B2C vs B2B Consumer Decision-Making: A Comparative Report

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B2C & B2B CONSUMER DECISION-MAKING PROCESS
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Executive Summary
Consumer Decision-making process plays an important role in determining the fate of a
company. A number of factors go in to the influencing of consumers decision for buying a
particular product. There are different types of buyers in a market and the marketers also take up
strategies depending upon the type of buyers. The assignment here tries to analyze the different
factors that influence the consumer's decision-making process and the strategies taken up by
marketers to carry out B2B and B2C transactions. Taking up different strategies depending upon
the buyers helps in the future growth of the market.
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Table of Contents
Introduction......................................................................................................................................4
LO1: Demonstrating the ability to purchase with reference to decision making............................4
P1: Analyzing the stages of the decision-making process...............................................................4
P2: Importance of consumer decision-making the process for marketers......................................5
M1: Evaluating the roles played by marketers to respond to the decision making the process......5
LO2: Factors influencing consumer decision-making criteria........................................................7
P3: Comparing the decision-making criteria between B2B and B2C.............................................7
P4: Propose approaches to understand B2B and B2C decision-making process............................9
M2: Evaluating how different factors influence consumer decision-making criteria...................10
LO3: Marketers role in analyzing decision-making criteria.........................................................11
P5: Role played by marketers in influencing the decision-making criteria...................................11
M3: Methods taken by marketers to influence the consumer decision-making process..............13
D1: Evaluating the role of theories, models in influencing the decision-making the process.......13
Conclusion.....................................................................................................................................13
Reference List................................................................................................................................14
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Introduction
Consumers Decision making the process can be referred to as a specific behaviour of consumers
of how consumers and buyers select products or avail services to satisfy their requirements and
desires. According to Wang and Yu (2017), the consumer's decision-making process solely
depends upon the individual choices and preferences. A number of factors play an important role
in influencing the decision of consumers to avail a particular product or service. The assignment
mainly focuses on the consumer decision making the process for a particular product or
organization. The assignment also tries to draw a comparison between the B2B and B2C
decision-making process. It also analyses the factors affecting consumer behaviour and how the
marketing team of a company will deal with it.
Company Background
Hook Norton Brewery is a beer manufacturer company in UK. It is the best example for
Victorian Tower Brewery. Established in the year 2001, the company is basically a family
oriented business that mainly deals in varieties of ales and beers. The main aim of the company
is to provide the best range of ales and beers to its customers by combining traditional brewing
methods with modern technologies. According to the reports, the company's product is very
popular among the European population and the company has also received an increment in its
gross profit margins by 29.1 % from 26.4% (Hooky.co, 2019).
Assignment 1
LO1: Demonstrating the ability to purchase with reference to decision making
P1: Analyzing the stages of the decision-making process
A consumer can be termed as a person who before buying a product a consumer goes through a
series of process and there are several factors that influence the decision of a consumer. In order
to gain a firm position in the market, it is necessary for a company to produce products according
to consumer’s choice and preferences. Therefore the company should follow certain steps that
generally influence the consumer decision. According to Fang et al. (2016), if a company can
understand the wants and preferences of the consumer at the right time and produce goods
according to it then it can gain high profit. Firstly the consumer decision-making process starts
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with a problem recognition phase where the consumer identifies his requirements and wants.
For example, a consumer wants to drink the best beer that is present in UK so the individual will
search for the best brewers in UK. Secondly, the consumer often uses a search engine to find
out the actual products that can satisfy the needs. For example, the consumer will gather all the
information about the beers provided by the best brewery in UK. The next step involves
searching for alternatives depending upon price, quality reviews etc. For example before opting
to have beer from the Hook Norton Company the consumer might once gather information about
the other alternatives that are available in the market. The final step involves the evaluation of
the decision made where the consumer decides whether or not he would avail the service of the
Hook Norton Company in future depending upon his/her experience after having the beer.
P2: Importance of consumer decision-making the process for marketers.
Analyzing Consumer Behavior is necessary for any organization before it launches a new
product in the market. As opined by Karimi et al. (2015), apart from individual’s choice and
preferences, several numbers of factors goes into the influencing of the consumer decision-
making the process. Factors influencing consumer behaviour may also include:
● product features
● the brand value of company
● customer ratings.
The operational framework of a company involves manufacturing goods and selling them to
consumers to earn a profit. As consumers are the sole factor upon which the development of a
company depends, therefore, it is necessary for the company's management to take up strategies
according to the requirements of the consumers. For example, before launching a new variety of
beer or ales into the UK market the Hook Norton company should try to study the consumer
perception. Therefore it is necessary for the company to understand the needs preferences, past
experiences of its consumers so that they can position their product in such a manner in the
market that it would bring high profit (Rezaei, 2015).
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M1: Evaluating the roles played by marketers to respond to the decision making the
process.
The consumer decision-making process plays an important role in deciding the fate of a company
and its product. As providing satisfaction to consumers is the sole motto for companies,
therefore, the company should take up strategies and initiatives in such a manner that it would
help to influence the consumers' decision-making process in a positive manner (O'Rourke and
Ringer, 2016).
The decision-making model of consumer behaviour is divided into five steps. Therefore it is
necessary for the marketers to develop strategies based on these five phases.
● Problem Recognition phase: This phase involves the understanding of the consumer
about his particular problem, or his desire. At this stage, the consumer desperately tries
to find a way in which he can satisfy his need or solve his problem. As for the marketers,
it is necessary for the company to create its brand awareness so that the company remains
at the top priority list while solving the problem, or meeting the needs of its potential
consumer. Therefore the marketing strategies of the company at this phase should be such
that it becomes the first preference of its consumers.
● Search Engine Phase- This phase involves the consumer in searching for all the possible
information about the way in which he /she can solve his problem or meet his desires. For
example, before buying a beer from the company, the consumer will gather all the
information in terms of price, ingredients, and customer ratings. So et.al. (2015), stated
that it is necessary for the marketers to take up strategies that would make all information
about their products and services easily available to its consumers. This can be done by
creating official websites or community pages where the marketers can share valuable
information about their new products and services.
● Alternative Evaluation Phase: In this phase, the consumer tries to compare the product
of the a particular company with other alternatives available in the market. For example
before buying beer from the Hook Norton company, the consumer wills information of
the beer with that of other company’s beer available in the market. The marketing team at
this phase should try to provide information in such a manner that its product would
appear to be the best in the market (So et al., 2015). Strategies like personalizing websites
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according to buyer preferences, providing the best discounts on the most bought products
will help to gain customers attention.
● Purchase Phase: At this phase, the consumer has made his/her mind to buy the beer of
the Hook Norton company, therefore at this stage, it is necessary for the marketers should
take up the examples of the sale as an achievement that would help to attract more
buyers. The marketers at this phase can ask their buyers to provide feedback regarding
their products on their official websites which would help to gain the attraction of other
buyers.
● Post Purchase Phase: Once the sale is made it is necessary for the marketers to maintain
a good relationship with its buyers. The marketers can take up strategies like sending
emails to their regular customers about the new product launches or providing discounts
on purchasing goods to their regular customers.
Figure 1: The Consumer Decision Making Process
(Source: So et al., 2015).
Assignment 2
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LO2: Factors influencing consumer decision-making criteria
P3: Comparing the decision-making criteria between B2B and B2C
A buyer of a product can be of various type. It can either be a normal consumer (B2B) who buys
goods and products solely for his /her personal use or the buyer can be another organisation or
business (B2B) which buys the product to sell it to other consumers (Mencarelli and Riviere,
2015). In both the cases marketing of a product requires excellent customer service, good
knowledge of the company about the customers' preferences and maintaining authenticity in both
the business transaction.
However, there are slight differences between both the business transactions.
B2B B2C
1. The main driving factor for business
includes customer ratings for the
product or good past relationship
The main driving factor for influence involves
the brand name of the company, the price of
products.
2. It is a complex form of a business
transaction as it involves a transaction
with an organization that needs profit
It is a simple form of a business transaction as
the buyers are consumers whose main motto
is to get his desires fulfilled/
3. These type of transaction involves a
large number of stakeholders like
suppliers, customers, management of
the company who is purchasing the
product.
This type of transaction has only one
stakeholder who is the customers.
4. The decision making or the sales
cycle is comparatively larger as the
number of stakeholders is more and
each one has a different opinion.
The decision making or sales cycle is shorter
as it only involves the decision making of a
consumer.
5. The product information in this type of The product information, in this case, is less
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transaction should be more so that it
can fulfil the purchasing company's
profit criteria
as it only aims to satisfy the customer needs.
6. The marketing activities followed in
this type of transaction include
creating brand awareness, holding
meetings with the company,
maintaining a good relationship
The marketing activities, in this case, involve
providing discounts to consumers, creating
brand awareness, analyzing and producing
products only according to the needs of the
consumer.
7. Example: web development business Example: Beer manufacturing business
Table 1: Comparison between B2B and B2C business
(Source: Created By author)
P4: Propose approaches to understand B2B and B2C decision-making process.
Mencarelli and Riviere (2015), stated that business operations refer to the strategies that are used
by the management of a particular business to secure a good position in the competitive market
by attracting more customers. The strategies taken up by companies depend upon the type of
buyers they are dealing with that is whether they are consumers or a company.
In case of B2C transactions the company's sell their products to consumers who use it for their
sole purpose. Therefore the company's should adopt strategies that would help to fulfil the
preferences and desires of its consumers
1. Demographics: the company's while producing goods should try to produce goods
according to the age groups of its customers. For example id, a company has customers
belonging to the age group of 18-25 years the company should try to produce goods
depending upon their preferences.
2. Promotion through web platforms: The social media platforms through web pages,
communities, and official websites help companies to promote about their business and
provide relevant information to consumers about the products (Cawsey and Rowley,
2016). Social media in recent times have become great consumer influencer by allowing
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the consumer to have a view on the public ratings about a particular product of a
company that they want to buy.
3. Providing best deals: Customers usually get attracted to products that provide the best
deals and discounts and which can be easily affordable. Therefore companies should try
to provide the best deals and discounts on its products in order to attract customers.
As opined by Mencarelli and Riviere (2015), B2B transaction involves the selling of products
and services to another organization. This type of business transaction is relatively complex and
therefore the management has to take different strategies for its function. The strategies that are
usually followed in this type of transaction are as follows:
1. Enabling interactions: As opined by a B2B transaction is important is a complex
procedure therefore the company before carrying out any business transaction should
hold numerous meetings with the purchasing company in order to get the opinion of its
large stakeholder base.
2. Identifying the key decision maker: in case of a B2B transaction, the company should
try to find the key decision maker of the client organization. The key decision maker is
one who will take all the decision related to the client organization. Approaches like
searching on Google, LinkedIn can be used in such cases.
3. Producing products that fit the market: Production of products that are best fitted is a
competitive market. Launching a product that is not required by the potential client
organization may lead to failures in B2B transactions. Therefore it is necessary for the
company to do market research about its client organization and then produce products
according to its needs.
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Figure 2: B2B and B2C transactions
(Source: Mencarelli and Riviere, 2015)
M2: Evaluating how different factors influence consumer decision-making criteria
Consumer Behavior refers to the behaviour of buyers while buying a particular product or
availing a particular service. Consumer Behaviour on a particular product or service can directly
influence the loss or profit margins that the company will acquire. However, the decision of
consumers about buying a particular product of a company is influenced by several factors. The
factors are:
● Needs as per age: It is evident that different age groups have different needs and desire.
For example, the needs of a 10-year-old kid will always be different from a 68-year-old
man. Therefore it is necessary for companies to manufacture goods that can satisfy the
needs of an individual as per his age.
● Perception: The perception of an individual plays an important role in increasing the
customer base for a company. Customers often try to avail products from a company
which has high brand value. This is because they have a perception that the products of
the company will be of superior quality compared to other substitutes in the market.
● Trends: Every consumer tries to follow the trend that is popular at a particular time.
Following the trend, they often avail goods that are produced according to the trend. For
example, if there is a trend of wearing skirts, consumers will generally opt for the product
of the company that is manufacturing skirts.
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● Experience: The past experiences that a customer has after availing a particular product
or service will also have an influence on its decision-making process in future. For
example, if a consumer gets satisfied after drinking a new variety of beer from the Hook
Norton Company, he will surely opt for other drinks of the company in future.
● Socio-Economic Level: The socio-economic level of a consumer also plays an important
role in influencing his product purchasing decision. According to Flammer (2015),
consumers generally to for products that have quality and which easily available at a low
price. Therefore it is necessary for a company to produce goods and keep the price level
such that it can be affordable by all consumers irrespective of their economic status.
LO3: Marketers role in analyzing decision-making criteria
P5: Role played by marketers in influencing the decision-making criteria
Decision-making process plays an important role in determining the fate of a company and its
products. As opined by Rezaei (2015), consumer’s behaviour or perception about a company
depends upon several factors like brand name, customer’s ratings, cultural background of
consumer and many more. However, the marketing strategies that are taken up by the company's
can play an important role in influencing the decision of its consumer.
For example in the problem recognition phase, when the consumer tries to find a solution for his
problem or a way to satisfy his desires the marketing team to create a brand awareness of their
company which will help the consumer to priorities it at first. For example in case of the
transaction process of the Hook Norton company which follows B2C transaction process the
company management can create a brand awareness of its drinks that would help it to get the
first preference of its buyers. In the case of a web development company like Intellect soft, the
company has to create brand awareness about its products for its client organizations.
In the selection engine phase, the marketers of B2C business process provides valuable
information about their products to its clients whereas in case of B2B transactions the web
development company may provide few information that is necessary to attract its client
organization. A B2B business usually does not reveal all the company information to its clients
at first instance (Mencarelli and Riviere, 2015).
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