10/31/11 Consumer Behavior IILM-GSM By : Prof. Amit Kumar
Course: Consumer Behavior <ul><li>Unit-1  Consumer in the Marketplace </li></ul><ul><li>Unit-2  Models of Consumer Behavio...
10/31/11 Consumer in the Marketplace Consumer Behavior  Consumer in Marketplace IILM-Graduate School of Management
Contents <ul><li>What is Consumer Behavior? </li></ul><ul><li>Why Should Marketers Study Consumer Behavior? </li></ul><ul>...
<ul><li>“ Why do consumers do what they do in the marketplace when they do it? This is the underlying question in the stud...
Consumer Behavior Self Analysis   <ul><li>What kind of product did you buy? Brand name? </li></ul><ul><li>Why did you buy ...
Analyzing Consumer Behavior <ul><li>“ Marketing  is an organizational function and a set of  </li></ul><ul><li>processes f...
Analyzing Consumer Behavior <ul><li>The marketers are always looking for emerging trends that suggest new marketing opport...
Analyzing Consumer Behavior <ul><li>In the summer of 2003, some marketing pundits proclaimed the existence of a new male m...
Analyzing Consumer Behavior <ul><li>Emergence of this market has been a boon for men’s grooming products, fueling the succ...
Analyzing Consumer Behavior <ul><li>Gaining a through, in-depth consumer understanding helps </li></ul><ul><li>to ensure t...
What is Consumer Behavior ? 10/31/11 <ul><li>Consumer behavior is the study of  how individuals, groups, and organizations...
Needs, Wants & Demands <ul><li>Needs are basic human requirements. </li></ul><ul><ul><li>Stated needs,  the customer wants...
10/31/11 Maslow’s Hierarchy of Needs <ul><li>Maslow sought to explain why people are driven by particular needs at particu...
Value and Satisfaction <ul><li>Value proposition: a set of benefits they offer to customers to satisfy their needs. </li><...
Why Should Marketers Study Consumer Behavior? <ul><li>To better understand the customer </li></ul><ul><li>To develop bette...
10/31/11 Participants in Buying Behavior <ul><li>Initiator : the person who first suggests or thinks of the idea of buying...
Types of Buyer Behaviour <ul><li>Complex buyer behaviour e.g. Intel Pentium Processor </li></ul><ul><li>Dissonance-reducin...
Stages in Consumer Decision Making Process <ul><li>Problem Recognition   - recognizes a need for something </li></ul><ul><...
What New Car Buyers Consider Important 10/31/11 Consumer Behavior  Consumer in Marketplace IILM-Graduate School of Managem...
<ul><li>People do not buy products & services ,they buy benefits . That is ,we make purchases not for the products themsel...
<ul><li>Consumer Benefits are those positive factors that the consumer obtains as a result of the possession and/or use of...
<ul><li>In fact, people do not really buy ‘goods’ and ‘services’; they buy ‘benefits’ that these goods and services provid...
<ul><li>From a buyer’s point of view, each marketing tool is designed </li></ul><ul><li>to deliver a customer benefit. </l...
<ul><li>Every product has four components: a basic core of functional benefits, an accessory ring of added-value benefits,...
<ul><li>Basic core  of a laptop computer is design, features, memory, speed, operating system, installed software, warrant...
<ul><li>A sense of belonging derived from using the same brand of laptop as your friend is a  psychological benefit . Buyi...
Consumer Behavior & Market Segmentation   <ul><li>Market segmentation is the process of classifying a market into distinct...
10/31/11 Segmenting Consumer Markets <ul><li>Geographic:  dividing a market into different geographical units, such as nat...
Organisational Buyer Behaviour <ul><li>‘ The decision-making process by which formal organisations establish the need for ...
Understanding Business/Industrial Market <ul><li>Buying and selling of goods and services not only takes place between a c...
Characteristics that makes Business  Market unique <ul><li>Market structure and demand  ( In a consumer market, there are ...
Organisational Buyer Situations <ul><li>Some of the organizational buying situations are: </li></ul><ul><li>  </li></ul><u...
Organisational Buyer Situations <ul><li>Participants in Business Buying Process: </li></ul><ul><li>  </li></ul><ul><ul><li...
Business Buying Process <ul><li>Business buying process is much more complex than consumer buying  </li></ul><ul><li>proce...
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Cb unit-i (consumer in market place)

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  • Consumer is a broad label for any individuals or households that use goods and services generated within the economy . A marketplace is the space, actual, virtual or metaphorical, in which a market operates. The term is also used in a trademark law context to denote the actual consumer environment, ie. the &apos;real world&apos; in which products and services are provided and consumed.
  • Lcd or plazma tv like sony, samsung, lg
  • In indian context……a typical behavior is people living in living relationships…Bindass Channel came up with a programme named’ emotional attayachar’ …that is a kind of loyalty test on your partner..if u want to do a loyalty test for your partner..u can buy this service. … .or a nucler family A health insurance company can come up with the product to serve nuclera family..before that in joint family …the relatives used to support financially and emotionally in case of any health problem, disease..etc.
  • David Robert Joseph Beckham , OBE (born 2 May 1975) is an English footballer who currently plays in midfield for Milan in Serie A, on loan from Major League ... There is a new age man in town and he spends most of his time in shopping malls. Leading the pack is soccer star David Beckham, who last week paid a visit to SA for the World Cup 2010 final drawgoing. They are called metrosexuals - a combination of the words metropolitan and heterosexual, a neologism of the 2000s that refers to a heterosexual man - especially one living in a post-industrial, capitalist culture - that has a strong concern for his appearance or a lifestyle that displays attributes stereotypically associated with homosexual men, says WikiPedia. There has been vast debate on the use of this term and it would appear that it had far more to do with consumerism than sexuality. Many of the men who could be regarded as metrosexuals concurred and emphasises that it had much more to do with &amp;quot;good grooming principles&amp;quot; based often on the demands of the job and a healthy expendable income, rather than their sexuality. But because of the perceptions that metrosexuals are anything but heterosexual, they would prefer the term not to be used. The term originated in an article by Mark Simpson published in 1994 when he wrote: &amp;quot;Metrosexual man, the single young man with a high disposable income, living or working in the city (because that&apos;s where all the best shops are), is perhaps the most promising consumer market of the decade. In the Eighties he was only to be found inside fashion magazines such, in television advertisements for Levis jeans or in gay bars. In the Nineties, he&apos;s everywhere and he&apos;s going shopping.&amp;quot; VOC&apos;s Open Lines spoke to five men to find out how they viewed the matter. This is their response: Adil Adams, unisex hair salon owner When he first told his father that he wanted to become a hair stylist, he was sent to see a psychologist because in those days it was just not the done thing for a &amp;quot;good, Muslim boy&amp;quot;. Much of the blame for that could be laid at the door of the connotations to male hairdressers, many of whom are from the gay community. This, Adams said, does not make it easy for people to accept male hairstylists. But it did not stop him. Today he runs the very successful Hair Studio on Kromboom Road, Rondebosch and next week opens his second salon in a brand new 5-star halal hotel in Cape Town. When he first opened his unisex hair salon, he was very careful to design it in a way that would make both men and women comfortable to enter. &amp;quot;If you ask me about the term metrosexual, then it must be said that it has nothing to do with sexuality. If you are comfortable being a man who is comfortable with himself, then labels don&apos;t&apos; matter. When I first started, 25% were men. That has now risen to about 35% and it is growing. You could say it all goes back to the early 1980&apos;s when teenagers began blow drying their hair and guys like George Micheal was among the first to have blond high lights in his flick back hair. Today it includes a wide range of dedicated products for males, including the ever popular GHD and hair gel.&amp;quot; According to Adams, men are increasingly showing an interest in their appearance. &amp;quot;They feel that if they look good, they feel good. They also earn more and can afford to spend on themselves, including married men. Some of my female clients will hold back on their spending because of their budgets, but will tell me that their husbands have no problem spending on themselves or even using their hair care products. &amp;quot;It is definitely a market from high school students to the upwardly mobile. As a result, they don&apos;t flinch at paying R300 for a basic haircut and spending almost double that amount on hair care products provided by the salon. In addition, some of them also show an interest in depilation, spa services, manicures and pedicures which come at a higher price,&amp;quot; he said. Yazid Fakir, sound engineer Former VOC staffer and now an undisputed yuppy, Yazid Fakir once sported spiky hair with red highlights and was quite comfortable with gelling his hair. But having been married in the last year, he says his grooming practises have changed. &amp;quot;I don&apos;t see myself as a metrosexual. I think I am more balanced than that. I&apos;de prefer calling it being well groomed without being a sissy about it. Surprisingly though, I know a lot of males who are metrosexuals.&amp;quot; There is a certain dress code that goes with being a metrosexual that he likes. &amp;quot;It is more yuppy than punk or grunge. It&apos;s the kind of tasteful clothes you could easily wear to work. As for hair care - before I married I spent a lot more time on my hair. After I married, it was not so important any more because I believe that my wife loves and cares for me for who I am and not what I look like. So I am happy with my R25 hair cut at the barber shop.&amp;quot; However, the queue at the barbershop was becoming shorter all the time, he admits. &amp;quot;Before when you went to the barbershop there was a lengthy queue outside of people waiting their turn. Today you can get into the chair almost immediately because it seems that a lot more men are going over to the salon. I can&apos;t imagine though paying R300 for a haircut.&amp;quot; Adeeb Franciscus, IT expert One young male who has no problem being identified as a metrosexual male who takes care of himself is VOC&apos;s web developer, Adeeb Franciscus. However, he too has problems with the link between metrosexuals and homosexuality. &amp;quot;As long as people don&apos;t confuse the two, I don&apos;t mind being regarded as a metrosexual, especially after I looked up its definition. To me it refers to a young male, mainly single with money to spend. I would like to think that it is a man with good grooming habits who is in touch with his feminine sides. It&apos;s a contemporary thing.&amp;quot; It includes taking good care of his hair and clothes in the main. He spends between R300 - R450 a month on his hair care products and much more on clothing. &amp;quot;In fact, it could become almost a sin what you end up spending on clothes,&amp;quot; he admits, but believes that what you wear must show your worth. &amp;quot;It means no slopping clothes. It is definitely sophisticated. For instance, my shoes must match what I wear. It also includes a man bag. I have one of those and I use it for my wallet, my laptop and cellphone. So there is nothing effeminate about it.&amp;quot; Igsaan Higgins, attorney Attorney and activist, Igsaan Higgins - also an expert on VOC&apos;s Legal Hour , chuckled at being asked to comment on this issue. He too has a problem with the term &amp;quot;metrosexual&amp;quot;, but at the same time he is comfortable with being a man that takes very good care of himself, does not mind spending money on himself, but it does not define the totality of his being. &amp;quot;I don&apos;t regard myself as a metrosexual, because I don&apos;t like the term. It is just one aspect of who I am. The fact is the modern work place calls upon men to take good care of themselves. If you are a professional, you want to look the part - look good and smell like a million bucks. When I meet a client, I have three minutes to assess the person. The first thing I look at is hands and teeth - which tells me how they groom themselves; then shoes and watch - which tells me about their finances. If I want you to take care of my affairs and you don&apos;t look like you can take care of yourself, how am I supposed to trust you?&amp;quot; As for the poster boy for metrosexuals, soccer star David Beckham, Higgins said he does not really identify with him. &amp;quot;I do understand good grooming better - as do a growing number of young men. You see it in the gel in their hair and the labels on their clothes. But one must take care not to get lost in the consumerism, for looking good is just one aspect of who I am. &amp;quot;You must also look at my professionalism, my philanthropy, what I give back to the community...to get a complete picture of who I am.&amp;quot; As such, he said, there was no reason why men can not go for manicures, pedicures of visit spas. While it is self indulgent, it also speaks of a man who knows how to take care of himself.&amp;quot; Farouk Abrahams, soccer expert Former goalkeeper, Bafana coach and now the force behind developing young soccer stars at the Farouk Abrahams Soccer Academy, Abrahams is what many might describe as a &amp;quot;man&apos;s man&amp;quot;. He dismisses Beckham&apos;s image as a metrosexual, saying &amp;quot;Beckham was a better soccer player before he became the poster boy for metrosexuals. Top footballers don&apos;t want that kind of burden on them because it keeps them from doing the job on the field. &amp;quot;You then end up competing with your wife, she dresses you up and all this takes place in front of the media. You don&apos;t need that if you want to be a true soccer hero. There are so many other soccer players who are stars without being metrosexuals.&amp;quot; At the same time, he takes very good care of his own grooming, but is nowhere close to a metrosexual. &amp;quot;I don&apos;t wear clothes that are unmatched and take care of my skin. There is no issue with using a good cream or shampoo. I don&apos;t believe that any man has an excuse not to take care of himself. But this kind of thing can become a cult. Gradually it becomes the main focus because you are in the public eye. &amp;quot;And let&apos;s face it, there are no poor metrosexuals. People spend because they can. It&apos;s all about the image and they say ‘if you have the money, why not?&apos;&amp;quot; But while he encourages men, including his sons, to take care of their appearance, he strongly advises them to steer clear of being labelled as a metrosexual. Maulana Dawood Sampson, alim A man who has no problem wearing a pink t-shirt to support breast cancer, is Maulana Dawood Sampson of the Parkwood Mosque who is also the expert on VOC&apos;s Being a Real Man series. He emphasises that the Prophet SAW himself took very good care of himself. &amp;quot;We are taught that Allah loves beauty and Rasulullah (SAW) was fond of grooming himself, smelling nice. He would take care in cleaning his teeth with miswaq, neatening his beard, and trimming his moustache.&amp;quot; Muslims are also taught that it is afdal (highly recommended) for them to beautify themselves for their spouses. &amp;quot;This applies men as much as to women. So there is nothing wrong with a man who takes good care of himself. But Islam promotes balance in all things - from work to what we wear - and we are also advised against wastage or overdoing things.&amp;quot; According to the alim, this means not becoming a slave to fashion. This message is particularly apt since Muslims are just as influences as anyone else by globalisation and Western cultures. &amp;quot;Today many of us are dressed but still naked, because that is what fashion dictates. But there is a certain dress code for Muslims. For men it means being covered from the navel to the knee, not wearing anything that is tight fitting, it should not resemble the kuffar or the opposite sex and no silk.&amp;quot; It also means taking care of costs. &amp;quot;We are not there to dress to impress. So weigh what you can afford to buy so that you don&apos;t overspend. Always consider that Islam loves simplicity and a real man does not need more than simplicity. So be fit, dress well, smell nice, but keep it simple. However, you choose to groom yourself, ‘be wise, Islamatise&apos;,&amp;quot; he advised. VOC
  • David Robert Joseph Beckham , OBE (born 2 May 1975) is an English footballer who currently plays in midfield for Milan in Serie A, on loan from Major League ... Association football , more commonly known as football or soccer ,speaking SOOKAR is a team sport played between two teams of eleven players using a spherical ball . It is widely considered to be the most popular sport in the world A sarong or sarung (pronounced [ˈsaɾoŋ] in Malay ; English:  /səˈrɒŋ/ ) is a large tube or length of fabric , often wrapped around the waist and worn as a kilt by men and as a skirt by women There is a new age man in town and he spends most of his time in shopping malls. Leading the pack is soccer star David Beckham, who last week paid a visit to SA for the World Cup 2010 final drawgoing. They are called metrosexuals - a combination of the words metropolitan and heterosexual, a neologism of the 2000s that refers to a heterosexual man - especially one living in a post-industrial, capitalist culture - that has a strong concern for his appearance or a lifestyle that displays attributes stereotypically associated with homosexual men, says WikiPedia.
  • In indian context……a typical behavior is people living in living relationships…Bindass Channel came up with a programme named’ emotional attayachar’ …that is a kind of loyalty test on your partner..if u want to do a loyalty test for your partner..u can buy this service. … .or a nucler family A health insurance company can come up with the product to serve nuclera family..before that in joint family …the relatives used to support financially and emotionally in case of any health problem, disease..etc.
  • In indian context……a typical behavior is people living in living relationships…Bindass Channel came up with a programme named’ emotional attayachar’ …that is a kind of loyalty test on your partner..if u want to do a loyalty test for your partner..u can buy this service. … .or a nucler family staying in metros not in their cities A health insurance company can come up with the product to serve nuclera family..before that in joint family …the relatives used to support financially and emotionally in case of any health problem, disease..etc.
  • A sound understanding of consumer behavior is essential to the long run success of any marketing program.
  • Power byke..with low cost.. For example, one needs clothes, but one may not needs designer clothes. One does not need toys, movies, or games. One needs food, but does not have to have steak or dessert.
  • Think abt the concept of smart class rooms…initiator is some faculty who joined as professor at IILM from Shastri Institute of Jaipur…influencer like other senior professor and IT people at IILM Greater noida and lodi road ..having some technical experties Decider is the owner of the institute Ms Malvika Rai…buyer is the director of the Insitute..users are the PGDM students at IILM-GSM In class room at Accman....2 students thought about a classroom AC since u paid huge amount…which includes all Influencer is like a technical expert U can add one more that is evaluator Organization buying is the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers. (Webster and Wind)     Some of the characteristics of organizational buyers are:   1. Consumer market is a huge market in millions of consumers where organizational buyers are limited in number for most of the products. 2. The purchases are in large quantities. 3. Close relationships and service are required. 4. Demand is derived from the production and sales of buyers. 5. Demand fluctuations are high as purchases from business buyers magnify fluctuation in demand for their products. 6. The organizational buyers are trained professionals in purchasing. 7. Several persons in organization influence purchase. 8. Lot of buying occurs in direct dealing with manufacturers.     Organizational Buying Situations   Straight rebuy In this buying situation, only purchasing department is involved. Thet get an information from inventory control department or section to reorder the material or item and they seek quotations from vendors in an approved list.   The &amp;quot;in-suppliers&amp;quot; make efforts to maintain product and service quality. The &amp;quot;out-suppliers&amp;quot; have to make efforts to get their name list in the approved vendors&apos; list and for this purpose they have to offer something new or find out any issues of dissatisfaction with current suppliers and promise to provide better service.   Modified rebuy   In this buying situation, there is a modification to the specifications of the product or specifications related to delivery. Executives apart from the purchasing department are involved in the buying decisions. The company is looking for additional suppliers or is ready to modify the approved vendors list based on the technical capabilities and delivery capabilities.   New task buy   In this situation, the buyer is buying the product for the first time. As the cost of the product or consumption value becomes higher, more number of executives are involved in the process. The stages of awareness, interest, evaluation, trial, and adoption will be there for the products of each potential supplier. Only the products which pass all the stages will be on the approved list and price competition will follow subsequently.   Systems buy   Systems buying is a process in which the organization gives a single order to a single organization for supplying a full system. The buying organization knows that no single party is producing all the units in the system. But it wants the system seller to engineer the system, procure the units from various vendors and assemble, fabricate or construct the system.     Participants in the Business Buying Process   Users   The persons who use the item. Say for safety gloves the operators.   Initiators   The persons who request the purchase. The safety officer may initiate the request for the purchase.   Influencers   Persons who held define specifications. In this case of safety gloves, the safety officer may himself define specifications. If an industrial engineer is in the organization, he may also be consulted. There can a different gloves for different working situations and industrial engineer may be more aware of specific requirements due to his special nature of work - human effort engineering.   Buyers   They are the person who actually do the buying transaction.   Gatekeepers   They control access to personnel in a company. The receptionist, the secretaries etc.   Deciders   People who decide on product requireements and suppliers. It is the final approval for product specfications and suppliers&apos; list.   Approvers   Persons who approve the purchase. In the case of safety gloves, the personal manager may have the power to approve.       Major Influencers on Business Buyers   Environmental factors   Expected demand for the product that the buying organization is selling, expected shortages for the item, expected changes in technology related to the item etc. are the environmental factors that will have an effect.   Organizational factors   Changes in purchasing department organization like centralized purchasing, decentralized purchasing and changes in purchasing practices like  long-term contracts, relationship purchasing, zero-based pricing, vendor-performance evaluation are the organization factors of importance to marketers.   Interpersonal factors   These factors are the relationship between buyers and sales representatives of various competitor companies.   Individual factors   These factors related to the buyer. What sort of ways of interacting and service are appreciated by the buyers and what ways are considered as irritants? Marketers have to understand the reactions of buyers.   Organizational Buying/Purchasing/Procurement Process Steps in the Process Problem recognition General need description Product specification Supplier search Proposal solicitation Supplier selection Order routine specification   Supplier performance review   Philip Kotler, Marketing Management, 9th Edition  
  • Dissonance-reducing buying behaviour occurs when the consumer is highly involved but sees little difference between brands. This is likely to be the case with the purchase of a lawn mower or a diamond ring. After making a purchase under such circumstances, a consumer is likely to experience the dissonance that comes from noticing that other brands would have been just as good, if not slightly... Variety-Seeking Behavior in Product Choice In a free market (as opposed to a planned economy), consumers are offered a great deal of choices.  Within a single product category, there are often a large number of brands.  These brands may differ in size, quality, price, image and other attributes.  In a free market, consumers make their choices based upon the utilities that they derive from the different brands.  Thus some consumers will look for the cheapest product, others will look for the best quality (whatever that means) and still others will look for products that are consistent with their self-images. There are also consumer utilities that are independent of product attributes.  An example is the so-called variety-seeking behavior, whereby consumers routinely switch from one product to another because they are motivated by the utility inherent in experiencing variety.  For marketers, such variety-seeking behavior represents mixed blessings of opportunities and vulnerabilities.  An understanding of variety-seeking behavior is therefore important in defending and/or expanding market share. In the marketing literature, one approach towards the study of variety-seeking behavior is based upon understanding the psychological processes that lead to the need for variety.  One psychological driver is boredom, whereby the utility from one brand decreases with repeated use while competing brands become more attractive simply by being not the current brand.  Another driver is curiosity because different brands may promise to provide different experiences. We will now cite some survey data from the 2001 TGI Colombia study.  This is a survey of 7,020 persons between the ages of 12 and 64 years old conducted by IBOPE Colombia.  During this survey, the respondents were shown the statement: &amp;quot;I like changing brands often, to get variety and to try things out.&amp;quot;  19.9% of the respondents said that they &apos;completely agreed&apos; with this statement. In the following graph, we show the agree rates separately by age/sex groups.  For the females, the agree rates are slightly higher among the 12 to 24 year olds, but the older groups are below average.  For the males, the agree rates are highest among the young (12 to 34 year olds), and then drops down rapidly as age increases. The study of variety-seeking behavior based upon psychological processes may be criticized for relying too much on stated intention  A different approach to the study of variety-seeking behavior is through the empirical analysis of observed temporal variations in consumption patterns.  Better yet, it would be interesting to see the extent to which the stated preference for variety-seeking behavior translates into physical action. In the next chart, we show the &apos;completely agree&apos; rate to the statement &amp;quot;I like changing brands often to get variety and try things out&amp;quot; separately within product users who have consumed a single brand within a product category.  For the beverage and snacks, the time period was 7 days; for jeans, the time period was 12 months.  If the statement means anything, we would expect the single brand users to be less likely to agree.  Compared to the overall agree rate for the total population of 19.9%, the agree rates for the single brand users in most of these product categories are not significantly different. One reason for the lack of agreement between the psychographic statement and the reported purchase behavior is that this specific psychological statement was not category-specific.  A consumer may be a brand-loyalist in some product categories, but a variety-seeker in other categories.  Another reason is that each category has its own configuration of competition and product differentiation.  The best synthesis of the psychological and behavioral approaches should be category-specific. We leave you with one final example of variety-seeking behavior.  What do you think is really going on here?  Do you have enough ideas for several telenovelas ...? Complex buying behaviour occurs when the consumer is highly involved with the purchase and when there are significant differences between brands. This behaviour can be associated with the purchase of a new home or of an advanced computer. Such tasks are complex because the risk is high (significant financial commitment), and the large differences among brands or products require gathering a... Dissonance-reducing buying behaviour occurs when the consumer is highly involved but sees little difference between brands. This is likely to be the case with the purchase of a lawn mower or a diamond ring. After making a purchase under such circumstances, a consumer is likely to experience the dissonance that comes from noticing that other brands would have been just as good, if not slightly... Habitual buying behaviour Consumer behaviour in the buying of cheap frequently purchased items, characterized by low consumer involvement and few significant brand differences. Purchases are made out of habit, rather than a strong commitment to a brand. Generally, price and sales promotions are used to stimulate sales, as consumers tend to base their decisions on past behaviour and have no need for further information. Significant differences…like pentium processor or AMD processor…duplex house by Jaypee and by Oasis or AVG Homes… Few diffeerences ..like laptop by HP or dell or mobile by nokia touchphone and samsung smart phones Dissonance..diamond ring from tanishque…laptop and mobile… Vareiety…biscuits…noodles maggi &amp; top roman…chocolates brands Habitual…salt..flour..atta..rice and other commodities Complex .new home duplex or flat by japyee or osais or avg…
  • Find the attributes for the different products and services..in 4 member in a group…laptop..moblie…Ac cooler…house like duplex…credit cards…insurance product….holidays package….motor bike….water purifier…microwave……….
  • Talking about alto and swift…in both the case tangible benefits are same but intangible benefits are different..also comparing swift and BMW…if consumer pay 45 lakhs for the BMW it means they will get more benefits in terms of intangible benefits
  • Reliability - ability to perform the promised service accurately…. Five dimensions that determine service quality: RATER MODEL Reliability - ability to perform the promised service accurately. Assurance - Knowledge and courtesy of employees and their ability to inspire trust and confidence. Tangibles – physical facilities, equipment and appearance of personnel Empathy – caring and the individualized attention that the firm provides to its customers. Responsiveness – willingness to help customers and provide prompt service.
  • Take example of AC conditioner (it takes 6 hrs for a sound sleep in case of AC..without it will be 10 hrs..in a hot summer time)…if ur office is 1 km for ur residence takes 10-15 mins by walk..but if u have bike or car then 2-5 mins..means u saved 10 mins..
  • Organization buying is the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers. (Webster and Wind)     Some of the characteristics of organizational buyers are:   1. Consumer market is a huge market in millions of consumers where organizational buyers are limited in number for most of the products. 2. The purchases are in large quantities. 3. Close relationships and service are required. 4. Demand is derived from the production and sales of buyers. 5. Demand fluctuations are high as purchases from business buyers magnify fluctuation in demand for their products. 6. The organizational buyers are trained professionals in purchasing. 7. Several persons in organization influence purchase. 8. Lot of buying occurs in direct dealing with manufacturers.     Organizational Buying Situations   Straight rebuy In this buying situation, only purchasing department is involved. Thet get an information from inventory control department or section to reorder the material or item and they seek quotations from vendors in an approved list.   The &amp;quot;in-suppliers&amp;quot; make efforts to maintain product and service quality. The &amp;quot;out-suppliers&amp;quot; have to make efforts to get their name list in the approved vendors&apos; list and for this purpose they have to offer something new or find out any issues of dissatisfaction with current suppliers and promise to provide better service.   Modified rebuy   In this buying situation, there is a modification to the specifications of the product or specifications related to delivery. Executives apart from the purchasing department are involved in the buying decisions. The company is looking for additional suppliers or is ready to modify the approved vendors list based on the technical capabilities and delivery capabilities.   New task buy   In this situation, the buyer is buying the product for the first time. As the cost of the product or consumption value becomes higher, more number of executives are involved in the process. The stages of awareness, interest, evaluation, trial, and adoption will be there for the products of each potential supplier. Only the products which pass all the stages will be on the approved list and price competition will follow subsequently.   Systems buy   Systems buying is a process in which the organization gives a single order to a single organization for supplying a full system. The buying organization knows that no single party is producing all the units in the system. But it wants the system seller to engineer the system, procure the units from various vendors and assemble, fabricate or construct the system.     Participants in the Business Buying Process   Users   The persons who use the item. Say for safety gloves the operators.   Initiators   The persons who request the purchase. The safety officer may initiate the request for the purchase.   Influencers   Persons who held define specifications. In this case of safety gloves, the safety officer may himself define specifications. If an industrial engineer is in the organization, he may also be consulted. There can a different gloves for different working situations and industrial engineer may be more aware of specific requirements due to his special nature of work - human effort engineering.   Buyers   They are the person who actually do the buying transaction.   Gatekeepers   They control access to personnel in a company. The receptionist, the secretaries etc.   Deciders   People who decide on product requireements and suppliers. It is the final approval for product specfications and suppliers&apos; list.   Approvers   Persons who approve the purchase. In the case of safety gloves, the personal manager may have the power to approve.       Major Influencers on Business Buyers   Environmental factors   Expected demand for the product that the buying organization is selling, expected shortages for the item, expected changes in technology related to the item etc. are the environmental factors that will have an effect.   Organizational factors   Changes in purchasing department organization like centralized purchasing, decentralized purchasing and changes in purchasing practices like  long-term contracts, relationship purchasing, zero-based pricing, vendor-performance evaluation are the organization factors of importance to marketers.   Interpersonal factors   These factors are the relationship between buyers and sales representatives of various competitor companies.   Individual factors   These factors related to the buyer. What sort of ways of interacting and service are appreciated by the buyers and what ways are considered as irritants? Marketers have to understand the reactions of buyers.   Organizational Buying/Purchasing/Procurement Process Steps in the Process Problem recognition General need description Product specification Supplier search Proposal solicitation Supplier selection Order routine specification   Supplier performance review   Philip Kotler, Marketing Management, 9th Edition  
  • Organizational Buying Situations   Straight rebuy In this buying situation, only purchasing department is involved. Thet get an information from inventory control department or section to reorder the material or item and they seek quotations from vendors in an approved list.   The &amp;quot;in-suppliers&amp;quot; make efforts to maintain product and service quality. The &amp;quot;out-suppliers&amp;quot; have to make efforts to get their name list in the approved vendors&apos; list and for this purpose they have to offer something new or find out any issues of dissatisfaction with current suppliers and promise to provide better service.   Modified rebuy   In this buying situation, there is a modification to the specifications of the product or specifications related to delivery. Executives apart from the purchasing department are involved in the buying decisions. The company is looking for additional suppliers or is ready to modify the approved vendors list based on the technical capabilities and delivery capabilities.   New task buy   In this situation, the buyer is buying the product for the first time. As the cost of the product or consumption value becomes higher, more number of executives are involved in the process. The stages of awareness, interest, evaluation, trial, and adoption will be there for the products of each potential supplier. Only the products which pass all the stages will be on the approved list and price competition will follow subsequently.   Systems buy   Systems buying is a process in which the organization gives a single order to a single organization for supplying a full system. The buying organization knows that no single party is producing all the units in the system. But it wants the system seller to engineer the system, procure the units from various vendors and assemble, fabricate or construct the system.  
  • Participants in the Business Buying Process   Users   The persons who use the item. Say for safety gloves the operators.   Initiators   The persons who request the purchase. The safety officer may initiate the request for the purchase.   Influencers   Persons who held define specifications. In this case of safety gloves, the safety officer may himself define specifications. If an industrial engineer is in the organization, he may also be consulted. There can a different gloves for different working situations and industrial engineer may be more aware of specific requirements due to his special nature of work - human effort engineering.   Buyers   They are the person who actually do the buying transaction.   Gatekeepers   They control access to personnel in a company. The receptionist, the secretaries etc.   Deciders   People who decide on product requireements and suppliers. It is the final approval for product specfications and suppliers&apos; list.   Approvers   Persons who approve the purchase. In the case of safety gloves, the personal manager may have the power to approve.       Major Influencers on Business Buyers   Environmental factors   Expected demand for the product that the buying organization is selling, expected shortages for the item, expected changes in technology related to the item etc. are the environmental factors that will have an effect.   Organizational factors   Changes in purchasing department organization like centralized purchasing, decentralized purchasing and changes in purchasing practices like  long-term contracts, relationship purchasing, zero-based pricing, vendor-performance evaluation are the organization factors of importance to marketers.   Interpersonal factors   These factors are the relationship between buyers and sales representatives of various competitor companies.   Individual factors   These factors related to the buyer. What sort of ways of interacting and service are appreciated by the buyers and what ways are considered as irritants? Marketers have to understand the reactions of buyers.   Organizational Buying/Purchasing/Procurement Process Steps in the Process Problem recognition General need description Product specification Supplier search Proposal solicitation Supplier selection Order routine specification   Supplier performance review   Philip Kotler, Marketing Management, 9th Edition  
  • Do the mapping of the consumer and business buying behavior. Problem recog..same in both General need desc and product specfication is additional steps ..only in business buying In consumer buying..we have information serach..but here supplier search and proposal soliciation Select from alternatives but here we have supplier selection Purchasing ..here we have order proutine specification Post purchase .here we have performabce reviews
  • Cb unit-i (consumer in market place)

    1. 1. 10/31/11 Consumer Behavior IILM-GSM By : Prof. Amit Kumar
    2. 2. Course: Consumer Behavior <ul><li>Unit-1 Consumer in the Marketplace </li></ul><ul><li>Unit-2 Models of Consumer Behavior </li></ul><ul><li>Unit-3 Cultural Influences on Consumer Decision making </li></ul><ul><li>Unit-4 Sociological Influences on Consumer Decision making </li></ul><ul><li>Unit-5 Personal / Individual Influences on Decision making </li></ul><ul><li>Unit-6 Psychological Influences on Decision making </li></ul><ul><li>Unit-7 Consumer Decision Making Process </li></ul><ul><li>Unit-8 Consumer Influence & Diffusion of Innovation </li></ul>10/31/11 Consumer Behavior IILM-Graduate School of Management
    3. 3. 10/31/11 Consumer in the Marketplace Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    4. 4. Contents <ul><li>What is Consumer Behavior? </li></ul><ul><li>Why Should Marketers Study Consumer Behavior? </li></ul><ul><li>Types of Buyer Behavior </li></ul><ul><li>Consumer Decision making process </li></ul><ul><li>Consumer Benefits, Total Product Concept </li></ul><ul><li>Consumer Segmentation, Targeting & Positioning </li></ul><ul><li>Organisational Buyer Behaviour </li></ul><ul><li>Case-Study : ‘M/s Duleath Ltds- Durcom Shoes’ </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    5. 5. <ul><li>“ Why do consumers do what they do in the marketplace when they do it? This is the underlying question in the study of consumer behavior. You can’t attempt to answer this question without first defining who ’ consumers ’ are and what is meant by the ‘ marketplace ', especially as we leap into the nonstore electronic and ‘dotcom ’ world. Further, how do marketers find consumer? How do consumers find products and services to meet their needs?” </li></ul>Introduction 10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    6. 6. Consumer Behavior Self Analysis <ul><li>What kind of product did you buy? Brand name? </li></ul><ul><li>Why did you buy the product? What triggered the desire to make the purchase? </li></ul><ul><li>What other brands did you consider purchasing? </li></ul><ul><li>What information sources were consulted before making the purchase? </li></ul><ul><li>What information sources were most influential and why? </li></ul><ul><li>Why did you choose the brand you purchased (what criteria did you base your decision on)? </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    7. 7. Analyzing Consumer Behavior <ul><li>“ Marketing is an organizational function and a set of </li></ul><ul><li>processes for creating, communicating, and delivering </li></ul><ul><li>value to customers and for managing customer </li></ul><ul><li>relationships in ways that benefit the organization and its </li></ul><ul><li>stakeholders.” </li></ul><ul><li> - AMA </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace The aim of marketing is to meet and satisfy target customers’ needs and wants better than competitors. IILM-Graduate School of Management
    8. 8. Analyzing Consumer Behavior <ul><li>The marketers are always looking for emerging trends that suggest new marketing opportunities. The metro sexual is one. </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace Metrosexuals - a combination of the words metropolitan and heterosexual, especially one living in a post-industrial, capitalist culture - has a strong concern for his appearance or a lifestyle… IILM-Graduate School of Management
    9. 9. Analyzing Consumer Behavior <ul><li>In the summer of 2003, some marketing pundits proclaimed the existence of a new male market-the “ metrosexual ”- which was defined as straight urban men who enjoy such things as shopping and using grooming products and services. English Soccer star David Beckham has been touted as the metrosexual icon. He is not afraid to wear nail polish or sarongs (off the field). </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace One researcher estimated that 30 to 35 percent of young American men exhibit metrosexual tendencies, as evidenced in part by their purchase of products such as skin care cream and fragrances. IILM-Graduate School of Management
    10. 10. Analyzing Consumer Behavior <ul><li>Emergence of this market has been a boon for men’s grooming products, fueling the success of brands such as Unilever’s Axe , a fragrant all over body spray, The Body Shop’s “For Men” line, and U.K drugstore chain Boots ’ newly opened Men’s Zones. </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    11. 11. Analyzing Consumer Behavior <ul><li>Gaining a through, in-depth consumer understanding helps </li></ul><ul><li>to ensure that right products are marketed to the right </li></ul><ul><li>consumer in the right way. </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace Successful marketing requires that companies fully connect with their customers. Adopting a holistic marketing orientation means understanding consumers-gaining a 360-degree view of both their daily lives and the changes that occur during their lifetimes. IILM-Graduate School of Management
    12. 12. What is Consumer Behavior ? 10/31/11 <ul><li>Consumer behavior is the study of how individuals, groups, and organizations select, buy, use and dispose of goods, services, ideas or experiences to satisfy their needs and wants. </li></ul><ul><li>Studying consumer behavior provides clues for improving or introducing products or services, setting prices & developing other marketing strategies. </li></ul>Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    13. 13. Needs, Wants & Demands <ul><li>Needs are basic human requirements. </li></ul><ul><ul><li>Stated needs, the customer wants an expensive car </li></ul></ul><ul><ul><li>Real needs, customer wants a car whose operating cost is low </li></ul></ul><ul><ul><li>Unstated needs, customer expects good service from the dealer </li></ul></ul><ul><ul><li>Delight needs, customer would like the dealer to include onboard navigation system </li></ul></ul><ul><ul><li>Secret needs, customer wants to be seen by friends as a savvy consumer </li></ul></ul><ul><li>Needs become wants when they are directed to specific objects that might satisfy the need. </li></ul><ul><li>Demands are wants for specific products backed by an ability to pay. </li></ul><ul><li>Do marketers create needs ? </li></ul><ul><li>How consumer evaluates the wants? (Concept of value proposition) </li></ul>10/31/11 If V.P for Coke is high then consumer wants Coke Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    14. 14. 10/31/11 Maslow’s Hierarchy of Needs <ul><li>Maslow sought to explain why people are driven by particular needs at particular times. </li></ul><ul><li>Why does one person spend considerable time & energy on personal safety and other.. </li></ul><ul><li>Human needs are arranged in a hierarchy , from the most pressing to the least pressing. </li></ul><ul><li>Theory helps marketer understand how product fit into the plans and lives of consumers. </li></ul><ul><li>A motive is a need that is sufficiently pressing to drive the person to act. </li></ul>Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    15. 15. Value and Satisfaction <ul><li>Value proposition: a set of benefits they offer to customers to satisfy their needs. </li></ul><ul><li>Value can be seen as a combination of qsp. </li></ul><ul><li>Value = Benefits/ Costs = </li></ul><ul><li>(Functional Benefits +Emotional Benefits) </li></ul><ul><li>(Monetary Costs + Time Costs+Energy Costs+ Psychic Costs) </li></ul><ul><li>Value of customer offering can be increased by: </li></ul><ul><ul><li>Raise benefits </li></ul></ul><ul><ul><li>Reduce costs </li></ul></ul><ul><ul><li>Raise benefits AND reduce costs </li></ul></ul><ul><ul><li>Raise benefits by MORE THAN the raise in costs </li></ul></ul><ul><ul><li>Lower benefits by LESS THAN the decrease in costs </li></ul></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    16. 16. Why Should Marketers Study Consumer Behavior? <ul><li>To better understand the customer </li></ul><ul><li>To develop better marketing mix (Product, Price, Place, Promotion, People, Process, Physical Evidence) strategies </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    17. 17. 10/31/11 Participants in Buying Behavior <ul><li>Initiator : the person who first suggests or thinks of the idea of buying a particular product or service. </li></ul><ul><li>Influencer : a person whose views or advice carry weight in making the final buying decision </li></ul><ul><li>Decider : the person who ultimately makes the final buying decision or any part of it </li></ul><ul><li>Buyer : the person who makes the actual purchase </li></ul><ul><li>User : the person who consumes the product or service </li></ul>Other people often influence a consumers purchase decision. The marketer needs to know which people are involved in the buying decision and what role each person plays, so that marketing strategies can also be aimed at these people. Think about your past purchase– who was in which role? Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    18. 18. Types of Buyer Behaviour <ul><li>Complex buyer behaviour e.g. Intel Pentium Processor </li></ul><ul><li>Dissonance-reducing behaviour (brand reduces after-sales discomfort) </li></ul><ul><li>Habitual buying behaviour e.g. salt - little difference </li></ul><ul><li>Variety seeking behaviour - significant brand differences e.g soap powder </li></ul>10/31/11 Fairly large in amount or quantity , likely to have a major effect Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    19. 19. Stages in Consumer Decision Making Process <ul><li>Problem Recognition - recognizes a need for something </li></ul><ul><li>(discrepancy between actual and desired state) </li></ul><ul><li>Information Search – searches for alternatives to satisfy the need </li></ul><ul><li>(internal and external sources) </li></ul><ul><li>Alternative Evaluation – evaluates alternatives </li></ul><ul><li>(evaluative criteria) </li></ul><ul><li>Purchase Decision – selects alternative which bests meets evaluative criteria </li></ul><ul><li>Postpurchase Evaluation – reevaluates product as he/she uses it </li></ul><ul><li>(cognitive dissonance) </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    20. 20. What New Car Buyers Consider Important 10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    21. 21. <ul><li>People do not buy products & services ,they buy benefits . That is ,we make purchases not for the products themselves, but for the problems they solve or the opportunities they offer. </li></ul><ul><li>We each seek different benefits. The athlete who buys a brand-name sports watch that keeps perfect time and works under water is looking for very different from the person who receives an inscribed watch as an anniversary gift. In practical, the two watches serve an identical purpose-they both tell the time-but other benefits they offer differ widely. </li></ul>Consumer Benefits 10/31/11 lines forming a design Consumer Behavior Consumer in Marketplace A business executive who takes his cloths to a laundry service is buying not just clean shirts but a sharp professional image. IILM-Graduate School of Management
    22. 22. <ul><li>Consumer Benefits are those positive factors that the consumer obtains as a result of the possession and/or use of a product or service. ( Tangible & Intangible benefits ) </li></ul><ul><li>Consumers seek bundles of types of benefits: </li></ul><ul><ul><li>Tangible benefits : e.g., a watch keeps good time; has leather band </li></ul></ul><ul><ul><li>Intangible benefits : e.g., the “reliability” reputation of the watch manufacturer; the image of the watch wearer </li></ul></ul>Consumer Benefits 10/31/11 lines forming a design Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    23. 23. <ul><li>In fact, people do not really buy ‘goods’ and ‘services’; they buy ‘benefits’ that these goods and services provide. </li></ul><ul><li>Thus, when consumers buy toothpaste , they are really buying healthy teeth and gums, or fewer trips to the dentist, or fresh breath, or a bright, happy smile. </li></ul>Consumer Benefits 10/31/11 lines forming a design Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    24. 24. <ul><li>From a buyer’s point of view, each marketing tool is designed </li></ul><ul><li>to deliver a customer benefit. </li></ul><ul><li>Seven Ps Seven Cs </li></ul><ul><ul><ul><li>Product Customer Solution/Choice </li></ul></ul></ul><ul><ul><ul><li>Price Customer Cost </li></ul></ul></ul><ul><ul><ul><li>Place Convenience </li></ul></ul></ul><ul><ul><ul><li>Promotion Communication </li></ul></ul></ul><ul><ul><ul><li>People Consideration </li></ul></ul></ul><ul><ul><ul><li>Process Consistency </li></ul></ul></ul><ul><ul><ul><li>Physical Evidence Confirmation </li></ul></ul></ul>Consumer Benefits 10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    25. 25. <ul><li>Every product has four components: a basic core of functional benefits, an accessory ring of added-value benefits, a psychological ring of benefits tied to consumer feelings, and the benefits of the time saved or taken by the product. </li></ul>Total Product Concept 10/31/11 Basic Core Accessory Ring Psychological Ring TIME Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    26. 26. <ul><li>Basic core of a laptop computer is design, features, memory, speed, operating system, installed software, warranty etc. offered by the seller. </li></ul><ul><li>Accessory benefits include such ‘added-value’ factors as store reputation, convenience of location etc. also friendliness of sales person, ease of parking, or quick service also fall into this category. These benefits are not paid for, yet they are part of what is received. </li></ul>Total Product Concept 10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    27. 27. <ul><li>A sense of belonging derived from using the same brand of laptop as your friend is a psychological benefit . Buying a new innovative product in order to feel that you are ahead of the crowd is another example. </li></ul><ul><li>The fourth element shown is time . Everything we purchase either saves time or takes time from us. Eating at a fast-food outlet rather than an elegant restaurant saves an hour or more. </li></ul><ul><ul><li>However the value of saving time depends upon the perspective of the consumer-to some people taking time shopping to find the perfect item is time well spent, whereas to others it is time wasted. </li></ul></ul>Total Product Concept 10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    28. 28. Consumer Behavior & Market Segmentation <ul><li>Market segmentation is the process of classifying a market into distinct subsets (segments) that behave in similar ways or have similar needs. </li></ul><ul><li>Dividing a market into smaller groups of buyers with distinct needs, characteristics, or behaviours, who might require separate products or marketing mixes </li></ul><ul><li>If all consumers respond the same way, then there should be no need to segment a market </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    29. 29. 10/31/11 Segmenting Consumer Markets <ul><li>Geographic: dividing a market into different geographical units, such as national, regional, local, city size, density of population, and climate </li></ul><ul><li>Demographic : dividing the market into groups based on demographic variables such as age, sex, family size/ life cycle, income, occupation, education, religion, and ethnic origin </li></ul><ul><li>Psychographic : dividing a market into different groups based on social class, lifestyle, or personality characteristics </li></ul><ul><li>Behavioural : dividing a market into groups based on purchase occasion, benefits sought, user status, usage rate, loyalty status, readiness state, and attitude towards the product </li></ul>Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    30. 30. Organisational Buyer Behaviour <ul><li>‘ The decision-making process by which formal organisations establish the need for purchased products and services, and identify, evaluate, and choose among alternative brands and suppliers’ </li></ul><ul><li>Kotler and Armstrong 1989 </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    31. 31. Understanding Business/Industrial Market <ul><li>Buying and selling of goods and services not only takes place between a consumer and a firm but also between two firms or businesses. A firm may buy raw material from the other firm or business to process it further or it may buy finished goods or even services to sell them to the consumers under its brand name. </li></ul><ul><li>For example, Britannia Industries Limited buys flour from many flour mills to make biscuits, which are finally sold in the consumer. </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    32. 32. Characteristics that makes Business Market unique <ul><li>Market structure and demand ( In a consumer market, there are usually many buyers, i.e. individuals or households. However, these buyers buy in less quantity. But a business market contains a few but large buyers who buy in bulk ) </li></ul><ul><li>Nature of the buying unit ( key players involved include technical experts, management and business market experts and finally well-trained sales persons.) </li></ul><ul><li>Types of decisions and decision process (more complex decisions) </li></ul><ul><li>Major types of buying situations ( straight re-buy, modified re-buy, new task situation, systems buying ) </li></ul><ul><li>Participants in Business-buying process </li></ul><ul><li>The Business Buying process </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    33. 33. Organisational Buyer Situations <ul><li>Some of the organizational buying situations are: </li></ul><ul><li>  </li></ul><ul><ul><li>Straight rebuy </li></ul></ul><ul><ul><li>Modified rebuy </li></ul></ul><ul><ul><li>New task buy </li></ul></ul><ul><ul><li>Systems buy </li></ul></ul><ul><ul><ul><li>Systems buying is a process in which the organization gives a single order to a single organization for supplying a full system. The buying organization knows that no single party is producing all the units in the system. But it wants the system seller to engineer the system, procure the units from various vendors and assemble, fabricate or construct the system. </li></ul></ul></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    34. 34. Organisational Buyer Situations <ul><li>Participants in Business Buying Process: </li></ul><ul><li>  </li></ul><ul><ul><li>User - The persons who use the item. Say for safety gloves the operators. </li></ul></ul><ul><ul><li>Initiators - The safety officer may initiate the request for the purchase. </li></ul></ul><ul><ul><li>Influencers - Safety officer may himself define specifications or an industrial engineer </li></ul></ul><ul><ul><li>Buyers - Person who actually do the buying transaction </li></ul></ul><ul><ul><li>Gatekeepers - The receptionist, the secretaries or finance dept. etc. </li></ul></ul><ul><ul><li>Deciders - People who decide on product requirements and suppliers. </li></ul></ul><ul><ul><li>Approvers - The personal manager may have the power to approve </li></ul></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management
    35. 35. Business Buying Process <ul><li>Business buying process is much more complex than consumer buying </li></ul><ul><li>process. It usually consists of eight stages and take quite a bit of time before a </li></ul><ul><li>decision is finally made. The different stages are: </li></ul><ul><li>Problem/Need recognition </li></ul><ul><li>General need description – general characteristics & quantity of required item </li></ul><ul><li>Product specification – specifies best technical product characteristics for item </li></ul><ul><li>Supplier search – try to find best vendors. </li></ul><ul><li>Proposal solicitation – buyer invites qualified suppliers to submit proposal </li></ul><ul><li>Supplier selection – buyer reviews the proposals and select a supplier (s) </li></ul><ul><li>Order-routine specification – buyer decides & specifies the details of order (Quantity, expected time of delivery, warranties, return policies etc) </li></ul><ul><li>Performance review – final stage where the buyer rates his/her satisfactions with suppliers and decides whether to continue, modify or drop them. </li></ul>10/31/11 Consumer Behavior Consumer in Marketplace IILM-Graduate School of Management

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