Chapter 6: Business markets and business buying behaviour (The business…
Chapter 6: Business markets and business buying behaviour
Factors that influence buyer behaviour include environmental, organisational, interpersonal and individual.
Interpersonal influence: the target market business marketers take these factors and establish from it.
Organisational influence: the way in which the company is maintained and operated.
Environmental influence: customers are influenced by economic environment, meaning primary demand , economic outlook, the cost of money, key materials, technology, politics and competitive development
Individual influence: individual motives perceptions and preferences.
Business marketing are the sales of services and products by one company to another. Consumer marketing are these products and services being put to use.
The business buying process
Supplier search: buyer tries to find best suppliers of products and service
Proposal solicitation: buyer invites qualified suppliers to submit proposal
Product specification: firm decides on and specifies the best technical product characteristics for a needed item
Supplier selection: buyer reviews proposal and selects a supplier/s
General need description: describes the general characteristics and quantity of a needed item
Problem recognition: this is when a problem is recognised
Order-routine specification:buyer writes final order with chosen supplier/s
Performance review: buyer assesses performance of the supplier and decides to continue, modify or end arrangement
Institutional and government markets
Institutional markets: these markets consists of schools, hospitals, nursing homes and other institutions that provide products and services to people in their care.
Government markets: these are your government units that purchase or rent products and services for carrying out the main functions of government.
Market structure and demand
The buyers are more geographically concentrated and the business demand is derived demand.
Fluctuating demand: demand changes a lot and faster that demand for consumer goods and services
Inelastic demands: price changes do not have a significant impact on demand, especially over the short term.
Nature of buying unit
It involves more decisions from the participants and more professional purchasing effort.
Trained purchasing agents and several people are included in the decision-making process.
Major types of buying situations
Modified re-buy: buyer wants to modify product and/or service specifications, pricing, terms or suppliers
Straight re-buy: the buyer routinely recorders something without any modifications
New task: buyer buys a product for the first time