By Christopher Melotti
The Buyer Decision Process
Conceptually, a buyer or consumer experiences and progresses through a series of steps in regards to the acquisition of a product to satisfy their needs. They are as follows:
(1) Problem recognition
(2) Information search
(3) Evaluation of alternatives
(4) Purchase decision
(5) Post-Purchase behaviour
The size, complexity and frequency of this process depends on the buyer themselves and the nature of the purchase. Things like the cost, risk and impact of the outcome all influence the nature of this process. For example, a buyer will go through more carefully when purchasing a house versus a candy bar.
Problem Recognition
Once a consumer's actual state and ideal state are not aligned, a consumer senses a problem that requires rectification. If their actual state remains the same, but their ideal state lifts, this is the recognition of an opportunity or want (such as a nicer car or house). If their ideal state remains the same but their actual state falls, this is the recognition of a need (such as hunger of thirst).
Different consumer segments are driven differently and have different ideal and actual states.
Information Search
After a consumer identifies their need or want, they go on the hunt for information. This can include internal (memory or experience) and external (the internet, commercials, media, reviews, customer service, family and friends) sources.
There is also the bias of plain information versus persuasive information. A consumer must be able to determine which kind of information to follow and trust.
At the information search, a buyer begins to weigh up total benefits over total costs to determine their own feelings about how certain products may satisfy their needs.
Brand awareness and preference also comes into play here. An evoked set is a list of brands that a consumer is preferential to and lean more towards. An inert set are the brands that a consumer are impartial to and an inept set are brands that a consumer will avoid for whatever reason.
A good marketing strategy would be to make genuine and useful information readily available for consumers in the method and channels their categories tend to use more often.
Evaluation of Alternatives
After information is collected, a consumer will determine if there are other options or substitutes for their needs so they can determine the optimal gain, given their situation. It varies from consumer to consumer as some are careful thinkers whilst others are more impulse buyers, and they may place different value on certain products and industries over others.
The current context of the need also has relevance at the alternatives seeking level. For example, a consumer weighs up different restaurants depending on if they are eating alone, going on a date, are looking to spurge, celebrate a birthday, and so on. The context of their need places a significant skew on their choices.
Once a consumer has their alternatives figured out, they will rank all options depending on all different attributes they deem important. A good marketing strategy at this point is to ensure that your product is easy to rank by highlighting all of the features and benefits in order to persuade buyers to rank your product higher as a more viable option.
Decision
This is the point where the consumer decides to act, and it is literally as simple as choosing the alternative that was at the top of their ranking list, offering them the highest utility. Whilst original purchase intentions and engrained preferences do play a part in information search and evaluation of alternatives steps, the actual outcome may be very different as a different, originally unforseen product offered the best utility.
A good marketing strategy at the decision point is to reduce the perceived risk for the consumer, so utility value is far more appealing.
Post-Purchase Behaviour
After the product is purchased and consumed to satisfy the original need or want, the consumer determines how satisfied or dissatisfied they are. Their expectations play a big role in this- did their choice meet, exceed or disappoint their expectations.
A consumer can experience cognitive dissonance, also known as buyer's remorse, at this stage. Due to the large amount of choice in a market place, internal conflicts can occur where the consumer becomes nervous, wondering if they had made the correct decision.
The best marketing strategy to employ here is, only promise what your product can deliver, reassure your customers that they've made the right decision and, if dissatisfaction occurs, encourage feedback and rectify the situation to turn them into satisfied customers again.
Influences on Consumer Behaviour
There are several influences that greatly impact on buyer behaviour, some more than others. From least to most:
(1) Culture and society
(2) Social (reference groups, family, friends, status)
(3) Personal (age, life cycle stage, economic situation, lifestyle, personality)
(4) Psychological (motivation, perception, leaving, beliefs and attitudes)
Culture and society are basically the groups and social norms that a buyer tends to gravitate to and associate with.
Social influences refer to parties externally close to the buyer, such as family and friends. It also refers to the role different parties play, whether or not the buyer is the user, the influencer, the initiator, etc. too.
Personal influences are the factors and attributes of the buyer themselves on a physical level, such as their ages, occupation, etc.
The psychological influences are on an internal, mental level and revolve around the way a consumer thinks. Therefore, their perception, approach to motivation, the way they learn and interpret stimuli, and their ingrained beliefs and attitudes.
Marketing is able to utilise and adapt to these influences in order to reach the target market, catering messages to them personally.
When the Buyer Is A Business: B2B Marketing
B2B Marketing is a buzz word for business to business marketing and trade. In other words, not a business to consumer situation. Business to business trading also fits into the buyer behaviour theory as a business still acts as a buyer on a basic level: it's just, due to their nature, it becomes slightly more complex. A common misconception is that B2B marketing is based more on facts than an emotional purchase, as is quite common for an individual buyer, but this isn't always the case. Whilst businesses have systems and procedures in place to enact purchasing, the people involved in the process are still people.
B2B Decision Process
Previously, the five main steps of an individual buyer's decision process was outlined. For a B2B buyer, the process gains a few extra steps simply due to the nature that purchases are privy to policies and approval systems.
(1) Problem recognition
(2) General need description
(3) Product specification
(4) Supplier search and short-listing
(5) Proposal solicitation
(6) Supplier evaluation and selection
(7) Order routine specification
(8) Performance review
Simply put, an organisation or business's needs are different to an individual's needs. When a business looks to purchase something, it is usually for the organisation to use in their main course of business, which is why the need has to be elaborately detailed and then suppliers are sought after to tender for the need fulfilment. Once this occurs and a supplier is found, routine purchases tend to occur until there is a review.
Questions To Ask To Understand A Buyer
There are a few questions that can be asked to assist in better understanding the target consumer and their buying process.
(1) What do they think and feel?
(2) What do they see in the environment?
(3) What do they hear from close influences?
(4) What do they say and do?
(5) What causes them pain and frustration?
(6) What causes them gain?
Christopher Melotti
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