Peter Drucker said that the purpose of business is to create a customer; on this view buyer behavior is the most essential aspect of business. To understand consumers is to understand how to develop a successful business. The guiding principle of marketing is to "find a need and fill it." Even inventions with no apparent use can be made useful when buyer behavior is examined.

 

This lecture covers some facts about buyer behavior and offers some explanations for the facts. Despite the fast pace of Web technology, the behavior of consumers has characteristics that seldom change.

 

Products

Convenience Goods – purchased frequently, immediately and with a minimum of effort

• Staples, e.g., pet food
• Impulse items, e.g, magazines
• Emergency goods, e.g., cold medicine

Shopping goods – purchased less frequently or immediately and with comparison

• durable goods, e.g., furniture
• nondurable goods. e.g., wine

Specialty goods – purchased for brand nameSpecialty goods - purchased for brand name

• durable goods, e.g., clothing
• nondurable goods, e.g., cosmetics

Venues

• Brick and mortar (physical, catalog)
• Internet only (e-tail)
• Bricks and clicks

Problems

• Low conversion rates: Five percent of site visitors buy products

• Abandoned shopping carts: About 60% of shopping carts carts are abandoned

• Difficult e-commerce shopping paths: Difficulty in getting from home page to sales-confirmation window; bad navigation and product organization

• Annoying or irrelevant animations: Flashy graphics that slow page loading

• Difficult returns: Difficulties in returning unwanted goods

• Excessive shipping charges: Too-high shipping charges; shipping as a profit center

• Technical problems: Malfunctioning sites, pages or scripts; no confirmation of purchase

• Inventory information missing: Out-of-stock surprises at end of purchase

• Poor product graphics: Bad image quality and unreliable colors

• Intrinsic Web problems:
  • No immediate gratification
  • No social experience
  • No physical presence

• Shopping distractions: Awful popups and other annoying ads

• After-purchase problems:
  • Spam with no unsubscribe feature or opt-out rather than opt-in
  • Mistaken identity
  • Tracking of past behavior

• Privacy issues:
  • Invasive registration
  • Required cookies

Purchase Information Sites

Purchase Process

Key Steps

Purchase venue Purchase intention Purchase confidence Buy Purchase satisfaction Repeat Purchase