|
|
Comparing Consumer to Industrial Marketing. Page 3 / 5 |
|
3. How are purchasing decisions made?
Many marketing texts argue that industrial buying is characterised by
rational decision making. Many companies would like to think this is the case
however it may be more accurate to say that industrial buyer behaviour is more
often based on measurable performance characteristics of the offering (and
perhaps the availability of high levels of technical knowledge on the subject
matter) and less on non measurable perceived characteristics such as style
fashion or peer acceptance.
This is not to say that perceived characteristics, style fashion or peer
acceptance are not rational decision variables because they patently are. They
are just not so easily measurable as a performance characteristic. It remains
true however that individual buyers in industry are also consumers and peer
groups exist within professions, departments and companies. 3.1 Who makes purchasing decisions
& how? | Industrial markets | In industry buyers are often forced to go through a buying process
controlled by their companies which may involve professional purchasing staff,
specifying engineers, approved suppliers, quality department approval
etc. | Consumer
Markets | In consumer markets
buying decisions are made by one or more individual consumers. There is rarely
a formal purchasing model consumers are forced to go through which means they
may in some circumstances be at greater risk of not knowing all the
alternatives. | Summary: individuals make the decision in both industrial and
consumer markets but the process is more likely to be formalised in
industry. |
3.2 What support is available to the decision
makers? | Industrial
markets | Industrial buying
groups often include technically and commercially aware individuals and
companies try to make the process as rational as they can by installing various
procedures. Industrial customers often have a high level of technical
knowledge about the products they are buying. | Consumer Markets | Consumers look to their peers,
colleagues, friends, advice and independent reviews, depending on the value of
the purchase. It is rare in consumer markets that individual consumers
have as much technical knowledge about the products or services they are buying
as those selling these products. | Summary: greater technical
knowledge and advice is available to buyers in the industrial setting. It
follows they may be looking for more technical measurable information about
their options and perhaps less on immeasurable issues on which to base their
decision. |
3.3 What is the influence of groups in
purchasing? | Industrial markets | Because buying groups and procedures are characteristic of
industrial markets it is likely a reasonable information search will have been
carried out to identify alternatives. It is also likely that post purchase
blame or credit can be shared wider than one individual which may reduce risk
implicit in decision making. | Consumer Markets | Individual consumers can act on their own (typically they can
however be grouped into like minded groups of people who tend to choose in the
same way). Nevertheless by acting on their own individual consumers may face
greater perceived risks for example: buying out of date fashion goods, being
ridiculed for having the wrong brand name in a fashion conscious group. It
may follow that individual consumers could be more affected by what other
consumers are buying than companies might be affected by what other companies
are buying. | Summary: buying groups may reduce perceived risk in industry but
as they also exist informally in consumer markets this may not define the
difference. |
>> Next page: "Market
value, consumption and transactions."
|
|
Home