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3. Buyer Behaviour
Why study customers?
Effective marketing must begin with “a thorough understanding of how and why
customers behave as they do” (Merenski, 1998). Specifically, in order to tailor
solutions to customers’ particular needs and desires, the marketer requires a
grounded knowledge of buyer motivations and decision-making processes, together
with all those environmental factors which may exert influence upon them. Put
another way, the marketer is seeking to address three basic questions:
Why does the customer want to buy a particular product or service?

How will he or she decide which option to purchase?

What factors may influence this decision?
Buyer behaviour is a huge subject and it is only possible in this course to provide a
brief introduction to the key issues. For the purposes of this session, we’ll therefore
concentrate primarily upon consumer behaviour, then conclude by highlighting
some of the similarities and differences between this and organisational buyer
behaviour (or business-to-business purchasing). To illustrate our discussion, we’ll
look at a subject which (love it or hate it!) we can all relate to, namely shopping.
Consumer Motivation
The study of consumer motivation essentially addresses the question: “Why do
people shop?” The answer, really, is that people shop for a variety of reasons and it
is very difficult to make generalisations. Shopping for food can, on one level, be
seen as satisfying some basic survival need. The problem with that, however, is that
most of us buy far more food than we would actually need for basic subsistence and
many of the items we purchase in a supermarket are “luxuries” (relatively speaking).
One of the most influential studies of consumer motivation is that conducted by
Tauber (1972). According to Tauber, there are two main categories of motivation for
shopping:
Personal Motives: Role Playing – some shopping activities are associated with a
particular role in society (housewife, mother, student, etc).
Diversion – shopping can be a form or recreation, or an escape
from daily routine.
Self-Gratification – shopping can be mood-related, for instance
where people engage in “retail therapy” to cheer themselves
up or alleviate depression.
Learning – shopping is an ideal way to learn about new fashions
and trends.
Physical Activity – for some people, a stroll around the mall can
be their main form of exercise.
Sensory Stimulation – shoppers often report that they enjoy
handling merchandise, the sounds of background music, the
scents of perfume counters, etc, and visit stores or malls to
indulge in this.
Social Motives:
Social Interaction – people enjoy the opportunities for social
interaction with friends, strangers, sales staff, etc.
Peer Affiliation – certain shops allow customers mix with key
reference groups; e.g. people with shared interests, members
of a social category they either belong to or aspire to, etc.
Status & Authority – shopping experiences are sometimes seen
as ways of commanding respect and attention; e.g. during
encounters with sales staff.
Pleasure of Bargaining – some shoppers love to “haggle”, a way
of obtaining goods at a better price or of priding oneself on the
ability to make “wise” purchases.
The above categories are by no means mutually exclusive. Some 70% of the
population visit a shopping mall at least once per week and they are liable to do so
for a variety of reasons at any one time. Shopping is certainly far more than merely
going to a store to buy a product one needs or wants – people often go to the mall
with no intentions of spending any money at all!
Pause for thought…..
What was the last item you purchased in a store? Did you go shopping specifically to
look for it? Why did you buy it? Who was involved in you purchasing decision?
Were you happy with the decision you made?
Exercise: Make a list of all the things you noticed last time you went shopping.
Include anything at all that crosses your mind, from things you actually saw or did to
things you felt. Save the list for later!
Consumer Decision-Making
Since the 1960s, the study of consumer behaviour has focused largely upon
consumer decision-making processes. Influenced by cognitive psychology, a
number of so-called modal models (or “box-and-arrow” models) have been
proposed, presenting the various stages the consumer goes through when choosing
a product to buy or store to shop in, presented in a flow-chart format (e.g. Nicosia,
1966; Engel et al., 1995). A rather stylised summary of these modal models might
look something like this:-
Identification of Need / Want
Task Orientation
Information Search
Environmental
Factors
Evaluation of Options
Purchase Decision
Post-Purchase Evaluation
In the left-hand column above, we can see that the decision process begins with the
consumer recognising that he or she needs or wants to buy an item. Attention is
then devoted to the task in hand and information gathered. The consumer evaluates
the options available, makes his or her choice and purchases the product. At any
stage in the process, events encountered at one stage may cause the consumer to
revert to a previous stage; for example, during evaluation, none of the options
available may prove satisfactory and the consumer may therefore decide to reassess
the initial need and begin the process again for a completely different alternative
solution. Conversely, with very common or repeat purchases, particular stages (e.g.
information search) may be passed through without conscious attention being
applied (i.e. may be automatised) because the information required is already
available in memory. Finally, note how the decision process doesn’t end with
purchase – the extent to which a purchase is deemed successful or unsuccessful will
feed back to influence future purchase decisions.
To the right of the diagram, we see environmental factors which may influence the
decision-making process at any stage. This category would include a whole array of
variables, ranging from exposure to advertising and promotional materials through to
store atmosphere, crowding and the opinions of significant others.
The diagram is a summary of the models available which, however complex they
may appear, all hypothesise the same linear decision-making process. There is no
one single universally accepted model, each having its own particular strengths and
weaknesses. In a way, this is probably a reflection of the many different consumer
motivations highlighted above – particular models being stronger than others for
specific types of shopping.
There are two main problems with modal models such as this when it comes to their
usefulness to the marketer.
Firstly, the “box-and-arrow” approach is rather
descriptive. It tells us the decision-making stages the customer negotiates, but tells
us very little about how the marketer can actually influence these stages to make his
or her product/service the preferred option.The second weakness of this approach is
closely related to the first. Note how the environment is merely “lumped together”
to the right of the diagram. When we consider all of the factors this encompasses
(store location, layout, advertising, prevailing socio-economic conditions, etc.), this
seems woefully inadequate. Moreover, the location of the environment box separate
to the decision-making process gives the impression of the environment as simply
being something “out there”, divorced from the individual shopper. The reality, of
course, is that consumers are a part of the environment, interacting with
environmental factors and influencing each other.
A more accurate model of
consumer decision-making would probably locate the environment “box” as follows:-
Identification of Need / Want
Task Orientation
Information Search
Environment
Evaluation of Options
Purchase Decision
Post-Purchase Evaluation
As you can see, this revised model locates the decision-making process within the
environment box, recognising that the individual is part of the environment.
Environmental Psychology
Since the mid-1970s, marketers have expressed increasing interest in
environmental psychology, an area of applied psychology which deals with “the
transactions between the individual and the socio-physical environment” (Stokols,
1981). Environmental psychology (EP) hypothesises a bi-directional relationship
between the individual and the environment, rather than a simple uni-directional
stimulus-response model.
To illustrate this, imagine a shopper in a fashion store looking for a new coat. The
traditional psychology model would have the shopper examining coats available in
the store (stimuli), selecting one and buying it (the response). In practice, of
course, consumers both influence and are influenced by the retail environment. If a
particular coat is a big seller, the retailer may stock more units, increase the range of
sizes/colours available, and so on. Alternatively, if the coat is a very poor seller, the
retailer may discontinue the line all together.
Either way, the stimuli in the
environment will have changed as a result of consumer behaviour.
So, the
relationship between consumers and the retail environment is a two-way process
with, if you like, marketing serving as the communication channel between the two.
The main attraction EP holds for marketers is that it provides a conceptual
framework with which to identify and classify all those environmental factors which
may influence the customer – many of which will be under the marketer’s direct
control.
An EP analysis of shopping (or any behaviour, for that matter) begins with selection
of an appropriate unit of analysis. If you think about it, the word “environment”
could mean the room you are currently in, the city, the country, the entire planet, or
whatever. Such disparate units are very difficult to manage, so the environmental
psychologist always begins by selecting a segment of the environment to
investigate; i.e. a sub-unit of the environment in which to explore all those variables
effecting the individual. Put another way, the psychologist is interested in the
effective context of the behaviour which, in the case of retail buyer behaviour, may
be the retail store in which the consumer is shopping.
One way of looking at the store is in terms of a setting in which shopping behaviour
occurs. Barker (1968) first introduced the term behaviour setting into EP to
denote “an environmental context in which certain behaviours may be expected to
occur, irrespective of the individual actors present”.
Take the example of a supermarket. When visiting the supermarket, we probably all
behave in pretty much the same way. We enter the store, we select a trolley or
basket, we navigate the aisles selecting products, we stand in line at the check-out,
we unload the goods, we pay for them, we pack our bags, etc., etc. In other words,
as supermarket shoppers, we follow set behavioural programmes, often with little
thought to what we are “supposed to do”.
The idea of the behaviour setting is very influential in retailing. Having studied how
shoppers follow certain behavioural programmes, for instance, architects can design
stores so as to better facilitate customer flow via changes in layout, aisle width,
shelving, check-out location, etc. Indeed, many store designers now refer to
themselves as “architectural psychologists”, drawing on techniques from two
seemingly separate disciplines in quite interesting and novel ways.
From a
marketing point of view, however, the behaviour setting concept is of only limited
value. Not all attempts to influence consumer behaviour can rely merely on changes
in store design. We therefore need a slightly different unit of analysis in order to
better understand consumer behaviour, a unit which focuses less on the aggregate
behaviour of many shoppers in a store and more upon the individuals who are
actually following the behavioural programmes observed.
Retail Shopping Situations
One particularly important unit of analysis in EP is the situation, a time-delimited
subunit of Barker’s behaviour setting. Seen from the perspective of the consumer, a
shopping situation is a particular act of buying behaviour occurring at a specific
point in space and time (Hackett & Foxall, 1993). A fashion store, open to
customers from 9am to 5pm, is simply a behaviour setting. Within this behaviour
setting, however, “Consumer A, shopping in Store B, at day and Time C, looking for
an outfit to wear at Person D’s wedding” would constitute a specific shopping
situation. Thus, on the one hand, a behaviour setting may contain a great many
unrelated situations. To Consumer A, on the other hand, this is a unique act of
shopping, or at least a historically and spatially specific one, defined by a particular
matrix of situational influences.
Seen from this perspective, then, the situation serves as an interface between the
person (e.g. fashion consumer) and the stimulus-object (garment purchased), all
those factors defining that interface constituting situational variables. Over the
years, several attempts have been made to develop appropriate typologies with
which to codify these situational variables, ranging from those which focus mainly
upon the situation as perceived by the individual (e.g. Kakkar & Lutz, 1981) to
Magnusson's (1981) distinction between the actual-objective characteristics of the
situation and person-bound properties. In terms of consumer research application,
however, perhaps the most influential taxonomic structure has been that proposed
by Belk (1975) which continues to generate empirical work (e.g. Stoltman et al.
1999; Roslow et al. 2000; Nicholson et al., 2001).
According to Belk, situational variables are “all those factors particular to a time and
place of observation which do not follow from a knowledge of personal (intraindividual) and stimulus (choice alternative) attributes” (Belk, 1974).
Such
attributes range from store location and layout, to time of day and presence (or
absence) of others, classifiable according to five distinct dimensions of situational
influence: physical setting, social setting, temporal perspective, task definition and
antecedent states. It is a robust typology of variables which, on the whole, appear
relatively comprehensive and cross-cultural.
The physical setting begins with the geographical and institutional location of the
retail store (Bucklin, 1967), but might equally be seen in terms of the environment in
which the consumer reads a catalogue, or accesses a Web site, together with any
complicating factors arising from the intervening technologies. It also subsumes:
influences on behaviour resulting from environmental conditions, such as weather or
climate; visible configurations of merchandise and information provision in a store,
catalogue or Web site; and all those variables Kotler (1973) classified as “store
atmospherics”, such as the effects of background music or colour scheme. In respect
of these latter influences in particular, there are obvious parallels in catalogue
shopping, such as illustrations accompanying products designed to invoke the
consumer’s imagination, and there may well be equivalents in virtual shopping
environments also.
The social setting focuses on the presence or absence of others, together with their
social roles, role attributes and opportunities for interaction. It is therefore a
dimension which encapsulates everything from awareness of security staff in the
mall and opportunities for interaction with in-store sales staff, through to the
presence of those accompanying the consumer on the shopping trip and even
proximity to total strangers. This can easily be extended to analysis of remote
shopping situations; e.g. the often solitary nature of catalogue shopping, interactions
with telesales staff, online consumer “communities”, etc.
Given that a situation is a time-delimited context, a temporal perspective is crucial
to its description and all of the variables codified under this category are applicable
to shopping in multiple forms. Time of day and constraints upon time available for
shopping are variables with very obvious effects on buyer behaviour, for instance, as
are factors such as seasonal variations in the available product range – a particularly
important situational variable within the context of fashion shopping. Belk argues
that event proximity must also be considered; e.g. date relative to ‘pay day’, time
since last meal, etc.
Belk’s concept of task definition is more person-bound and encompasses cognitive
and motivational elements of the shopping situation, effectively capturing situational
influences on the task definition, orientation, search and evaluation stages depicted
in traditional cognitive consumer decision-making models. For example, differences
in information-processing behaviour have been observed where consumers are
shopping for practical or hedonic products, products for themselves versus gift
purchases for others, etc. Again, although such variables are normally explored
empirically within the context of store or mall behaviour, there seems no reason to
suppose that these issues are not equally applicable in catalogue and Internet
shopping situations also.
Antecedent states represent temporary conditions which the consumer either
brings to a situation or, alternatively, which may change significantly as a result of
that situation. An obvious example here is mood-related effects upon behaviour,
such as anxiety, pleasure or depression, which, when not chronic or enduring trait
conditions, can be regarded as situational; for instance, where a consumer’s mood
state results in negative expectations of a store, or serves as an initial motivation for
going shopping as a form of “retail therapy”. On a more general level, Belk argues
that factors such as fatigue, cash-in-hand and temporary illness symptoms can also
be located within this category.
Taken in sum, Belk’s taxonomic structure seems to accommodate the vast majority
of situational variables typically explored within a consumer research context.
Moreover, there is no reason to presuppose that the five dimensions hypothesised
are only applicable to the in-store shopping situations normally subjected to a
Belkian analysis. Indeed, many of the variables highlighted by researchers adopting
a Belkian perspective, such as ambience of surroundings and time of day, appear
equally characteristic of remote shopping situations also – whether physical or
electronic/’virtual’. Most importantly of all, perhaps, the taxonomy is highlighting
variables which, in the main, are often under the marketer’s control to some degree,
making it a useful tool to with which to analyse the effectiveness of the retail or
service provision in influencing consumer decision-making.
Pause for thought (2)
Exercise: Go back to the list you made earlier of things you noticed last time you
went shopping. Now, try to classify them according to Belk’s five categories of
situational influence.
Which category seems the most important in explaining
influences on your own shopping behaviour? Which category has least influence?
What does this tell you about the way you shopped on that occasion?
Consumer Behaviour vs Organisational Buying
In contrast to consumers, organisational buyers represent those “buying goods
and services on behalf of an organisation for the purpose of the furtherance of
organisational objectives” (Lancaster, 1999). Before highlighting some of the
differences between the two, however, it is important to caution against over
stressing the differences. For instance, some authors argue that buying goods on
behalf of one’s employers makes buyers more caution and rational than when
purchasing consumer goods privately. Closer examination of the evidence, however,
suggests the differences are almost exclusively related to price and very small
anyway. So, be aware that there can be differences, but they are by no means
always universal – a single employee feeling poorly motivated towards his/her job on
one day, for example, may well be far less cautious than on other days when all is
well in the workplace!
The most obvious difference between consumer and organisational buying is that the
underlying motivation is different; i.e. personal consumption versus business usage.
There are other contrasts, however:Setting for Buying: For consumers, the buying unit is within the
whereas for the organisational buyer, the setting is within the firm. This
the industrial marketer targeting the organisational buyer must take
factors such as buying procedures, levels of authority, and so on,
relevant in consumer marketing.
household,
means that
account of
factors not
Technical/Commercial Knowledge: Usually, the organisational purchaser will be a
trained professional, more knowledgeable than the average consumer purchaser.
This can often necessitate a completely different sales approach.
Contact with Buyers/Distribution Channels: Organisational markets are usually
more geographically concentrated than consumer markets. Factors such as proximity
to available labour, raw materials, and transportation facilities often dictate an
industry’s location. In addition, compared to consumer markets, there can be far
fewer potential customers. Taken together, these variables mean that the industrial
marketer must normally maintain far more direct and personal contact with his or
her potential clients.
Number of Decision-Makers: In consumer purchasing, the number of people
involved in the decision-making process can be very small; i.e. an individual, a
couple, a family, etc. In organisational buying, however, a great many people can
be involved in the purchasing process. This can mean differences in both the number
of people marketing communications must attempt to convince and that quite
different decisions might emerge as a result of group dynamics than might initially
be anticipated on the basis of individual discussions.
Derived Demand: Organisational buyers often continually adjust their buying
decisions on the basis of projected sales figures, buying more units when forecast
sales are higher. The result can be a sort of “pendulum effect”, with a knock-on
effect throughout the buying chain as each chain member adjusts it’s buying
patterns accordingly.
Reciprocal Demand: Sometimes, a buyer can also be a seller at the same time. A
software company producing a package for an insurance company, for instance,
might also purchase its insurance services from what is effectively one of its own
customers. Both companies want to sell to each other, affecting each other’s
eventual buying decisions to a varying degree.
As we can see, there are subtle differences between consumer and organisational
forms of buying. The article by Wilson (1996) in the Course Reader develops these
themes further – be familiar with the key concepts she raises before the exam!