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Questions and Answers
What is the primary role of users in the organizational buying process?
What is the primary role of users in the organizational buying process?
Which role in the buying center is responsible for negotiating contract terms?
Which role in the buying center is responsible for negotiating contract terms?
In the context of the buying center, who has the power to affect the specifications of a product?
In the context of the buying center, who has the power to affect the specifications of a product?
Which role in the buying center controls the flow of information?
Which role in the buying center controls the flow of information?
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What type of risk involves potential reprimand for making wrong decisions in the organizational buying process?
What type of risk involves potential reprimand for making wrong decisions in the organizational buying process?
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Which type of organizational buyer primarily reprocesses products before selling them?
Which type of organizational buyer primarily reprocesses products before selling them?
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What characterizes the demand in organizational markets?
What characterizes the demand in organizational markets?
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Which of the following is true regarding the order process in organizational markets?
Which of the following is true regarding the order process in organizational markets?
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Which of the following best describes the decision-making process in organizational buying?
Which of the following best describes the decision-making process in organizational buying?
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Which characteristic of organizational markets implies that a few customers contribute significantly to total sales?
Which characteristic of organizational markets implies that a few customers contribute significantly to total sales?
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What is a common attribute of products purchased in organizational markets?
What is a common attribute of products purchased in organizational markets?
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What is a significant concern for buyers in organizational markets?
What is a significant concern for buyers in organizational markets?
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What is a distinguishing feature of government unit buyers?
What is a distinguishing feature of government unit buyers?
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Study Notes
B2B Marketing
- B2B marketing focuses on businesses buying goods and services for use in their own operations or resale.
Organizational Markets
- Markets where companies buy goods and services.
- Types of organizational buyers include:
- Industrial firms
- Resellers
- Government units
- Non-profit organizations
Organizational Buyers
- Industrial firms process products before resale.
- Resellers are wholesalers and retailers who resell goods without reprocessing.
- Government units buy for their constituents.
- Non-profit organizations provide goods and services for society.
Characteristics of Organizational Markets
- Market Structure: Fewer, larger buyers geographically concentrated.
- A small number of customers account for a large portion of sales.
- The market size is usually considerably larger than consumer markets.
Demand in Organizational Markets
- Derived Demand: Demand for industrial products is driven by demand for consumer products.
- Inelastic Demand: The price change of B2B products does not significantly affect the quantity demanded.
- Fluctuating Demand: Business product demand fluctuates more than consumer product demand.
Characteristics of Organizational Markets - Order and Decision Process
- Purchase orders are typically larger than consumer purchases.
- Multiple people are involved in the buying decision.
- Decision-making processes are more complex, formalized, and reliant on many factors.
- Decision time is usually longer due to complexity. Involves higher risk.
Organizational Buying Behaviour
- B2B products/services are technically complex. Bought based on specifications.
- Time, technical support, and pricing are important considerations.
- Buying procedures are established and followed by qualified buyers.
- Explicit buyer criteria and seller evaluation procedures exist.
- Internet purchasing is common.
Organizational Buying Risk
- Organizational Risk: Risk associated with working with a particular organization.
- Personal Risk: Risk of being reprimanded for a wrong decision.
Organizational Buying Process
- The process consists of several steps, from problem recognition to post-purchase evaluation. Involves information gathering, evaluation of alternatives, and purchase decisions.
- Stages: Problem recognition, information search & value assessment, evaluation of alternatives & value assessment, purchase decision & value assessment, post-purchase behavior, and outcome evaluation. Detailed activities within each stage can include product specification, supplier search, proposal solicitation, supplier selection, order routine specification and performance review.
- Different buying roles exist within the buying center:
- Users,
- Gatekeepers,
- Influencers,
- Deciders,
- Buyers
Organizational Buying Situations
- Different buying situations exist:
- Straight rebuy,
- Modified rebuy,
- New buy
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Description
Explore the fundamentals of B2B marketing and its unique characteristics. This quiz covers the types of organizational buyers, market structures, and the concept of derived demand. Test your understanding of how businesses engage in purchasing goods and services.
