Chapter 08 The Buying Process and Buyer Behaviour

Developing a Customer Strategy

Greatest challenge to salespeople in the age of information is to understand realized and
unrealized needs and improve responsiveness to customers
• Customer has supplanted the product as the driving force in sales today

Buying a home allergy, when you once wanted to buy a house a realtor would show you houses
available, now people access a realtor’s website and shows them what they want to buy and do
the research themselves.

Power tools of the “new” customer:

1) Instant comprehensive electronic information
2) Immense choice in every segment of commerce
3) Real-time price comparison at the moment and location of purchase on increasingly advanced
technology, can compare a price of some products around the world, smaller window of prices
different between counties, least expensive markets will sell out faster,
make sure the global pricing strategy is

Customer Strategy – a carefully conceived plan that will result in maximum customer
responsiveness
• Need to achieve a better understanding of the customer’s buying needs and motives
• Better position to offer a value-added solution
Consumer Versus Business Buyers
Treat different customers differently
• Consumer Buyer Behaviour – buying behaviour of individuals and households who buy goods
and services for personal consumption

Business Buyer Behaviour – buying behaviour of organizations that buy goods and services for
use in the production of other products and services or for the purpose of reselling or renting
them to others at a profit
• Buying Centre – a cross-functional team of decision makers who often represent several
departments

Larger number of people involved a longer process.

Types of Business Buying Situations

New-Task Buy –first-time purchase of a product or service
• Rely on consultative selling skills, customer is trusting the company

• Straight Rebuy –routine purchase of previously purchased goods or services

• Simplify the buying process
• Constantly monitor to be sure customer is completely satisfied, may not be in contact with the
buyers, conference call and help strength relastionship
Modified Rebuy – purchasing when the buyer wants to reconsider product specifications, prices,
or suppliers
• Provide outstanding service after the sale and anticipate changes in customer needs, looking
into what sold seasons before, often when new season product comes in

Building Strategic Alliances

• Systems Selling – a type of selling that appeals to buyers who prefer a packaged solution to a
problem from a single seller, thereby avoiding the series of separate decisions sometimes
involved in a complex buying situation

Types of Consumer Buying Situations

Amount of time consumers devote to a buying situation can vary greatly depending on:
• Cost of the product • Familiarity with the product • The importance of the item to the consumer

Habitual Buying Decision –requires very little involvement and in which brand differences are
usually insignificant
• Variety-Seeking Buying Decision –motivated by the desire for variety rather than product
dissatisfaction
• Complex Buying Decision – an often lengthy consumer buying decision characterized by a
high degree of involvement, true when products are higher in price or if its filling a important
need

Customer’s Buying Process

• Buying Process – the stages a buyer goes through when making a buying decision
• Systematic series of actions, or a series of defined, repeatable steps, intended to achieve a result
• Understanding each individual buyer’s decision-making process is central to success

*Steps in the Typical Buying Process

Habitual buying decisions often skip or reverse some of the stages

Always ends in service, the service the client receives reflects the customer loyalty

Need Awareness – help determine magnitude of problem and identify solution

• Evaluation of Solutions – provide useful information that helps with informed choice
• Help them achieve their objectives
• Resolution of Problems – high quality proposal; proof sources
Purchase – hassle-free process and be your customer’s advocate
• Implementation – quality monitoring of delivery through invoice, and follow-up to ensure
satisfaction

Transactional Process Buying

Buyers:
• Well aware of their needs
• Become frustrated with salespeople who use needs assessment, problem solving, or
relationship building
• How to add value: Facilitate a convenient, hassle-free purchase

Consultative Process Buyer

Buyers:
• Lack needs awareness or need help evaluating possible solutions
• Can be complex and/or expensive
How to add value:
• Conduct a systematic assessment of situation
• Help customer evaluate solutions and solve a problem
• Help resolve any problems that surface prior to and post-purchase

Strategic Alliance Process Buyer

Careful study of the proposed partner
• Both parties must be prepared to explain how they will add value and commit resources to
establish and maintain the relationship

The Buyer Resolution Theory

Purchase will be made only after the prospect has made five buying decisions:
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)

Understanding Buyer Behaviour

Psychological and social forces that influence the buying Behaviour

Needs That Influence Buyer Behaviour
Basic human needs have changed little throughout economic history
• Ways in which needs are fulfilled has changed greatly in the age of information
• Starting point is to review the individual physiological and psychological needs that shape the
customer’s behaviour

Maslow’s Hierarchy of Needs

• Provides salespeople with a practical way of understanding which need is most likely to
dominate customer behaviour in certain situations

Physiological – primary needs

• Security – need to be free from danger and uncertainty
• Social – need to belong
• Esteem – desire to feel worthy in the eyes of others
• Self-actualization – need for self-fulfillment

Group Influences on Buying Decisions

Salespeople can develop the type of insight customers view as being valuable

Role – a set of characteristics and expected social behaviours based on the expectations of others
2) Reference Group – two or more people who have well-established interpersonal
communications and tend to influence the values, attitudes, and buying behaviours of one
another; a point of comparison

Social class – group of people who share similar values, interests, and behaviours • Determined
by a combination of income, education, occupation, and accumulated wealth
• Major influence in B2C situations
Culture – values, beliefs, institutions, transmitted behaviour patterns, and thoughts of a people or
society
• As diversity increases, companies must reexamine their strategies
• Microculture – value systems shared by communities based on common life experiences,
expanded with the growth of technology which increased engagement

Perception – a process through which sensations are interpreted, using knowledge and
experience
• Received through sight, hearing, touch, taste, and smell an interpreted using knowledge and
experience
• Selective attention – screen out or modify stimuli if in conflict with learned attitudes

Buying Motive – an aroused need, drive, or desire that initiates the buying-decision process
• Perceptions influence and shape this behaviour
• Some are influenced by more than one buying motive
• Dominant Buying Motive (DBM) – has the greatest influence on a customer’s buying decision

Emotional versus Rational Buying Motives

• Emotional Buying Motives – prompts 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 prospect’s
reason or better judgment such as price, quality, and availability of technical assistance;
objective review

Patronage versus Product Buying Motives

• Patronage Buying Motives – cause the prospect to buy a product from one particular company
rather than another
• superior service, attractive décor, product selection, and selling competence
• Product Buying Motives – cause the prospect to buy one particular product brand over another
• brand, quality, price, and design or engineering preference

Creating Value throughout the Buying Process Model

Summary
Ensure maximum customer responsiveness with a customer strategy
• End use consumers and business buyers differ in their approach to the buying process
• Create an alignment between the selling process and the customer’s buying process
• Buying process will differ for transactional, consultative, and strategic alliance buyers
• Many factors influence the customer’s thinking and ultimately their buying decisions
Ensuring the customer’s needs are met and problems are solved