SALES MANAGEMENT
Session 3: Consumer and
organisational buyer behavior
Sales Management
DIFFERENCES BETWEEN
CONSUMER &
ORGANISATIONAL BUYING
• Fewer organizational buyers
• Close, long term relationships between organizational buyers and
sellers
• Organisational buyers are more rational
• Organisational buying may be to specific requirements
• Reciprocal buying may be important in organizational buying
• Organisational selling/buying may be more risky
• Organisational buying is more complex
• Negotiation is often important in organizational buying
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Sales Management
CUSTOMER UNDERSTANDING
1. Who is important in the buying decision?
2. How do they buy?
3. What are their choice criteria?
4. Where do they buy?
5. When do they buy?
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Sales Management
CONSUMER BUYING CENTER
User
User Ngêêii
Ng
Initiator
Initiator
khëi
khëix ííng
x ng
Consumer buying
center Ngêêii
Buyer Ng
Influencer
Buyer Influencer
¶nh
¶nhhëëng
h ng
Decider
Decider
Sales Management 4
THE BUYER DECISION PROCESS
Problem
recognition
Information
search
Evaluation of
alternatives
Purchase
decision
Postpurchase
behavior
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THE BUYER DECISION PROCESS
Need Recognition
• Occurs when the buyer recognizes a
problem or need triggered by:
– Internal stimuli
– External stimuli
THE BUYER DECISION PROCESS
Information Search
Sources of Information
• Personal sources—family and friends
• Commercial sources—advertising, Internet
• Public sources—mass media, consumer organizations
• Experiential sources—handling, examining, using the
product
THE BUYER DECISION PROCESS
Evaluation of Alternatives
• How the consumer processes information to
arrive at brand choices
THE BUYER DECISION PROCESS
Purchase Decision
• The act by the consumer to buy the most
preferred brand
• The purchase decision can be affected by:
– Attitudes of others
– Unexpected situational factors
THE BUYER DECISION PROCESS
Post-Purchase Decision
• The satisfaction or dissatisfaction that the
consumer feels about the purchase
• Relationship between:
– Consumer’s expectations
– Product’s perceived performance
• The larger the gap between expectation and
performance, the greater the consumer’s
dissatisfaction
THE BUYER DECISION PROCESS
Post-Purchase Decision
Customer satisfaction is a key to building
profitable relationships with consumers—to
keeping and growing consumers and
reaping their customer lifetime value
RESPONSE HIERARCHY MODEL (AIDA)
AIDA Model of The Stages of the Buying
Communications Process
• Gain Need recognition/problem
ATTENTION solving
• Stimulate INTEREST Information Search
• Create DESIRE
Evaluation of Alternatives
• Generate ACTION
Purchase Decision
• Create SATISFACTION
Post-purchase Stage
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HOW AND WHY CONSUMERS BUY?
Model of Customer Buyer Behavior
Sales Management
ORGANIZATIONAL BUYER BEHAVIOUR
Three elements:
1.STRUCTURE
Decision making Unit or Buying center is all of the
individuals and units that participate in the business
decision-making process
– Initiators: those who begin the purchase process
– Users: those who actually use the product
– Influencers: provide information
– Buyers: have authority to execute the contractual
arrangements
– Deciders: have the authority to select the supplier
– Gatekeepers: those who control the information flow
ORGANIZATIONAL BUYER BEHAVIOUR
2. PROCESS
Figure 3.5 The organisational decision-making process (buy phases)
Sales Management
ORGANIZATIONAL BUYER BEHAVIOUR
The Buying Process
Problem recognition occurs when someone in
the company recognizes a problem or need
• Internal stimuli
– Need for new product or production equipment
• External stimuli
– Idea from a trade show or advertising
ORGANIZATIONAL BUYER BEHAVIOUR
The Buying Process
General need description describes the characteristics
and quantity of the needed item
Product specification describes the technical criteria
Value analysis is an approach to cost reduction where
components are studied to determine if they can be
redesigned, standardized, or made with less costly
methods of production
ORGANIZATIONAL BUYER BEHAVIOUR
The Buying Process
Supplier search involves compiling a list of
qualified suppliers
Proposal solicitation is the process of
requesting proposals from qualified
suppliers
ORGANIZATIONAL BUYER BEHAVIOUR
The Buying Process
Supplier selection is the process when the
buying center creates a list of desired supplier
attributes and negotiates with preferred
suppliers for favorable terms and conditions
Order-routine specifications is the final order
with the chosen supplier and lists all of the
specifications and terms of the purchase
ORGANIZATIONAL BUYER BEHAVIOUR
The Buying Process
Performance review involves a critique of
supplier performance to the purchase terms
ORGANIZATIONAL BUYER BEHAVIOUR
3. CONTENT
•This aspect of organizational buyer behavior
refers to the choice criteria used by members of
the DMU to evaluate supplier proposals.
MAJOR TYPES OF BUYING
SITUATIONS
– Straight re-buy
• Reordering without modification
– Modified re-buy
• Requires modification to prior purchase
– New task
• First-time purchase
Sales Management
