Consumer Buying Behavior And Decision Making

Con corresponder Buying Behavior And finish MakingRecent research discovered that consumers ar just bidly to specify obtain and to be regularised non only by intercourses and peers, by endorsers but likewise by attitudes, situations and emotion (Olsen et al., 2007).The unconscious transition of consumer stopping point making can be viewed as three well defined stages namely the Input, the Process and the rig as shown below (Schiffman, 2005).The Input Stage influences the individuals deferred payment of a merchandise need and comprises of two principal(prenominal) characters of training which is the firms marketing efforts in term of its price, promotion, location of the retail extinctlets and the second source is the external sociological influences on the consumer which includes family, friends, neighbors, social class amongst other(prenominal)s.The Process stage emphasizes on the way consumers make their finiss. The psychological actors incorporate each in dividual like motivation, perception, learning, in the flesh(predicate)ity and attitudes which affect the way external elements from input stage affects the consumers recognition of a need, pre- bargain for search for teaching and evaluation of substitute(a)s.The output stage comprises of two related post- finis activities namely the grease ones palms behaviour and post-purchase evaluation. A low-cost and non-durable mathematical harvest whitethorn be influenced by the manufacturers coupon and may rattling be a trial purchase. The consumer evaluates the produce through direct use. For a relatively durable harvest-festival such as a laptop, the consumer decision-making model is examined in greater depth (Schiffman, 2005).2.1 Factors influencing Consumer Buying decision2.11 pagan FactorsIn a sense, culture is a societys personality (Wayne, 2008). consort to Hawkins (2009), culture is defined as the sum of total learned belief, values and customers that serve to direct the c onsumer behavior of members of a particular society. Individual ar brought up to follow the beliefs, values and customs of their society and to avoid behavior that is considered as taboo. (Graham, 2009). Overall societies be segmented into subcultures. The sub-cultural divisions atomic number 18 based on nationality, religion, geographic locality, race, age and sex.2.12 Social FactorsA university extension groups argon groups that serves as frames of reference for individuals in their purchase or consumption decisions. Indirect reference group consist of groups with whom a person does not have direct face to face contact, such as picture show stars, TV personalities, sports heroes or even interesting-looking people on the street (Graham, 2009).An individual who has little or no experience with a durable production is more likely to research out the advice or practice of others (Solomon et al., 2009). When consumers ar concerned with obtaining accurate nurture nigh the per formance or quality of a product or suffice, they ar likely to be persuaded by those whom they consider trustworthy and knowledgeable (Hoyer et al., 2007). Appeals by celebrities and other reference group are utilize very effectively to communicate with their market. For many consumers, their family is their primary reference group for many attitudes and behavior. The members of a family assume specific roles in their everyday forgeing, such roles or tasks deal to realm of consumer purchase decisions.2.13 Psychological FactorsPsychological factors arousing within individuals relatively drive general behavior of consumers and thusly affect their behavior. The main influences on consumer behavior are personality and self-concept, motivation, learning and perception (Sorensen, 2009).2.14 Individual Factorsdemographic variables are individual characteristics which consist of occupation, sex, income, origin, ethnic, race and age (Kanuk,1999).2.2 Organizational Buying BehaviorThe de cision making process by which formal organizations confirm the need for products and service to be purchased, consider and take among alternative providers and sets (Glavee, 2009).(Hutt, 2009), as an outcome of the vast area of prior research, proceeded the characterization of the industrial buying behavior shared out into three major aspects The Buying Process, The buying Centre and Factors influencing the buying centre.As Kelly (2007), the buygrid model is a conceptual model, which describes the different combinations of buying phases and buying situations. It incorporates three types of buying situations (1) the bracing task, (2) the straight re-buy, and (3) the modified re-buy, combined with eightsome phases in the buying decision process. The model serves as an easy framework for visualizing the otherwise labyrinthian line of reasoning buying process and enables the vender to identify the critical phases and situation requiring specific types of training.2.3 The Buyin g CentreAs Hutt (2009) mentivirtuosod, companies do not buy, people do. It is of utmost importance to have a concrete knowledge round those involved in the buying decision making process of the acceptables or services that a vendor aim to sell. It has been indicated that many individuals are pertained in the buying process of industrial goods.2.4 Roles of the Buying Centre membersBuyers are known to assume some common roles in a buying process (Wind, 1967). These roles are discriminate into six groups which are shown below.Initiator is the one or group of individuals who become aware of a society bother and recognize that the problem can be solved via acquisition of a product or service.The influencers are those who have a say in whether a product or service is bought or not. The more critical a purchase is to companys business, the higher the number of influencers.Gatekeepers usually act as problem or product experts. They have information industrious a range of vendor offe rings. Other buying centre members therefore rely on their information for their assessment of prospective vendors offerings. Thus, by controlling information, and, by having access to decision makers in the firm, the gatekeepers largely determine which vendors get the chance to sell.Deciders are those who make the unfeigned purchase decision. For instance, they say yes or no to what vendors offer.The buyer is one who makes arrangements for the delivery of the goods. He is also a good deal straightway involved in negotiating the conditions under which the transactions will be do.Users are those who usually make use of the products in normal working process.2.5 Factors influencing the buying process and the buying centreDifferent due influences that affect the buying process and the buying centre previously addressed ( Nielson, 2008) Aspects influencing the buying process abbreviated descriptionOrganizationalTechnology, goal, task, actors, structure.InterpersonalFormal authority , persuasivenessPersonalStatus, politics, ethics. environmentalPhysical, economic, technological, legal, political and cultural.2.6 WOM in Consumer EnvironmentWord of mouth is closely disseminating information by verbal communication, particularly references including general information in an informal or person-to-person approach. Word of Mouth is usually regarded as a verbal communication, although nett dialogue, such as, message boards, emails and blogs (Olson et al., 2010).2.7 WOM influencing consumer buying behaviorWOM is considered to be of utmost importance in shaping consumers attitudes and behaviors. Silverman (2011), canvass the diffusion of technology products and concluded that the pattern of ownership may be justified by the front man of an effective network consisting of neighbours exchanging product information.Songe (2006) pointed out that WOM is the most natural source of influence in the purchase of technology and household goods. It is three times effective a s radio advertising, newspapers and magazines.2.8 Characteristics of WOMWOM can be seen as unequivocal as well as negative (Jantsh, 2010). Negative WOM arose when consumers gather information on miss of service, high prices or impolite sales personnel. PWOM is a reference to the passing of positive information. Scharffer (1998) indicated that dissatisfied customers made complain twice than when they are satisfied. Goodman (2009) justified that the services recovery programmes, service guarantees and complaints process affect the caution of WOM.WOM is considered to be an unlimited activity to consumers. The WOM activity can be perceived as a function where the individuals with whom the organization and its employees come into contact like the customers, suppliers, competitors, the general public, or other stakeholders (Misner, 1999). Throughout a decision making process, WOM may be employed at different stages. WOM can be used in the first place or after a purchase.The use of WOM in a pre-purchase stage is referred to as input WOM and turnout WOM is issued after the purchase (Assael, 1997).The effectiveness of WOM is far from being unnoticed. Some organizations regard customer WOM as one of the most strong marketing tool (Wilson, 1994). According to Scharffer (1998), marketers attempt to directly influence feel leaders, incite WOM communication in advertising or depict communications form scene leaders.2.9 The Nature of WOM fill in (2002), distinguished three main types of WOM communications in an evaluation on personal influence in buying technology products namely product information, private experience and recommendation. Product information is informing about the product such as benefits of the products. Private experience includes explanations about reasons for purchasing the product. Recommendation refers to point of views about the product. These categorization implies that WOM attends to inform and to influence. Product news, for example, is eff icient in bringing awareness about a product and its features. Listening about the experiences of the product from a friend cooperate the consumer in evaluating the absolute merits of one brand or another. Eventually through the perceptions of others, advice is inhering in making the purchase decision stage (Solomon et al., 2009).2.10 mental picture leaders and followersAccording to Rosen (2002), mass media messages are caught and disseminated by sagacity leaders. He also pointed out that mediated communication are circulated to opinion leaders who disseminate it through WOM to their peers. This in turn drill some influences.According to his theory, opinion leaders are present in all groupings of society and may be persuasive on specific topic (Songe, 2006).Lois (2007), could not differentiate between followers and opinion leaders. In his research, he inclined to talk of influencers rather than opinion leaders. He pointed out that influencers are active information searcher, mo re dependent and more innovative.The follower is active and may ask for information as well as considering opinions of others Those who diffuse information are also likely to receive it which denote that opinion leaders are also followers and vice versa.Wilson (1994) has certified that there is a dominance of personal influence in decision making. In his ingest, Hutt (2009) added that people who received positive WOM about a new product were more likely to purchase it rather than those who received negative WOM.The powerful effect of WOM is conjugated to various factors. There are situations where consumers referrals are perceived as being more rational and good than commercial sources of information (Rosen, 2002).Dialogues with either friends or relatives tend to be friendly and can help for arduous out genuine behaviours. Potential consumers of a particular product can acquire some of the product experience by searching for someone who has acquired recent experience with the product (Silverman, 2011).2.11 Importance of WOM in service sectorGood service is essential to promote positive WOM. Consumers depend largely on personal communication with other customers since their experiences are regarded as a trial (Goodman, 2010). Wilson (1994), in turn found that services consumers choose to search for reference from relative and peers rather than promotional sources. Customers are skeptical. They do not remember anymore about what they see or hear. (Kelly, 2007).According to Finch (2003), it is considerable when reference groups are likely to influence especially when the customer is dealing with a decision process and the purchase of the product involve certain happen.Proctor (1995) noted the individuals who have ongoing involvement are more prone to be opinion leaders. Consumers would rather seek information from friends and family if risk is likely to emerge when making a purchase (Scharffer, 1998).2.12 Motives for gentle in WOM communicationFinch (200 3), concluded that there are a multitude of reasons for engaging in WOM communication. Sernovitz (2009), support with evidence that those who disseminate information are certainly those who are experiencing the product. The involvement in the product-related decision is an essential component in personal communications.According to Songe (2006), WOM communication is the basic interest in the product family line concerning ongoing involvement. Individuals who have an enduring interest in a product category experience expiation in discussing about it (Wilson, 1994). Additionally, Rosem (2002), pointed out that WOM communication is usually introduced to remove any doubt about product excerpt.According the theory of Wilson (1994), a consumer may try to decrease discomfort by explaining the positive aspects of a recently purchased product to peers and family. Furthermore, purchasing the similar product by a friend or relative proves the original judgment of the consumer (Skubal, 2002) . Discussing about the product may likely to drive people to personal joy (Songe, 2006).2.13 Post-Purchase Decision-MakingNegative WOM is known to be a framework of customer complaining behaviour. Harris (2008) suggested that consumers can either show their dissatisfaction or end up the relationship when confronting with unmet expectations. Furthermore, Burg (2005) classified three main reactions to dissatisfaction namely switching to another brands or substitute, making a complaint to the retailer or personnel and finally informing others about the unsatisfactory product or service. Concerning minor dissatisfaction consumers are not likely to complain nor do they dispersed negative WOM (Finch, 2003). When the level of dissatisfaction is important, consumers are more likely to complain (Kelly, 2007). Goodman (2009), referred that after purchases, consumers are likely to manoeuvre in a post-purchase evaluation of the product. If the consumer is not satisfied, psychological discom fort may occur.2.14 Pre-Purchase DMAccording to Scharffer (1998), WOM is seen as a process through which consumers convey both informational influence in evaluation of the product and the purchase intention of fellow consumers. This type of information can thus be expressed according to the choice of the referral source or the task of selecting the product (Lees, 2007).2.15 WOM has a powerful influence on organizational DMWOMC is thus considered as a growing necessity in B2B markets. According to Neilsen (2000) , WOM consists of informal communications say by consumers at other consumers about ownership or characteristics of particular goods or services and or their sellers.WOM is perceived as an exit outcome to dissatisfaction with the product quality it can be perceived a behavioral manifestation of a latent loyalty towards the supplier or the brand (Canning, 2007). The WOM system is referred to a network where personal, verbal, face to face communication take place. It is also d efined as the attribute of the information dealt and how these information would determine the role of the participants (Balter et al., 2009).2.16 Provision of WOMWhile in any prevailing WOM circumstances, recommendations, opinions, information are likely to succeed in both ways. Emotions influence how decisions are formulated. In B2B purchase, the buyer does not touch the overall benefit of the solution and may not be compensated for making a good purchase, but a bad purchase can damage the reputation and job security of the buyer. The area of Prahalad (2004) revealed that organizational buying decisions are normally influence fear. Organizational buyers tend to reduce fear by reducing risk. Personal risk is mostly hidden from the rational process and is considered as an important factor in B2B buying.Like in quality judgments, satisfaction can result to positive WOM through an exit, interpretive program and loyalty logic argument (Nielson, 2002). To such a degree that satisfact ion has affective bases, the statement contract earlier about the influence to WOM route has validity as well (Robins, 2008).The involvement with a product certainly provides a person with the motivation and ability to come up with product-related conversations with others. Like Jantsch (2010), observed an individuals patronage engagement with a product or service brings out to overflowing thoughts and emotions that can easily recalled in WOM experiences, frequently willfully so, in order to clear out the tension or the experience.Dissatisfaction with a product presumed to be essential by the individual is particularly filled with WOM potential (Balter et al. 2009).Researchers have been able to separate several product-related factors that reduce the occurrence and extent of WOM activity. Price awareness for product, for one, has been encountered to correspond remarkably with WOM transmission. Preceding a dissatisfactory experience, individuals have demonstrated to participate in more or less WOM conversations depending on the sincerity and controllability and composure of the problem (Bowman, 2009), as well as the perceived likelihood of a favorable decline (Wilson, 2006). Positive outcomes concerning complaint handling and redress, like the diffusive and synergetic justice of the redress orientation and the stratagem of recovery, can lead positive consequences for a provider as individuals have the tendency to respond to positive things about the provider (Balter et al., 2009).2.17 Strategies for managing risksRosen (2009) introduced three strategies for managing risk namelyApproved supplier list. B2B buyers are prone to select companies they already know. If a member from the buying centre has pre-approved a supplier, the risk is reduced even if it is not the right solution.Word of mouth for example colleagues and friends. User communities are one of the main sources of information for researching B2B purchases. A recommendation from a credible source tend to reduce risk.Word of mouth from existing suppliers. A good representative build good relationship with their suppliers to create a credible source for referrals.2.18 Buyers seek personal recommendationThe most influential channels across decision making process were blogs, playscript of mouth, websites, trade journals and other form of media. According to Nail (2002), organizational buyers valued WOM communication which provide a personal recommendation.2.19 The Buying ProcessBowman (2009) made the conclusion that B2B buying is a decision process driven by the emotions of the people involved. Business buyers are mostly motivated to reduce personal risk of making mistakes. The decision making process in the B2B environment is not an easy task. Generally doers are those making the purchase of the product or service. The buyer has the entire responsibility for reducing corporate risk.The heading of a broad chain of gatekeepers in organizations means determine the level of comp lexity in decision-making process in B2B environment. In the B2B environment, decision making process is much more puzzling where there is no specific decision-maker across organizations (Nail, 2002). Graham (2009) implied that in an organization there is a gatekeeper who is allowed to share ideas and information to the members in the buying centre.Both the doers and the buyers need to search for information in the buying process. B2B website should take into good will the information demand of those who search the Internet. Person to person meetings are crucial to reach the emotional needs of prospects. Building credible relationship through person to person meetings with both doers and buyers is necessary in the complex decision making process. Analytical plan offer recommendations about which options and information to consider or to reject. This help the organization to facilitate decisions to their relevant core.2.20 The impact of Social MediaRobins (2008) declared that onlin e channel, precisely the social media occupied an essential role in how research is proceeded and finally the decision on business purchases in the future. Social media like Website, Blogs or Facebook are also considered to be influential. Inactive channels like the press advertising are equally influential. Robins (2008) pointed out that decision-makers need to search social media channels for information to their actions. Colleagues and peers add value to decision and thus minimizing risks (Siguardarson, 2000). Factors like the ability to learn from experiences of others, the ability to access to information and the ability to communicate with others.According to the study of Robins (2008), B2B buyers refer to trade journals as well as professional online media for B2B decision making. The study also regards word of mouth and personal reference from professional colleagues or peers which is considered as the most influencing source in buying decisions.According to the study of Fad er (2010), there is a noticeable change in the influence of supplier websites at the beginning of the purchasing process. He further characterized websites as very influential. Personal recommendation is understandably approved as the most valuable factor in B2B purchasing decisions.Channel like throw journals, Website, Blogs and Facebook are seen as large influencers concerning the provision of information to help buyers identify potential suppliers. Buyers and deciders are personally involved in the final decision making process. The members in the buying centre regularly used word of mouth and supplier websites as sources of information (Bowman, 2009). Mass media is a mean of reaching directly opinion leader, follower or the gatekeeper (Jantsch, 2010). According to Santeller (2010), the gatekeeper is considered as a source of information to both opinion leaders and followers. The research of Hoyer et al. (2006) showed that diffusion of social of social media is increasing const antly.According to the study of Sorensen (2009), some B2B buyers prefer to use of social media channels while others refer more to traditional information channels. He further observed that B2B buyer opted for issue-based information from supplier websites as a main source of information at the beginning of the buying process. Furthermore the level of influence are reduced towards later on stages.