Buying Decision Behaviour

Buying Decision Behaviour Contents (Jump to) 1.0 Introduction 2.0 Types of Buying Decision Behaviour 3.0 The importance of understanding consumer buying behaviours 4.0 Conclusion References 1.0 Introduction Understanding consumer buying behaviour is crucial for successful marketing. Consumer buying behaviour is defined as the buying behaviour of final consumers, individuals and households who purchase goods and services for personal consumption (Kotler, Brown, Adam and Armstrong, 2001: 858). Consumer buying behaviour can be classified into four groups: complex, variety-seeking, dissonance-reducing and habitual buying behaviour. These buying decision behaviours vary in terms of the involvement levels and the perceived differences between brands (Lawson, Tidwell, Rainbird, Louden and Bitta, 1997: 523). According to Mitchell (2002: 71), one of the core functions of marketing is to connect buyers and sellers as efficiently and effectively as possible. Therefore, it is imperative for marketers to acquire a profound and comprehensive understanding of consumer buying behaviours. 2.0 Types of Buying Decision Behaviour The relationship between different types of consumer buying behaviour with the level of consumer involvement and the degrees of differences between brands. The level of involvement in a purchasing a product is related to the importance of the purchase, the risks involved and the type of cognitive processing that is generated (East, 1997: 19). 2.1 Complex buying behaviour Complex buying behaviour is personalised by high levels of consumer involvement in a purchase and significant perceived differences among brands (Kotler, et al., 2001: 211). Consumers usually apply complex buying behaviour when the intended purchases are expensive, infrequent and risky (Rowley, 1997: 88). Purchase decisions are more intricate compared to other products that are less costly (Chao and Gupta, 1995: 48). According to Adcock (1993: 54), buyers undertaking complex buying behaviour are likely to go through each stage of the decision making process. They will usually spend time inquiring about the product, evaluating alternative brands and comparing options before finally making the purchase. For example, a person who wishes to buy a car would be very involved in deciding what car to purchase. He or she will engage in an extensive information search, such as by visiting different car dealers, surfing the Internet and so on, to evaluate and compare the numerous types of model s available in the market and also to scout for the best deals. They may take weeks or months to make a decision. A car is an expensive asset and will usually be used for a long time. As a result, consumers undergo complex buying decision behaviour to ensure that they will not regret their investment in future. 2.2 Dissonance-reducing buying behaviour Dissonance-reducing buying behaviour encompasses high involvement in purchase decisions but little dissimilarity between brands (Adcock, 1993: 57). Purchases are usually expensive, infrequent and risky (Kotler, et al., 2001: 211). The buying decision is often made from only a small range of products. Considering the products brand name is not the main priority in the purchase decision, consumers will make their choice by evaluating and comparing the products based on their price, quality, performance and the consumers individual preferences ( Kennedy and Kiel, 2000: 84). For example, when purchasing a lawn mower, consumers may face a high involvement decision because a lawn mower is rather costly. However, the lawn mower brand names will not be of much concern to consumers. Buyers will still look around and compare different lawn mowers based on their extrinsic features, and purchases are normally made within a shorter period of time as opposed to complex buying behaviour (Kotler, et al., 2001: 212). After making a purchase, the consumer may encounter postpurchase dissonance, also known as after-sales discomfort, resulting from discrepencies between the consumers decision and the consumers prior evaluation (Lawson, et al.,1997: 447). For instance, the buyer may discover undesirable traits or hear negative comments about the lawn mower and thus regret his or her purchase. To minimise such dissonance, marketers have introduced certain features to satisfy customers, such as warranties and after-sales services (Lawson, et al.,1997: 637). 2.3 Variety-seeking buying behaviour Variety-seeking buying behaviour can be defined as consumer buying behaviour in situations concerning low consumer involvement but with significant perceived differences in brands (Kotler, et al., 2001: 212). These purchases are made simply because the of the consumers desire for novelty (Lawson, et al., 1997: 525). In other words, consumer may deviate from their normal brand purchase because they feel like trying something different for a change. Consumers who practice variety-seeking buying behaviour buy for the sake of diversifying and not as a result of dissatisfaction with the product (Adcock, 1993: 57). To further illustrate the point, a consumer who regularly buys Kellogs Corn Flakes, whom one day opts to purchase Nestles Honey Stars for a change, is engaging in variety-seeking buying behaviour. The consumer may be just bored of Kellogs Corn Flakes for awhile after consuming them every morning and would like to try out a different cereal, not because he or she is discontented with Kellogs Corn Flakes. Marketers have developed strategies to reduce this consumer behaviour, which will be discussed in the later sections of this report. 2.4 Habitual buying behaviour Consumers perform habitual buying behaviour when buying frequently purchased products that are relatively of low cost and that involves very little risk and decision effort (Kennedy and Kiel, 2000: 84). There is low consumer involvement and few differences between brands in this buying behaviour (Rowley, 1997: 89). These products are purchased almost automatically out of habit rather than brand loyalty by consumers( http://www.bbci.freeserve.co.uk/SAGEPROJECT/UnderstandingConsumerBehaviour.asp). This normally applies to grocery products. For instance, people do not generally spend much time or mental effort selecting a packet of sugar or a bar of soap. They do not really pay attention to the brand names of these products. Unlike complex buying behaviour, consumers who purchase the same product regularly, do not go through all the steps in the decision making process (Kotler, et al., 2001: 212). They need not undertake an information search or evaluate and compare the different produc ts in the market. Instead, they receive information through repetitive advertisements on the television or newspapers and this forms brand familiarity. Consumers are not inclined to a product, rather, they select the particular brand out of familiarity (Kotler, et al., 2001: 212). They would just recognise their need and immediately make a purchase decision. They may not even bother to make a postpurchase evaluation (Rowley, 1997: 89). 3.0 The importance of understanding consumer buying behaviours 3.1 Develop a more effective and efficient marketing strategy Consumer buying behaviour is an integral part of marketing. Attaining a deeper comprehension of the different types of consumer buying behaviour would be a boon for marketers as it would assist them in developing a more sophisticated marketing strategy, thus allowing the organisation to compete more efficiently and effectively than its competitors (Mitchell, 2002: 74). By analysing the type of buying behaviour that relates to the organisations products, marketers are able perform effective segmentation, which may lead to a more efficient targeting of resources (Rowley, 1997: 89). For example, for products that are susceptible to complex buying behaviours such as automobiles and computers, marketers tend to concentrate on promoting them on the basis of the features and the benefits a consumer may gain from the products (Adcock, 1993: 56).. Most car catalogues will show pictures of the engine and highlight the details of the technical features of the vehicle. For products that are more prone to dissonance-reducing and habitual buying behaviours, marketers will advertise substantially to ensure that their products will be considered by as many people as possible (Adcock, 1993: 57) and also to familiarise consumers with their products (East, 1997: 19). Providing another example, marketers will try to encourage habitual buying behaviour for products that are more inclined to variety-seeking buying behaviours among consumers by extensive advertising and dominating shelf space. In contrast, marketers may also try to encourage variety-seeking buying behaviour by offering promotions and free samples (Kotler, et al., 2001: 212). They do so to induce new customers to purchase their products. To summarise the point, a clear understanding of the types of buying behaviours can help marketers to construct relevant marketing strategi es to market the particular product so as to increase the products sales. 3.2 Form a healthy relationship between buyers and sellers As mentioned earlier, one of the core functions of marketing is to connect buyers and sellers as efficiently and effectively as possible (Mitchell, 2002: 71). The marketing concept stresses that organisations should create a marketing mix that will satisfy their customers better than their competitors. To do so, marketers must examine the major influences that determine what, where, when and how consumers make purchasing decisions (http://www.bbci.freeserve.co.uk/SAGEPROJECT/UnderstandingConsumerBehaviour.asp). According to Wilson (1998: 785), marketers who understand the types of buying behaviour that are related to their product will be able to come up with marketing techniques that will provide customer satisfaction and at the same time, establish brand loyalty among its customers. Marketers should always remind themselves that satisfied consumers would have a very positive impact on the organisations success. Therefore, it is essential for marketers to understand and evaluate the different types of consumer buying behaviour. 4.0 Conclusion The four types of buying behaviour mentioned earlier basically summarises how and why consumers make their purchase decisions. However, one has to keep in mind that the purchase of a particular product does not always derive the same type of decision making behaviour (East, 1997: 19). For example, an affluent businessman who enjoys collecting cars may not undergo complex buying behaviour as opposed to an average earning salesman who is buying a car for transportation purposes. In conclusion, understanding consumer buying behaviour can assist marketers in constructing a more efficient and effective marketing strategy allowing them to form a tighter relationship with their customers. Hence, it is vital for marketers to understand the four different types of buying behaviour that relates to their product. References Adcock, D., Bradfield, R., Halborg, A., and Ross, C. (1993), Marketing Principles and Practice, Pitman Publishing, London. Chao, P. and Gupta, P.B. (1995), ‘Information search and efficiency of consumer choices of new cars International Marketing Review, Vol. 12, No. 6, pp 47-59. East, R. (1997), Consumer Behaviour: Advances and Applications in Marketing, Prentice Hall, London. Kotler, P., Brown, L., Adam, S., and Armstrong, G. (2001), Marketing, (5th Edn), Prentice Hall, Sydney. Lawson, R., Tidwell, P., Rainbird, P., Loudon, D., and Bitta, A.D. (1997), Consumer Behaviour in Australia and New Zealand, McGraw-Hill, Sydney. Kennedy, M and Kiel (2000). ‘Marketing: A Strategic Approach. Nelson Thompson Learning, Melbourne. Mitchell, A.S. (2002), ‘Do you really want to understand your customer? Journal of Consumer Behaviour, Vol. 2, Issue 1, pp 71-79. Rowley, J. (1997), ‘Focusing on customers Library Review, Vol 46, No. 2, pp 81-89. Samara, N., Understanding Consumer Behaviour, (http://www.bbci.freeserve.co.uk/SAGEPROJECT/UnderstandingConsumerBehaviour.asp) Accessed (30 August 2003) Wilson, D.F. (1998), ‘Why divide consumer and organisation buyer behaviour? European Journal of Marketing, Vol. 34, No. 7, pp 780-796.