BUYERS
BEHAVIOUR
Buyer behavior is concerned with the activities &
actions of people & organization that purchase &
use economic goods & services, including the
influences on these activities & actions.
Distinguishing features of consumer
and organizational buyer behavior
1- fewer organizational buyer- generally a co.
marketing industrial products will have fewer
potential buyers than one marketing in
consumer markets. 80% of out put to10-15
organizations in organizational buyer.
However in consumer market trade
intermediaries are more in numbers.
2-CLOSE, LONG TERM RELATIONSHIPS BETWEEN
ORGANIZATIONAL BUYERS AND SELLERS.
Dedicated sales & marketing teams are
employed to service major customer.
The nature of relationship in many consumer
markets is different: customers &
manufacturers rarely meet.
3-Organizational buyers are more
rational
It is probably true that on the whole
organizational buying is more rational.
Decision will be made on economic criteria.
Organizational buyers have to justify their
decisions to other members of the
organization.
4-Organizational buying may be to
specific requirements
Organizational buying is based on the
specific requirements. This is feasible because
of the large potential revenue of such
products like railway engine.
6-Reciprocal buying may be
important in organizational buying
An organizational buyer may be in a powerful
negotiating position with a seller, it may be
possible to demand concessions in return for
placing the order in products in return for
securing the order.
7-Organizational buying/selling may
be more risky
Business to business markets are sometimes
characterized by a contract before the product
is made. Further the product itself may be
highly technical and the seller may be faced
with unexpected problems once work has
started
8-Organizational buying is more
Many organizational purchases involve large
complex
sums of money and are new to the co. involve
many people at different levels of the
organization. The managing director, product
engineer, production manager, purchase
manager and operatives may influence the
decision of which expensive machine to
purchase.
9-Negotiation is often important in
organizational buying
The sellers list price may be regarded as the
starting point for negotiation, but the actual
price will depend on the negotiation skills and
power bases of buyers and sellers.
The consumer decision making
process:
A consumer may pass through a series of
steps as decision making process as below.
Need
identificatio
1. Types
of
n
needs
-Functional
(Rational)
-psychology
(emotional)
2. Hierarchy
of needs
(5
hierarch
y)
3. Conflicts
of needs
4.Recognitio
n of
needs
Information
search
1. Nature of
informatio
n (brand ,
quality
color etc. )
1.Sources
of
informatio
n
(experienc
e, reports,
magazines
etc.)
3. Times of
informatio
n search)
Modified purchase
Evaluatio
n of
Alternativ
es
1. Organize
data in a
desired
form 2.
Develop
the
decision
criteria
cost
performan
ce
Suitability
convenien
ce etc.
Product
selection
and
buying
decision
1. Select the
best
alternativ
e 2.Make
purchase
decision
-Store
-place
-time
-Day , etc
Repurchase
New purchase
decision
Postpurchase
1.Evaluate
behavior
the
rationality of
decision
made in the
past.
2.Identify the
level of
satisfaction
provided by
the product
3.Make repurchase,
new
purchase
modified
decision
Factors affecting the consumer
buying decision process
1- The buying situation: There are three types
of buying situations (a) extensive problem
solving
(b) limited problem solving
(c) automatic response
(a) Extensive problem
solving
When a problem or need is new the means of
solving that problem is expensive and
uncertainty is high, aconsumer is likely to
conduct extensive problem solving.
Sales person should provide sufficient
information to the buyer so that group of loyal
buyers can be developed.
(b) Limited problem
solving
If the consumer has some experience with the
product may be inclined to stay loyal to the
brand previously purchased. However, a
certain amount of information search and
evaluation of a few alternatives occurs as a
rudimentary check that the right decision is
being made. In this situation may provide
limited opportunity for sales people of
competing products to persuade consumers
that they should switch model or brand by
providing relevant information.
(c) Automatic response
E Companies who have built up a larg e brand
image will wish to move their customer to the
state of automatic response. Advertising may
be effective in keeping the brand in the
forefront of the consumers mind. Personal
selling to the ultimate consumer may be
superflous.
2-personal influences
Concerns the psychology of the individuals
concerned
It includes personality, motivation, perception
and learning.
It is extremely difficult for sales people to
judge accurately how extrovert or introvert,
conventional or unconventional ,a customer
is.
BUZZOTTA,LEFTON AND SHERBERG proposed
a two-dimensional approach to understanding
buyer psychology. (1) dominant (2)submissive
Dominant
It is the drive to take control of others. It
wants to lead in personal encounters, to have
control of situations and to have a strong
desire to be independent
submissive
It is the disposition to let others take the
lead. It implies a willingness to be controlled,
a need to comply with the wishes of others
and an avoidance of confrontation.
warm
Warmth is having a regard for others. A warm
person is described as one who is out going,
good humoured, optimistic and willing to
place trust in others.
hostile
Hostility is having a lack of regard for others.
It suggest a person who is cold, distrustful and
disdainful of others.
In general each person primarily falls in to
one of the four groups. The sales person must
look for their hallmark as
(1)dominant-hostile (2) submissive-hostile (3)
submissive-warm (4) dominant-warm
1- Dominant-hostile
These people are loud, talkative, demanding
and forceful in their actions. They are usually
difficult to get along with and can be
offensive. They tend to distrust sales people.
To win the respect of dominant-hostile people,
the appropriate sales person behavior is to
adjust their dominance level upward to meet
that of the buyer. This would involve sitting
upright, maintaining eye contact, listening
respectfully and answering directly.
2- submissive-hostile
These people are cold, aloof and uncommunicative.
They tend to be loner and work in jobs that demand
concentration rather than socialization, such as
research, accounting and computer programming
etc. They prefer to avoid sales intervi ew. While
responding to questions they tend to be short.
While dealing with submissive-hostile buyer a sales
person should not attempt to dominant, but
gradually try to win his or her trust. The sales person
should match the buyers dominance level and ask
open ended questions in a slow and soft manner.
3-submissive-warm
These people are extrovert , friendly, understanding,
talkative and positive-minded, who are not natural
leaders. They prefer to buy from some one they like and
view a sales interview as a social occasion.
Generally they accept most of what the sales person
tells them, but if they feel any doubt they will postpone
the decision to buy.
The sales person should satisfy their social needs by
being warm and friendly. S/he should not attempt to
dominate, but should share the social experience. Once
the trust have been established, the sales person should
guide the interview towards the goal of decision making.
4-dominant-warm
These people are open minded, but not afraid
to express their ideas and opinions.They are
not hesitate to buy from any one who can
proof to their satisfaction and there is a
benefit to be gained.
Dominant-warm people consider respect more
important than being liked.The sales person
should match the dominance level while
maintaining the warm manner. Sales
arguments need to be backed up whenever
possible by evidance.
3-social influences
Social class
Reference groups
Culture
family
Social class
Based on the occupation of the head of the
household
Upper middle class
Middle class
Lower middle class
Skilled working class
Working class
Lowest class
Reference groups
A group of people that influences a persons
attitude or behaviour. (group of friends, the
family, work colleagues)
culture
It refers to the traditions,values and attitudes
of the whole society within which an individual
lives.
Submissive
family
The family is sometimes called a primary
reference group that may play a significant
part in consumer buying behavior.
