Consensual Purchase Decision by ihz40241

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									                Chapter 12
Organizational and Household Decision Making

                        By Michael R. Solomon

                          Consumer Behavior
                          Buying, Having, and Being
                                        Sixth Edition
                                               12 - 1
   Opening Vignette: Amanda
• Why is Amanda nervous?
• What difficulties has Amanda had
  since moving in with Orlando?
• Why does Orlando’s occupation
  convince Amanda that he is capable
  of more?
• What did Amanda do to help Orlando
  prepare the hors d’oeuvres?
                                   12 - 2

             12 - 3
Organizational Decision Making
• Collective Decision Making
   – A process in which more than one person is involved in the purchasing
     process for products or services to be used by multiple consumers
• Organizational Buyer
   – A person who purchases goods and services on behalf of companies for
     use in the process of manufacturing, distribution, or resale
• Business-to-Business Marketers:
   – Specialize in meeting the needs of organizations such as corporations,
     government agencies, hospitals, and retailers
• The organizational buyer’s perceptions of the
  purchase situation is influenced by:
   – Expectations of the supplier
   – Organizational climate of his own company
   – Assessment of his own performance
                                                                         12 - 4
Organizational Decision Makers

• In the Information Age, organizational decision makers
  must stay on top of clients’ complex needs.
                                                       12 - 5
Advertising to Organizational Buyers
                   • Advertisements targeting
                     organizational buyers such as
                     this CDW ad for technology
                     equipment often try to assuage
                     the concerns of the risk
                     associated with purchase.
                   • This ad states, “At CDW, we
                     know that every day, you’re
                     asked to do the impossible.
                     From personal account
                     managers to custom
                     configuration, you can count on
                     us for brand name products, the
                     way you need them, when you
                     need them.”

                                                12 - 6
    Organizational Decision Making
   Versus Consumer Decision Making
• Factors which distinguish organizational and
  industrial purchase decisions from individual
  consumer decisions:
  – Purchase decisions frequently involve many people
  – Products are often bought according to precise technical
    specifications that require a lot of product category
  – Impulse buying is rare
  – Decisions are often risky
  – The dollar volume of the purchase is substantial
  – More emphasis on personal selling than advertising
                                                               12 - 7
How do Organizational Buyers Operate?

• Type of Purchase:
  – The type of item to be purchased influences the
    organizational buyer’s decision-making process
  – Buying Center:
     • A group of people who make the more complex
       organizational decisions
• The Buyclass Framework:
  – Straight rebuy: A habitual decision
  – Modified rebuy: Involves limited decision making
  – New task: Involves extensive problem solving

                                                      12 - 8
Organizational Buying Decision Types

                                  12 - 9
How Organizational Buyers Operate
• Decision Roles:
  – Initiator: The person who brings up the idea or need.
  – Gatekeeper: The person who conducts the information
    search and controls the flow of information available to a
  – Influencer: The person who tries to sway the outcome of
    the decision.
  – Buyer: The person who actually makes the purchase.
  – User: The person who winds up using the product or
• B2B E-Commerce
  – Refers to Internet interactions between 2 or more
    businesses or organizations
                                                             12 - 10
                   The Family
• Defining the Modern Family
  – Extended Family: Consists of three generations living
    together and often includes grandparents, aunts, uncles, and
  – Nuclear Family: A mother and a father and one or more
• Just What Is A Household?
  – Family Household: Contains at least two people who are
    related by blood or marriage.
• Family Size
  – Fertility rate: Determined by the number of births per year
    per 1,000 women of childbearing age.

                                                            12 - 11
               Family Structures

• Family structures continue to evolve, but some basic conflicts
  remain the same. This Italian ad for an antacid product says,
  “Certain things are hard to swallow.”
                                                                   12 - 12
      Meeting Family Size Needs
• Folger’s Coffee
  addresses an
  important need by
  allowing single people
  to brew one cup of
  coffee at a time.

                                  12 - 13
    The “Sandwich Generation”

• This insurance ad reminds us that people in the
  “sandwich generation” often must care for their parents
  in addition to their children.
                                                       12 - 14
Nontraditional Family Structures
  – Persons of Opposite Sex Sharing Living Quarters
• Voluntarily Childless:
  – Women of childbearing age who choose to have no
• Who’s Living at Home?
  – Boomerang Kids: Children between the ages of 18 and 34
    that return home to live with their parents.
• Animals Are People Too! Nonhuman Family

                                                        12 - 15
Dog Condoms?

      • This Spanish public
        service ad promotes
        pet sterilization via a
        fake ad for dog

                              12 - 16
Two Brides

             12 - 17
          The Family Life Cycle
• Family Life Cycle (FLC)
  – Concept that combines trends in income and family
    composition with the changes in demands placed upon this
    income to segment households.
• FLC Models
  – Focuses on longitudinal changes in priorities which is
    valuable in predicting demand for specific product
    categories over time.
  – Four variables are necessary:
     •   (1) Age
     •   (2) Marital Status
     •   (3) Absence or Presence of Children
     •   (4) Ages of Children
• Life-Cycle Effects on Buying
                                                             12 - 18
                   Ethan Allen
• This ad by a furniture
  specifically refers to
  stages in the family life

                                 12 - 19
Family Life Cycle

      Figure 12.1   12 - 20
          The Intimate Corporation:
           Family Decision Making
• Household Decisions
  – Consensual Purchase Decision: Members agree on
    desired purchase
  – Accommodative Purchase Decision: Members
    have different preferences or priorities and cannot
    agree on a purchase
  – Factors determining the degree of family decision
     •   Interpersonal need
     •   Product involvement and utility
     •   Responsibility
     •   Power
                                                    12 - 21
           Discussion Question
• This Kudos
  advertisement tries to
  explain that the
  product will satisfy two
  members of the
  household for different
• What type of family
  decision have the
  mother and son

                                 12 - 22
     Sex Roles and Decision-Making
• Autonomic Decision
  – When one family member chooses a product
• Syncratic Decision
  – When the family jointly makes a decision
• There is a shift in decision making
  toward more compromise and turn-
• Spouses typically exert significant
  influence on decision making.

                                               12 - 23
 Identifying the Decision Maker

• Family Financial Officer (FFO):
  – The individual who keeps track of the family’s
    bills and decides how much surplus funds will be
• Four Mother Types (LeoShe):
  –   June Cleaver, the Sequel
  –   Tug of War
  –   Strong Shoulders
  –   Mothers of Invention
                                                   12 - 24
          Who Buys the Pants?

• Although many men still wear the pants in the family,
  it’s women who buy them.
                                                          12 - 25
Leo Mother Types

     Figure 12.2   12 - 26
United Kingdom Households

                            12 - 27
 Identifying the Decision Maker

• Four Factors Determine the Degree to
  Which Decisions will be Made Jointly
  by One or the Other Spouse
  –   Sex-role stereotypes
  –   Spousal resources
  –   Experience
  –   Socioeconomic Status
• Kin-Network System:
  – Ties among family members, both immediate and
                                               12 - 28
Women Manage Many Tasks
            • Women often
              manage many tasks
              within the family that
              pull them in many

                                  12 - 29
Heuristics in Joint Decision Making

• Synoptic Ideal:
  – Calls for the husband and wife to take a common view
    and act as joint decision makers
• Frequently observed decision-making
  – (1) Areas of common preference based on salient,
    objective dimensions rather than subtler, hard-to-
    define cues.
  – (2) Couple agrees on a system of task specialization.
  – (3) Concessions are based on the intensity of each
    spouse’s preferences.

                                                        12 - 30
     Children As Decision Makers:

• Primary Market:
  – Kids spending their own allowance on their
    own wants and needs.
• Influence Market:
  – Parental Yielding: Occurs when a parental
    decision maker is influenced by a child’s
    request and “surrenders.”
• Future Market:
  – Kids eventually grow up to be adults.
                                                 12 - 31
Kids’ Influence on Household Purchases

                                    12 - 32

          12 - 33
        Consumer Socialization
• Consumer Socialization
  – The process “by which young people acquire skills,
    knowledge, and attitudes relevant to their functioning
    in the marketplace.”
• Influence of Parents:
  – Parents’ influences in consumer socialization are
    both direct and indirect.
• Television: “The Electric Babysitter”:
  – The more children are exposed to television, the
    more they will accept images depicted as real.
                                                        12 - 34
Five Stages of Consumer Development

               Figure 12.3      12 - 35
     Consumer Socialization (cont.)
• Sex Role Socialization:
  – Children pick up on the concept of gender identity as early as
    age one or two.
• Cognitive Development
  – Stage of Cognitive Development: The ability to comprehend
    concepts of increasing complexity
  – Preoperational Stage of Development: A stage of cognitive
• Alternative three-segment approach:
  – (1) Limited
  – (2) Cued
  – (3) Strategic
                                                              12 - 36
Marketing Research and Children
• Product Testing:
  – A particularly helpful type of research with children.
  – Involves watching kids play with toys or involving
    them in focus groups
• Message Comprehension:
  – Children differ in their ability to process product-
    related information
  – Ethical issues must be considered when directing
    advertising appeals at children

                                                           12 - 37
              Product Testing

• Lego did research to learn how boys and girls play with
  their building toys.
                                                       12 - 38
Children’s Perceptions of Commercials

               Figure 12.4         12 - 39
Discussion Question
         • Ads that directly target
           children must deal with a
           number of ethical issues.
           This ad solicits children to
           directly contact the
         • The girl in the picture is
           captioned as saying, “My
           name is Nina, I am 4 years
           old and I have three close
           friends and live in a house
           with 6 rooms.”
         • How does this ad target the
           weaknesses of the cognitive
           capabilities of children in
           this age range?
                                    12 - 40

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