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Document Sample
CRM
Aims
To explore consumer and organisational buyer
behaviour and decision-making processes
To understand the various influences on consumer
buyer behaviour
To understand the influences on organisational buyer
behaviour
MK282
Customer Relationship Marketing
Lecture Four
Buying Behaviour and Decision-making
Dr. Paurav Shukla
Types of customers by Relationship
Types of Customers
Strength
Loyalists Intimate relationships
the most satisfied become apostles for your company. doctor and patient
Mercenaries Face-to-face relationships
only loyal to low prices and are transaction specific with no customer and small retail store
intentions of ever establishing a relationship.
Distant relationships
Hostages
interactions over phone or online
“stuck” with you for a variety of reasons. Complainers.
No relationships
Defectors
manufacturers with final customers who buy through
various types of dissatisfied former customers.
middlemen
Jones, T.O., Sasser, W.E. (1995), "Why satisfied customers defect", Harvard Business Review, pp.88-99
Applicability of CRM Definitions
Goods suppliers Buying behaviour: ‘The decision process and actions of
Service providers people involved in buying and using products’
Competitors as in strategic alliances
Nonprofit organizations Customer Attitude: ‘An individual’s enduring evaluation,
Government entities as in joint R&D feelings and behavioural tendencies towards an object or
activity’
Ultimate customers
Dibb, Simkin
Intermediate customers:
Franchisees
Channel members
Functional departments
Employees
Other company business units
Baran, R. J., R. J. Galka, and D. P. Strunk (2008), Principles of Customer Relationship Management: Thomson.
Dr. Paurav Shukla 1
CRM
Simple Response Model Model of Buying Behavior
Marketing Other Buyer’s Buyer’s decision
stimuli stimuli characteristics process
Product Economic Cultural Problem recognition
Technological Social Information search
Stimulus Organism Response Price
Place Political Personal Evaluation
Promotion Cultural Psychological Decision
Postpurchase
behavior
Buyer’s decisions
Product choice
Brand choice
Dealer choice
Purchase timing
Purchase amount
Buyer’s Characteristics The Traditional Family Life Cycle
Cultural Young single
Culture, sub-culture and social class
Young married without children
Social
Reference groups, family, roles and status
Young married with children
Middle aged married with children
Personal
Age and life cycle, occupation, economic circumstances, Middle aged married without dependent children
lifestyle and personality
Older married
Psychological
Motivation, learning, perceptions, beliefs
Older unmarried
and attitudes
Product Adoption Process Product Adoption Categories
Lack of Awareness Attention
Awareness
Interest
Comprehension
Early Majority 34%
Late majority 34%
Adopters 13.5%
Innovators 2.5%
Laggards 16%
Attitude Desire
Action Action
Early
The DAGMAR The AIDA Model
Process Distribution of Product Adopter Categories
Dr. Paurav Shukla 2
CRM
Four Types of Buyer Behaviour DMU: Decision Making Units
‘The group of people within an organisation who are
involved in making organisational purchase decisions’
The degree and significance of
between the brand alternatives
Repetitive Dissonance
Members of the buying centre:
Low
Petrol, FMCG, reduction Clothes,
Banks Carpet Users
differences
Sales Promotions Added Value Influencers
Buyers
Deciders
Variety Seeking Complex
High
Gatekeepers
Holidays, Furniture Cars, PCs
Accessible In-Depth
Information Information
Low High
The customer’s degree of involvement with the product
How Customers Use or Dispose of DMP: Decision Making Process
Products
To be Problem Recognition
Rent it Give it (re)sold
Get rid of it away
temporarily General Need
Loan it
To be
used Specification
Trade it
Get rid of it Supplier Search
Product permanently Direct to
Use for consumer Proposals Submission
original Sell it
purpose
Through Supplier Selection
Keep it Convert
to new Throw it middleman
purpose away Order Specification
Store it To Performance Review
intermediary
Major Influences on Industrial Buying
Business vs. Consumer Markets
Behavior
Fewer buyers Environmental
Larger buyers Organizational
•Level of
Close supplier-customer relationship demand Interpersonal
Geographically concentrated •Economic •Objectives Individual
outlook •Interests •Age
Derived demand •Policies
•Interest rate •Authority •Income Business
Fluctuating demand •Procedures •Education
•Rate of techno- •Status •Job position Buyer
Professional purchasing logical change
•Organizational •Personality
Several buying influences •Political and structures •Empathy •Risk attitudes
regulatory •Culture
Multiple sales calls developments •Systems •Persuasive-
ness
Direct purchasing •Competitive
developments
Reciprocity
•Social responsi-
Leasing bility concerns
Dr. Paurav Shukla 3
