Chapter 07 Business Marketing (7-8 - 7-8b.)

What must a salesperson determine?

The buying situation and info required from the buying organization's perspective to anticipate the size and composition of the buying center.

Regarding buying centers, there is no formal announcement stating...

"who is in" and "who is out."

Buying centers do not...

1.) Appear on formal organization charts. Example: even though a formal committee may have been set up to choose a new plant site, that committee is only part of the buying center.

Business buying has 5 important aspects, they are:

1.) Buying Centers 2.) Evaluative Criteria 3.) Buying Situations 4.) Business Ethics 5.) Customer Service

What's another service that business buyers seek? Why?

1.) Dependability of supply. 2.) They must be able to count on delivery of what was ordered when it is scheduled to be delivered.

Example: Buying Center Roles for Computer Purchases; what is the roles of the individuals in the following scenarios? 1.) Division general manager proposes replacing the company's computer network. 2.) Corporate departments for purchasing and information services analyze the company's needs and recommend likely matches with potential vendors. 3.) All division employees use the computers. 4.) Corporate controller's office and vice president of information services have an important say in which system and vendor the company will deal with. 5.) Purchasing agent negotiates the terms of sale. 6.) Vice president of administration, with advice from others, selects the vendor the company will deal with and the system it will buy.

1.) Initiator 2.) Gatekeepers 3.) Users 4.) Influencers/evaluators: 5.) Purchaser 6.) Decider

What are the 6 BUYING CENTER roles that each play a part in the business purchase process?

1.) Initiator: Person who first suggests making a purchase. 2.) Influencers/evaluators: People who influence the buying decision. 3.) Gatekeepers: Group members who regulate the flow of information. 4.) The Decider: Person who has the formal or informal power to choose or approve the selection of the supplier or brand. 5.) The Purchaser: The person who actually negotiates the purchase. 6.) Users: Members of the organization who will actually use the product.

Senior executives are typically not involved in the ___________ but often get involved again later in the process to __________.

1.) Middle phases of the buying process 2.) Monitor the deal's closing

What does the average buying center include? When does the composition of the buying group change?

1.) More than 1 person and up to 4 per purchase. 2.) The composition of the buying group usually changes from one purchase to another and sometimes even during various stages in the buying process.

What 3 criteria do business buyers use to evaluate products and suppliers?

1.) Quality 2.) Service 3.) Price.

Definition: QUALITY; give an example.

1.) Quality refers to technical suitability 2.) A superior tool can do a better job in the production process and superior packaging can increase dealer and consumer acceptance of a brand.

However, a buyer who pressures a supplier to cut prices to a point at which the supplier loses money on the sale almost forces __________. What may this also result in?

1.) Shortcuts on quality 2.) This may also force the supplier to quit selling to him/her.

What 4 characteristics do executives look for in sales representatives?

1.) The ability to marshal resources 2.) An understanding of the buyer's business goals 3.) Responsiveness to requests 4.) Willingness to be held accountable

What do INFLUENCERS help define? Who are particularly important as influencers?

1.) They help define specifications and provide info for evaluating the options. 2.) Technical personnel.

Some firms have developed strategies to reach executives throughout the ___________ and during _________ of the relationship. Give an example.

1.) buying process 2.) non-buying phases FedEx Corp. has initiated a marketing effort called "access" aimed at c-level executives. It includes direct mail, email, and a custom magazine prepared exclusively for c-level executives. It also hosts exclusive leadership events for these senior executives. Other firms have developed programs utilizing a combination of print and online products and events to reach the elusive c-level audience.

Give 3 examples of how the membership and influence of people involved in the buying decision can vary.

1.) in engineering-dominated firms like Bell Helicopter, the buying center may consist almost entirely of engineers. 2.) In marketing-oriented firms like Toyota and IBM, marketing and engineering have almost equal authority. 3.) In consumer goods firms like Clorox Corporation, PRODUCT MANAGERS and other MARKETING DECISION MAKERS may dominate the buying center.

When it comes to the evaluation of QUALITY, what does it also apply to? How so?

1.) the salesperson and the salesperson's firm. 2.) Business buyers want to deal with reputable salespeople and companies that are financially responsible.

What does a purchasing agent view the gatekeeping role as?

A source of their power.

Definition: BUYING CENTER

All the people in an organization who become involved in the purchase decision

In a small manufacturing company, __________ may be a member.

Almost everyone

How may an assistant also act as a gatekeeper?

By determining which vendors get an appointment with a buyer.

What do successful selling strategies often focus on?

Determining the most important buying influences and tailoring sales presentations to the evaluative criteria most important to these buying center members.

When it comes to the DECIDER role, what is difficult in complex situations?

In complex situations, it is often difficult to determine who makes the final decision.

Who could the PURCHASER be?

It could be anyone from the president of the company to the purchasing agent, depending on the importance of the decision.

How does the number of people involved in a BUYING CENTER vary?

It varies with the complexity and importance of a purchase decision.

Who are frequently located outside the purchasing department?

KEY INFLUENCERS

What do business buyers want to buy at?

Low prices--at the lowest prices under most circumstances.

What varies from company to company?

Membership and influence

Marketers who want to build executive-level contacts must do what?

Must become involved in the buying process early on because this is when most executives get involved.

In many cases, more than ______ person(s) is involved in a purchase decision.

One

What should be a part of every organization's marketing strategy?

QUALITY IMPROVEMENT

Almost as much as they want satisfactory products, what do business buyers want?

Satisfactory service

When is a service that helps buyers sell their finished products appropriate?

Services of this sort are especially appropriate when the seller's product is an identifiable part of the buyer's end product.

What may happen to members in a buying center?

Some may drop out of the new buying center and others whose talents are needed then become part of the buying center.

Explain how a purchase offers several opportunities for service (prepurchase service, postpurchase service, and Postsale Service).

Suppose a vendor is selling heavy equipment. Prepurchase service could include a survey of the buyer's needs. After thorough analysis of the survey findings, the vendor could prepare a report and recommendations in the form of a purchasing proposal Postpurchase Service: installing the equipment and training those who will be using it. Postsale Service: include maintenance and repairs

Who plays an informal yet powerful role in the buying center?

The company president.

What 3 things do successful vendors realize?

The importance of identifying who is in the decision-making unit, each member's relative influence in the buying decision, and each member's evaluative criteria.

What are marketers often frustrated by?

Their inability to reach c-level (chief) executives who, in today's economy, play an important role in many buying decisions.

What do USERS often do?

They often initiate the buying process and help define product specifications.

What is the first step in developing a business selling strategy?

Understanding how purchase decisions are made in organizations.