MKTG 7

Strategic Alliance (Strategic Partnership)

a cooperative agreement between business firms

North American Industry Classification System (NAICS)

a detailed numbering system developed by the United States, Canada, and Mexico to classify North American business establishments by their main production processes

Stickiness

a measure of a web site's effectiveness; calculated by multiplying the frequency of visits times the duration of a visit times the number of pages viewed during each visit (site reach)

Trust

The condition that exists when one party has confidence in an exchange partner's reliability and integrity

Relationship Commitment

A firm's belief that an ongoing relationship with another firm is so important that the relationship warrants maximum efforts at maintaining it indefinitely

New Buy

A situation requiring the purchase of a product for the first time

Describe Business Marketing

Business Marketing provides goods and services that are bought for use in business rather than for personal consumption. Intended use, Not physical characteristics, distinguishes a business product from a consumer product.

Discuss the unique aspects of business buying behavior

Business buying behavior is distinguished by five fundamental characteristics. first, buying is normally undertaken by a buying center consisting of many people who range widely in authority level. second, business buyers typically evaluate alternative products and suppliers based on quality, service, and price - in that order. Third, Business buying falls into three general categories: new buys, modified rebuys, and straight rebuys. Fourth, the ethics of business buyers and sellers are often scrutinized. Fifth, customer service before, during, and after the sale plays a big role in business purchase decisions

Explain the major differences between business and consumer markets

In business markets, demand is derived, inelastic, joint and fluctuating. purchase volume is much larger than in consumer markets, customers are fewer in number and more geographically concentrated and distribution channels are more direct. buying is approached more formally using professional purchasing agents, more people are involved in the buying process, negotiation is more complex and reciprocity and leasing are more common. and, finally selling strategy in business markets normally focuses on personal contact rather than on advertising.

Describe the seven types of business goods and services

Major equipment includes capital goods, such as heavy machinery. accessory equipment is typically less expensive and shorter-lived than major equipment. Raw materials are extractive or agricultural products that have not been processed. component parts are finished or near finished items to be used as parts of other products. Processed materials are used to manufacture other products. Supplies are consumable and not used as part of a final product. business services are intangible products that many companies use in their operations.

Explain the North American Industry Classification System

NAICS provides a way to identify ,analyze ,segment, and target business and government markets. Organizations can be identified and compared by a numeric code indicating business sector, sub sector, industry group, industry, and industry subdivision. NAICS is a valuable tool for analyzing, segmenting, and targeting business markets.

Identify the four major categories of business market customers

Producer markets consist of for-profit individuals and organizations that buy products to use in producing other products, as components for other products, or in facilitating business operations. re seller markets consist of wholesalers and retailers that buy finished products to resell for profit. government markets include federal, state, county, and city governments that buy goods and services to support their own operations and serve the needs of citizens. Institutional markets consist of very diverse non business institutions whose main goals do not include profit

Derived Demand

The demand for business products

Business Marketing

The marketing of goods and services to individuals and organizations for purposes other than personal consumption

Discuss the role of relationship marketing and strategic alliances in business marketing

Relationship marketing entails seeking and establishing long-term alliances or partnerships with customers. a strategic alliance is a cooperative agreement between business firms. firms form alliances to leverage what they do well by partnering with others that have complimentary skills

Describe the role of the internet in business marketing.

The rapid expansion and adoption of the internet has made business markets more competitive than ever before. the number of business buyers and sellers using the internet is rapidly increasing. firms are seeking new and better ways to expand markets and sources of supply, increase sales and decrease costs, and better serve customers with the internet, every business in the world is potentially a local competitor.

Business-to-Business Electronic Commerce

The use of the Internet to facilitate the exchange of goods, services, and information between organizations

Keiretsu

a network of interlocking corporate affiliates

Reciprocity

a practice where business purchasers choose to buy from their own customers

Straight Rebuy

a situation in which the purchaser reorders the same goods or services without looking for new information or investigating other suppliers

Modified Rebuy

a situation where the purchaser wants some change in the original good or service

Buying Center

all those people in an organization who become involved in the purchase decision

Business-to-Business online exchange

an electronic trading floor that provides companies with integrated links to their customers and suppliers

Major Equipment (Installations)

capital goods such as large or expensive machines, mainframe computers, blast furnaces, generators, airplanes, and buildings

Supplies

consumable items that do not become part of the final product

Component Parts

either finished items ready for assembly or products that need very little processing before becoming part of some other product

Business Services

expense items that do not become part of a final product

Accessory Equipment

goods, such as portable tools and office equipment, that are less expensive and shorter-lived than major equipment

Original Equipment Manufacturers (OEMs)

individuals and organizations that buy business goods and incorporate them into the products that they produce for eventual sale to other producers or to consumers

Multiplier Effect (Accelerator Principle)

phenomenon in which a small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to make the consumer product

Processed Materials

products used directly in manufacturing other products

Joint Demand

the demand for two or more items used together in a final product

Disintermediation

the elimination of intermediaries such as wholesalers or distributers from a marketing channel

Raw Materials

unprocessed extractive or agricultural products, such as mineral ore, lumber, wheat, corn, fruits, vegetables, and fish