Economics of Buyer's Behaviour
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1 Economics of Buyer's Behaviour Shalini Yadav N5 Northern Book Centre New Delhi
2 Preface ' vii 1. INTRODUCTION " 1 What is Buyer's Behaviour? 2 Difference between Buyers and Consumers 3 Importance of Buyer's Behaviour 3 Inter Relationship between Buying and Selling 5 Return to a Buyer's Market 5 Causes Leading to a Buyer's Market 6 Emerging Potential of the Indian Market 6 Objectives of Buying 8 Models or Theories of Buyer's Behaviour 9 Economic Theory 9 Physiological Theory 11 Psychological Theory 11 The Stimulus Learning Theory 11 The Gestalt Theory 12 The Psychoanalytical Theory ' 13 The Sociological Theory 13 Other Comprehensive Theories 14 The Nicosia Model 14 Howard Sheth Model 14 Engel, Kollat and Blackwell Model 15 Types of Buyer's Behaviour 15 Organisational Buying Behaviour 16
3 Organisational Buying Process Differences between Organisational and Household Buyers Buying Roles in Decision Making Process Types of Purchase (buying) Decision Behaviour Routinised Response Behaviour (RRB) Limited Problem Solving (LPS) Extensive Problem Solving (EPS) Stages in Buying Decision Process Need Recognition Information Search Evaluation of Alternatives Purchase Decision Post-purchase Evaluation and Behaviour Brand Loyalty References METHODOLOGY AND LITERATURE REVIEW Objectives of the Study Hypothesis Methodology Limitations of the Study Literature Review Psychological Analysis of Economic Behaviour by George Katona (1951) 40 Buyer's Behaviour: Theoretical and Empirical Foundations by John A. Howard and Lyman E. Ostlund (1973) 41 Indian Consumers: Studies and Cases for Marketing Decisions by Subhas C. Mehta (1979) 41 Principles of Marketing by Philip Koder (1983)
4 xi Consumer Behaviour: Concepts and Applications by David Loudon and Albert J. Delia Bitta (1988) 43 Consumer Psychology for Marketing by Gordon R. Foxall and Ronald E. Goldsmith (1994) 44 Consumer Behaviour by Leon G. Schiffman and Kanuk Leslie Lazar (1996) 45 Commentary on Consumer Behaviour by S.A. Chunawalla (2000) -* SlTUATIONAL SETTING 47 Patna 47 History. 47 Physical Situation 49 Climate and Rainfall 51 River 51 Population 52 Education 55 Caste 56 Economic Condition 56 Communication: Road Transport 58 Political Condition 58 Ranchi 59 History 60 Physical Situation 62 River System 62 Climatic Conditions 63 Population 63 Sex Ratio 64 Literacy 65 Social Relations 66 Tribal Mooring 66 Economic Condition ' 67
5 i Contents Industrialisation 67 Trade and Commerce 68 Communication Facilities 68 Political Condition 68 References GENERAL FACTORS INFLUENCING BUYER'S BEHAVIOUR 71 Demographic Factors 71 The Number and Geographic Distribution of Population 71 The Composition of Population Age Gender Marital Status Household Characteristics Geography or Location Religion Education of die Population Occupation Social Factors Family Role of Family Members Reference Groups Celebrity Appeal Expert Appeal The Common Man Appeal The Executive Spokesperson Appeal Role and Status Social Class Opinion Leaders Cultural Factors
6 Culture Sub-Culture Psychological Factors Motivation Maslow's Theory of Motivation McClelland's Theory of Achievement Motivation Perception Learning Attitudes Personality References 5. ECONOMIC FACTORS INFLUENCING BUYER'S BEHAVIOUR Economic Factors and Buyer Decision Macro Economic Factors Gross National Product (GNP) Per Capita Income Distribution of GDP Stage of Economic Development The Marketing Infrastructure General Economic Condition Business Cycle Prosperity Recession Depression Recovery Inflation Shortages Government Policy Fiscal Policy Monetary Policy
7 Competition Perfect Competition Monopoly Monopolistic Competition Oligopoly Types of Competitive Forces Rivalry among Existing Competitors Threat of New Entrants Threat of Substitute Products Bargaining Power of Suppliers Bargaining Power of Buyers Economic Factors Affecting Personal Consumption Spending Income Disposable Income Discretionary Income Attitude Towards Income Income Expectations Past Income Changes Orfier People's Income Willingness to Purchase Family Composition Wealth Assets Attitude towards Assets Consumer Credit Price Saving and Spending Decision References Propensity to Consume
8 xv 6. FINDINGS AND ANALYSIS 135 Section A 135 Section B 140 Section C 146 Section D 158 Section E 167 Section F 175 Section G * -*" 179 Section H 181 Section I CONCLUSION AND SUGGESTIONS 194 Suggestions 200 Product Strategies 200 Pricing Strategies 202 Distribution Strategies 202 Promotion Strategies 203 BIBLIOGRAPHY 205 INDEX 213
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