Business Markets and Business Buyer Behavior

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Business Markets and Business Buyer Behavior
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Business Markets

• Business Market g all the organizations that buy
  goods and services to use in the production of
  other products and services that are sold/rented
  or supplied to others
• Business buying process g decision making process
  by which business buyers 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
Contain fewer, but larger buyers
Customers are more geographically concentrated
Buyer demand is derived from final consumer
demand
Marketing Structure and Demand
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Characteristics of Business Markets
Types of Decisions and the Decision Process
Build Long-Term Partnerships
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Model of Business Buyer Behavior
Buyer Responses Product or service
choice Supplier Choice Order Quantities Deliver
y terms and times Service terms Payment

• The Environment
• Marketing
• Stimuli
• Product
• Price
• Place
• Promotion
• Other Stimuli
• Economic
• Technological
• Political
• Cultural
• Competitive

The Buying Organization The buying
center Buying decision process (Interpersonal
and individual influences) (Organizational
Influences)
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Major Types of Buying Situations
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Participants in the Business Buying Process
Users
Initiators
Influencers
Gatekeepers
Buyers
Deciders
Approvers
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Major Influences on Business Buyer Behavior
Environmental Economic developments Supply
Conditions Technological change Political and
regulatory developments Competitive
Developments Culture and customs
Organizational Objectives Policies Procedures
Organizational Structure Systems
Interpersonal Authority Status Empathy Persuas
iveness
Individual Age Education Job Position Personality
Risk Attitudes
Business Buyers
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Organizational Factors Influencing Business Buyer
Behavior
Purchasing- Department Upgrading
Cross- Functional Roles
Centralized Purchasing
Decentralized Purchasing of Small Ticket Items
Internet Purchasing
Long-Term Contracts
Purchasing- Performance Evaluation Pro. Buyers
Lean Production
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Problem Recognition
Stages of Business Buying Process
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Institutional Markets
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Business Buying on the Internet

• Business buyers may purchase electronically by
• Electronic data interchange links (EDI)
• The Internet
• Connecting to customers to
• Share marketing information,
• Sell products services,
• Provide customer support, and
• Maintain on-going relationships.

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Benefits and problems created by buying on the
Internet

• Problems
• Cut purchasing jobs
• Erode supplier-buyer loyalty
• Create potential security disasters

• Benefits
• Shave transaction costs
• Reduce time between order and delivery
• Create more efficient purchasing systems
• Forge more intimate relationships
• Level the playing field