04. consumer behaviour and business market

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Consumer behaviour and business Market by Tharaka Dias

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04. consumer behaviour and business market

  1. 1. THARAKA DIAS MBA(USA), BBA(USA), Dip in Mgt, ACIM(UK),FAEA(Dip in AEA-UK), FinstSMM(UK), CPM(Asia), MSLIM
  2. 2. PsychologySociologyAnthropology(science of humanity)MarketingEconomics AOT - www.tharakadias.com 2
  3. 3. Because no longer can we take the customer/consumer forgranted.
  4. 4. Out of 11000 new productsintroduced by 77 companies, only 56%are present 5 years later.Only 8% of new product conceptsoffered by 112 leading companiesreached the market. Out of that 83%failed to meet marketing objectives. AOT - www.tharakadias.com 4
  5. 5. All managers must become respectanalysts of consumer motivation andbehaviour
  6. 6. No.Because cross - cultural styles, habits, tastes,prevents such standardisation.
  7. 7. The more successful a firm has been in thepast, the more likely is it to fail in the future.
  8. 8. Because people tend to repeat behaviour forwhich they have been rewarded.
  9. 9. “Please leave your values at the desk” - Paris hotel“Drop your trousers here for best results” -Bangkok laundry“The manager has personally passed all waterserved here” - Acapulco restaurant“Because of the impropriety of entertaining guestsof the opposite sex in the bedroom, it is suggestedthat the lobby be used for the purpose.” - ZurichhotelLadies are requested not to have children in thebar.”-bar.”- Norway bar AOT - www.tharakadias.com 9
  10. 10. “Come alive out of the grave” -Germany“Pepsi brings your ancestors backfrom the grave” - China AOT - www.tharakadias.com 10
  11. 11. AOT - www.tharakadias.com 11
  12. 12. Consumer4Ps Marketing Buyer Buyer Buyer Environment Characteristics Decision Process Decision AOT - www.tharakadias.com 12
  13. 13. 4 PsProduct Price Place Promotion AOT - www.tharakadias.com 13
  14. 14. Marketing EnvironmentEconomic Technological Political Cultural AOT - www.tharakadias.com 14
  15. 15. CulturalSocialPersonalPsychological AOT - www.tharakadias.com 15
  16. 16. Problem RecognitionInformation SearchEvaluation of AlternativesPurchase DecisionConsumptionPostpurchase behaviour AOT - www.tharakadias.com 16
  17. 17. Product ChoiceBrand ChoiceDealer ChoicePurchase TimingPurchase Amount AOT - www.tharakadias.com 17
  18. 18. CultureSub - cultureSocial Class AOT - www.tharakadias.com 18
  19. 19. Reference GroupsFamilyRoles and Statuses AOT - www.tharakadias.com 19
  20. 20. Family Life CycleOccupation and EconomiccircumstancesLifestylePersonality and self - concept AOT - www.tharakadias.com 20
  21. 21. MotivationPerceptionLearningBeliefs and Attitudes AOT - www.tharakadias.com 21
  22. 22. InitiatorInfluencerDeciderBuyerUser AOT - www.tharakadias.com 22
  23. 23. ComplexDissonance - ReducingHabitualVariety seeking AOT - www.tharakadias.com 23
  24. 24. Problem RecognitionInformation SearchEvaluation AlternativesPurchase Decision AOT - www.tharakadias.com 24
  25. 25. SatisfactionActionsUse and Disposal AOT - www.tharakadias.com 25
  26. 26. AOT - www.tharakadias.com 26
  27. 27. Characteristics of Business Markets Sales in the business market far exceed sales in consumer markets.AOT - www.tharakadias.com 27
  28. 28. Characteristics of Business Markets Business markets differ from consumer markets in many ways. ▪ Marketing structure and demand ▪ Nature of the buying unit ▪ Types of decisions and the decision process AOT - www.tharakadias.com 28
  29. 29. Characteristics Compared to consumer markets: Marketing Business markets Structure and ▪ have fewer but larger Demand customers Nature of the Business customers ▪ are concentrated Buying Unit geographically Types of Demand is different Decisions and ▪ Derived demand the Decision ▪ Price inelastic Process ▪ Fluctuates more, and changes more quickly AOT - www.tharakadias.com 29
  30. 30. Characteristics Compared to consumer Marketing purchases: Structure and Business purchases Demand involve more buyers Nature of the in the decision Buying Unit process. Types of Purchasing efforts are Decisions and undertaken by the Decision professional buyers. Process AOT - www.tharakadias.com 30
  31. 31. Characteristics In comparison to consumer Marketing purchases: Structure and Business buyers face Demand more complex buying Nature of the decisions. Buying Unit The buying process is Types of more formalized. Decisions and Buyers and sellers the Decision work together closely and build long-term Process relationships. AOT - www.tharakadias.com 31
  32. 32. Model of Business Buyer Behavior 7- 32
  33. 33. Major Types of Buying Situations Straight rebuy ▪ Reordering without modification Modified rebuy ▪ Requires modification to prior purchase New task ▪ First time purchase AOT - www.tharakadias.com 33
  34. 34. Systems Selling: Buying a packaged solution to a problem from a single seller. ▪ Convenience is a major benefit Often a key marketing strategy for businesses seeking to win and hold accounts. AOT - www.tharakadias.com 34
  35. 35. Participants in the Buying Decision ProcessUsers InfluencersBuyers Deciders Gatekeepers AOT - www.tharakadias.com 35
  36. 36. Emotions also play a role in business buying.Volvo stresses that the trucks’ benefits willmake “drivers a lot more possessive”. 7- 36
  37. 37. Major Influences onBusiness Buyer Behavior 7- 37
  38. 38. Key Factors Economic trends Supply conditions Technological changeEnvironmental Regulatory andOrganizational political environmentsInterpersonal CompetitiveIndividual developments Culture and customs AOT - www.tharakadias.com 38
  39. 39. Key Factors Objectives Policies Environmental Procedures Organizational Organizational Interpersonal structure Individual Systems AOT - www.tharakadias.com 39
  40. 40. Key Factors Authority Status Empathy Environmental Persuasiveness Organizational Interpersonal Individual AOT - www.tharakadias.com 40
  41. 41. Key Factors Authority Age Environmental Education Organizational Job position Interpersonal Personality Individual Risk attitudes AOT - www.tharakadias.com 41
  42. 42. Stages of theBusiness Buying Process 7- 42
  43. 43. Eight Stages: Stage 1: Problem Recognition Stage 2: General Need Description Stage 3: Product Specification ▪ Value analysis helps to reduce costs AOT - www.tharakadias.com 43
  44. 44. Eight Stages: Stage 4: Supplier Search ▪ Supplier developmentAOT - www.tharakadias.com 44
  45. 45. Eight Stages: Stage 5: Proposal SolicitationAOT - www.tharakadias.com 45
  46. 46. Eight Stages: Stage 6: Supplier Selection Stage 7: Order-Routine Specification ▪ Blanket contracts are often used for maintenance, repair and operating items. Stage 8: Performance Review AOT - www.tharakadias.com 46
  47. 47. Business Buying on theInternet E-procurement is growing rapidly. Reverse auctions account for much of the online purchasing activity. E-procurement offers many benefits: ▪ Access to new suppliers ▪ Lower purchasing costs ▪ Quicker order processing and delivery AOT - www.tharakadias.com 47
  48. 48. Institutional MarketsThe Background:Institutional marketsare often overlooked inB2B marketingThe Potential: Thismarket is somewhatrecession-resistant;great target for hardeconomic times AOT - www.tharakadias.com 48
  49. 49. Institutional MarketsTiming is Important:.For example, Augustis a good month forschools, but often apoor time for otherinstitutions due toworker vacations. AOT - www.tharakadias.com 49
  50. 50. Government Markets Most firms that sell to government buyers are not marketing-oriented. Some companies have separate government marketing departments. Much of government buying has migrated online. AOT - www.tharakadias.com 50
  51. 51. Thank youAOT - www.tharakadias.com 51

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