7

Analyzing
Business Markets

Marketing Management, 13th ed

 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?

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 7-2

 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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 CISCO Targets Businesses

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 What is Organizational Buying?

Organizational buying refers

to 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.

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 7-5

 Top Business Marketing Challenges

Expand understanding of customer needs

Compete globally as China and India
reshape markets
Master analytical tools and improve
quantitative skills
Reinstate innovation as an engine of growth
Create new organizational models and
linkages

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 Characteristics of Business Markets

Fewer, larger buyers Multiple sales calls

Close supplier- Derived demand
customer Inelastic demand
relationships Fluctuating demand
Professional Geographically
purchasing concentrated buyers
Many buying Direct purchasing
influences

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 Buying Situation

Straight
Straight rebuy
rebuy

Modified
Modified rebuy
rebuy

New
New task
task

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 Systems Buying and Selling

Turnkey solution System

desired; subcomponents
bids solicited assembled

Prime Second-tier
contractors contractors

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 The Buying Center
Initiators
Initiators

Users
Users

Influencers
Influencers

Deciders
Deciders

Approvers
Approvers

Buyers
Buyers

Gatekeepers
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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 Sales Strategies

Key Buying
Small Sellers Influencers

Multilevel
Large Sellers In-depth
Selling

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 Stages in the Buying Process:
Buyphases
Problem recognition
General need description
Product specification
Supplier search
Proposal solicitation
Supplier selection
Order-routine specification
Performance review
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 Table 7.2 Buygrid Framework

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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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 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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 Table 7.3 Vendor Analysis

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 Handling Price-Oriented Customers

Limit
Limit quantity
quantity purchased
purchased

Allow
Allow no
no refunds
refunds

Make
Make no
no adjustments
adjustments

Provide
Provide no
no services
services

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 Methods for Researching
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

Stockless
purchase plans

Vendor-managed
inventory

Continuous
replenishment

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 Establishing Corporate Trust
and Credibility

Expertise

Trustworthiness Likeability

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 Figure 7.1 Trust Dimensions

Cooperating
Transparent
Design

Product/Service Product
Quality Comparison

Incentive Supply Chain

Pervasive
Partnering
Advocacy
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 Factors Affecting
Buyer-Supplier Relationships

Availability of Importance of
alternatives supply

Complexity of Supply market

supply dynamism

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 Categories of Buyer-Seller
Relationships

Basic buying and Cooperative

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

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 What is Opportunism?

Opportunism is some form of

cheating or undersupply relative to
an implicit or explicit contract.

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 Aramark Successfully Services Institutional
and Government Markets

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 Marketing Debate
how different is B-to-B marketing?
Take a position:
1. Business-to-business marketing
requires a special, unique set of marketing
concepts and principles.
or
2. Business-to-business marketing is really
not that different and the basic marketing
principles apply.

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 Marketing Discussion

Consider some of the consumer

behavior topics from Chapter 6.
How might you apply them to business-
to-business settings?

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