MARKETING MANAGEMENT

12th edition
7
Analyzing
Business Markets

Kotler Keller
Chapter Questions
 What is the business market, and how does
it differ from the consumer market?
 What buying situations do organizational
buyers face?
 Who participates in the business-to-
business buying process?

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Chapter Questions
 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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Organizational Buying

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.

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Characteristics of Business
Markets
 Fewer, larger buyers  Derived demand
 Close supplier-  Inelastic demand
customer relationships  Fluctuating demand
 Professional  Geographically
purchasing
concentrated buyers
 Many buying influences
 Direct purchasing
 Multiple sales calls

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Buying Situation

 Straight rebuy
 Modified rebuy
 New task

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The Buying Center
 Initiators
 Users
 Influencers
 Deciders
 Approvers
 Buyers
 Gatekeepers

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Of Concern to Business Marketers

 Who are the major decision participants?

 What decisions do they influence?
 What is their level of influence?
 What evaluation criteria do they use?

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Types of Business Customers
 Price-oriented  Gold-standard
 Solution-oriented  Strategic-value

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Handling Price-Oriented Customers

 Limit quantity purchased

 Allow no refunds
 Make no adjustments
 Provide no services

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Purchasing Orientations
 Buying
 Procurement
 Supply chain management

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Product-Related Purchasing Processes

 Routine products
 Leverage products
 Strategic products
 Bottleneck products

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Methods of e-Procurement
 Websites organized using vertical hubs
 Websites organized using functional hubs
 Direct extranet links to major suppliers
 Buying alliances
 Company buying sites

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Forms of Electronic Marketplaces
 Catalog sites
 Vertical markets
 Pure play auction sites
 Spot markets
 Private exchanges
 Barter markets
 Buying alliances

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Assessing Customer Value
 Internal engineering  Conjoint analysis
assessment  Benchmarks
 Field value-in-use  Compositional
assessment approach
 Focus-group value  Importance ratings
assessment
 Direct survey
questions

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Order Routine Specification and
Inventory
 Stockless purchase plans
 Vendor-managed inventory
 Continuous replenishment

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Desirable Outcomes of a B2B
transaction: OTIFNE
 On time
 In full
 No error

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Establishing Corporate Credibility

 Expertise
 Trustworthiness
 Likeability

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Factors Affecting
Buyer-Supplier Relationships
 Availability of alternatives
 Importance of supply
 Complexity of supply
 Supply market dynamism

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Categories of Buyer-Seller
Relationships

 Basic buying and  Cooperative systems

selling  Collaborative
 Bare bones  Mutually adaptive
 Contractual  Customer is king
transaction
 Customer supply

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Opportunism

Some form of cheating or

undersupply relative to an
implicit or explicit contract.

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