CHAPTER 3

The Consumer and

Organizational Buyer
I. Introduction
This chapter is concerned with the behaviour
of consumers and organizations that
purchase products and services. The
relevance of buyer behaviour is examined
and links with marketing research, market
segmentation and the marketing mix are
established
I. Introduction
From the perspective of the buyer as a
problem solver the chapter then focuses on
the consumer as an individual.
II. Why study the buyer?
A central component of the definition of marketing
is satisfying customers’ needs profitably. To
achieve that it is necessary to understand
consumers, their needs and wants, and how they
will respond to various marketing efforts.
Each consumer is unique and that is a good
reason to trust sound marketing research rather
than hunches based on the extrapolation of
personal motives. As a starting point for
marketing research hunches are useful when
they are regarded as ideas to be tested.
Therefore we can ask:
+ ‘‘Do many people share this view?’’
+ ‘‘How many?’’
+ ‘‘Do they have any other views that are
more strongly held?’’
1) The role of consumer behaviour in marketing

Consumer behaviour provides a range of

concepts to help marketers think about their
customers, and marketing research provides the
techniques to measure those concepts.

Consumer behaviour is also closely integrated

with all other aspects of marketing, but most
notably with the selection of target markets
and the development of marketing mixes.
2) Consumer behaviour and target markets
As mentioned earlier each consumer is unique.
Most marketing is concerned with the provision
of standardized products aimed at particular
groups of consumers. All consumers are
different from other consumers, but, and this is
not contradictory, they are similar to some
other consumers

If the total market for products is considered it

can easily be seen that it really comprises many
smaller segments, each with specialized needs.
Segmentation involves creating homogenous
groups made up of individuals with identifiable
common characteristics. These might be place
of residence, age, lifestyle or even how they
behave on your website: these are what we call
segmentation criteria.

The individuals within a same segment are

supposed to have the same expectations
and should react in a similar way to an
offer, type of content or a specific
message.
Quizz
What are the factors applied to separate
the segments in the marketing?
a) Demographic Segmentation

Segmenting a market according to demographics

is the most basic form of segmentation. Combining
demographic segmentation with other types can
help you to narrow down your market even more.
b) Geographic Segmentation

There are several kinds of geographic segmentation.

The most basic is identifying users based on their
locations such as their country, state, county and zip
code. You can also identify consumers based on the
characteristics of the area they live in, such as its
climate, the population density and whether it’s urban,
suburban or rural.
c) Psychographic Segmentation

These attributes may not be as easy to observe as

demographics, but they can give you valuable insight
into your audience’s motives, preferences and needs.
Understanding these aspects of your audience can
help you to create content that appeals to them more
effectively.
d) Behavioral Segmentation

You can also segment your market based on

consumers’ behaviors, especially regarding your
product. Dividing your audience based on behaviors
they display allows you to create messaging that
caters to those behaviors.
It is the understanding of these types of
consumer needs that is the essence of
consumer behaviour and the subsequent
identification of suitable target markets for
firms

Investigation of consumer behaviour is

sometimes designed specifically to identify
particular groups of consumer with interests
and buying behaviour in common. The later
section on lifestyles will outline one such
approach to market segmentation.
3) Consumer behaviour and the marketing mix
The study of consumer behaviour not only
provides a framework for identifying consumer
needs and target markets, but it also enables
the anticipation of consumer responses to
marketing action.

The marketing mix is the combination of

elements that a marketer offers to a target
market. It comprises decisions made about
products, prices, promotion, services and
distribution that are assembled in a coherent
manner to represent the firm’s offering to the
consumer
a) Consumer behaviour and products

Why do consumers buy one

product?
a) Consumer behaviour and products
Products are bought because they meet needs.
These needs may be mainly physiological such
as the requirement for warmth or may include
social needs such as the desire to be thought
attractive.
b) Consumer behaviour and promotion
The promotion of items requires an
understanding of consumers’ media habits so
that the correct media can be chosen.
Understanding consumer behaviour enables the
selection of appropriate promotional messages.
c) Consumer behaviour and price
c) Consumer behaviour and price
Price for many people is a major indicator of
quality. Style and design are sometimes difficult
to judge, especially for the untrained. Therefore
some consumers take surrogate indicators of
quality and in particular price. An understanding
of the perceptual process and how consumers
learn about prices and value is helpful in
constructing a pricing policy.
d) Consumer behaviour and distribution

The choice of an appropriate distribution

channel and designing elements within that
channel should be based on an understanding
of the consumer. Knowing when, where and
how consumers wish to buy are fairly
obvious applications.

Understanding and matching self-images and

store images and creating particular store
atmospheres to encourage certain moods
need research and ideas from consumer
behaviour.
4) Consumer decision-making
One main way of examining consumer
behaviour is to take the view of the consumer
as a problem solver.

The problem-solving perspective raises many

questions that will be addressed; they concern
the types of decision consumers must make,
the various stages of the decision process
consumers progress through and major factors
that influence those decisions.
a) Types of consumer decision
1) How to find out about new styles?
2) What style, size to buy?
3) Where to buy from?
4) How to pay?
5) Which bills to pay promptly?
6) When to buy?
7) How many items to buy?
8) Will any accessories need to be purchased?
9) Whether to shop alone or accompanied?
10) Which sales assistant to approach for help?
11) What to do if the product is unsatisfactory?
12) What will be the reaction of significant others to
the
purchase?
13) Whether or not to purchase online or mail order?
If buying online or mail order, how to arrange
delivery?
a) Types of consumer decision
If marketers see consumer decisions as a
series of smaller related
problems to be solved, then the benefit
comes in terms of planning activities to
ensure that the consumer is helped when
help is needed.

Marketing research is necessary to

determine which decisions are
important to the particular target
market of the firm.
b) The decision process
Most models of consumer behaviour use
the stages or near equivalents as shown
in diagram

The diagram of consumer decision

process.
b) The decision process
Having become aware of a need, the
consumer reflects on the situation and can
decide to proceed with the purchase
process and collect information, defer the
purchase or conclude that the problem is
insignificant or cannot be solved.
b) The decision process
The goal of marketing is to move customers
along the continuum from the promiscuous
to the insistent, as shown in
III. The innovation adoption process
Each new product or trend introduced to the
market has a life cycle that begins with its
introduction, then goes through the growth and
maturity stages where the product is adopted by a
segment of consumers, all followed by the
product’s decline when it falls out of favor
III. The innovation adoption process
Stage 1 - Product Awareness
We find that the process begins with the
awareness
stage. In this stage, the consumer becomes
aware of some new offering, such as an
idea, product, or trend.

If consumers do not know your product

exists, than it might as well not exist!

Case Example – Movie Teasers

III. The innovation adoption process
Stage 2 - Product Interest
The consumer’s curiosity is piqued, leading
to efforts to gather more information about
the new offering. The consumer begins to
wonder if the offering is right for her or suits
her needs

Among the methods used in the todays

business landscape include a website
describing the product, blog posts,
tutorial or instructional videos etc.
III. The innovation adoption process
Stage 3 - Product Evaluation
The consumer processes the gathered
information and mentally “tries on” the new
offering for her own situation. For instance,
the consumer may ask :
“Would this work with what I already own?”
or “Does this trend work for someone my
age?”
III. The innovation adoption process
Stage 4 - Product Trial
In the trial stage, the consumer physically
tests the new offering to see if reality matches
her expectations. For a new trend, the
consumer may try products on in the store to
see if the style is flattering and comfortable.
In the case of the sandals, the visual
truncation of the leg (i.e., making the legs look
shorter and wider) may lead the customer to
reject the trend during the in-store trial stage,
or the shoes may be purchased and shown to
friends who define the shoes as hideous.
III. The innovation adoption process
Stage 5 - Product Adoption
When the consumer enters the product
adoption phase, he/she is ready to purchase
your companies product. This is the critical
stage that businesses need to get their
consumers to.

Individuals may go through the stages of

the adoption process model at different
rates, depending on the attributes of the
innovation and the characteristics of the
individual consumer.