A modified rebuy can occur for different reasons. Some examples include a business making changes to the product and a business decreasing costs.
Straight rebuys refer to the consistent purchases that are made by a company on a regular basis. These include the purchases that are made periodic...
A modified rebuy is the type of buying situation that occurs when a business makes a purchase from the same vendor or supplier but changes the orde...
A straight rebuy doesn't take as much time or research as the new buy or modified rebuy, but it is still important. The straight rebuy consists of...
A rebuy in business refers to the recurring purchases made from the same company. Two types of buying situations that consist of rebuys include the...
Understand this concept through examples of the three primary buying situations: straight rebuy, modified rebuy, and new task buy. Updated: 10/13/2021
Various factors may work in different situations. Every time when the buyer is to take a purchase decision, buying situation can be different, it m...
1 Complex buying behavior. Complex buying behavior is encountered particularly when consumers are buying an expensive product. 2 Dissonance-reducin...
A business-to-business buyer may encounter are the straight rebuy, the modified rebuy, and the new-task buy. In a straight rebuy situation, the buy...
What is more likely is that a purchase is new to the people involved. For example, a school district owns buildings. But when a new high school needs to be built, there may not be anyone in management who has experience building a new school. That purchase situation is a new buy for those involved.
A straight rebuy is a situation in which a purchaser buys the same product in the same quantities from the same vendor. Nothing changes, in other words. Postpurchase evaluations are often skipped, unless the buyer notices an unexpected change in the offering such as a deterioration of its quality or delivery time.
The stages in the B2B buying process are as follows: Someone recognizes that the organization has a need that can be solved by purchasing a good or service. The need is described and quantified. Qualified suppliers are searched for, and each qualified supplier is sent a request for proposal (RFP), which is an invitation to submit a bid to supply the good or service. The proposals suppliers submit are evaluated, one or more supplier (s) selected, and an order routine with each is established. A postpurchase evaluation is later conducted and the feedback provided to the suppliers. The buying stages an organization goes through often depend on the buying situation—whether it’s a straight rebuy, new buy, or modified rebuy.
If the good is a physical product, the vendors generally provide the purchaser with samples, which are then inspected and sometimes tested. They might also ask satisfied customers to make testimonials or initiate a discussion with the buyer to help the buyer get comfortable with the product and offer advice on how best to go about using it.
4. Qualified suppliers are asked to complete responses to requests for proposal (RFPs). Each vendor that makes the cut is sent a request for proposal (RFP), which is an invitation to submit a bid to supply the good or service. An RFP outlines what the vendor is able to offer in terms of its product—its quality, price, financing, delivery, after-sales service, whether it can be customized or returned, and even the product’s disposal, in some cases. Good sales and marketing professionals do more than just provide basic information to potential buyers in RFPs. They focus on the buyer’s problems and how to adapt their offers to solve those problems.
7. A postpurchase evaluation is conducted and the feedback provided to the vendor. Just as consumers go through an evaluation period after they purchase goods and services, so do businesses. The buying unit might survey users of the product to see how satisfied they were with it. Cessna Aircraft Company, a small U.S. airplane maker, routinely surveys the users of the products it buys so they can voice their opinions on a supplier’s performance1.
Chapter 15: Price, the Only Revenue Generator
In a modified rebuy situation the buying organization may seek certain modifications in the specifications of the product/service being purchased, prices, terms of supply, etc. The most appropriate decision-making approach in this type of situation is the limited problem-solving approach. This situation usually involves participants in the buying decision process. In a new task buying situation, the company is buying a product or service for the first time and has very little or no experience in such a purchase.
In a straight rebuy situation, the buyer reorders a product or service without any modifications on a routine basis through the purchasing department. In this situation, the buyers have substantial experience in dealing with the need and require little or no additional information. A routine problem-solving approach is suitable for this type of buying situation.
The decision-makers seek more information in this situation to help them evaluate and choose from amongst the alternatives. In such a situation the organization buying process is more complex and involves many more participants from different departments in the organization. The buying company also needs to decide on the product/service specifications, prices, delivery terms, order quantities, service terms, etc. companies follow the extensive problem-solving approach for making decisions in such situations.
There are seven commonly used organizational buying criteria. One of them is
it occurs when the users, influencers, or decider in the buying center want to change the product specifications, price, delivery schedule, or supplier. The item purchased is largely the same as with the straight buy. But the changes usually necessitate enlarging the buying center to include the people outside the purchasing department. (a changed order)
1) price, (2) ability to meet the quality specifications required for the item, (3) ability to meet required delivery schedules, (4) technical capability, (5) warranties and claim policies in the event of poor performance, (6) past performance on previous contracts, and (7) production facilities and capacity.
A consumer wants to buy a car and it’s a huge purchase decision for him because it involves great financial and economical risks. He has to consider many factors. Like how his friends, family, and colleagues would react. How his social status in the social circle would look after acquiring the car.
Companies influence the buying behavior of habitual consumers by having special shelf space, where they show the number of products and their different versions.
Dissonance-reducing buying behavior happens when the consumer shows a high level of involvement because the product is very pricy and expensive. We don’t usually buy expensive things in our daily routine life. When it comes to it, the consumer would buy the product that is easily and readily available. It’s because there aren’t many choices with not many significant alternatives.
Complex buying behavior occurs when a person buys an expensive and costly product. In our daily life, we don’t normally buy costly products frequently. When it comes to it, we show complete interest in the purchase decision by thoroughly investigating and researching the product.
It’s because there’s a difference between buying a car and buying a coffee or an ice-cream. It’s a common observation that if the product is costly and expensive, then it’s purchasing would take more time. Rather than a product that’s casual, cheap, and ordinary.
The customer would buy the product without doing sufficient research and inquiring information about it. His main purpose is to buy a table to use it and he’s got enough information for the purchase.
Example of habitual buying Behavior. A consumer wants to buy a loaf of bread, salt, sugar, toilet paper, or any other daily use items . He would like to buy the products of the brands that he’s already familiar with rather than experimenting with something new.
Modified rebuy could also be called as limited problem solving situation in which supplies a change and gives the customer with new experience and new preference (CM, 2005). It gives a chance to the customer to try something new. If the introduction of a new brand or a product shows many advantages to the customer, it could require a change in the customers’ decision criterion. For example, a housewife decides to buy a soap and she sees a new liquid toilet soap which promises to keep her skin soft and moisturized, the brand also promises to give vitamin E, which the manufacturer claims is required in temperate conditions. The liquid toilet soap brand is available in four fragrances .The pack can be refilled every time the soap gets fully consumed .Now this introduction is likely to change her decision and may be the choice criterion. If she spends some time in evaluating the liquid toilet soap against the normal bar soap and then decides to try it, we conclude that for her it was a limited problem solving situation (CM, 2005). As can be seen, modified rebuy might often lead to a trial purchase. The customer may even decide to continue with her current product choice. Generally it has been admitted that brand extension strategy helps the customer to reduce the elements of newness in the purchase decision.
In conclusion, there are three major types of buying situations, which are new task, modified rebuy and straight rebuy. Three factors make the buying situations be different from the others, customers may face different problems in these situations. Thus, there are four main factors which are likely to affect customer involvement.
In the new task buying situation, because customer has no experience for the products, it may have more factors affecting the customer involvement. The customers could consider all the factors: capacity, quality, price and also brand, it could take the customers more time than other buying situations.
Generally, the customers spend little or no time choosing alternatives of the product and the substitutes of the product .Brand loyalty is relatively higher here. Moreover, this is a buying situation where a customer perceives a low risk in buying the product and/or the brand. For example, a housewife goes to the shop or a supermarket and spends much less time in choosing her toiletries, drinks like tea or coffee and other food products. For each time she goes to buy the things for family requirements and needs, she generally finishes up buying the same brand.
In other words, customers are aware of his or her choices, they know what they are searching for, as his or her choice, what exactly his need is and which is based on personal experience of either self or others might be relatives, friends or the customers have heard about it that is known to be called as good messages.
The new task could also be defined as extensive problem solving situation (LME, 2006). In this situation, the buyer has no past experience for products and he is totally new to buy the products which require some and extensive efforts for a buyer to decide about the product purchase. It may take customers longer time to make a decision because it could have a greater risk or cost and take more time in getting know of the new products.
Consumer behaviour is the study of individuals, groups, or organizations and the processes they use to choose, expend, and dispose of products, services, experiences, or ideas to satisfy their needs and the impacts that these processes have on the consumer and society (Noel, 2009). Consumer behaviour mixes elements from psychology, sociology, ...