Business and Organizational Customers and Their Buying Behavior
-
Upload
felix-perkins -
Category
Documents
-
view
248 -
download
0
description
Transcript of Business and Organizational Customers and Their Buying Behavior
Chapter 6Business and Organizational Customers and Their Buying Behavior
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
6-2
At the end of this presentation, you should be able to:1. name and give examples of the different
types of business and organizational buyers.
2. describe how organizational and business markets differ from consumer markets.
3. describe each step in the model of organizational/business buying.
4. explain the different types of buying processes.
6-3
At the end of this presentation, you should be able to:5. understand the different types of buyer-seller
relationships and their benefits and limitations.
6. know about the number and distribution of manufacturers and why they are an important customer group.
7. know how buying by service firms, retailers, wholesalers, and governments is similar to—and different from—buying by manufacturers.
8. understand important new terms.
6-4
Business and Organizational Customers – A Big Opportunity
•Federal•State and Local
Government Units
•Wholesalers•Retailers
Intermediaries
•National•LocalNonprofits
•Manufacturers•Farms, mines, etc.
•Financial institutions
•Other providers
Producers
All Business &
Organizational
Customers
6-5
Understanding Business & Organizational Customers for Marketing Strategy Planning (Exhibit 6-1)
A Model of Organizational/Business Buying
• Defining the problem• Buying process • Buyer–seller relationships
Characteristics of Types of OrganizationalCustomers
• Manufacturers• Producers of services• Retailers & wholesalers• Government units
Chapter 5Final Consumersand Their BuyingBehavior
Chapter 6Business and OrganizationalCustomers and Their BuyingBehavior
Business & OrganizationalMarkets and CustomersAre Different• Buyers• Economic needs• Behavioral needs• Ethical issues• Purchasing managers• Multiple buying influence• Buying procedures
6-6
Business and Organizational Customers
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
6-7
Serving International Markets
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
6-8
Differences Between Organizational Customers and Final Consumers (Exhibit 6-2)
Business &Organizatio
nalMarkets Are
Different
Multiple buying
onfluence
Ethical issues arise
Buyers follow
proceduresPurchasingmanagers
arespecialists
Behavioral needs
still matter
Economic needs areprimary
Fewer but larger
customers
6-9
Multiple Buying Influence
6-10
Multiple Influence and Roles in the Buying Center
Gatekeepers Deciders
InfluencersUsers
Buyers
BuyingCenter
6-11
Checking Your Knowledge
Consuela Velasquez is a receptionist for a group of seven physicians. As she controls the calendars for the physicians, any sales representatives from a pharmaceutical company wanting to call on the physicians have to go through Consuela. As a result, it is very important for sales reps to cultivate a good relationship with her. In the buying center, Consuela would be best described as a:
A. buyer.B. user.C. influencer.D. gatekeeper.E. decider.
6-12
Checking Your Knowledge
Ahmed Jamison is a purchasing specialist for a large company. He has the authority to execute purchase orders on amounts up to $100,000. On a purchase order for a higher amount, Ahmed arranges the terms of sale, but the transaction has to be approved by the company president. In the buying center for a purchase in excess of $100,000, Ahmed is a(n) _________ and the president is a(n)_________.
A. buyer; influencer B. influencer; buyerC. buyer; deciderD. gatekeeper; deciderE. user; influencer
6-13
A Model of Organizational Buying (Exhibit 6-4)Step 1: Defining the problem• Problem recognition• Need description• Product
specification
Step 2: Buying process• Establish buying
process• Gather information• Solicit bids and
select the supplier
Step 3: Managing the buyer-seller relationship• Structure the
relationship• Monitor supplier
performance
6-14
Step 1: Define the ProblemFrom
recognizing problems to describing
needs
Specifications describe the
product
Quality certification
6-15
Step 2: The Buying Process
Establish buying
processes
Gather informatio
n
Solicit bids & select
suppliers
6-16
Organizational Buying Processes(Exhibit 6-5)
Characteristics
Time required
Multiple influence
Review of suppliers
Information needed
Type of Process
Medium
Some
Some
Some
ModifiedRebuy
Much
Much
Much
Much
New-TaskBuying
Little
Little
None
Little
StraightRebuy
6-17
Major Sources of Information Used by Organizational Buyers (Exhibit 6-6) Marketing
sourcesNonmarketing
sources
Personal
Sources
Impersonal
Sources
• Salespeople • Others from suppliers firm• Trade shows
• Online events & virtual trade shows• Sales literature and catalogs• Emails & newsletters• Web site content including blogs, videos, case studies, & white papers
• Online searches• Rating services• Trade associations• News publications• Product directories• Online communities
• Buying centre members• Outside business associates• Consultants and outside experts
6-18
New-Task Buying Requires Information
Search Engines
New-Task Buying
RequiresInformation
Competitive Bids
Online Communities
Web Sites
6-19
Checking Your KnowledgeNikita Jackson, a sales representative for an industrial supply house, calls on a prospective business customer. The customer has an established relationship with another supplier, but says that there have been some reliability problems with deliveries. Nikita seizes the opportunity to describe her company’s state-of-the-art logistics and transportation system that provides outstanding delivery reliability at low shipping costs. Nikita is encouraged because her customer seems to be in a ___________ situation.
A. straight rebuyB. modified rebuyC. new-taskD. extensive problem-solvingE. limited problem-solving
6-20
Checking Your KnowledgeAuto parts wholesaler Fixem, Inc. decides to invest in a new data management system to increase the efficiency of its warehouse operations. Previously, all record-keeping was done via printed documents, but now all transactions will be electronic. This change will require Fixem to expend a significant amount of money for hardware, software, and training. However, in the long run, the cost savings should exceed the up-front investment. Fixem has arranged for presentations to be made by three different vendors. Fixem seems to be facing a ______________ buying situation.
A. straight rebuyB. modified rebuyC. new-taskD. extensive problem-solvingE. limited problem-solving
6-21
Interactive Exercise: Organizational Buying
6-22
Step 3: Managing Buyer-Seller Relationships in Business Markets
Relationships can involve many fromboth sides
Close Relationships
May ProduceMutual Benefits
• Mutual trust • Long-term
outlook• Share tasks at
lower total cost
Relationships May
Not Make Sense
• Reduced flexibility• Some purchases
are too small or infrequent
• Some purchases require much special attention
6-23
Relationships Have Many Dimensions (Exhibit 6-7)
6-24
Relationships Have Many Dimensions (Exhibit 6-7)
6-25
Relationship Dimensions
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
6-26
Relationship Dimensions
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
6-27
Checking Your Knowledge
Gotcha! is a chain of trendy stores catering to the urban contemporary market. As part of its close relationship with suppliers, Gotcha! has an Internet site that is accessible only by suppliers, and it provides up-to-the minute point-of-sale information from all of the Gotcha! stores. Suppliers can see how their products are doing at retail during any time of the day or night. In the relationship between Gotcha! and its suppliers, the Gotcha! supplier site is an example of:
A. information sharing.B. legal bonds.C. reciprocity.D. operational linkages.E. negotiated contracts.
6-28
Buyer-Seller Relationships
6-29
Dynamics of Buyer-Seller Relationships
Buyers May Use Several Sources to
Spread Risks
Powerful Customer May Control the
Relationship
Buying Varies by Customer Type
6-30
Manufacturers Are Important CustomersNot Many Big
Ones
NAICS CodesBusiness
Data Classifies Industries
Clustered in Geographic
Areas
6-31
Illustrative NAICS Code Breakdown for Apparel Manufacturers (Exhibit 6-9)
Food (311) others…Leather (316)
Apparel (315)
Knitting Mills
(3151)others…
Apparel accessories
(3159)
Cut & Sew Apparel (3152)
Men’s & boys’
(31522)others…
Other cut & sew
(31529)
Women’s & girls’
(31523)
Lingerie (315231) others…Dresses
(315233)Blouses
(315232)
Manufacturing (31)
Construction (23) others…Retail
(44)
6-32
Producers of Services — Smaller and More Spread Out
Buying May Not Be Formal
Car Repair Medical Services
Housekeeping Services
LibraryService
Small ServiceBuyers
Legal Services
6-33
Retailers & Wholesalers Buy for Their Customers
Committee Buying Is
Impersonal
Reorders Are Straight Rebuys
Buyers Watch Computer
Output Closely
6-34
The Government MarketSize and Diversity
Competitive Bids
“Approved” Supplier
ListGovernmen
t Wants
Foreign Governmen
ts
FCPA
6-35
You should now be able to:
1. name and give examples of the different types of business and organizational buyers.
2. describe how organizational and business markets differ from consumer markets.
3. describe each step in the model of organizational/business buying.
4. explain the different types of buying processes.
6-36
You should now be able to:
5. understand the different types of buyer-seller relationships and their benefits and limitations.
6. know about the number and distribution of manufacturers and why they are an important customer group.
7. know how buying by service firms, retailers, wholesalers, and governments is similar to—and different from—buying by manufacturers.
8. understand important new terms.
Key Terms1. business and
organizational customers
2. purchasing managers3. multiple buying
influence4. buying center 5. requisition6. purchasing
specifications7. ISO 90008. new task buying
9. straight rebuy10. modified rebuy11. competitive bid12. vendor analysis13. just-in-time delivery 14. negotiated contract
buying15. outsource16. North American
Industry Classification System (NAICS) codes
17. Foreign Corrupt Practices Act6-37