MGT301 Principles of Marketing Lecture-16
Summary of Lecture-15
Consumer Buying Behavior Marketing and Other Stimuli Marketing and Other Stimuli Buyer’s Black Box ”what” & “how” Buyer’s Black Box ”what” & “how” Buyer’s Response Product Price Place Promotion Economic Technological Political Cultural Buyer characteristics affecting consumer behavior Buyer’s decision process Product choice Brand choice Dealer choice Purchase timing Purchase quantity
Characteristics Affecting Consumer Behavior Cultural Social Personal Psychological
Buyer Decision Process
Postpurchase Behavior Postpurchase Behavior Purchase Evaluation of Alternatives Evaluation of Alternatives Information Search Need Recognition Cultural, Social, Individual and Psychological Factors affect all steps Cultural, Social, Individual and Psychological Factors affect all steps
Social Factors Individual Factors Psycho- logical Factors Cultural Factors CONSUMER DECISION- MAKING PROCESS BUY / DON’T BUY
Today’s Topics
Business Markets and Buying Behavior
What is a Business Market? The Business Market - all the organizations that buy goods and services to use in the production of other products and services that are sold, rented, or supplied to others.
Characteristics of Business Markets
Market Structure and Demand Fewer, larger buyers Geographically concentrated Demand derived from consumers Inelastic demand Fluctuating demand
Nature of the Buying Unit More buyers More professional purchasing effort
Types of Decisions & the Decision Process More complex decisions Process is more formalized Buyer and seller are more dependent on each other Build close long-term relationships with customers
Business Buyer Behavior The buying behavior of the organizations that buy goods and services for use in the production of other products and services or for the purpose of reselling or renting them to others at profit.
Model of Business Buyer Behavior
The Buying Organization Marketing and Other Stimuli Marketing and Other Stimuli Buyer’s Response Product Price Place Promotion Economic Technological Political Cultural Interpersonal and Individual Influences Organizational Influences Product or Service Choice Supplier Choice Order Quantities Delivery Terms and Times Service Terms Payment The Buying Center Buying Decision Process
Business Buying Situations
Straight Rebuy New Task Buying Modified Rebuy Involved Decision Making
Participants in the Business Buying Process: The Buying Center Buying Center Buying Center Users Gatekeepers DecidersInfluencers Buyers
Influencer Initiator User Gate- keeper Buying Center Buying Center Buyer Decider
Major Influences on Business Buying Level of demand Economic outlook Interest rate Rate of techno- logical change Political and regulatory developments Competitive developments Social responsi- bility concerns Objectives Policies Procedures Organizational structures Systems Interests Authority Status Empathy Persuasive- ness Age Income Education Job position Personality Risk attitudes Culture Environmental Business Buyer Interpersonal Organizational Individual
Stages in the Business Buying Process
Problem Recognition General Need Description Product Specification Supplier Search Proposal Solicitation Supplier Selection Order Routine Specification Performance Review
Key Organizational Buying Criteria
Quality Specifications Technical Capability Past Performance Organizational Buying Criteria Delivery Schedules Price Warranty / Claim Policies Production Facilities / Capacity
Institutional Markets Schools, hospitals, nursing homes, prisons and other institutions that provide goods and services to people in their care.
Government Markets Governmental units-federal and provencial-that purchase or rent goods and services for carrying out the main functions of government.
Difference between Business Marketing and Consumer Market Fewer buyers, concentrated, competitive Driven by derived demand More inelastic More professional, complex Direct purchase from producer
Long-term relationship More leasing More departments are involved Users, influencers, buyers, deciders, gatekeeper
Enough for today...
Summary Business Markets and Buying Behavior
Characteristics of Business Markets
Model of Business Buyer Behavior
The Buying Organization Marketing and Other Stimuli Marketing and Other Stimuli Buyer’s Response Product Price Place Promotion Economic Technological Political Cultural Interpersonal and Individual Influences Organizational Influences Product or Service Choice Supplier Choice Order Quantities Delivery Terms and Times Service Terms Payment The Buying Center Buying Decision Process
Business Buying Situations
Straight Rebuy New Task Buying Modified Rebuy Involved Decision Making
Major Influences on Business Buying Level of demand Economic outlook Interest rate Rate of techno- logical change Political and regulatory developments Competitive developments Social responsi- bility concerns Objectives Policies Procedures Organizational structures Systems Interests Authority Status Empathy Persuasive- ness Age Income Education Job position Personality Risk attitudes Culture Environmental Business Buyer Interpersonal Organizational Individual
Stages in the Business Buying Process
Problem Recognition General Need Description Product Specification Supplier Search Proposal Solicitation Supplier Selection Order Routine Specification Performance Review
Next…. Market Segmentation
MGT301 Principles of Marketing Lecture-16