COMM 223 — Marketing Management
Chapter 5: Understanding Consumer and Business Buyer Behaviour
Based on: Armstrong, Kotler et al., Marketing: An Introduction, 7th Canadian Edition
Chapter Overview:
This chapter examines the most important element of the marketplace — customers
— and the forces that shape their buying behaviour. The chapter is divided into two
major halves. The first half explores consumer buyer behaviour, covering the cultural,
social, personal, and psychological factors that influence purchasing decisions,
followed by the full five-stage consumer buyer decision process and the special
adoption and diffusion process for new products. The second half shifts to business
markets and business buyer behaviour, covering the nature of business markets, the
types of buying situations, the buying centre, the key influences on business buyers,
and the eight-stage business buyer decision process. The chapter closes by
examining how digital, mobile, and social media — particularly e-procurement and B-
to-B social media marketing — have transformed business-to-business marketing.
Central thesis: to affect the whats, whens, and hows of buyer behaviour, marketers
must first understand the whys.
1. Consumer Markets and Consumer Buyer Behaviour
Consumer buyer behaviour refers to the buying behaviour of final consumers —
individuals and households that buy goods and services for personal consumption. All
of these final consumers combine to make up the consumer market. The North
American consumer market consists of more than 366 million people (including 329
million Americans and 37 million Canadians). In the U.S. alone, individuals consume
more than US$13 trillion worth of goods and services each year. Canada’s consumer
spending was projected at CAD$1.17 trillion in 2018.
What Is Consumer Behaviour?
Consumers make many buying decisions every day, and the buying decision is the focal
point of the marketer’s effort. Most large companies research consumer buying
decisions in great detail to answer questions about what consumers buy, where they
buy, how and how much they buy, when they buy, and why they buy. Marketers can
study actual consumer purchases to find out what they buy, where, and how much. But
learning about the whys behind consumer buying behaviour is much harder — the
answers are often locked deep within the consumer’s mind. Often, consumers
themselves don’t know exactly what influences their purchases.
The study of consumer behaviour is an ongoing process that starts long before the
consumer purchases a product or service, and continues long after consumption.
Marketers must be aware of issues across all three stages of the consumption process:
, • Prepurchase issues: How does a consumer decide that he or she needs a
product? What are the best sources of information to learn about alternative
choices? How are consumer attitudes formed and changed?
• Purchase issues: Is acquiring a product a stressful or pleasant experience?
What does the purchase say about the consumer? How do situational factors
such as time pressure or store displays affect the purchase decision?
• Postpurchase issues: Does the product provide pleasure or perform its
intended function? How is it eventually disposed of? What determines whether a
consumer is satisfied? Does this person tell others about their experiences and
influence their decisions?
Consumers’ responses — ranging from actual purchase to engaging in word-of-mouth
communications about the product — are the ultimate test of whether a marketing
strategy is successful.
Characteristics Affecting Consumer Behaviour
Consumer purchases are influenced strongly by cultural, social, personal, and
psychological characteristics (see Figure 5.2). For the most part, marketers cannot
control such factors, but they must take them into account.
A. Cultural Factors
Cultural factors exert a broad and deep influence on consumer behaviour. Marketers
need to understand the role played by the buyer’s culture, subculture, and social class.
Culture
Culture is the set of basic values, perceptions, wants, and behaviours learned by a
member of society from family and other important institutions. Culture is the most basic
cause of a person’s wants and behaviour — human behaviour is largely learned.
Growing up in a society, a child learns basic values, perceptions, wants, and behaviours
from his or her family and other important institutions.
A child in the United States is normally exposed to values such as achievement and
success, freedom, individualism, hard work, efficiency and practicality, material comfort,
youthfulness, and fitness and health. Canadians, in contrast, value freedom; the beauty
of the natural landscape; respect, equality, and fair treatment; family life; and being
Canadian. Despite differences, both the U.S. and Canada are consumer cultures, and
marketing practices reinforce this as a way of life.
Marketers are always trying to spot cultural shifts to discover new products that might
be wanted. For example, the cultural shift toward greater concern about health and
fitness has created a huge industry for health-and-fitness services, exercise equipment
and clothing, organic foods, and a variety of diets.
Subculture
Subculture is a group of people with shared value systems based on common life
experiences and situations. Subcultures include nationalities, religions, racial groups,
and geographic regions. Many subcultures make up important market segments, and
marketers often design products and marketing programs tailored to their needs.
, Important subculture groups in Canada include:
• Regional subcultures: Canada is a regional country, so marketers may develop
distinctive programs for the Atlantic provinces, Quebec, Central Canada, the
Prairies, and British Columbia. Geographic features, climate, immigration
patterns, economies (tied to commodities such as fish, timber, wheat, minerals,
or oil), and perceived disparities in political power have all shaped regional
character and personality.
• Founding nations: Canada had three founding nations: the English, French,
and Indigenous Peoples. Anglophones account for approximately 58 percent of
the population; francophones make up approximately 21 percent. Approximately
213,230 Canadians reported an Indigenous language as their mother tongue.
More than 1.67 million people (4.9 percent of the Canadian population) reported
Indigenous identity in the 2016 Census, primarily Métis and Inuit — a number
expected to reach between 2.0 and 2.6 million by 2036. Indigenous Peoples
have distinct cultures that influence values and purchasing behaviour, and have
also profoundly influenced the rest of Canada through art, a love of nature, and
concern for the environment.
• Ethnic subcultures: Approximately 21.9 percent of Canada’s population is an
immigrant. South Asians now make up the largest visible minority population in
Canada at over 1.9 million (5.6 percent); Chinese is the second-largest visible
minority group with over 1.5 million; and the Black population of Canada has
exceeded 1 million. The percentage of Canada’s population who identify as
visible minority is projected to grow from roughly 22 percent in 2016 to almost 35
percent by 2036. Canadian companies are realizing the importance of culturally
relevant advertising using a multimedia approach to reach visible minority
populations.
Total Market Strategy:
Beyond targeting subcultural segments with specially tailored efforts, many marketers
now embrace a total market strategy — the practice of integrating ethnic themes
and cross-cultural perspectives within their mainstream marketing, appealing to
consumer similarities across subcultural segments rather than differences. Examples
include Cheerios and IKEA commercials featuring interracial and blended families.
Toyota’s Camry “Sensations” campaign illustrates both dimensions: specific ads
targeting Hispanic, African American, and Asian American subsegments, and
overarching mainstream ads with a diverse mix of actors under a single cross-cultural
theme. As a Toyota executive notes: “If a person of any group is looking for
communication that is like them, the good news is because of the breadth of
something like a Camry campaign, they can find it.”
Social Class
Social classes are society’s relatively permanent and ordered divisions whose
members share similar values, interests, and behaviours. Social class is not determined
by a single factor, such as income, but is measured as a combination of occupation,
income, education, wealth, and other variables. Social scientists have identified seven
Chapter 5: Understanding Consumer and Business Buyer Behaviour
Based on: Armstrong, Kotler et al., Marketing: An Introduction, 7th Canadian Edition
Chapter Overview:
This chapter examines the most important element of the marketplace — customers
— and the forces that shape their buying behaviour. The chapter is divided into two
major halves. The first half explores consumer buyer behaviour, covering the cultural,
social, personal, and psychological factors that influence purchasing decisions,
followed by the full five-stage consumer buyer decision process and the special
adoption and diffusion process for new products. The second half shifts to business
markets and business buyer behaviour, covering the nature of business markets, the
types of buying situations, the buying centre, the key influences on business buyers,
and the eight-stage business buyer decision process. The chapter closes by
examining how digital, mobile, and social media — particularly e-procurement and B-
to-B social media marketing — have transformed business-to-business marketing.
Central thesis: to affect the whats, whens, and hows of buyer behaviour, marketers
must first understand the whys.
1. Consumer Markets and Consumer Buyer Behaviour
Consumer buyer behaviour refers to the buying behaviour of final consumers —
individuals and households that buy goods and services for personal consumption. All
of these final consumers combine to make up the consumer market. The North
American consumer market consists of more than 366 million people (including 329
million Americans and 37 million Canadians). In the U.S. alone, individuals consume
more than US$13 trillion worth of goods and services each year. Canada’s consumer
spending was projected at CAD$1.17 trillion in 2018.
What Is Consumer Behaviour?
Consumers make many buying decisions every day, and the buying decision is the focal
point of the marketer’s effort. Most large companies research consumer buying
decisions in great detail to answer questions about what consumers buy, where they
buy, how and how much they buy, when they buy, and why they buy. Marketers can
study actual consumer purchases to find out what they buy, where, and how much. But
learning about the whys behind consumer buying behaviour is much harder — the
answers are often locked deep within the consumer’s mind. Often, consumers
themselves don’t know exactly what influences their purchases.
The study of consumer behaviour is an ongoing process that starts long before the
consumer purchases a product or service, and continues long after consumption.
Marketers must be aware of issues across all three stages of the consumption process:
, • Prepurchase issues: How does a consumer decide that he or she needs a
product? What are the best sources of information to learn about alternative
choices? How are consumer attitudes formed and changed?
• Purchase issues: Is acquiring a product a stressful or pleasant experience?
What does the purchase say about the consumer? How do situational factors
such as time pressure or store displays affect the purchase decision?
• Postpurchase issues: Does the product provide pleasure or perform its
intended function? How is it eventually disposed of? What determines whether a
consumer is satisfied? Does this person tell others about their experiences and
influence their decisions?
Consumers’ responses — ranging from actual purchase to engaging in word-of-mouth
communications about the product — are the ultimate test of whether a marketing
strategy is successful.
Characteristics Affecting Consumer Behaviour
Consumer purchases are influenced strongly by cultural, social, personal, and
psychological characteristics (see Figure 5.2). For the most part, marketers cannot
control such factors, but they must take them into account.
A. Cultural Factors
Cultural factors exert a broad and deep influence on consumer behaviour. Marketers
need to understand the role played by the buyer’s culture, subculture, and social class.
Culture
Culture is the set of basic values, perceptions, wants, and behaviours learned by a
member of society from family and other important institutions. Culture is the most basic
cause of a person’s wants and behaviour — human behaviour is largely learned.
Growing up in a society, a child learns basic values, perceptions, wants, and behaviours
from his or her family and other important institutions.
A child in the United States is normally exposed to values such as achievement and
success, freedom, individualism, hard work, efficiency and practicality, material comfort,
youthfulness, and fitness and health. Canadians, in contrast, value freedom; the beauty
of the natural landscape; respect, equality, and fair treatment; family life; and being
Canadian. Despite differences, both the U.S. and Canada are consumer cultures, and
marketing practices reinforce this as a way of life.
Marketers are always trying to spot cultural shifts to discover new products that might
be wanted. For example, the cultural shift toward greater concern about health and
fitness has created a huge industry for health-and-fitness services, exercise equipment
and clothing, organic foods, and a variety of diets.
Subculture
Subculture is a group of people with shared value systems based on common life
experiences and situations. Subcultures include nationalities, religions, racial groups,
and geographic regions. Many subcultures make up important market segments, and
marketers often design products and marketing programs tailored to their needs.
, Important subculture groups in Canada include:
• Regional subcultures: Canada is a regional country, so marketers may develop
distinctive programs for the Atlantic provinces, Quebec, Central Canada, the
Prairies, and British Columbia. Geographic features, climate, immigration
patterns, economies (tied to commodities such as fish, timber, wheat, minerals,
or oil), and perceived disparities in political power have all shaped regional
character and personality.
• Founding nations: Canada had three founding nations: the English, French,
and Indigenous Peoples. Anglophones account for approximately 58 percent of
the population; francophones make up approximately 21 percent. Approximately
213,230 Canadians reported an Indigenous language as their mother tongue.
More than 1.67 million people (4.9 percent of the Canadian population) reported
Indigenous identity in the 2016 Census, primarily Métis and Inuit — a number
expected to reach between 2.0 and 2.6 million by 2036. Indigenous Peoples
have distinct cultures that influence values and purchasing behaviour, and have
also profoundly influenced the rest of Canada through art, a love of nature, and
concern for the environment.
• Ethnic subcultures: Approximately 21.9 percent of Canada’s population is an
immigrant. South Asians now make up the largest visible minority population in
Canada at over 1.9 million (5.6 percent); Chinese is the second-largest visible
minority group with over 1.5 million; and the Black population of Canada has
exceeded 1 million. The percentage of Canada’s population who identify as
visible minority is projected to grow from roughly 22 percent in 2016 to almost 35
percent by 2036. Canadian companies are realizing the importance of culturally
relevant advertising using a multimedia approach to reach visible minority
populations.
Total Market Strategy:
Beyond targeting subcultural segments with specially tailored efforts, many marketers
now embrace a total market strategy — the practice of integrating ethnic themes
and cross-cultural perspectives within their mainstream marketing, appealing to
consumer similarities across subcultural segments rather than differences. Examples
include Cheerios and IKEA commercials featuring interracial and blended families.
Toyota’s Camry “Sensations” campaign illustrates both dimensions: specific ads
targeting Hispanic, African American, and Asian American subsegments, and
overarching mainstream ads with a diverse mix of actors under a single cross-cultural
theme. As a Toyota executive notes: “If a person of any group is looking for
communication that is like them, the good news is because of the breadth of
something like a Camry campaign, they can find it.”
Social Class
Social classes are society’s relatively permanent and ordered divisions whose
members share similar values, interests, and behaviours. Social class is not determined
by a single factor, such as income, but is measured as a combination of occupation,
income, education, wealth, and other variables. Social scientists have identified seven
