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Model of Buyer behavior


Understanding your customers will help you to develop and distribute your product, as well as getting the right price point and developing successful promotional activities.

The psychology of the buying process has been widely studied, and no matter what size your business, knowledge of this process can help you become more successful.

Both businesses and consumers exhibit patterns of buying behavior. The business model is less open to debate as your business customers will almost certainly have some formalized process of buying in place. Your task is to understand the process and match your marketing activities to the different stages of the process. This means that the customer will receive the right kind of contact at the right time.

This model is important for anyone making marketing decisions. It forces the marketer to consider the whole buying process rather than just the purchase decision (when it may be too late for a business to influence the choice!)

The model implies that customers pass through all stages of every purchase. However, in more routine purchases, customers often skip or reverse some of the stages.

For example, a student buying a favorite hamburger would recognize the need (hunger) and go right to the purchase decision, skipping information search and evaluation. However, the model is very useful when it comes to understanding any purchase that requires some thought and deliberation.

The buying process starts with need recognition. At this stage, the buyer recognizes a problem or need (e.g. I am hungry, we need a new sofa, I have a headache) or responds to a marketing stimulus (e.g. you pass Starbucks and are attracted by the aroma of coffee and chocolate muffins).

An “aroused” customer then needs to decide how much information (if any) is required. If the need is strong and there is a product or service that meets the need close to hand, then a purchase decision is likely to be made there and then. If not, then the process of information search begins.

A customer can obtain information from several sources:

• Personal sources: family, friends, neighbors, etc.
• Commercial sources: advertising; salespeople; retailers; dealers; packaging; point-of-sale displays
• Public sources: newspapers, radio, television, consumer organizations; specialist magazines
• Experiential sources: handling, examining, using the product

The usefulness and influence of these sources of information will vary by product and by customer. Research suggests that customers value and respect personal sources more than commercial sources (the influence of “word of mouth”). The challenge for the marketing team is to identify which information sources are most influential in their target markets.
In the evaluation stage, the customer must choose between the alternative brands, products, and services.

How does the customer use the information obtained?

An important determinant of the extent of evaluation is whether the customer feels “involved” in the product. By involvement, we mean the degree of perceived relevance and personal importance that accompanies the choice.

Where a purchase is “highly involving”, the customer is likely to carry out the extensive evaluation.

High-involvement purchases include those involving high expenditure or personal risk – for example buying a house, a car, or making investments.

Low involvement purchases (e.g. buying a soft drink, choosing some breakfast cereals in the supermarket) have very simple evaluation processes.
Consumer behavior is the study of when, why, how, and where people do or do not buy a product. It blends elements from psychology, sociology, social anthropology, and economics. It attempts to understand the buyer decision-making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioral variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general.

 Customer behavior study is based on consumer buying behavior, with the customer playing the three distinct roles of user, payer, and buyer. Research has shown that consumer behavior is difficult to predict, even for experts in the field. Relationship marketing is an influential asset for customer behavior analysis as it has a keen interest in the re-discovery of the true meaning of marketing through the re-affirmation of the importance of the customer or buyer. Greater importance is also placed on consumer retention, customer relationship management, personalization, customization, and one-to-one marketing. Social functions can be categorized into social choice and welfare functions.

 Each method for vote counting is assumed as a social function but if Arrow’s possibility theorem is used for a social function, social welfare function is achieved. Some specifications of the social functions are decisiveness, neutrality, anonymity, monotonicity, unanimity, homogeneity, and weak and strong Pareto optimality. No social choice function meets these requirements on an ordinal scale simultaneously. The most important characteristic of a social function is the identification of the interactive effect of alternatives and creating a logical relation with the ranks. Marketing provides services in order to satisfy customers.
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