Basic Marketing, 13th edition

1
Chapter 7 Business and Organizational Custome
rs and Their Buying Behavior
2
Different Types of Customers
Exhibit 7-1
7-3
3
Issues in Organizational Buying

• 1. Must satisfy direct purchasers AND their
  customers
• 2. Major focus on economic factors
• 3. Concentration of economic power.
• 4. Large buyers have buying specialists
• 5. Often have multiple buyers or influencers
• Users, Influencers, Buyers, Deciders,
• Gatekeepers

4
Buying Center

• Business purchases often involve multiple
  influence
• "Buying center"all people who participate in or
  influence a particular purchase
• Buying center varies from purchase to purchase
• Does not appear on the "organizational chart"
• Structure may be formal or informal

5
Issues in Organizational Buying

• 6. Organizational Buyers are more rational, but
  personal factors can still be critical
• 7. Long-term buying agreements are more common
• 8. Far more negotiation, especially for larger
  purchases
• 9. Much more information sharing
• 10. Reciprocity

6
Three Kinds of Organizational Buying Processes

• New-task buying
• An organization has a new need and the consumer
  wants a great deal of information
• Modified rebuy
• the in-between process where some review of the
  buying situation is donethough not as much as in
  new-task buying
• Straight rebuy
• a routine repurchase that may have been made many
  times before

7
Organizational Buying Processes
Exhibit 7-4
7-6
8
Major Sources of Information Used by
Organizational Buyers
9
Basic Methods in Organizational Buying
7-7
10
Definitions (not in book)

• Inspection Buying looking at every item before
  buying
• Sample Buying looking only at part of a
  potential purchase
• Description Buying buying from a written or
  verbal description of the product
• Competitive Bids terms of sale offered by
  suppliers in response to the buyers purchase
  specifications
• Negotiated Contract Buying book pg 191

11
Business Internet Purchases

• Higher Percentage of Total Purchases
• More limited Buyer / Seller Pool
• Greater Dollar Volume
• Possible to Buy or Get Bids Quickly
• Often Done on Closed Sites Requiring Permission
  to Participate
• Closed Sites Often Used for Current Customers
• Very Common For Standardized Purchases and
  Totally Unique Purchases (used)

12
Buyer-Seller Relationships

• 1 Building relationships and limiting the number
  of suppliers you work with
• 2 cooperation
• 3 share information
• 4 operational linkages
• 5 contracts
• 6 relationship specific adaptions
• 7 risk of powerful customers
• 8 buyers may still use multiple sources to cut
  their risk.

13
Resellers Buying Criteria

• Will The Product Sell?
• At What Price (Profit Margin) Can it Be Sold For?
• How Many Can Be Sold?
• How Fast Will They Sell?

14
Government Market

• Government units
• Federal government
• State governments
• Local governments
• Foreign countries
• Bid buying and negotiated contracts
• Sources of information
• Commerce Business Daily
• A variety of Internet web-sites
• Small Business Administration
• Government purchasing departments