Phillip Kevin Lane

Kotler • Keller
Marketing Management • 14e
 r 7
t e
a p
Ch

Analyzing Business
Markets
Discussion Questions
1. What is the business market, and how does it differ
from the consumer market?
2. What buying situations do organizational buyers face?
3. Who participates in the B2B buying process?
4. How do business buyers make their decisions?
5. How can companies build strong relationships with
business customers?
6. How do institutional buyers and government agencies
do their buying?
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 e d
fin
De Organizational Buying
The decision-making process by which
formal organizations establish the need
for purchased products and services and
identify, evaluate, and choose among
alternative brands and suppliers.

-- F. Webster Jr and Y. Wind

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 Business Markets
Transportation
& Distribution

Agriculture Construction

Forestry
Manufacturing

Communications
Banking & Finance
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Business Markets
Similarities to the Consumer Market
• Understanding deep customer needs
• Identify areas for growth
• Improving value management techniques
• Calculating better marketing metrics
• Competing and growing in global markets
• Countering product commoditization
• Gain support for the marketing concept
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 Business Markets
Differences to the Consumer Market Geographically
Concentrated

Fewer, Larger
Buyers

Professional
Buyers

Multiple Personal
Sales Calls Relationships
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 Business Markets
Differences to the Consumer Market

Derived Demand

Inelastic Demand

Demand
•Derived
•Inelastic
•Fluctuating
Fluctuating Demand
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Buying Situations

New Task
Straight Rebuy

Modified Rebuy
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Systems Buying and Selling

uyer
B

ra c t o r
e Co nt
Prim

c t or s
o nt ra
- ti er C
d
Secon
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Business Buying Participants

Initiator/ Influencer Decider

Users

Gatekeeper Approver
Buyers
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Buying Center Influences

Participants differ by:

• Interest
• Authority
• Status
• Persuasiveness
• Decision criteria

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Targeting Firms and Buying Centers

Who to target?
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Purchasing/Procurement Process

Diverse supplier base

Benefits vs. Costs

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Stages in the Buying Process

Description and
Characteristics

Performance Order
Review Specification

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Stages in the Buying Process

Internal stimuli
•New product being developed
•Broken machine
•Low stock level

External stimuli
•Trade show visit
•Advertisement

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 Stages in the Buying Process

Description and
Technical specifications
Characteristics
• Reliability
• Durability
• Price

Product value analysis

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 Stages in the Buying Process

Trade directories
Trade advertisements
Trade shows

E-Procurement Lead generation

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Stages in the Buying Process

Formal presentation

Written
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Stages in the Buying Process

Supplier-evaluation model
Number of suppliers

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 Stages in the Buying Process

Order
Specification Stockless
purchase
plan
Technical specifications
Quantity
Delivery time
Return policy
Warranties
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 Stages in the Buying Process

Performance
Review

End user evaluations

9
Weighted-score
method
7 4
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 Buygrid Framework
Table 7.1
Buyclasses
Modified Straight
New Task
Rebuy Rebuy
1. Problem Recognition Yes Maybe No
2. General need description Yes Maybe No
3. Product specification Yes Yes Yes
Buyphases

4. Supplier search Yes Maybe No

5. Proposal solicitation Yes Maybe No
6. Supplier Selection Yes Maybe No
7. Order-routine specification Yes Maybe No
8. Performance review Yes Yes Yes

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Managing B2B Relationships

Online social media

One-to-one Marketing
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 Managing B2B Relationships
Vertical Coordination

Relationship Factors
Availability of alternatives
Importance of supply
Complexity of supply
Supply market dynamism

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 Buyer-Seller Relationship Categories
Cooperative systems

Collaborative

Customer is king

Contractual transaction Mutually adaptive

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Institutional and Governments Markets
Prisons

Government
agencies

Schools

Hospitals
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