Types of Buying Situations

Buying situation types are not only depending on products differ. Even the types of buying situations different for each consumer. Each time the buyer is to make a purchase decision and it may or may not be the same as the previous one. The differentiation between the two buying situations may be caused by the absence of any or all of the following factors.

1. Awareness about competing brands in a product group.

2. Customer has decision criteria and

3. Customer is able to evaluate and decide on his choice.

Viewed against these parameters, one may observe that it is not the product that differentiates one buying situation from another; rather it is the time that the buyer spends in learning and evaluating the alternatives or finally selecting one of them. Howard and Sheth have described these buying situations as being:

1. Routinized response behavior

2. Limited problem solving and

3. Extensive problem-solving.

Routinized Response Behavior or Straight Rebuy

This is a buying situation characterized by the presence of all the above three criteria for differentiation. In other words, here the customer is aware of his or her choices, knows what he is looking for, as his or her decision is based on personal experience of either self or others. Generally, the customers spend little or no time choosing an alternative. Brand loyalty is relatively higher here. Moreover, this is a buying situation where a customer perceives a low risk in buying the product and/or the brand. Consider the typical shopping behavior of a housewife. She goes to the grocer or a supermarket and spends much less time selecting her toiletries, beverages like tea or coffee, and other food products. For each time she goes to buy her family's requirements, she generally ends up buying the same brand.

Limited Problem Solving or Modified Rebuy

This is a buying situation with a difference. This could be, for example, the introduction of a new brand or product often requiring a change in the customer's decision criteria. Continuing the example of the housewife, assume that in her next shopping cycle, she sees a new liquid toilet soap which promises to keep her skin soft and moisturized .the brand also promises to give vitamin E, which the manufacturer claims is required in temperate conditions.

The liquid toilet soap brand is available in four fragrances. The pack can be refilled every time the soap gets fully consumed. Now, this introduction is likely to change her decision and maybe the choice criteria. If she spends some time in evaluating the liquid toilet soap against the normal bar soap and then decides to try it, we conclude that for her it was a limited problem-solving situation. As can be seen, this buying situation will often lead to a trial purchase. the customer may even decide to continue with her current product selection. generally, it has been observed that a brand extension strategy helps the customer to reduce the element of newness in the purchase decision. Like, for example, Unilever deciding to introduce liquid toilet soap under its most popular brand name lux. It may be remembered that customer perceives moderate risk in this situation.

Extended Problem Solving (EPS)

- High degree of the complexity

- Often occurs with expensive items or can be fueled by doubts and fears

- All 7 consumer decision making stages are often used (need recognition, search for information, pre-purchase evaluation of alternatives, purchase, consumption, post-consumption evaluation, and divestment)

- Dissatisfaction often leads to negative word of mouth

- A longer time is taken to decide