Marketing Management I - Buyer's Behavior

Buyer Behavior Model

The buyer behavior model, also known as the consumer decision-making process, is a theoretical framework used to understand how consumers make purchasing decisions. The model consists of three main components: the environment, the buyer's black box, and the buyer's response.

• Environment: The environment includes all of the external factors that influence the buyer's decision-making process, such as marketing stimuli (product, price, promotion, and place), cultural, social, economic, and technological factors.
• Buyer's black box: The buyer's black box represents the internal psychological processes that take place in the buyer's mind before making a purchase decision. This includes the buyer's characteristics, motivation, perception, learning, and attitudes towards the product or service.
• Buyer's response: The buyer's response is the ultimate outcome of the decision-making process. It can take the form of purchasing the product, considering other alternatives, or rejecting the product altogether.

The following is a more detailed explanation of each component:

Environment:

• Marketing stimuli: The marketing mix (product, price, promotion, and place) is the primary set of stimuli that influences the buyer's decision-making process. For example, a consumer may be attracted to a product due to its price, quality, or unique features.
• Cultural factors: Culture refers to the shared values, beliefs, and practices of a group of people. Cultural factors can influence the buyer's behavior in terms of their attitudes towards a product or service. For example, a product may be considered socially acceptable in one culture but not in another.
• Social factors: Social factors include the buyer's reference groups, family, and social status. These factors can influence the buyer's behavior by affecting their attitudes towards a product or service. For example, a buyer may purchase a product to conform to the expectations of their social group.
• Economic factors: Economic factors include the buyer's income, savings, and level of debt. These factors can influence the buyer's behavior by affecting their purchasing power and willingness to spend.
• Technological factors: Technological factors refer to the advances in technology that can influence the buyer's behavior. For example, a buyer may be attracted to a product due to its advanced features or technological capabilities.

Buyer's black box:

• Buyer characteristics: This includes the buyer's age, gender, income, education level, and occupation.
• Motivation: Motivation refers to the driving force behind the buyer's decision-making process. For example, a buyer may be motivated to purchase a product to meet a specific need or desire.
• Perception: Perception refers to the way that the buyer interprets and understands the marketing stimuli. For example, a buyer may perceive a product to be of high quality based on its packaging and branding.
• Learning: Learning refers to the way that the buyer acquires knowledge and experience related to a product or service. For example, a buyer may learn about a product through advertising or word of mouth.
• Attitudes: Attitudes refer to the buyer's overall evaluation of a product or service. Attitudes can be positive, negative, or neutral and can be influenced by a variety of factors such as previous experiences or cultural values.

Buyer's response:

• Purchase decision: The ultimate outcome of the decision-making process is the purchase decision. This can include purchasing the product, choosing an alternative product, or not purchasing the product at all.
• Post-purchase behavior: After making a purchase, the buyer may evaluate their decision and experience with the product. This can lead to either satisfaction or dissatisfaction with the product or brand, which can influence future purchase decisions.

Factors affecting Buyer Behavior

There are several factors that can affect buyer behavior. Some of the most important ones are:

• Cultural factors: Culture, subculture, and social class can all influence buyer behavior. For example, someone's religion or ethnicity might affect their purchasing decisions, or they may be influenced by their membership in a particular social group.
• Social factors: Reference groups, family, and social roles can all play a role in buyer behavior. People may be influenced by the opinions or actions of others around them, such as friends or family members, or they may feel pressure to conform to certain social expectations.
• Personal factors: Personal characteristics like age, income, lifestyle, and personality can all influence buyer behavior. For example, someone who is health-conscious may be more likely to purchase organic foods or gym memberships.
• Psychological factors: Motivation, perception, learning, and beliefs and attitudes can all affect buyer behavior. People may be motivated to purchase something because of a particular need or desire, and their perceptions and beliefs about a product or brand can influence their decisions.
• Situational factors: The particular circumstances in which a purchase is made can also affect buyer behavior. Factors like the time of day, location, and even weather conditions can all play a role in a person's decision to make a purchase. For example, a person may be more likely to buy an umbrella on a rainy day.

Overall, buyer behavior is influenced by a complex array of factors that can be difficult to predict or control. Marketers must take these factors into account when developing their strategies in order to effectively reach and engage their target customers.

Personal Factors (Nielsen PRIZM Lifestage Groups System)

Personal factors are individual characteristics that influence a person's behavior and decision-making process. One way to segment consumers based on personal factors is through the Nielsen PRIZM Lifestage Groups System. This system segments consumers into 66 different groups based on their age, household composition, and other personal characteristics.

Some examples of personal factors that can impact consumer behavior include:

• Age: Different age groups have different needs and wants, and may respond differently to marketing stimuli. For example, older consumers may be more concerned with health and wellness, while younger consumers may be more interested in technology and social media.
• Gender: Men and women may have different preferences for products and services, and may respond differently to marketing messages.
• Family Life Cycle: Different stages of the family life cycle (e.g. newlyweds, families with young children, empty nesters) can impact buying behavior. For example, families with young children may be more likely to purchase products that are kid-friendly, while empty nesters may be more interested in travel and leisure.
• Income: Income level can impact purchasing power and buying behavior. Consumers with higher incomes may be more likely to purchase luxury products, while consumers with lower incomes may be more focused on price and value.
• Education: Education level can impact consumers' knowledge, attitudes, and behaviors. Consumers with higher levels of education may be more likely to make informed purchasing decisions and be more brand loyal.
• Personality: Personality traits can impact consumer behavior. For example, consumers with an extroverted personality may be more likely to try new products and take risks, while consumers with an introverted personality may be more risk-averse and prefer familiar brands.

The PRIZM Lifestage Groups System combines these personal factors to create unique consumer segments that marketers can target with tailored messages and offers.

Major groups in Nielsen PRIZM Lifestage Groups System

Nielsen PRIZM Lifestage Groups System is a segmentation system used to divide consumers into different groups based on their demographic and lifestyle characteristics. The system includes 14 major groups, which are:

1. Young Digerati: Affluent, educated, and technology-driven individuals who live in urban areas.
2. Bohemian Mix: Young and middle-aged adults with diverse cultural interests, living in urban areas.
3. Blue-Chip Blues: Wealthy, middle-aged individuals who live in exclusive suburban areas.
4. Gray Power: Affluent, retired individuals who live in upscale suburban areas.
5. New Empty Nesters: Middle-aged couples without children who live in suburban areas.
6. Golden Ponds: Older, retired individuals who live in rural areas.
7. Young Influential: Young and educated urbanites who are trendsetters and early adopters.
8. Up and Coming Families: Young families who live in suburban areas and are focused on child-rearing and education.
9. Suburban Style: Affluent, middle-aged individuals who live in suburban areas and enjoy upscale living.
10. Middleburg: Middle-aged families who live in suburban areas and are focused on education and career advancement.
11. Kids and Cul-de-Sacs: Middle-aged families with children who live in suburban areas and focus on family-oriented activities.
12. Traditional Times: Older, middle-class individuals who live in small towns or suburban areas and value traditional values.
13. Rural Resort Dwellers: Affluent, retired individuals who live in rural areas and enjoy recreational activities.
14. Urban Elders: Older, retired individuals who live in urban areas and value cultural activities.

These groups are further divided into smaller segments based on their behavior, lifestyle, and consumption patterns. By understanding the characteristics of each group, marketers can develop targeted marketing strategies and tailor their products and services to meet the needs and preferences of each group.