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