced by his or her perception of the situation. There are three perceptual processes through which people can form different perceptions of the same stimulus:

Use Key Term Perception here.

  1. Selective attention is the tendency for people to screen out most of the information to which they are exposed.
  2. Selective distortion describes the tendency of people to interpret information in a way that will support what they already believe.
  3. Selective retention shows that people tend to retain only information that supports their attitudes and beliefs.
  4. Subliminal advertising refers to marketing messages received without consumers knowing it. Studies find no link between subliminal messages and consumer behavior.
  1. Learning describes changes in an individual’s behavior arising from experience. It occurs through the interplay of drives, stimuli, cues, responses, and reinforcement.

Use Key Term Learning here.

Applying the Concept

Video rentals generally include previews of movies that have not yet been released in theaters. How does this apply to the effect of the learning concept just reviewed on your own buyer decision process?

  1. A belief is a descriptive thought that a person has about something. An attitude describes a person’s relatively consistent evaluations, feelings, and tendencies toward an object or an idea. Attitudes put people into a frame of mind of liking or disliking things, and of moving toward or away from them. Attitudes are difficult to change.

Use Key TermsBelief, Attitude here.

The Buyer Decision Process

  1. There are five stages in the buyer decision process (see Figure 5-5): need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior. In more routine purchases, consumers can skip or even reverse some of these stages.

Use Chapter Objective2 here.

Use Figure 5-5 here.

  1. Need recognition is the start of the decision process. The buyer recognizes that he or she has a problem or need.
  2. The need can come from external stimuli, such as advertising, or internal stimuli, such as hunger or thirst.
  3. Information search may or may not take place. If it does, consumers can get their information from many sources.
  4. Personal sources include family, friends, neighbors, and so forth.
  5. Commercial sources are advertising, salespeople, packaging, and so forth.
  6. Public sources include the media and consumer-rating organizations.
  7. Experiential sources include the consumer handling or examining the product itself.
  8. The relative importance of each of these sources varies by consumer. The most effective sources tend to be personal; commercial sources tend to inform the consumer, but personal sources can legitimize the products.

Use Discussing the Issues 4 here.

  1. Evaluation of alternatives depends on the individual consumer and the buying situation. In some cases, consumers can evaluate product alternatives very carefully, using careful calculations and logical thinking. At other times, very little consideration of alternatives is done—impulse buying and relying on intuition rule.
  2. Thepurchase decision entails forming the purchase intention. Typically, consumers will now buy what they have decided on. However, two factors can come between the purchase intention and purchase decision.
  3. First, attitudes of others can intervene. If someone close to the consumer casts doubt on the decision made, the purchase might not take place.
  4. Second, there could be unexpected situational factors. A consumer could see a drop in income, or a competitor could drop their prices.
  5. Post-purchase behavior is also considered part of the buying process. The difference between the consumer’s expectations and the perceived performance of the good purchased determines how satisfied the consumer is. If the product falls short of expectations, the consumer is disappointed; if it meets expectations, the consumer is satisfied; if it exceeds expectations, the consumer is said to be delighted.
  6. Cognitive dissonance generally results from every major purchase. This is the discomfort caused by post-purchase conflict. Every purchase involves compromise, through forgoing benefits of other products.

Use Key TermCognitive Dissonance here.