Marketing Chapter 8
Individual Influences of the Buying Decision Process
Personal Characteristics of participants in the buying center
Demand for Business Products
Derived Demand Inelastic Demand Joint Demand Fluctuating Demand
Reseller Markets
Intermediaries ( wholesalers or retailers) that buy finished goods and resell them for a profit
Attributes of Business Customers
-Well informed about the products they purchase -Demand detailed information and technical specifications -Help the firm achieve organizational objectives -Engage in rational buying behavior -Often form partnerships with suppliers
Sole Sourcing
An organization's decision to use only one supplier
Which of the following markets may have complex buying procedures due in part to their public accountability?
Government markets
Straight Rebuy
a routine repurchase purchase of same products under the approximately the same terms
Sampling in Business Buying
entails taking a specimen of the product and evaluating for suitability before purchase
vendor analysis
A formal, systematic evaluation of current and potential vendors
Stages of the Business Buying Decisions Process
1 - Recognize Problem 2- Develop product specifications to solve problem 3- Search and evaluate possible products and suppliers 4- select product and supplier and order product
The four categories of the business markets:
1. Producer Markets 2. Reseller Markets 3. Government Markets 4. Institutional Markets
Online marketplaces where buyers and sellers can exchange information, goods, services, ideas, and payments are best described as _______.
B2B e-commerce sites
Derived Demand for Business Products
Demand for business products that is the result a demand for consumer products
Inelastic Demand for Business Products
Demand that is not significantly altered by a price increase or decrease
Commodities and raw materials are typically purchased using which method of business buying?
Description
Government Markets
Federal, state, county, or local governments that buy goods and services to support their internal operations and provide products to their constituencies
Organizational Influences of the Buying Decision Process
Include company objectives, purchasing policies and resources and size and composition of buying center
Producer Markets -
Individuals and business organizations that purchase products to make profits by using them to produce other products or using them in their operations
Business Markets
Individuals, organizations, or groups that purchase a specific kind of product for resale, direct use in producing, other products, or use in general daily operations
Business Buying Decisions Roles
Initiator/ Users, influencers, buyers, deciders and gatekeeper
ACME Corp. has ordered widgets from Wiley Widgets several times before, but now it would like Wiley Widgets to offer a lower per-unit price in exchange for a larger order. ACME is using which of the following types of business purchases?
Modified rebuy purchase
Types of Business Purchases
New Task Purchase, Straight Rebuy, Modified Rebuy
Which of the following is NOT one of the ways that business transactions differ from consumer transactions?
Orders by businesses are frequently small and inexpensive.
Institutional Markets
Organizations with charitable, educational, community, or other nonbusiness goals
Gorton's Seafood buys large amounts of fish to use in its frozen dinners and dinner components. Gorton's Seafood belongs in which of the following business markets?
Producer market
Purchasing agents at ACME Corp. are looking in company files and trade directories, contacting suppliers for information, soliciting proposals from known vendors, and examining various online and print publications. They are in which of the following stages of the buying decision process?
Searching for and evaluating potential products and suppliers
business buying behavior
The purchase behavior of producers, government units, institutions, and resellers
Interpersonal Influences of the Buying Decision Process
The relationship between people in the business trust and collaboration are important
Inspection of Business Buying
Used with some products that have unique characteristics and very in regard to condition
Joint Demand for Business Products
When 2 or more items are used in combination to produce a product
Description of Business Buying
When a products are highly standardized, a buyer can order by describing quantity, grade and other attributes
modified rebuy
a new task purchase that is changed on subsequent orders or when straight rebuy requirements are modified
Modified Rebuy
a new-task purchase that is changed on subsequent orders or when straight-rebuy requirements are modified
Reciprocity
an arrangement in which two organizations agree to buy from each other
value analysis
an evaluation of each component of a potential purchase
New Task Purchase
an item is purchased to be used to perform a new job or solve a new problem
multiple sourcing
an organization's decision to use several suppliers
Environmental Influences of the Buying Decision Process
competitive and economic factors, political forces, legal and regulatory forces, technological changes and sociocultural issues
Which of the following markets includes wholesalers or retailers? a. Institutional markets b. Buying centers c. Producer markets d. Reseller markets e. Government markets
d. Reseller markets
Methods of Business Buying
description, inspection, sampling, negotiation
To estimate the purchase potential of business customers, a marketer must find a relationship between a variable available in industrial classification data, such as number of employees, and the size of _______.
e. potential customers' purchases
A price increase or decrease does not significantly alter demand for a product with _______.
inelastic demand
Factors Resellers Consider
level of demand resale price space required - sales per square foot suppliers ability to provide adequate quantities when and where needed availability of technical assistance
B2B ecommerce sites
online marketplace where business buyers and sellers from around the world can exchange information goods, services, ideas and payments
Primary Concerns of Business Customers
price, product quality, service, supplier relationships, ethnics and social responsibility
When a business buyer invites vendors to bid to supply a specified good or service in competition with each other, with the lowest bidder winning the right to sell to the buyer, this is best described as _______.
reverse auction
Online marketing efforts make the buying process far more efficient because it _______ and _______.
saves time; reduces costs
The North American Industry Classification System (NAICS) is a(n) _______.
single industry classification system used by the United States, Canada, and Mexico to generate comparable statistics
Negotiation in Business Buying
some purchases are based on negotiated contracts wherein buyers describe what they need, and sellers submit bids
The group of people within an organization who make business buying decisions are best described as _______.
the buying center
The buying center
the group of people within the the organization who make business purchase decisions
North American Industry Classification System (NAICS)
used by the U.S, Canada and Mexico to help generate comparable statistics
Examining quality, design, materials, and possibly item reduction or deletion to acquire the product in the most cost-effective way is best described as _______.
value analysis