Marketing 345 - Chapter 5
buying process characteristics
*Technically qualified and professional buyers follow established purchasing policies and procedures. *Buying objectives and criteria are typically spelled out, as are procedures for evaluating sellers and their products or services. *There are multiple buying influences, and multiple parties participate in purchase decisions. *There are reciprocal arrangements, and negotiation between buyers and sellers is commonplace. *Online buying over the Internet is widespread
starbucks is a leader in sustainable procurement:
- integrates environmental considerations into the organization's buying process - coffee growers in 20 countries - fair price for beans - ecologically sound growing
organizational buying criteria
- price - ability to meet specs -ability to meet schedules - technical capacity - past performance - warranties - production capacity
marketing mix characteristics
-Direct selling to organizational buyers is the rule, and distribution is very important -Advertising and other forms of promotion are technical in nature -Price is often negotiated, evaluated as part of broader seller and product/service qualities, and frequently affected by quantity discounts
Organizational buying objectives
-Profits -Women/Minority Suppliers/Vendors -Efficiency -Environment/Sustainability
The following are the stages of both consumer and organization purchase decisions. Place each stage in the most typical order of the buying process. Place the first action at the top and continue until you place the final stage at the bottom.
1. problem recognition 2. information search 3. alternative evaluation 4. purchase decision 5. postpurchase behavior
Which of these is a task considered to be part of the buying function in a business?
Awarding contracts to vendors
Business marketing fundamentally differs from consumer marketing in which way?
Business marketing involves buyers who intend to resell the product or use it in the creation of other products.
Which is not a stage in the organizational purchase decision process?
Commercialization
market characteristics
Demand for industrial products and services is derived, Few customers typically exist and their purchase orders are large
The buying function in a business is responsible for which of these?
Gathering and screening information about vendors Selection and purchase of goods Formal solicitation of bids
Which of the following buy classes involves the greatest potential risk to the buyer
New buy
In the United States, data about all economic activity is categorized into a hierarchical set of six-digit NAICS codes. What does NAICS stand for?
North American Industry Classification System
Industrial, reseller, and government markets are the three categories of ________ buyers.
Organizational
________ buyers include manufacturers, wholesalers, retailers, and government agencies. (one word)
Organizational
Evaluative criteria in the consumer decision process are most similar to what?
Organizational buying criteria for business buyers
user
Person who actually uses the product
influencer
Person who affects the decision, often by helping define specifications
gatekeeper
Person who controls the flow of information
buyer
Person who has formal authority and responsibility to select the supplier
product or service characteristics
Products or services are technical in nature and purchased on the basis of specifications; many goods purchased are raw and semi-finished; Heavy emphasis is placed on delivery time, technical asistance, and postsale service
Which of the following are true of a buying center?
The buy-class situation affects the number of people involved in the center.
Which of the following are true of a buying center?
The buy-class situation affects the number of people involved in the center. It consists of several individuals with common goals and knowledge pertaining to purchase decisions.
Which of the following are typical in a new buy buying situation?
The buying center includes more people. Decision time is lengthy.
Which of the following is typical of organizational buying compared to consumer buying?
The purchase size is typically larger.
Which of the following are likely to participate in an organization's buying center?
The purchasing manager An employee from another functional area
Which of the following is typical of organizational buying compared to consumer buying?
There are far fewer buyers.
Though its composition can vary depending on what is being purchased, the buying center almost always includes
a buyer or purchasing manager.
When several people in an organization participate in purchase decisions, often for more important or expensive contracts, it is called
a buying center.
Both consumers and organizational buyers purchase products online but
a much larger percentage of the total dollars sold online are organizational transactions.
traditional auction
an online auction in which a seller puts an item up for sale and would-be buyers are invited to be bid in competition with each other
The number of people involved in the buying center, the amount of decision time, and the number of suppliers considered are some of the factors that determine the`
buy class.
Organizational buying behavior revolves around a ________ that has similarities to consumer buying behaviors.
decision-making process
Derived demand refers to the concept that demand for industrial products is driven by
demand for consumer products.
Kellogg's purchases large quantities of whole grain in order to produce its cereal products. Consumers' desire for cereal affects the size and frequency of Kellogg's purchases, which is an example of what characteristic of organizational buying?
derived demand
Independent trading communities and private exchanges provide online trading platforms for organizations and are examples of
e-marketplaces.
Firms selling to organizational buyers have ________ potential customers compared to firms selling to consumers.
far fewer
In addition to industrial and reseller markets, organizational markets include ________ ones.
government
reverse auction
in an e-marketplace, is an online auction in which a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other.
NAICS provides common
industry definitions for Canada, Mexico, and the United States.
In a traditional auction, the winner
is the buyer with the highest bid.
The typical purchase involved in an organizational buying exchange is ________ that in consumer buying.
larger in size than
A(n) _________ rebuy occurs when an organizational buyer has purchased a similar product in the past but has decided to change something like the specifications, price, or supplier.
modified
The changes made to an order for a previously purchased product in a ________ typically requires expanding the buying center to include people outside the purchasing department.
modified rebuy
Which of the following are the recognized buy classes in organizational buying?
modified rebuys, straight rebuys, and new rebuys
buy classes:
new rebuy. straight rebuy, and modified rebuy
Because it improves timeliness of supplier information and reduces both order processing and marketing costs, ________ buying is popular in all three kinds of organizational markets. (one word)
online
E-marketplaces
online trading communities that bring together buyers and supplier organizations to make possible. the real-time exchange of info, money, products, and services
Industrial, reseller, and government markets are the three categories of ________ buyers.
organizational
When an organization buys raw materials that are reprocessed and sold as finished goods, or if it buys goods it will then sell, it is considered a(n) ________ buyer.
organizational
More than two-thirds of the global dollar value of online purchase transactions arise from
organizational buyers
The decision-making process organizations use in establishing a need for products and choosing among different providers of them is called
organizational buying behavior.
Price, technical capability, and warranties are typical ________ used by industrial buyers to evaluate other firms.
organizational buying criteria
North American Industry Classification System (NAICS)
provides common industry definitions for Canada, Mexico, and the US, which makes it easier to measure economic activity in the 3 member countries of the NAFTA
The industrial buying practice in which two organizations agree to purchase each other's products is known as __________ (one word).
reciprocity
Which of the following are primary reasons for the popularity of online buying in all three kinds of organizational markets?
reduced marketing costs, reduced buyer order processing costs, and timely supply of information
A(n) ___________ rebuy occurs when an organizational buyer simply reorders additional units of products with no changes from an approved supplier. (one word)
straight
When an administrative assistant reorders office supplies for a business, placing the same order as last month without checking with anyone else, he is doing a
straight rebuy.
organizational buying behavior
the decision - making process that organizations use to establish the need for products and services to identify, evaluate, and choose among alternative brands and suppliers
derived demand
the demand for industrial products and services that is driven by or derived from the demand for consumer products and services
buying center
the group of people in an organization who participate in the buying process and share common goals, risks, and knowledge important to purchase decision
business - to - business marketing
the marketing of products and services to companies, governments, or not-for-profit organizations for use in the creation of products and services that they can produce and market to others
Business-to-business marketing involves the marketing of goods and services to organizations for use in the creation of goods and services that
they produce and market to others.
organizational buyers
those manufacturers, wholesalers, retailers, service companies, not-for -profit organizations, and government agencies that buy products and services for their own use or resale
sustainable procurement
to benefit the environment
Which of the following is the main reason that business organizations buy products?
to increase profitability
The underlying reason that Nissan Motor Company, an organizational buyer, switched its advertising agency was
to increase revenues.
In a(n) ________ auction, products are simply sold to the buyer with the highest bid.
traditional
Reciprocity is an industrial buying practice in which
two organizations agree to purchase each other's products.
A secretary who requests a new laser printer to speed up his work most likely has what role in the buying center?
user
Within the buying center, you are considered the ________ when you are the one using the product within your organization.
user
Which of the following are roles within a buying center?
user, influencer, gatekeeper
roles in the buying center
users, influencers, buyers, deciders, gatekeepers
