Ch. 7: Business Markets & Buying Behavior

Multiple Sourcing

An organization's decision to use several suppliers

New-Task Purchase

An organization's initial purchase of an item to be used to perform a new job or solve a new problem

Derived Demand

Demand for business products that stems from demand for consumer products

Joint Demand

Demand involving the use of two or more items in combination to produce a product

Inelastic Demand

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

Product Specifications

Written statements describing a product's necessary characteristics, standards of quality, and other information essential to identifying the best supplier for the needed product

Vendor Analysis

A formal, systematic evaluation of current and potential vendors

Modified Rebuy Purchase

A new-task purchase that is changed on subsequent orders or when the requirements of a straight rebuy purchase are modified

Straight Rebuy Purchase

A routine purchase of the same products under approximately the same terms of sale by a business buyer

Reciprocity

An arrangement unique to business marketing in which two organizations agree to buy from each other

Value Analysis

An evaluation of each component of a potential purchase

North American Industry Classification System (NAICS)

An industry classification system that generates comparable statistics among the United States, Canada, and Mexico

Sole Sourcing

An organization's decision to use only one supplier

Online marketplaces where buyers and sellers can exchange information, goods, services, ideas, and payments are best described as

B2B E-Commerce Sites

Government Markets

Federal, state, county, or local governments that buy goods and services to support their internal operations and provide products to their constituencies

What market may have complex buying procedures due in part to their public accountability?

Government Markets

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

A price increase or decrease does not significantly alter demand for a product with

Inelastic Demand

Reseller Markets

Intermediaries that buy finished products and resell them for a profit

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 what type of business purchase?

Modified Rebuy Purchase

B2B E-Commerce Sites

Online marketplaces where buyers and sellers from around the world can exchange information, goods, services, ideas, and payments

Institutional Markets

Organizations with charitable, educational, community, or other nonbusiness goals

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

Potential customers' purchases

Gorton's buys large amounts of fish to use in its frozen dinners and dinner components. Gorton's belongs in which of the following markets?

Producer Market

What market includes wholesalers or retailers?

Reseller Markets

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

Purchasing agents at ACME Corp. are looking in company files and trade directories, websites, 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

The group of people within an organization who make business buying decisions are best described as

The Buying Center

Buying Center

The people within an organization who make business purchase decisions

Business (Organizational) Buying Behavior

The purchase behavior of producers, government units, institutions, and resellers

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

Online marketing efforts make the buying process far more efficient because it ________ and _______.

saves time; reduces costs