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99THTH EDITION EDITION
CHAPTER 7CHAPTER 7UNDERSTANDING UNDERSTANDING BUYER BEHAVIORBUYER BEHAVIOR
Manning and Reece
PART IV
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LEARNING OBJECTIVES-1 Discuss the meaning of a customer
strategy
Understand complex nature of consumer and business buyer behavior
Discuss social and psychological influences shaping buying decisions
Discuss power of perception in shaping buyer behavior
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LEARNING OBJECTIVES-2 Distinguish between emotional and rational buying motives
Distinguish between patronage and product buying motives
Explain two commonly accepted theories about how people arrive at buying decision
Describe three ways to discover customer buying motives
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CUSTOMER STRATEGYDEFINED
”A customer strategy is a carefully conceived plan that results in maximum customer responsiveness. One major dimension of this strategy is to achieve a better understanding of the customer’s buying needs and motives.”
Figure 7.1 7-5
STRATEGIC/CONSULTATIVESELLING MODEL
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CONSUMER vs. BUSINESS BUYERS
Consumer buyer behavior Consumer buyer behavior Individuals and households who Individuals and households who buy for personal consumption buy for personal consumption
Business buyer behavior Business buyer behavior Organizations that buy goods and Organizations that buy goods and services used in production of services used in production of other products and services that other products and services that are sold, rented, or supplied to are sold, rented, or supplied to othersothers
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BUYER BEHAVIOR COMPLEXITY
ADOPT ONE-TO-ONE ADOPT ONE-TO-ONE MARKETING STRATEGYMARKETING STRATEGY
CULTIVATE LONG-TERM CULTIVATE LONG-TERM RELATIONSHIP WITH EACH RELATIONSHIP WITH EACH CUSTOMER CUSTOMER
WORKS FOR BOTH RETAIL WORKS FOR BOTH RETAIL AND BUSINESS-TO-AND BUSINESS-TO-BUSINESSBUSINESS
Figure 7.2 7-8
CUSTOMER STRATEGY MODEL
See Figure 7.3. 7-9
CURRENT TRENDS
Consumers moving upscale to Consumers moving upscale to premium, luxury goodspremium, luxury goods
Customer respect central to Customer respect central to success in every market success in every market
Customers from diverse racial, Customers from diverse racial, ethnic, and cultural backgroundsethnic, and cultural backgrounds
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BASIC NEEDS—MASLOW
Physiological Physiological –food, shelter–food, shelter
Security Security –free from danger–free from danger
Social Social ––identification with identification with social groups, friendshipsocial groups, friendship
Esteem Esteem –desire to feel worthy –desire to feel worthy in eyes of othersin eyes of others
Self-Actualization Self-Actualization –need for –need for mastery, self-fulfillmentmastery, self-fulfillment
See Figure 7.4, next slide. 7-11
GROUP INFLUENCES Role Role –expectations associated with –expectations associated with
positionposition Reference Groups Reference Groups –categories of –categories of people you see self belonging topeople you see self belonging to Social Class Social Class –group with similar –group with similar jobs,values, interests, lifestyles jobs,values, interests, lifestyles Culture Culture –influences of group with –influences of group with common language, environment, common language, environment, also sub-cultures also sub-cultures
Figure 7.4 7-12
GROUP INFLUENCES
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DAIMLER/CHRYSLER
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APPLICATION: OVER-GENERALIZING
Remember, prospects act as individuals, not stereotypes “Facts are negotiable. Perception is rock-solid.” Some predict the demise of “demographics” in marketing …How would this impact customer analysis?
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USING JUST DEMOGRAPHICS
21-34-year-old female $40,000+ income college educated owns home
Could yield
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SELECTIVE PROCESSES-SELECTIVE PROCESSES-OVERVIEWOVERVIEW
EXPOSURE
ATTENTION
PERCEPTION
RETENTION
BEHAVIOR
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PERCEPTION: CUSTOMER NEED FORMATION
Selective Attention—We tend to Selective Attention—We tend to screen out certain messages screen out certain messages ……information overload information overload
Buyers conditioned by socio-Buyers conditioned by socio-cultural background and need to cultural background and need to use various selective processes use various selective processes
Salespersons should encourage Salespersons should encourage client client to discuss “perceptions” to discuss “perceptions” of productsof products
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BUYING MOTIVES
A buying motive is an aroused need, A buying motive is an aroused need, drive, or desire that stimulates drive, or desire that stimulates behavior to satisfy the aroused needbehavior to satisfy the aroused need
It’s helpful to discover the “dominant It’s helpful to discover the “dominant buying motive” or buying motive” or DBMDBM
Four basic motive types—emotional, Four basic motive types—emotional, rational, patronage, and productrational, patronage, and product
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EMOTIONAL AND RATIONAL
EMOTIONALEMOTIONAL--Acts due to passion or --Acts due to passion or
sentimentsentiment-- Emotional appeals -- Emotional appeals
commoncommon--Discovery of emotions --Discovery of emotions
involved helps involved helps determine “why” determine “why” customer buyscustomer buys
RATIONALRATIONAL--Acts on reason or --Acts on reason or
judgmentjudgment--Relatively free of --Relatively free of
emotionemotion--Discovery of important --Discovery of important
product, service, product, service, delivery details delivery details critical critical
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PATRONAGE AND PRODUCT MOTIVES
PATRONAGEPATRONAGE--Buy from particular --Buy from particular
firmfirm-- Past experience -- Past experience
positivepositive--Relevant elements: --Relevant elements:
superior service superior service competent sales competent sales staff product staff product selectionselection
PRODUCTPRODUCT--Buyer believes one is --Buyer believes one is
product superior to product superior to othersothers
--Preferences for: --Preferences for: specific brands specific brands quality quality price price design/engineering design/engineering
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BUYER RESOLUTION THEORY
Sometimes called the Sometimes called the 5-Ws5-Ws
– Why should I buy? (need)Why should I buy? (need)– What should I buy? (product)What should I buy? (product)– Where should I buy? (source)Where should I buy? (source)– What is a fair price? (price)What is a fair price? (price)– When should I buy? (time)When should I buy? (time)
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NEED-SATISFACTION THEORY
Beliefs about salesperson’s roleBeliefs about salesperson’s role
– Foundation of consultative sellingFoundation of consultative selling– Effective two-way communicationEffective two-way communication– Systematic inquiry with prospectSystematic inquiry with prospect– Two-way advocacy positionTwo-way advocacy position– Provides “best” solutionProvides “best” solution– Aims to develop long-term Aims to develop long-term
customer relationshipcustomer relationship
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THEORIES COMPARED-NEEDS WINS
Needs approach based on Needs approach based on systematic analysis of buyer systematic analysis of buyer situationsituation
Needs approach works well in all Needs approach works well in all selling situationsselling situations
Customers experience less stress Customers experience less stress with needs approachwith needs approach
See Figure 7.5, next slide. 7-24
BUSINESS-TO-BUSINESS Differs from consumer levelDiffers from consumer level Often a group or committee Often a group or committee decisiondecision Buyer often doesBuyer often does– Purchase requisition or requestPurchase requisition or request– Systematic information search Systematic information search – Evaluates alternativesEvaluates alternatives– Issues purchase orderIssues purchase order– Performs post-buy evaluationPerforms post-buy evaluation
Figure 7.5 7-25
BUSINESS BUYING DECISION STEPS
Last slide Chapter 7. 7-26
ASK ASK QUESTIONSQUESTIONSASK ASK QUESTIONSQUESTIONS
BE A GOOD BE A GOOD LISTENLISTENERERBE A GOOD BE A GOOD LISTENLISTENERER
BE A GOOD BE A GOOD OBSERVEOBSERVERRBE A GOOD BE A GOOD OBSERVEOBSERVERR
DISCOVERING CUSTOMER’S BUYING
MOTIVES