Organizational

Buying Behavior &

Models of Consumer
Buying

Shivali Kamal
Third sem
Rbs,Hyderabad
 Contents in brief:-
 Consumer Decision-Making,
 Models of Consumer Behaviour,
 Types of consumer behaviour models,
 Industrial buying behaviour
 Industrial Vs Consumer Market &
 The process of industrial purchasing .
Consumer Decision-Making
Buyer decision processes are the decision making processes undertaken by
consumers in regard to a potential market transaction before, during, and
after the purchase of a product or service.
A general model (“box-and-arrow” models) consists of :-
 Models of Consumer
Behaviour
 Economic model :-It is one-dimensional model. Being rational, one will
make his purchase decisions with the intention of maximizing the
utility/benefits. Economic model is based on certain predictions as price
effect ,substitution effect & income effect.
 The sociological model :-The individual buyer is a part of the institution
called society. So, he gets influenced by it and in turn also influences it in its
path of development.
 Learning model :-Classical psychologists have been interested in the
formation and satisfaction of needs and tastes .living beings were influenced
by both innate needs .A drive or internal stimulus which when directed
towards a drive-reducing object becomes a motive.
 Psychoanalytical model:-It is based on the work of psychologists who were
concerned with personality (outcome of id, super ego & ego). Human needs
and motives operated at the conscious as well as subconscious levels.
Marketers have been using this approach to generate ideas for developing
product-design, features, advertising and other promotional techniques.
Types of models of consumer
behaviour:-
A model a is simplified version of reality, it has
never been reality, it isn’t reality and it will never
be reality...…therefore all models are subject to
criticism.
 Maslow’sHierarchy of Needs (Conceptual model);
 The Howard Sheth Model of Buying Behaviour;
 Engel, Kollatand Blackwell model.
 Maslow’s Hierarchy of
Needs
5
Self-
Self-
actualization
actualization
(self-development
(self-development
andrealization)
and realization)

Esteem needs
4 Esteem needs
(self-esteem,recognition)
(self-esteem, recognition)
Social needs
Social needs
3 (sense
(sense of
of belonging,
belonging, love)
love)
Safetyneeds
Safety needs
2 (security, protection)
protection)
(security,
Psychological needs
Psychological needs
1 (food, water,
(food, water, shelter)
shelter)
Engel-Kollat-Blackwell
model
The Howard sheth model
 Industrial vs. consumer
markets
Aspect Industrial market Consumer market
Buying objective Enable production Personal need satisfaction
Buying motive Mainly rational Also emotional
Purchasing function Professional buying Consumers
Decision making Many persons involved, Often impulsive, without
much discussion consulting others
Characteristics Negotiations, intense Often without negotiation, little
interaction interaction
Product & market Large Limited
knowledge
Order size Often large Mostly small
Demand Derived, fluctuation Autonomous, relatively stable

Price elasticity Rather inelastic Rather elastic

Number of customers Mostly limited Very large

Spread of customers Sometimes large Large spread

geographic concentration
 The purchasing process
Define Select Contract Evaluation
Ordering Expediting
specification supplier agreement Follow up
- Vendor
Proc. Role - Get - Assure adequate - Prepare - Establish - Establish performance
specification supplier selection contract Order routine expediting evaluation
routine - Settling contract
problems
Elements - Functional - Prequalification - Contracting - Develop - Expediting
specification of suppliers expertise orderroutines - Vendor rating
- 'Trouble-
- Technical - Request for - Negotiating - Orderhandling - Vendor
shooting' evaluation
changes quotation expertise
- Bring supplier
engineering
knowledge to

Documents - Functional Supplier selection - Vendor

specification proposal Contract Order Overdue list balanced score
- Norm/spec. card
control - Vendor profile
- Vendor ranking
 Three types of
purchasing situations:-
New task :-
• Completely new product from unknown
suppliers
• High uncertainty regarding outcome
• (e.g. acquisition of capital goods)
Modified Rebuy :-
• New product from known supplier
• Existing product, new supplier
• Moderate uncertainty regarding
outcome
Straight rebuy:-
• Known product from known supplier
• Low uncertainty regarding outcome
Any Questions….?
Thank u for Your
attention