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7
Chapter Questions

• What is the business market, and how


Analyzing does it differ from the consumer
Business Markets market?
• What buying situations do
organizational buyers face?
• Who participates in the business-to-
business buying process?

Marketing Management, 13th ed


Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 7-2

Chapter Questions CISCO Targets Businesses

• How do business buyers make their


decisions?
• How can companies build strong
relationships with business customers?
• How do institutional buyers and
government agencies do their buying?

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What is Organizational Buying? Top Business Marketing Challenges

Organizational buying refers • Expand understanding of customer needs


to the decision-making process by • Compete globally as China and India
which formal organizations establish reshape markets
the need for purchased products and • Master analytical tools and improve
services, and identify, evaluate, and quantitative skills
choose among alternative brands • Reinstate innovation as an engine of growth
and suppliers. • Create new organizational models and
linkages

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Characteristics of Business Markets Buying Situation

• Fewer, larger • Multiple sales calls


buyers Straight rebuy
• Derived demand
• Close supplier- • Inelastic demand
customer • Fluctuating demand
relationships Modified rebuy
• Geographically
• Professional concentrated buyers
purchasing
• Direct purchasing
• Many buying New task
influences

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Systems Buying and Selling The Buying Center


Initiators
Turnkey solution System
desired; subcomponents Users
bids solicited assembled Influencers

Deciders

Approvers
Prime Second-tier
contractors contractors Buyers

Gatekeepers
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Of Concern to Business Marketers Sales Strategies

• Who are the major decision


participants?
Key Buying
• What decisions do they influence? Small Sellers Influencers
• What is their level of influence?
• What evaluation criteria do they use? Multilevel
Large Sellers In-depth
Selling

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Stages in the Buying Process:


Table 7.2 Buygrid Framework
Buyphases
• Problem recognition
• General need description
• Product specification
• Supplier search
• Proposal solicitation
• Supplier selection
• Order-routine specification
• Performance review

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Forms of Electronic Marketplaces Methods of e-Procurement

• Websites organized using vertical hubs


• Websites organized using functional
hubs
• Catalog sites
• Vertical markets • Direct extranet links to major suppliers
• Pure play auction sites • Buying alliances
• Spot markets
• Company buying sites
• Private exchanges
• Barter markets
• Buying alliances
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Handling Price-Oriented Customers


Table 7.3 Vendor Analysis

Limit quantity purchased

Allow no refunds

Make no adjustments

Provide no services

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Methods for Researching Order Routine Specification


Customer Value

• Internal engineering • Conjoint analysis Stockless


assessment • Benchmarks
purchase plans
• Field value-in-use • Compositional
assessment approach Vendor-managed
• Focus-group value • Importance ratings
inventory
assessment
• Direct survey Continuous
questions replenishment

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Establishing Corporate Trust


and Credibility
Figure 7.1 Trust Dimensions

Cooperating
Transparent
Design
Expertise Product/Service Product
Quality Comparison

Incentive Supply Chain

Pervasive
Trustworthiness Likeability Partnering
Advocacy
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Categories of Buyer-Seller
Factors Affecting Relationships
Buyer-Supplier Relationships
• Basic buying and • Cooperative
selling systems
Availability of Importance of
alternatives supply • Bare bones • Collaborative
• Contractual • Mutually adaptive
transaction • Customer is king
Complexity of Supply market • Customer supply
supply dynamism

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Aramark Successfully Services Institutional


What is Opportunism? and Government Markets

Opportunism is some form of


cheating or undersupply relative to
an implicit or explicit contract.

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Marketing Debate Marketing Discussion


 how different is B-to-B marketing?
Take a position:
1. Business-to-business marketing  Consider some of the consumer
requires a special, unique set of marketing
behavior topics from Chapter 6.
concepts and principles.
 How might you apply them to business-
or to-business settings?
2. Business-to-business marketing is really
not that different and the basic marketing
principles apply.

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