Consumer and Industrial Buying Behaviour

Two families in Lucknow with the same income walk into the same showroom and leave with different scooters. Price alone does not explain it. Consumer behaviour studies what does.

Leon Schiffman and Leslie Lazar Kanuk define it as the behaviour consumers display in searching for, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs. It draws on psychology, sociology, anthropology and economics, and is complex, dynamic, goal-oriented and shaped by perception.

An example. A family buys a scooter for a daughter starting college. Its region and class shape what seems normal (cultural). Her friends' scooters and her parents' views count (social). She is a student on a set budget (personal). She wants safety and style, and has a picture of each brand in her mind (psychological).

In the scooter purchase, the daughter is the initiator and the user, her friends are influencers, her father is the decider, and her mother, who goes to the showroom and pays, is the buyer.

Don't confuse the buyer with the user or the decider. The person who pays is often not the person who chooses or the person who uses. Marketers must find out who plays each role, because each needs a different message.

Where it breaks. The four factors act together, and the list explains a purchase after it happens better than it predicts the next one.

For exams. Culture is the most basic cause of wants; lifestyle is measured by AIO; the five buying roles belong to the social factors.

Cultural, social, personal, psychological.

Nobody compares brands before buying a packet of biscuits, but most people do before buying a refrigerator. The buying decision process maps the steps of a considered purchase, and shows where a seller can win or lose the sale.

An example. Ravi's old refrigerator breaks down before Diwali. He recalls brands he has owned, then asks his sister and reads reviews. He compares three models around ₹30,000 on price, capacity and power use. He picks one, but his brother says another brand is better, and he almost changes his mind. A week after buying, he wonders if he chose well, until the brand calls to check the installation.

The evoked set. From the total set of brands available, a buyer is aware of some (the awareness set), considers fewer (the consideration or evoked set), and chooses among a few (the choice set). Ravi might know 8 of 20 brands on sale, consider 3, and choose between the last 2.

Cognitive dissonance (Leon Festinger, 1957) is the discomfort after purchase caused by doubt about the choice, often called buyer's remorse. Marketers reduce it with reassurance, guarantees and after-sales contact. Satisfaction depends on the gap between expectations and perceived performance.

Involvement decides how much of this process a buyer goes through, from routine to extensive decisions.

Don't confuse cognitive dissonance with dissatisfaction. Dissatisfaction means the product performed below expectations. Dissonance is doubt about the choice, and it can arise even when the product works well, because the rejected options also had attractions.

Where it breaks. The model describes a considered purchase. Impulse buys skip stages, and routine buys jump from need straight to purchase.

In practice. Each stage is a point of action: ads trigger need, reviews feed the search, comparisons shape evaluation, offers close the sale, and follow-up calls ease dissonance.

Need, search, evaluate, buy, reflect.

A buyer may spend weeks choosing a car and two seconds choosing salt. A marketer who treats the two alike wastes money on one and loses sales on the other.

Reading the grid. A carpet costs a lot, so involvement is high, but many carpets look alike. The buyer decides fairly quickly, often on price or convenience, then looks for signs the choice was right. That is why the marketer's job comes after the sale: reassurance.

Don't confuse dissonance-reducing with complex buying. Both are high involvement. In complex buying the brands differ, so the buyer studies them first. In dissonance-reducing buying they look alike, so the buyer decides quickly and seeks comfort afterwards. Variety-seeking is also not dissatisfaction: the buyer switches for a change, not because the last brand failed.

Where it breaks. Involvement belongs to the buyer, not the product. A tea lover may study tea blends as carefully as a car, while a busy buyer reorders the same car brand by habit.

For exams. Expect a product to place in the grid, or a marketing response to match to a type.

High involvement and real differences make buying complex.

Three phones, three buyers, three different choices, even with the same ratings in front of them. The difference is the rule each buyer uses to turn ratings into a decision.

Under compensatory rules, such as Martin Fishbein's expectancy-value model, a buyer weighs all attributes together, so strengths can offset weaknesses.

Work it out. An illustration: phones A, B and C are rated out of 10. The buyer's weights are price 0.4, battery 0.3, camera 0.3.

• Compensatory: B has the highest weighted score, 7.2.
• Lexicographic, price first: A wins, with 9 on price.
• Conjunctive, minimum 5 on everything: C fails on camera; A and B pass, and the buyer takes whichever is met first.
• Disjunctive, battery of 9 or more: only C qualifies.

Don't confuse conjunctive with disjunctive. Conjunctive means “and”: every attribute must pass its minimum. Disjunctive means “or”: passing a high standard on any key attribute is enough.

Where it breaks. Real buyers mix rules: they often screen out brands with a conjunctive cut-off, then weigh the survivors compensatorily. The models are frameworks for thinking, not formulas that predict a purchase.

In practice. Find out which rule your buyers use. If they screen on a minimum, a single weak attribute can remove you before your strengths are seen.

Go deeper for practitioners

The comprehensive models. Each tries to show the whole decision in one diagram. The Nicosia model traces a message from the firm to the consumer's attitude, then through search and evaluation, purchase, and feedback. The Howard–Sheth model links inputs (stimuli from products and the social environment) through perceptual and learning constructs to outputs, from attention to purchase. The Engel–Kollat–Blackwell model centres on the five-stage decision process, fed by information processing and outside influences.

A decision. Your phone scores well overall but is the most expensive. If research shows buyers rank price first (lexicographic), cutting the price matters more than another camera upgrade. If they weigh everything (compensatory), the upgrade may be enough.

Links. The five-stage process in this chapter is where these rules operate: they are how stage 3, evaluation of alternatives, ends.

Conjunctive: every minimum. Disjunctive: one high standard. Lexicographic: the top attribute first.

An auto-parts plant in Pune reorders bolts with one email, but buying its first welding robot takes months and a dozen people. Selling to organisations means knowing which kind of purchase it is, and who is involved.

How business markets differ: fewer, larger buyers; close supplier-customer relationships; professional purchasing by trained buyers; several people influencing each decision; and geographically concentrated buyers. Above all, derived demand: demand for business goods comes from demand for the consumer goods they help produce. It is fairly inelastic in the short run and fluctuates more. If car sales fall, the Pune plant's orders for steel and parts fall with them, whatever the steel price.

The buyclasses and the buygrid come from Patrick Robinson, Charles Faris and Yoram Wind (Industrial Buying and Creative Marketing, 1967). The buygrid crosses the three buyclasses with eight buyphases: problem recognition, general need description, product specification, supplier search, proposal solicitation, supplier selection, order-routine specification, and performance review. A new task goes through all eight; a straight rebuy skips most of them.

The buying centre is everyone involved in a purchase decision. Webster and Wind (1972) named five roles: users, influencers, buyers, deciders and gatekeepers (who control the flow of information); later writers add initiators and approvers. For the robot: the shop-floor supervisor who will run it is a user; the production engineer who writes the specification is an influencer; the purchase officer who negotiates is the buyer, and also a gatekeeper who decides which sellers reach the engineers; the plant head is the decider.

Webster and Wind's model groups the influences on organisational buying into four kinds: environmental, organisational, interpersonal and individual.

Don't confuse the buyer with the decider. The buyer has formal authority to choose suppliers and arrange terms. The decider has the power to settle the choice, and in a big purchase that is often someone more senior.

Where it breaks. The buygrid describes a tidy, rational sequence. Real purchases also run on trust, past relationships and internal politics, which the framework names but cannot measure.

For exams. Match the buyclasses and buygrid to Robinson, Faris and Wind (1967), and the buying centre and four influences to Webster and Wind (1972). Derived demand is the classic contrast with consumer markets.

Go deeper for practitioners

A decision. You sell welding robots and have reached the Pune plant's purchase officer. Do you keep selling to him? The buying-centre view says map every role first. The engineer sets the specification, so make sure your robot meets it. The supervisor will use it, so a demonstration may win an ally. The plant head decides, so prepare the cost and payback case for that level.

Buyclass changes the job. As the current supplier in a straight rebuy, protect the routine: deliver on time and give no reason to re-evaluate. As an outside supplier, try to turn a straight rebuy into a modified rebuy by offering something new.

Straight rebuy, modified rebuy, new task.