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A model of consumer behaviour

MARK922 Understanding the whys of buying behaviour is very difficult
MARKETING MANAGEMENT
TRIMESTER 3, 2014 – Week 4
DR. URAIPORN KATTIYAPORNPONG (PING)
pingk@uow.edu.au; Bldg 40, Room 148
Consultation Times:
Wednesday 1100-1200, 15.45-17.15,
Thursday 13.45-15.15
VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

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Copyright © 2013 Pearson Australia (a division of Pearson Australia Group Pty Ltd) – 9781442549425/Kotler, Burton, Deans, Brown, Armstrong /Marketing/9e
Chapter 7 Characteristics influencing

Consumer behaviour consumer behaviour
Objective 1 Define the consumer market and construct a simple
model of consumer buyer behaviour
Objective 2 Name the four main factors that influence consumer
buyer behaviour
Objective 3 List and define the main types of buying decision
behaviour and the stages in the buyer decision process
Objective 4 identify the key components of bounded rationality
and behavioural economics, and discuss the
implications for marketers

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Copyright © 2013 Pearson Australia (a division of Pearson Australia Group Pty Ltd) – 9781442549425/Kotler, Burton, Deans, Brown, Armstrong /Marketing/9e Copyright © 2013 Pearson Australia (a division of Pearson Australia Group Pty Ltd) – 9781442549425/Kotler, Burton, Deans, Brown, Armstrong /Marketing/9e
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Cultural factors Family and household
Culture is the set of

basic values, Sub-
perceptions, wants and Culture
culture
behaviours learned by a
member of society from
family and other Social class
important institutions

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Social factors –
Roles in the buying process
Groups and social networks
Roles and status
Reference Initiator
Groups
groups • A person can belong to
User Influencer many groups – family,
Memberships Aspirational clubs, organisations, online
groups groups Buying
Decision communities. The person’s
position in a group can be
Online Buzz
leaders marketing
defined in terms of both
Buyer Decider role and status.
Online social
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Personal factors Types of buying decision behaviour

• People change the goods and services they buy over
Some purchases are simple and routine, even habitual.
Age and life-cycle stage their lifetime Others are far more complex
• A person’s occupation affects the goods and services
Occupation bought
• A person’s economic situation will affect their product

Economic situation choice
• People coming from the same subculture, social class

Lifestyle and occupation may live quite different lifestyles
Personality and self-

© Commonwealth of Australia, reproduced by permission
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• Brand personality is the specific mix of human traits that
are attributed to a particular brand
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Psychological factors The buyer decision process

• A motive is a need that is sufficiently pressing to direct the
The actual purchase decision is part of a much larger
Motivation person to seek satisfaction of the need buying process
• The process by which people select, organise and interpret

Perception information to form a meaningful picture of the world
• Changes in an individual’s behaviour arising from experience

Learning
• A descriptive thought or conviction that a person holds about

Beliefs and attitudes
© Commonwealth of Australia, reproduced by permission
something VISIONARY / PASSIONATE / DYNAMIC
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Chapter 8
Bounded rationality Business-to-business marketing
and behavioural economics Objective 1 Describe the structure of business-to-business markets
and the nature of demand
Objective 2 Describe the business buyer behaviour model, and identify the
three types of buying situations it applies to
Objective 3 Discuss the participants in the business-to-business buying
Segregation centre, and describe the major influences on them
Mental
and Objective 4 Identify and define the eight steps in the business buying
accounting
integration process, and compare and contrast these with the consumer
market
Losses are Objective 5 Understand the growth and importance of e-procurement
weighted more (buying on the internet)
heavily than Objective 6 Identify the differences between business markets, institutional
gains markets and government markets.
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Summary Business-to-business markets

• The consumer market is made up of all the individuals and households who buy
or acquire goods and services for personal consumption.
• Consumer buyer behaviour is influenced by four key sets of byer characteristics:
cultural, social, personal and psychological.
• Stages in the buyer decision process include problem recognition, information Business or
Reseller Business markets operate
search, evaluation of alternatives, purchase decision and post-purchase industrial
market ‘behind the scenes’ to most
behaviour. market consumers
• In practice, people make decisions based on bounded rationality – that is, based
on the limited information that they have – and on their limited ability to make the
best choice. Behavioural economics studies how people make decisions when an Institutional Government
outcome is uncertain, and how relatively predictable departures occur from what market market
might be considered ‘rational’ behaviour.

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Characteristics of business markets Nature of the buying unit

Market structure and demand
The nature of the buying unit Professional More purchase

purchasing participants
Types of decisions and the decision
process involved
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Market structure and demand Types of decisions

and the decision process
Close buyer-
Fewer buyers Larger buyers supplier More
relationships complex
Geographically More
Derived Inelastic
concentrated
demand
buyers
demand Leasing formalise
d
Market
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Industry classification schemes Business buyer behaviour

It allows analysis and comparisons across sectors, over time and between It differs from consumer buyer behaviour in a number of important ways.
countries An important difference is the types of decisions that are made by
businesses.

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Industry classification schemes (con’t) Main types of buying situations

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Participants The business buying process

in the business buying process The effort spent on each of the eight steps varies according to the
complexity of the purchase
Users
Gatekeepers Influencers
Deciders Buyers

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Major influences on business buyers E-procurement: business buying on the

Business buyers are subject to many influences when they make
their buying decisions
There are clear
cost savings to be
made when
purchasing online
and many
companies are
realising this
advantage

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Institutional and government markets
Institutional • Schools, universities, hospitals, nursing homes,

prisons and other institutions
markets
• Major influences on government buyers (e.g.,
Government environmental, organisational, interpersonal

and individual factors)
• Government buyer decision process:
markets
government buying practices often seem
complex and frustrating to suppliers
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Summary
• The B-to-B market comprises all • The business buying decision process itself can
organisations that buy goods and be quite involved, with eight basic stages:
services for use in the production of problem recognition, general need description,
other product and services, or for the product specification, supplier search, proposal
purpsoe of reselling or renting them to solicitation, supplier selection, order-routine
others at a profit. specification and performance review.
• Business buyers make decisions that • Recent advances in information technology
vary with the three types buying have given birth to ‘e-procurement’, by which
situations: straight rebuys, modified business buyers are purchasing all kinds of
rebuys and new tasks. products and services online.
• The decision-making unit of a buying • The institutional market consists of schools,
organisation, the buying centre, can hospitals, universities, prisons, and other
consist of many different persons institutions. The government market consists
playing many different roles. of government units – federal, stat and local.

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9/3/2014 9/3/2014

A model of consumer behaviour

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Chapter 7 Characteristics influencing

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Cultural factors Family and household

Culture is the set of

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Personal factors Types of buying decision behaviour

• A person’s economic situation will affect their product

• People coming from the same subculture, social class

Personality and self-

Psychological factors The buyer decision process

• The process by which people select, organise and interpret

• Changes in an individual’s behaviour arising from experience

• A descriptive thought or conviction that a person holds about

Summary Business-to-business markets

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Characteristics of business markets Nature of the buying unit

The nature of the buying unit Professional More purchase

Market structure and demand Types of decisions

Industry classification schemes Business buyer behaviour

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Industry classification schemes (con’t) Main types of buying situations

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Participants The business buying process

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Major influences on business buyers E-procurement: business buying on the

VISIONARY / PASSIONATE / DYNAMIC VISIONARY / PASSIONATE / DYNAMIC

Institutional and government markets

Institutional • Schools, universities, hospitals, nursing homes,

• Major influences on government buyers (e.g.,

Government environmental, organisational, interpersonal

VISIONARY / PASSIONATE / DYNAMIC

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