Business Markets And Business Buyer Behavior

Front 1

definition of business buyer behavior

Back 1

the buying behavior of organizations that buy goods and services for use in the production of other products and services or for the purpose of reselling or renting to others for a profit

Front 2

characteristics of business markets

Back 2

differ in marketing structure and demand compared to consumer markets

fewer but larger customers

may be concentrated geographically

derived demand, price is inelastic

Front 3

nature of buying unit for biz markets

Back 3

biz purchases involve more buyers in decision process

purchasing efforts are undertaken by professional buyers

Front 4

types of decisions and decision process for biz markets

Back 4

face more complex buying decisions

more formalized process

buyers and sellers work closely and build long term r/s

Front 5

model of business buyer behavior

Back 5

Front 6

major types of buying situations for biz buyers

Back 6

straight rebuy: reordering without modifications

modified rebuy: requires modification to prior purchase

new task: first time purchase

Front 7

what is systems selling

Back 7

buying a packaged solution to a problem from single seller (convenience)

often a key marketing strategy if want to win and hold accounts

Front 8

participants in the buying decision process

Back 8

users, influencers, buyers, deciders, gatekeepers

Front 9

environmental influences on biz buyers

Back 9

economic trends, supply conditions, technological change, regulatory and political environments, competitive developments, culture and customs

Front 10

organizational influences on biz buyers

Back 10

objectives, policies, procedures, organizational structure, systems

Front 11

interpersonal influences on biz buyers

Back 11

authority, status, empathy, persuasiveness

Front 12

individual influences on biz buyers

Back 12

authority, age, education, job position, personality, risk attitudes

Front 13

stages of the biz buying process

Back 13

problem recognition -> general need description -> product specification -> supplier search -> order-routine specification -> performance review

Front 14

steps 1,2,3 of biz buying process

Back 14

1: problem recognition

2: general need description

3: product specification - value analysis helps to reduce costs

Front 15

step 4 of biz buying process

Back 15

supplier search - supplier development

Front 16

step 5 of biz buying process

Back 16

proposal solicitation

Front 17

step 6 of biz buying process

Back 17

supplier selection:

single sourcing - buying particular product from only one supplier

multiple sourcing - buying from several different suppliers

reciprocity - trading partnership in which two firms agree to buy from each other

Front 18

more ways of selection of product and supplier

Back 18

outsourcing: obtaining vendors to provide goods/services that might otherwise be supplied in-house

crowdsourcing; pulling together expertise from around the globe to work on solving a problem

reverse marketing: buyers find capable suppliers and "sell" their purchase to suppliers

Front 19

step 7 of biz buying process

Back 19

order-routine specification: blanket contracts often used for maintenance, repair and operating items

Front 20

step 8 of biz buying process

Back 20

performance review

Front 21

benefits of single sourcing

Back 21

when frequent deliveries are needed/specialised products are desired

firm often becomes a large customer to supplier, can negotiate for more favorable prices

admin costs might also be lower

Front 22

cons of single sourcing

Back 22

firm is at mercy of supplier - failure to meet delivery dates could stop production line

Front 23

benefits of multiple sourcing

Back 23

protects firm from inventory or delivery problems

multiple suppliers keep each other honest in terms of pricing

Front 24

what are institutional markets

Back 24

consists of churches, schools, prisons, hospitals, nursing homes and other institutions that provide goods and services to people in their care

Front 25

characteristics of institutional markets

Back 25

low budgets, captive patrons, often overlooked in B2B

may develop separate divisions and marketing mixes to service institutional markets

Front 26

what are government markets

Back 26

government units purchasing or renting goods/services for carrying out main functions of government

Front 27

characteristics of government markets

Back 27

many buying units, require suppliers to submit bids, may favor domestic suppliers, extensive paperwork required from suppliers