Chapter 3

Buyer Behavior
Prepared by
Bùi Ngọc Tuấn Anh (PhD)

Introduction to buyer behavior

• Consumer vs. Business buyer behavior

– Distinction between consumer markets (individuals and
households) and business markets (organizations)
– The different motivations and processes involved in each
• Complexity of buyer behavior
– Acknowledging the difficulty of understanding the “black box” of
the consumer's mind
– The influence of both external and internal factors on buying
decisions

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Consumer markets and Consumer buyer behavior

• The consumer market consists of individuals and

households that purchase goods and services for
personal consumption
– The study of how they select, buy, use, and dispose of goods,
services, ideas, or experiences to satisfy their needs or wants.
• Model of Consumer behavior:
– The stimulus-response model where marketing and other
stimuli enter the consumer's "black box"
– The two components of the black box: buyer characteristics
and the buyer's decision process

Model of consumer behavior

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Consumer Behavior
Personal Factors

Cultural Factors

Social Factors

Cultural Factors
Social Class

Culture

Subculture

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Social Factors
Reference Groups

Family

Role and Status

Personal Factors

Personality

Age

Life Cycle Stage

4
Personal Factors
Occupation Values

Lifestyle
Economic situation

Psychological Factors

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Motivation
Freud

Maslow

Herzberg

Maslow’s Hierarchy of Needs

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Perception
Selective Attention

Selective Retention

Subliminal Perception Selective Distortion

Learning
Driver

Cues

Discrimination

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Emotions

Memory
Memory Processes

Mental Maps
Encoding Association Association
Retreival Association
Association
Association

Brand Associations Brand

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 The Buying Decision Process

Problem Recognition

“I’m Hungry”

Stimulus
• Internal
• External

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Information Search
Commercial Public

Personal Experiential

Successive Sets Involved in

Consumer Decision Making

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Evaluation of Alternatives
Beliefs

Attitudes

Expectancy-Value Model

Attribute
Memory Graphics Size and
Price
Capacity Capacity Weight
Model Weight: 40% Weight: 31% Weight: 20% Weight: 10%
A 8 9 6 9
B 7 7 7 7
C 10 4 3 2
D 5 3 8 5

Model A = 0.4 (8) + 0.3(9) + 0.2(6) + 0.1(9) = 8.0

Model B = 0.4 (7) + 0.3(7) + 0.2(7) + 0.1(7) = 7.0
Model C = 0.4(10) + 0.3(4) + 0.2(3) + 0.1(2) = 6.0
Model D = 0.4 (5) + 0.3(3) + 0.2(8) + 0.1(5) = 8.0

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 Steps between Evaluation of
Alternatives and Purchase Decision

Purchase Decision
Noncompensatory Models
Choice Heuristics:
• Conjective
• Lexicographic
• Elimination-by-aspect

Brand

Dealer
Purchase
Quantity
subdecisions
Timing

Payment method

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Postpurchase Behavior
Postpurchase Satisfaction Delighted

Satisfied

Dissatisfied

Loyal

Stay or Go

Defect Postpurchase Actions

How Customers
Use or Dispose of Products

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Moderating Effects

Low-involvement

Variety seeking

Behavioral Decision Theory

Decision Framing

Decision Heuristics

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The adoption process for new products

• Stages: Awareness, interest, evaluation, trial, and

adoption
• Individual differences in innovativeness: innovators, early
adopters, early mainstream, late mainstream, and lagging
adopters

The adoption process for new products

• Stages: Awareness, interest, evaluation, trial, and

adoption
• Individual differences in innovativeness: innovators, early
adopters, early mainstream, late mainstream, and lagging
adopters

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 Analyzing Business Markets

Business markets and business buyer behavior

• Defining the business market

– Organizations that buy goods and services for use in
production, resale, or rental
– The nature of business markets with fewer but larger buyers,
and geographic concentration
– Business demand is derived demand
– B-to-B marketers need to engage business customers and
build relationships by creating superior customer value

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Business Markets
Transportation &
Distribution

Agriculture Construction

Forestry
Manufacturing

Communications
Banking & Finance

Business Markets
Differences to the Consumer Market Geographically
Concentrated

Fewer, Larger
Buyers

Professional
Buyers

Multiple Personal
Sales Calls Relationships

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Business Markets
Differences to the Consumer Market

Derived Demand

Inelastic Demand

Demand
• Derived
• Inelastic
• Fluctuating
Fluctuating Demand

Characteristics of business buyer behavior

• More decision participants and a more professional

purchasing effort
• The role of trained purchasing agents and buying
committees
• The importance of well-trained marketing and sales
personnel

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Model of business buyer behavior

• Marketing stimuli and other factors affect the buying

organization
• The buying center and the buying decision process, with
influences from internal, interpersonal, and external
factors

Types of buying situations

• How different buying situations affect the decision process

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Business Buying Participants

Initiator/ Influencer Decider

Users

Gatekeeper Approver
Buyers

Stages in the Buying Process

Problem
Description and
Recognition
Characteristics Supplier
Search

Proposal
Solicitations

Performance Order Supplier

Review Specification Selection

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Stages in the Buying Process

Problem
Recognition Internal stimuli
• New product being developed
• Broken machine
• Low stock level

External stimuli
• Trade show visit
• Advertisement

Stages in the Buying Process

Description and Technical specifications

Characteristics
• Reliability
• Durability
• Price

Product value analysis

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Stages in the Buying Process

Supplier
Search

Trade directories
Trade advertisements
Trade shows

E-Procurement Lead generation

Stages in the Buying Process

Proposal
Solicitations

Formal presentation

Written

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Stages in the Buying Process

Supplier
Selection

Supplier-evaluation model
Number of suppliers

Stages in the Buying Process

Order
Specification Stockless
purchase
plan
Technical specifications
Quantity
Delivery time
Return policy
Warranties

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Stages in the Buying Process

Performance
Review

End user evaluations

Weighted-score
method
7 9 4

Buygrid Framework
Table 7.1
Buyclasses
Modified Straight
New Task
Rebuy Rebuy
1. Problem Recognition Yes Maybe No
2. General need description Yes Maybe No
3. Product specification Yes Yes Yes
Buyphases

4. Supplier search Yes Maybe No

5. Proposal solicitation Yes Maybe No
6. Supplier Selection Yes Maybe No
7. Order-routine specification Yes Maybe No
8. Performance review Yes Yes Yes

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Managing B2B Relationships

Online social media

One-to-one Marketing

Managing B2B Relationships

Vertical Coordination

Relationship Factors
Availability of alternatives
Importance of supply
Complexity of supply
Supply market dynamism

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 Buyer-Seller Relationship Categories
Cooperative systems

Collaborative

Customer is king

Contractual transaction Mutually adaptive

Institutional and Governments Markets

Prisons

Government
agencies

Schools

Hospitals

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