B2B Marketing

Click to edit Master subtitle style Organizational Buying Behavior Lecture 2

3/17/12

Prepared by: Asim Ahmed

P r i v a t e S e c t o r

Types of industrial customers

U n i L 3/17/12 e
Prepared by: Asim Ahmed

P u b l i c S e c t o r

Types of industrial customers

P a k i s t 3/17/12 a

Prepared by: Asim Ahmed

N G O s

Types of industrial customers

G r e e n S t a r

E d h i C
3/17/12
Prepared by: Asim Ahmed

G o v e r n m e n t

Types of industrial customers

D e p a r t m e 3/17/12

Prepared by: Asim Ahmed

N E E D R E A L I Z A T I O N :

Organizational buying process

A 3/17/12 c

Prepared by: Asim Ahmed

D E T E R M I N I N G C H A R A C T

Organizational buying process

3/17/12

Prepared by: Asim Ahmed

S E A R C H F O R P O T E N T I A

Organizational buying process

3/17/12

Prepared by: Asim Ahmed

Organizational buying process

OBTAINING PROPOSALS FROM SUPPLIERS:

After the search for suppliers is over enquiries are sent to vendors. Vendors respond to these queries and send their Technocommercial offer and sales brochures. Proposals normally include:

Scope of supply Product specs. Prices Taxes and duties

Packing charges 3/17/12 Mode of Transportation & Charges

Prepared by: Asim Ahmed

Organizational buying process

EVALUATING PROPOSALS & SELECTING SUPPLIERS:

After receiving the proposals from various vendors, these proposals are minutely compared and evaluated. Normally following parameters are observed:

Expected post sale support. Local representation Profile & background of local representative

In case of any query or doubt, additional information is sought. The buying organization brings all the vendors at the same level to make meaningful comparison.
Prepared by: Asim Ahmed

3/17/12

Organizational buying process

POST PURCHASE EVALUATION:

It is important to evaluate the supplier after the supply is complete. This evaluation is done on following parameter:

Actual delivery time Post Sale service Actual performance of product or service Courtesy calls made by the sales representative

This evaluation is important input for future requirements they may come up.
Prepared by: Asim Ahmed

3/17/12

Purchase participants

INTITATORS

Those who anticipate a problem or feel the need of certain goods.

Buyers

They are purchase personnel who send enquiries and get the proposals, negotiate with the vendors and get approval from the authority to issue the purchase order.

Gatekeepers

3/17/12

Gatekeepers are individuals who control the flow of information between buying organization and the supplier, or at times between the members of buying process.
Prepared by: Asim Ahmed

Purchase participants

USERS

Users are the department or individuals who use the proposed product or service

INFLUENCERS

Influencers tend to influence the purchase decision. They may be within the organization or outside the organization.

DECIDERS

3/17/12

They are individuals who are senior in hierarchy and approve the recommendations of buyers. In high value purchase they get involved in the purchase process at early stage.
Prepared by: Asim Ahmed

Purchase situations

STRAIGHT RE-BUY

A situation where a buyer organization wants to buy what it bought in the past as well.

MODIFIED RE-BUY

It is a situation where buying organization wants to improve upon or modify the past purchase.

NEW TASK

When a firm want to buy something for the first time.

Prepared by: Asim Ahmed

3/17/12

IN-suppliers & out-suppliers

IN-SUPPLIERS:

In-Suppliers to a firm are those suppliers who have done business with it. In Straight Re-Buy situation, In-Suppliers stand better chance to get an order. All In-Supplier has to do is to maintain the service level and terms & conditions.

OUT-SUPPLIERS:

Out-Suppliers are those who have never done business with the buying organization.

Out-Supplier attempts to convince the buying organization of its better product and services to gain the 3/17/12 Prepared by: Asim Ahmed order.

Attributes considered for purchase decision making

PRODUCT RELATED ATTRIBUTES:

These are essentially the features of the product. Such features include:

Better Quality. Extra Functions. Modular Design. Ease of maintenance. Extended Warranty. Fuel Efficiency.

3/17/12

Prepared by: Asim Ahmed

Attributes considered for purchase decision making

ECONOMY RELATED ATTRIBUTES:

These include purchase price, or landed price or economic life time cost, and terms & conditions.

Purchase Price:

Customer attempts to get value for money.

Commercial Terms & Conditions:

These include warranty, Payment Terms, Delivery Schedule, advance and performance bank guarantee.

3/17/12

Prepared by: Asim Ahmed

Attributes considered for purchase decision making

SUPPLIER RELATED ATTRIBUTES:

Reciprocity (Barter). Technical capability. Financial capability. Acquaintance with the supplier. Location of the supplier. Infrastructure of the supplier.

3/17/12

Prepared by: Asim Ahmed

Buying Behavior in public v/s private enterprise

Buying behavior in a private enterprise is different from that of a public sector. We may evaluate the difference based on following parameters:

Buy or not to buy decision. Objectives of Buying Buying Process Buying decision criteria Buying Decision members

3/17/12

Prepared by: Asim Ahmed

O r g a n i z a t i o n a l b u y i

Quick Review

3/17/12

Prepared by: Asim Ahmed