UNIT-4, Understanding Buyer’s Behaviors

Meaning of Consumer Market

Consumer market refers to the market where people purchase products/services for
consumption and are not meant for further sale. This market is dominated by the
products which consumers use in their daily life. Each time a consumer purchases
a commodity for his own usage he/she is participating in a consumer market.
Consumer market is applicable to both products and services. The consumer has
high decision power as the product or service which is being purchased is for self
use. Consumer market is traditionally assumed to be offline but with advent of
ecommerce, consumer markets can even be online.

Consumer Buying Behavior – Meaning and Definitions

Consumer buying behavior is the study of individuals, groups, or organizations and
the processes they use to select, secure, use, and dispose of products, services,
experiences, or ideas to satisfy needs and the impacts that these processes have on
the consumer and society.
Marketing success or failure of a company depends on target consumers’
individual and group reactions expressed in the form of buying patterns. Since
customer is the reason why any organization exists, it is necessary to understand
the customer and study the pattern of his buying behavior.
According to Frederick Webster- “Consumer buying behavior is all psychological,
social and physical behavior of potential customers as they become aware of,
evaluate, purchase, consume and tell other people about products and services.”

It may be viewed as an orderly process whereby the individual interacts with his
environment for the purpose of making market decisions on products and services.
To achieve a better understanding of the consumer behavior, study of such
disciplines like economics, sociology, psychology, and anthropology is required.
Economics explains consumer behavior in relation to economic factors. Sociology
and cultural anthropology supply explanations concerning the influences of family
and group behavior upon individual behavior, the diffusion of new products and
ideas (innovation) among various groups, and the impact of culture on its
members.
Psychologists explain the motivation that underlines buying behavior, the
perceptions individuals have of themselves and the products they buy. The internal
and external forces and influences interact in highly complex ways, affecting the
individual’s total pattern of behavior as well as his buying behavior.

Model of Consumer Buying Behavior

A consumer behavior model is a theoretical framework for explaining why and
how customers make purchasing decisions. The goal of consumer behavior models
is to outline a predictable map of customer decisions up until conversion, thus
helping you steer every stage of the buyer’s journey.

Consumer behavior models may sound complicated, but they’re not. They’re a way
to create a “buyer behavior story” that you can use to refine and improve your
customer experience.

As a whole, buyer behavior refers to an individual's buying habits based on

influences from their background, education, personal beliefs, goals, needs,
desires, and more.

Businesses aim to understand buyer behavior through customer behavior analysis,

which involves the qualitative and quantitative analysis of a target market.

These models are either traditional or contemporary.

TRADITIONAL CONSUMER CONTEMPORARY CONSUMER

BEHAVIOR MODELS BEHAVIOR MODELS

Learning Model Engel-Kollat-Blackwell (EKB) Model

Psychoanalytical Model Black Box Model

Sociological Model Hawkins Stern Model

Economic Model Howard Sheth Model

Nicosia Model

Webster and Wind Model

Traditional Behavior Models

Traditional behavior models were developed by economists hoping to understand

what customers purchase based on their wants and needs. Traditional models
include the following:

 Learning Model

 Psychoanalytical Model

 Sociological Model

 Economic Model

1. Learning Model of Consumer Behavior

The Learning Model of customer behavior theorizes that buyer behavior responds
to the desire to satisfy basic needs required for survival, like food, and learned
needs that arise from lived experiences, like fear or guilt. This model takes
influence from psychologist Abraham Maslow’s Hierarchy of Needs (pictured
below).

2. Psychoanalytical Model of Consumer Behavior

Sigmund Freud is the father of psychoanalysis. The psychoanalytical model draws

from his theories and says that individual consumers have deep-rooted motives,
both conscious and unconscious, that drive them to make a purchase. These
motives can be hidden fears, suppressed desires, or personal longings.

Thus, customers make purchases depending on how stimuli from your business,
like an advertisement on Instagram, appeal to their desires. It’s important to note
that, since these desires can be unconscious, customers don’t always know why it
appeals to them; they just know it feels right to have it.

This model is unique in terms of application, but it’s relevant to businesses that sell
an image that accompanies their products or services. For example, say you sell
glasses. We all long to fit in and feel like we’re valued and seen as capable, smart
people. Glasses are sometimes a symbol of intelligence, so you’d want to appeal to
this desire when crafting a customer experience.

3. Sociological Model

The Sociological Model of consumer behavior says that purchases are influenced
by an individual's place within different societal groups: family, friends, and
workgroups, as well as less-defined groups like Millennials or people who like
yoga. An individual will essentially purchase items based on what is appropriate or
typical of the groups they’re in.

This model can apply to most businesses, especially those that create products and
services relevant to specific groups. To use the Sociological Model, you’d want to
create experiences that speak to how these groups usually act. One example is
brands that sell exercise equipment.

4. Economic Model of Consumer Behavior

The economic model of consumer behavior is the most straightforward of the

traditional models. This model argues that consumers try to meet their needs while
spending as few resources (e.g. money) as possible.

That means that businesses and manufacturers can predict sales based on their
customers’ income and their products’ price. If companies offer the lowest-priced
product, they may feel that they’re guaranteed a consistent level of profit.

Contemporary Models

Contemporary models of consumer behavior focus on rational and deliberate

decision-making processes rather than emotions or unconscious desires. The
contemporary models include:
  Engel-Kollat-Blackwell (EKB) Model

 Black Box Model

 Hawkins Stern Model

 Howard Sheth Model

 Nicosia Model

 Webster and Wind Model

1. Engel-Kollat-Blackwell (EKB) Model of Consumer Behavior

The Engel-Kollat-Blackwell model of consumer behavior outlines a five-stage

decision process that consumers go through before purchasing a product or service.

 Awareness: During this stage, consumers view advertisements from a

business and become aware of their need, desire, or interest, to purchase
what they've just discovered.

 Information Processing: After discovering a product or service, a consumer

begins to think about how the product or service relates to their past
experiences or needs and whether it will fulfill any current needs.

 Evaluation: At this point, consumers will research the product they’ve

discovered and research options from competitors to see if there is a better
option or if the original product is the best fit.

 Purchasing Decision: A consumer will follow through with a purchase for

the product that has beat out competitors to provide value. A consumer may
also stop the process if they change their mind.

 Outcome Analysis: After making a purchase, a customer will use what

they’ve bought and assess whether their experience is positive or negative.
After a trial period, they’ll keep a product and maybe decide to become
repeat customers or express dissatisfaction and return to stage three.

2. Black Box Model of Consumer Behavior

The Black Box model, sometimes called the Stimulus-Response model, says that
customers are individual thinkers that process internal and external stimuli to make
purchase decisions. The graphic below illustrates the decision process.

It may look complex, but it’s a fairly straightforward path. A consumer comes into
contact with external stimuli from your business’ marketing mix and other external
stimuli, and they process it in their mind (black box). They relate the external
stimuli to their pre-existing knowledge, like personal beliefs and desires, to make a
decision.

In short, this model says that consumers are problem solvers who make decisions
after judging how your product will satisfy their existing beliefs and needs. Since
consumers only follow through with a purchase after understanding how a product
relates to their experiences, this model can benefit businesses selling products that
go along with a lifestyle.

3. Hawkins Stern Impulse Buying Model

The Impulse Buying theory is an alternative to the Learning Model and EKB, as it
claims that purchases aren’t always a result of rational thought. When we think of
impulse buying, we typically imagine picking up a candy bar or a pack of gum
right before checking out. These are certainly impulse purchases, but Hawkins
Stern categorizes them into four different types:

 Escape Purchase: Sometimes called pure impulse, this involves purchasing

an item that isn’t a routine item or on a shopping list. Consumers are drawn
to these items through appealing visuals.

 Reminder Purchase: A consumer makes a reminder impulse purchase when

they come across a product through in-store setups, promotional offers, or a
simple reminder that a product exists, like a strategically placed ice cream
scoop in the freezer aisle of a grocery store.

 Suggested Purchase: Suggested impulse purchases occur when a consumer

is made aware of a product after a recommendation or suggestion from an
in-store salesperson or online algorithms. For example, seeing an ad that
says, “Other people who bought this shoe you’re about to buy also purchase
 these socks.” The consumer didn’t know the socks existed, didn’t plan to
buy them, but now the suggestion has told them that they need them.

 Planned Purchase: Although planned is the opposite of impulse, these

purchases occur when a consumer knows they want a particular product but
will only buy it if there is a deal involved. An unexpected price drop could
lead a customer to make a planned impulse purchase.

The Hawkins Stern Model applies to most businesses, as there are no limits to what
a customer with this purchasing behavior will buy. Create a tailored customer
experience by putting care into product displays, creating AI algorithms for online
shopping, or placing items on sale to appeal to your shoppers who are planned
purchase impulse buyers.

4. Howard Sheth Model of Buying Behavior

The Howard Sheth model of consumer behavior posits that the buyer’s journey is a
highly rational and methodical decision-making process. In this model, customers
put on a “problem-solving” hat every step of the way — with different variables
influencing the course of the journey.

According to this model, there are three successive levels of decision-making:

 Extensive Problem-Solving: In this stage, customers know nothing about

the product they’re seeking or the brands that are available to them. They’re
in active problem-solving mode to find a suitable product.

 Limited Problem-Solving: Now that customers have more information,

they slow down and begin comparing their choices.

 Habitual Response Behavior: Customers are fully aware of all the choices
they have and know which brands they prefer. Thus, every time they make a
purchase, they know where to go.

5. Nicosia Model
The Nicosia Model places emphasis on the business first and the consumer second.
It argues that the company’s marketing messages determines whether customers
will buy.

The model is comprised of four “fields”:

 One: The business’ characteristics and the customer’s characteristics.

What does your marketing messaging look like? And what’s your
customer’s perception of that messaging? Are they predisposed to be
receptive to your message? The latter is shaped by the customer’s
personality traits and experiences.

 Two: Search and evaluation. Similar to the Howard Sheth model’s

“limited problem-solving” stage, the customer begins to compare different
brands here based on the company’s messaging.

 Three: Purchase decision. The purchase decision will occur after the
company convinces the customer to choose them as their retailer or provider.

 Four: Feedback. During the feedback field, the company will determine
whether it should continue using the same messaging, and the customer will
decide whether they will continue to be receptive to future messages.

6. Webster and Wind Model of Organizational Buying Behavior

The Webster and Wind Model is a B2B buying behavior model that argues there
are four major variables that affect whether an organization makes a purchase
decision. Those are:

 Environmental Variables: Environmental variables refer to any external

factors that could sway a purchase decision. Customer demands, supplier
relationships, and competitive pressure are a few examples. Broader
variables apply, too, such as technology, politics, and culture.

 Organizational Variables: Organizational variables refer to internal factors

that could sway a purchase decision, such as the organization’s goals and
evaluation criteria.
  Buying Center Variables: Who makes the final purchase decision? Who
has the authority to sign the contract, and who influences the buying
process? Buying center variables take all of this into account.

 Individual Variables: These variables refer to the demographic and

psychographic information of the individual prospect at the business. What’s
their education and level of experience? What are their goals and desires?

After taking all of those variables into account, B2B organizations are then able to
chart a predictable buyer’s journey for their target customers.

Characteristics Affecting Consumer Behavior

Consumer Buying Behavior refers to the buying behavior of the ultimate
consumer. Many factors, specificities and characteristics influence the individual in
what he is and the consumer in his decision making process, shopping habits,
purchasing behavior, the brands he buys or the retailers he goes. A purchase
decision is the result of each and every one of these factors. An individual and a
consumer is led by his culture, his subculture, his social class, his membership
groups, his family, his personality, his psychological factors, etc. and is influenced
by cultural trends as well as his social and societal environment. By identifying
and understanding the factors that influence their customers, brands have the
opportunity to develop a strategy, a marketing message (Unique Value
Proposition) and advertising campaigns more efficient and more in line with the
needs and ways of thinking of their target consumers, a real asset to better meet the
needs of its customers and increase sales.
Followings are the important characteristics affecting consumer behavior.
a) Economic Factors
One of the influencing factors of consumer buying behavior is the economic factor.
It refers to the consumer’s purchasing power and willingness to purchase goods
and services. The consumer’s purchasing capacity or willingness largely depends
on the following:
  Level of Personal Income: The ability of the consumer to pay money
depends upon the level of his personal income. The more income consumer
gets the higher purchasing capacity he will have.
 Income of Other Members of the Family: When there is the addition of
earning members, the buying capacity of the other member of the family is
affected in a positive way. In such circumstances, they are able and willing
to spend more money on products they desire.
 The Expectation of Income in the Future: The optimism or pessimism of
the consumer about his future income also determines the level of his current
expenditure. If he expects that, in the near future, he would receive
additional income from any other sources, he will be willing to spend more
and vice versa.
 Availability of Liquid Assets. Liquid assets are those, which are readily
available to turn into cash. The level of consumer spending on products and
services also depends on the availability of liquid assets such as bank
balance, cash in hand, shares, etc.
 Availability of Credit to Consumer. If an adequate credit facility is
available to consumers, they will tend to spend more on products and
services although their regular income is low.
 Past-Expenditure Habit. The buying behavior of the consumer is also
affected by his past expenditure habits. If the consumer’s past living
standard was high, the spending level of the consumer will also be higher
although he may not have adequate income during the period as he is
habituated to spending more. In such a situation, he would be initiated to sell
even his fixed assets.
b) Socio-Cultural Factors
Society consists of individuals, groups, and families of diverse natures, tastes,
values, motives, attitudes, and lifestyles. Therefore, the buying behavior of
individuals, groups, and families differs from one another.

A successful marketer is one who can do a detailed study of significant social

factors including family, reference group, social class, opinion leaders, and culture.

 Family: Family is a primary social institution. It is a group of individuals

related to each other such as the father, mother sons daughter, grandfather,
grandmother, granddaughters, nephew, uncle, etc. A family is a primary
group that exercises considerable influence on the consumption behavior of
the individual.
  Reference Groups: A reference group is a group of people with similar
values, beliefs, and attitudes. A reference group consists of all the groups
that have a direct or indirect influence on the person’s attitude or behavior.
A reference group may be a family, friends, membership groups, neighbors,
and so on.
 Social Class: Social classes are formed due to differences in income levels.
The major three social classes are, Upper class: They have high income with
a luxurious lifestyle. Middle class: They have a medium level of income.
Lower class: This is a very low-income class with low purchasing power.
 Opinion Leaders: Opinion leaders are the individuals who lead certain
reference groups. Opinion leaders possess a disproportionately large amount
of leadership quality. Opinion leadership refers to the degree to which an
individual influences others in a given choice situation. A marketer must be
able to identify such opinion leaders and analyze their roles that affect the
buying behavior of the groups.
 Culture: Culture is the total human-environment mankind’s knowledge,
beliefs, art, morals, law, customs, religion, and any other capabilities and
habits acquired by humans as members of society. The consumption pattern
of each of these groups differs significantly from one another. For example,
buying pattern of a vegetarian may differ from that of a non-vegetarian.
c) Psychological Factors
Psychology is a state of one’s mind which cannot be studied with the help of
general information and analysis; it requires interpretive or insight knowledge
about the consumer. Psychology is another major influencing factor that has a
major impact on buying behavior of a consumer. While analyzing the psychology
of a consumer, a marketer must be able to analyze:

 Why a person behaves as he does?

 What motivates him to behave in a particular manner?
 What role, do attitude, personality, and own image play in influencing
behavior?
The psychology of a person is governed by several factors, which must be
carefully analyzed by the marketer. These factors include:

 Motivation: Motivation is an activity directed towards a goal. It is an

internal emerging force that directs a person’s behavior towards his goal. A
buyer’s action at any time is affected by a set of motives. A person has many
needs without satisfaction and he cannot be motivated.
  Perception: Perception means knowledge or idea about a product or
situation received or derived by a person. In another word, perception is a
process whereby a person acquires or perceives the meaning of an object or
situation. A motivated person is ready to act in some way. How the
motivated person acts is influenced by his or her perception of the situation.
Two persons in the same motivated state may act quite differently because
they perceive the situation differently.
 Learning: When people perceive the meaning of an object or situation, they
act. When they act, they learn, i.e., people learn through experience. So
learning can be defined as the change in an individual’s behavior arising
from experience or prior behavior in a similar situation.
 Beliefs & Attitude: A belief is a descriptive thought that a person holds
about something while an attitude consists of knowledge about an object or
situation. Customers believe iPhone to be a product of premium quality
while Micromax for them is a product that provides smartphone facilities at
minimum cost.
 Personality: Personality means the person’s distinguishing psychological
characteristics that lead to relatively consistent and enduring responses to his
or her environment. Personality is usually described in terms of traits such as
self-confidence, self-control, dominance, autonomy, sociability, adaptability,
aggressiveness, conservative, defensive, etc. Marketers generally believe
that a person’s personality does influence the brand of products s/he
purchases.

d) Demographic Factors
Consumer buying behavior is also affected by demographic factors. These are the
individual characteristics such as age, sex, culture, income, family size,
occupation, marital status, etc.

These demographic attributes can influence the individuals who are involved in
family decision-making. They can influence the speed at which a person moves
through the consumer buying process. They also affect the particular stages of the
decision-making process. These factors can also affect the extent to which a person
uses products in a specific product category.

e) Psycho-Analytic Factors
The psychoanalytic approach, also called socio-psychology, propounded by
Sigmund Freud states that personality (mental framework) is made up of three
primary systems of interdependent psychological forces- the id, the superego, and
the ego. Human behavior is a function of the interaction of these three systems.

The buying decision process / Consumer Buying Process

Buyer behavior involves a mental process as well as physical activity. The buying
behavior and purchase decisions need to be studied thoroughly to understand
predict and analyze critical market variations. Buyer is a riddle/problematic, highly
complex entity want to satisfy his innumerable needs and desires. A buyer
knowingly or unknowingly completes the following five steps in his / her buying
process.

1. Problem Recognition:
Problem recognition results when a buyer recognizes a difference of sufficient
magnitude between perceived benefits and actual benefits derived from a product
or service. The buying process starts when the buyer recognizes a problem or need.
The consumer began to feel a problem in the form of a certain need or desire.
The needs can be triggered either by internal stimuli like hunger, thirst etc., or by
external stimulus generally referred to as a sign or cue. Depending on the intensity
of the want, the person will try to fulfill the unsatisfied want.
2. Information Search:
Information is to know about a service, attributes of service, prices, and stores and
so on. Search may be categorized in four categories- pre-purchase, ongoing,
internal and external. An aroused buyer may or may not search for more
information. If the buyers derive is strong and the desired service to satisfy the
need is easily available then he or she may not search for more information.
The extent of search activity depends upon the strength of derive, the amount of
information buyer already have, the ability to obtain additional information, the
importance or value given to gathering additional information and the satisfaction
buyers gets from information search. Buyers engage in both internal and external
information search. Internal search involves the buyer identifying alternatives from
his or her memory. For certain low involvement services, it is very important that
marketing programs achieve “top of mind” awareness.
For high involvement services, buyers are more likely to use an external search. A
compensatory decision involves the buyers “trading off” good and bad attributes of
a service. The amount of fort a buyer puts into searching depends on a number of
factors such as the market, number of competitors, differences between brands,
service characteristics, important of services and situational characteristics.
3. Evaluation of Alternatives:
Evaluation involves those activities undertaken by the buyer to compare
alternatives carefully on the basis of certain criteria, alternative solutions to market
related problems etc. The marketers are interested in knowing how the buyer
processes information to arrive at brand choice. There is no single evaluation
process used by the buyers or even one consumer in all purchase decisions.
4. Purchase Decisions:
Purchase decision is a consumer commitment for a product. It is the terminal stage
in the buying decision process that completes a transaction. In case a consumer is
buying a product for the first time, then from the behavioral view point it may be
regarded as a trial. The consumer will repeat the purchase only where he is
satisfied with its performance.
Actual purchasing process of buyer seeking to build a better understanding of how
buyers make their purchases. In the decision evaluation stage, the consumer forms
preferences among the brands in the choice set. The consumer may also form a
purchase intention and lean towards buying the most preferred brand. However
factors can intervene between the purchase intention and the purchase decision.

5. Post Purchase Behavior:

It refers to the behavior of a consumer after the purchase and use of products; it
originates out of consumer experience regarding the use of the product and is
indicated in terms of satisfaction. This behavior is reflected in repeat purchases or
discontinuation from further purchase. If product use experience indicates
satisfaction, they repeat purchases will occur, otherwise not.
Once the buyer makes a decision to purchase a product or service there can be
several types of additional behavior associated with that decision such as decisions
on service uses and decision on services related to the item purchased. The
marketer’s job continues even after the service is bought especially since he has to
learn a lot from the post purchase behavior undertaken by the buyer. This will be
indicative of whether the buyer is experiencing post purchase satisfaction or not.
Post Purchase satisfaction- The level of satisfaction experienced by the buyer after
his purchase will depend on the relationship between his expectations about the
service and performance of the service. After purchase of a service a buyer may
detect a few. Some buyers will not want the flawed services whereas others will be
indifferent to the flaw and some may even see the flaw as increased cost of the
service. The buyers post purchase actions will provide necessary feedback to the
marketers as to whether he/she is satisfied or dissatisfied with the product or
service acquired.
A satisfied buyer will act as an informal word of mouth for the firm whereas a
dissatisfied buyer will react in an entirely different manner.
Post purchase action- The satisfaction or dissatisfaction with the service will
determine subsequent performance of the service in the market. If the buyer is
satisfied then he will exhibit a higher probability of repeat purchase of the service.
The satisfied buyer will also tend to say good words about the service. Whereas a
highly dissatisfied buyer will not buy the service again and spread negative words
about service and company.

Meaning of Business Market

A business market is a method where a company uses to sell products or services
to a specific group of consumers. Typically, business markets facilitate sales from
one business to another in cases where one business plans to reuse or resell another
company's products or services.

A company that purchases goods and services in a business market might also use
the items they purchase as materials to produce new products of their own. There is
business markets designed around making sales directly to consumers as well, and
they focus on reaching a large audience rather than marketing to other businesses.
Business buyer behavior
Organizations that purchase goods and services for use in the manufacture of other
products and services that are sold, leased, or supplied to others are referred to as
business buyers.

Organizational buying is also known as institutional buying or business-to-business

(B2B) buying. The process starts when a company or organization determines a
need for goods. Then they gather details to compare and contrast products and
services from competing brands. Finally, they make a final purchase decision.

Organizations purchase goods and services for internal use as well as for use in the
manufacturing process to produce a finished product or service for end-users.
When the goods are used in their own manufacturing process, the purchase process
is referred to as industrial buying.

In some ways, organizational buying is similar to individual customer buying in

that it is not the organization that makes the purchasing decisions, but people from
all levels of the organization are involved in the process.
Model of Business Buyer Behavior :

The buyer behavior model is a structured step-by-step process. Under the

influence of marketing stimuli (product, price, place, and promotion) and
environmental factors (economic, technological, political and cultural), a customer
understands the need to make a purchase.
Participants in Business Buying Process
The major participants in business buying process are

Initiators-are the ones who initiate or recognize the need of a particular product
requirement in the organization for enhancement or to combat depravation.

Users-are the ones who are going to use the product or require it for the smooth
functioning of their operations.

Influencers --Influencers can be of different levels and the decisions that they
influence might differ from person to person or post to post. These are basically the
people who will influence the decision of which product to buy from where and
what suitable price to buy it in.

Deciders - they decide or have the authority to decide whether to buy a certain
product or not.

Approvers-they approve the deciders decisions to by usually these people are

authorized to do so.

Buyers--They are the once who make the actually purchases from other business.
 Major Influences on Business Buyers

Business buying behavior can be affected by various internal and external

factors. A marketing manager has to study carefully such factors that have an
impact on its customer serving, to improve the organization’s marketing policy and
plans.

The major factors affecting or influencing organizational buying behavior are:

 Environmental factors
 Organizational factors
 Interpersonal factors
 Personal factors
i) Environmental Factors
The environmental factors of business buying behavior include government
regulation, technological innovations, demand level, competition, social
responsibility, cost of funds, availability of natural resources, etc. Marketing
organizations need to assess the strengths and weaknesses of these factors and
analyze how they affect their customers.
Then the concerned organization should predict how buyers will adjust their
purchase. If necessary, they must be ready to change their marketing strategy to
keep up with buyers’ changed behavior.

ii) Organizational Factors

Every organization has a certain goal and objective, accepted procedures for
purchasing, and an organizational structure, all of which influence its purchasing
decisions. These organizational characteristics provide clues for determining how
one industrial buyer might be different from another and how purchase decisions
are likely to be made.

The goal and objective of an organization influence the types of products it needs
and the criteria by which it evaluates. Different organizations may have different
goals and objectives. Buying procedure of an organization may enforce the
suppliers to follow several rules beyond which they can not go. By law,
governmental organizations must call ‘biding’ while buying products from outside
suppliers. Generally, the supplier with the lowest bid is often selected. Similarly,
organizational structure assigns responsibilities and authority for decision-making
to job positions and determines who should make the purchase decision. The
authority may be either high-level or middle-level managers. It is a marketing
manager who should find ways of turning these challenges or problems into
potential opportunities.

iii) Interpersonal Factors

Within the organization also the primary users include the individual personnel or
staff with different motives, interests, and authority. They may interact with each
other. For example, a purchasing manager and a product user within the
organization may have quite different opinions relative to how important price is
about product quality and specific product features.

The purchasing manager may be concerned more with price saving, while the
product users may be concerned more with quality and design. In such a situation,
the supplier or salespeople and others having direct contact with the organizational
buying center should watch carefully for indications of buying center conflict and
how it is resolved.
 iv) Individual Factors
In any organization, the individual staff makes buying decisions and purchases
products. Therefore, organizational buying may be affected by their personal
motivations, perceptions, preferences, and background. These individual
characteristics are influenced by the individual participants’ demographic and
psychological factors. A supplier’s challenge is to learn about the characteristics of
the individual participants so that selling appeals can be tailored to the individual
nature of the actual buyer(s). A supplier may learn these characteristics through the
sales representatives, market research, other concerned business firms.

Analyzing buyer behavior is a challenge for any marketing professional. A supplier

must learn about the individuals in the buying center and how they go about
selecting products and suppliers. Only then a marketing plan can be designed to
appeal effectively to those who will make the purchase

Buying Styles

The four buying styles are based on the DISC behavioral model, and they control
how we like to communicate and be communicated with, how we prefer to make
purchasing decisions, and the speed with which we prefer to make them.

1. The Decisive (D Style)

The first buying style is called the Decisive. These buyers have a clear
picture in their mind of what results they want. They are often seen as “Type-A”
people, preferring to make buying decisions very quickly. They are more often
interested in “winning” or “promoting their own agenda” so they like to buy when
they feel they have “gotten their way,” so to speak. They are attentive to actions or
communication that will speed up those results. Discussions about details and
minutiae are distracting to these individuals. They prefer to discuss top-line, big-
picture concepts when considering the value of any offering.

2. The Interactive (I Style)

The second buying style is called the Interactive. These buyers want to
shape and mold events and enjoy “getting their way” when it comes to negotiations
or buying something. Unlike the High D, however, High I’s tend to go about this
by working with or through people – much more collaboratively. They are
interested in people and like to interact with others, understand others and to be
understood by others. They are most receptive to making a buying decision when
they feel a sense of connection with the person, are in a more social environment
and have had the opportunity to express their emotions, thoughts, fears or
excitement about the offering first. Like the High D, this person is also particularly
inattentive to details, preferring to stick to the big-picture and emotional benefits of
the solution.

3. The Stabilizer (S style)

The third buying style is called the Stabilizer. These buyers are more
passive and introverted and interested in the how and why of a solution (i.e., the
details and minutiae that the I and D couldn’t care less about). Their primary
interests are in maintaining stability within themselves and whatever situation they
find themselves in. Messages that don’t address the specifics, or that champion
radical change, are likely to alienate rather than resonate. They prefer to buy things
that will increase the stability in their lives, provide more security, and are well
known and well proven. They prefer to “take their time” more than any other
dimension so any offering should give them plenty of time to decide.

4. The Conscientious (C style/ careful)

The fourth and final buying style is called the Conscientious. These
buyers are also more passive and introverted. Like the High S, they too take a
much more detailed (the most) and accuracy-based approach to their buying habits.
Their buying decisions are very much driven by questions of accuracy, detail,
reliability, level of proof, etc. Without sufficient data to prove any statements made
to a High C, you will fail to achieve their buy in. Why is a favorite question for a
high C buyer. Prove it is the second most common one. They are very concerned
with doing things accurately. They are receptive to offerings that provide proof that
the solution works, proposals that are meticulously detailed and absent of ANY
grammatical mistakes or typos.
Decision Process of Business Buyer

The business buying decision process involves eight distinct stages. At each
stage, different decision makers may be involved, depending on the cost and
strategic importance of the purchase. To navigate the buying decision process
successfully, you need to provide the right type of information and ensure that
your sales representatives are contacting the right decision makers. You can also
strengthen your position by offering customers advice and guidance at each stage
– a process known as consultative selling.

1. Problem recognition: The buying starts when a person recognizes a problem or

need. He wants a product that can meet this need. This is called problem
reorganization. This can result from internal or external factors. Internally, a
company decides to launch a new product. To do this, a company needs new raw
materials, equipment, extra labor and capital, new suppliers, and selects a person as
a manager who will look after the whole production.

But externally, buyers may have some new experiences after watching TV ads or
sales calls, product reviews, or offering a lower price. In showing advertising,
marketers want to alert customers about the problem and after then they also show
how their products solve the problem.

2. General needs description: After recognizing a need, general needs

description is the next step. It describes the characteristics and quality of the items.
The expert team tries to improve durability, price, reliability, core value, and other
attributes.

3. Product specification: Next the organization develops product specifications

with the help of an engineering team. Cost reduction is an important issue in this
product specification. That’s why the team carefully redesigned, standardized or
adopts less costly methods and decides the best characteristics of the product.

4. Supplier search: In this stage, a buyer wants the best supplier. Buyers can make
a short list of qualified suppliers, search on Google, and watch a review on
YouTube, by contracting them. Today, Internet technology brings a revolutionary
change in finding information. Small suppliers also get facilities having internet.

5. Proposal solicitation: In this stage, the buyer invites qualified suppliers to

submit their proposals. Some suppliers offer their sample of the product to the
buyer; refer to their websites or promotional materials. If the product is expensive
then the suppliers show a presentation of their product.

6. Supplier selection: Here, the buyer reviews the supplier’s proposals and selects
the best one among them. In this selection, the members make a list of desired
supplier attributes and their importance. These attributes are product quality,
images, reputation, delivery systems, ethical corporate behavior, honesty, and
competitive prices. Then the buyer rates all suppliers and chooses the best one.

7. Order-routine specification / Purchase Order: In this business buying

process, the buyer prepares a formal written order for the chosen suppliers. It is
known as an order-routine specification. This routine order contains technical
specifications, quantity, quality, delivery time, return policies, warranties,
maintenance, repair, operation, etc.

8. Performance review: Here, the buyer reviews the supplier’s whole

performance. The buyer asks their users about the products and services and
requests them to rate their satisfaction. The performance review helps the buyer to
take any decision to continue the business or modify or drop. The seller ensures the
buyer about the expected satisfaction.

In all, this is a simple view of the eight stages of the business buying process.
However, the real process is much more complex than this one. Straight re-buy,
modified re-buy, new task, in contrast, buying situation has unique requirements.
Engaging Business Buyers with Digital and Social Marketing
As in every other area of marketing, the explosion of information technologies and
online, mobile, and social media has changed the face of the B-to-B buying and
marketing process. In the following sections, we discuss two important technology
advancements: e-procurement and online purchasing and B-to-B digital and social
media marketing.

i) E-procurement and Online Purchasing

E-procurement is the process of buying and selling supplies and services over
the Internet. It differs from e-commerce in that it makes use of a supplier’s closed
system typically available only to registered users.

When implemented properly, e-procurement opens the lines of communication

between a company and a supplier by creating a direct link and facilitating
interactions such as bids, purchase orders and emails.

What are the Benefits of E-Procurement?

E-procurement offers substantial benefits to the function of procurement

management within a purchasing organization, including:
 Cost Savings

Built-in monitoring tools help control costs and maximize performance, reducing
overhead and paperwork. Fully automated systems streamline processes and can
result in a faster cycle from creating an order to fulfillment. There also is an
opportunity for a larger selection of products and services.

 Shorter Purchasing Cycles

Centralized transaction tracking simplifies reporting on orders, payments, and

requisitions, as well as ensuring contract compliance, all of which can reduce
delivery time. Buyers have electronic access to available products, services, and
prices.
  Improved Inventory Control

Procurement professionals can quickly locate products from preferred suppliers

and are limited to the purchases they can make, so inventory is better controlled.

 Transparency

All information is centralized and can be made available to management,

stakeholders, shareholders or the public, as appropriate.

ii) Business to Business Digital & Social Media Marketing

B2B social media marketing is just what it sounds like — it’s where you market
your B2B Company on social media platforms like Facebook and Instagram. The
idea is to draw users to your page, get them interested in your content, and
eventually drive them to your site.

Why is social media for B2B companies so valuable?

You might not think social media is the most viable strategy for a B2B company.
After all, you’re marketing to businesses, not consumers. Why do you care about
marketing on a platform designed for individual users?

Despite the fact that you’re targeting businesses, those businesses are still made up
of individual users — and most of those users are on social media. So, social media
for B2B companies is still a viable strategy.

Now that we’ve established the value of B2B social media, the next question
becomes: How can you use it? What does it take to run a successful B2B social
media strategy?

Thankfully, social media doesn’t have to be difficult. Here’s a helpful video on how
to drive a successful B2B strategy:
 Below, we’ve compiled a list of B2B social media tips your business can use to
drive leads and conversions.

Here are six ways to improve your B2B social media strategy:

1. Choose the right platforms

The first step of using social media in your marketing is to determine which
platforms you’ll use. There are a variety of social platforms available to you,
including:

 Facebook
 Twitter
 Instagram
 LinkedIn
 And more!
You might only want to market on one platform, or maybe you’re looking to tackle
several at once. It all depends on what you’re capable of and where your audience is
located.

For more information on choosing the right platforms, check out this video:

Take some time to research which demographics can be found on which platforms.
Then compare that with the demographics common among your target audience to
figure out which platforms they tend to use.

For B2B companies, LinkedIn is often a particularly valuable resource since it’s
such a business-oriented platform.

2. Interact with your audience

Whatever you do on social media, there’s one thing you should never forget to do
— interact with your audience. By “interact,” we don’t mean talk at them, we mean
talk with them. It’s called social media — your communication should be two-way.
Think of it as a dinner party where you’re the host. You don’t want to get up on a
stage and spend the entire event talking to your guests like they’re an audience at a
speaking event — you want to mingle with them and chat with them one-on-one.

Likewise, engage with your followers on social media. When people tag you or ask
you questions, be sure to respond.

3. Share informational content

Consumers are often won over by nothing more than flashy visuals or catchy ads.
But in B2B marketing, it’s not that easy. Business executives tend to be much more
calculating with their financial decisions, meaning you need to present factual
information to win them over.

Its fine to have a sales post every so often, but most of your social media
content should stay on the informational side. Use info graphics and videos to
educate users about your business, products, and industry. You can also share blog
posts from your site if you have a blog.

As users learn more about you and what you do, they’ll become more open to
buying from you.

4. Share social proof

If a business visits your social media page, they can see a hundred posts where you
talk yourself up and still not be impressed — after all, of course you’re going to
make yourself sound good. But what if they see your past customers saying good
things about you?

That’s the idea behind social proof. If you let your customers do the talking, it
sends a much better message, because they’re the people your audience is most
likely to believe. To that end, look for ways to promote social proof on your page.
 You can do that by sharing testimonials, reposting favorable posts from users, and
linking to case studies. Once people see what you’ve done for your past customers,
they’ll be much keener to work with you.

5. Schedule your posts

Running a B2B social media strategy can be time-consuming. You have to come up
with fresh posts regularly if you want to hold people’s attention. But you may not
have time to create a new post every single day — so what can you do?

The answer is to schedule your social media posts. With the help of a social media
calendar — which you can make using a platform like Buffer or Hoot suite — you
can create multiple posts in advance whenever you have time and then schedule
them to go live later.

The result is that you’ll launch posts each day, even on the days when you don’t
have time to manage social media manually!

6. Use paid social media ads

When you think of social media, you typically think of organic posts from your
page. But you can also run paid ads on social media, which will appear right in
users’ feeds.

Moreover, you can target your ads toward specific groups of people based on
demographics like:

 Age
 Location
 Occupation
 And more!
That means you won’t waste your ads on unrelated audiences. Instead, you can
direct them to exactly the people you hope to convert. Not everyone will discover
your page organically, so paid social media ads are an excellent way to
spread brand awareness and draw in more users.