Understanding Customer Behaviour C H A P T E R 8

8 Copyright 2004 Pearson Education Canada Inc. 8-2 Learning Objectives Discuss the meaning of a customer strategy Explain three commonly accepted theories that explain how customers make buying decisions Discuss the psychological and group influences that shape customer buying decisions Discuss the power of perception in shaping buying behaviour

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-3 Learning Objectives (Continued) Distinguish between emotional and rational buying motives Distinguish between patronage and product buying motives Describe three ways to discover an individuals buying motives Identify and describe six buying center roles

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-4 Customer Strategy A carefully conceived plan that will result in maximum customer responsiveness

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-5 Strategic/Consultative Selling Model Strategic StepPrescription Develop a Personal Selling Philosophy Value Personal Selling Adopt Marketing Concept Become a Problem Solver/Partner Develop a Relationship Strategy Project positive, professional image Practise communication-style flexing Behave ethically Develop a Product Strategy Become a product expert Sell benefits Configure value-added solutions Develop a Customer Strategy Understand buyer behaviour Discover customer needs Develop prospect base

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-6 How Customers Make Buying Decisions Buyer Action Theory Buyer Resolution Theory Need Satisfaction Theory

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-7 Buyer Action Theory Attention Interest Desire Conviction Action

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-8 Buyer Resolution Theory Why should I buy? (need) What should I buy? (product) Where should I buy? (source) What is a fair price? (price) When should I buy? (time)

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc. 8-9 Basic Beliefs of the Need Satisfaction Theory Effective communication between buyer and seller Uncover specific needs that require custom solutions Salespeople represent their company and their clients, therefore a two-way advocacy position

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Basic Beliefs of the Need Satisfaction Theory (Continued) Salespeople should consider the total solution Focus on long-term customer relationships

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Customer Strategy Theories Needs of prospect are of little importance Product features are emphasized during the sales presentation Repeat business is not given a high priority Buyer Action TheoryBuyer Resolution TheoryNeed-Satisfaction Theory

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Customer Strategy Theories Needs of prospect are of little importance Product features are emphasized during the sales presentation Repeat business is not given a high priority Systematic inquiry is made to establish needs Buyer benefits are emphasized during the sales presentation Repeat business is given a high priority Buyer Action TheoryBuyer Resolution TheoryNeed-Satisfaction Theory

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Customer Buying Decision Influences – Maslows Hierarchy Self-Actualization Physiological Esteem Social Security

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Customer Buying Decision Influences Group Influences include Role Influences Reference groups Social Class Culture and Microcultures

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Motives A buying motive is an aroused need, drive, or desire that initiates the sequence of events that may lead to a purchase.

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Types of Buying Motives Dominant buying motives have the greatest influence on a customers buying decision. Emotional buying motives prompt the prospect to act as a result of an appeal to some sentiment or passion Rational buying motives prompt the prospect to act because of an appeal to the prospects reason or better judgment. They include price, quality, and availability of technical assistance.

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Patronage versus Product Buying Motives Patronage buying motives cause the prospect to buy a product from one particular company rather than another. Typical patronage buying motives include superior service product selection competence of the salesperson.

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Patronage versus Product Buying Motives Product buying motives are reasons that cause the prospect to buy one particular product brand or label over another. Typical product buying motives include brand preference; quality preference; price preference; and design or engineering preference. There are numerous buying motives that trigger prospects to select one product over another.

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Discover Individual Buying Motives Through Questioning Listening Observation

C H A P T E R 8 Copyright 2004 Pearson Education Canada Inc Typical Buying Centre Buyer Influencer Buying Decision Initiator User Gatekeeper Decider