Podcast
Questions and Answers
Which factors heavily influence business buyers?
Which factors heavily influence business buyers?
- Cultural factors and social events
- Only personal emotions
- Environmental, organizational, interpersonal and individual factors (correct)
- Technological changes only
How do great salespeople impact business buying?
How do great salespeople impact business buying?
- They have a minimal effect on sales volume.
- They can increase sales volume and customer satisfaction. (correct)
- They primarily focus on economic factors.
- They usually lower the prices significantly.
In situations where competing products are very similar, business buyers tend to:
In situations where competing products are very similar, business buyers tend to:
- Consult industry experts before making a decision.
- Be heavily influenced by personal factors. (correct)
- Rely solely on brand reputation.
- Only consider economic factors.
What environmental factor can lead business buyers to hold larger inventories?
What environmental factor can lead business buyers to hold larger inventories?
Which of the following is NOT a category of influence on business buyers?
Which of the following is NOT a category of influence on business buyers?
What role does emotional response play in business buying decisions?
What role does emotional response play in business buying decisions?
What influences the decision-making process of business buyers in terms of supply?
What influences the decision-making process of business buyers in terms of supply?
How does organizational structure affect business buying decisions?
How does organizational structure affect business buying decisions?
What is the primary goal of supplier development?
What is the primary goal of supplier development?
What are the consequences of focusing on products that do not require cooperation with suppliers?
What are the consequences of focusing on products that do not require cooperation with suppliers?
Which factor is NOT part of the business buying decision process?
Which factor is NOT part of the business buying decision process?
What role do internal and external factors play in the buying decision process?
What role do internal and external factors play in the buying decision process?
What is the primary concern for companies when balancing costs and quality?
What is the primary concern for companies when balancing costs and quality?
What is a key component of understanding business buyer behavior according to the provided model?
What is a key component of understanding business buyer behavior according to the provided model?
What does the model suggest about the stimuli affecting buyer responses?
What does the model suggest about the stimuli affecting buyer responses?
Which of the following questions is NOT suggested by the model of business buyer behavior?
Which of the following questions is NOT suggested by the model of business buyer behavior?
What is the primary advantage of systems selling in a business buying situation?
What is the primary advantage of systems selling in a business buying situation?
Who are considered users in the buying centre of an organization?
Who are considered users in the buying centre of an organization?
Which role in the buying centre is primarily responsible for helping define specifications?
Which role in the buying centre is primarily responsible for helping define specifications?
What could be a potential risk when choosing new suppliers over established ones like Scania?
What could be a potential risk when choosing new suppliers over established ones like Scania?
What is a possible disadvantage of opting for the cheapest offer in procurement?
What is a possible disadvantage of opting for the cheapest offer in procurement?
In the business buying process, what role does the decision-making unit play?
In the business buying process, what role does the decision-making unit play?
What is a significant reason businesses prefer to buy a complete solution from a single seller?
What is a significant reason businesses prefer to buy a complete solution from a single seller?
Why might approaching users rather than the formal buying unit be beneficial?
Why might approaching users rather than the formal buying unit be beneficial?
Who are the likely formal participants involved in the purchase of a corporate jet?
Who are the likely formal participants involved in the purchase of a corporate jet?
What is a potential downside of a corporate jet in terms of organizational practices?
What is a potential downside of a corporate jet in terms of organizational practices?
Which factor is suggested to strongly influence business buyers' decisions?
Which factor is suggested to strongly influence business buyers' decisions?
How can informal participants affect the buying decision?
How can informal participants affect the buying decision?
What common misconception do experts have regarding product recommendations?
What common misconception do experts have regarding product recommendations?
What is often assumed about the nature of business buying decisions?
What is often assumed about the nature of business buying decisions?
What role does the purchasing agent typically have in the buying center?
What role does the purchasing agent typically have in the buying center?
Why might a board member's informal influence on a buying decision be problematic?
Why might a board member's informal influence on a buying decision be problematic?
What is often a challenge when evaluating interpersonal factors in the buying centre?
What is often a challenge when evaluating interpersonal factors in the buying centre?
Which of the following best describes a formal decision-maker's potential frustration?
Which of the following best describes a formal decision-maker's potential frustration?
What impact do individual factors have on the buying decision process?
What impact do individual factors have on the buying decision process?
Which participant in the buying centre might have significant influence without being a formal decision-maker?
Which participant in the buying centre might have significant influence without being a formal decision-maker?
How do buyers with different buying styles approach decision-making?
How do buyers with different buying styles approach decision-making?
What do business marketers need to understand to effectively engage with the buying centre?
What do business marketers need to understand to effectively engage with the buying centre?
What is a potential influence that a participant in the buying centre may have?
What is a potential influence that a participant in the buying centre may have?
In the business buying process, how many stages do buyers typically follow for new, complex buying decisions?
In the business buying process, how many stages do buyers typically follow for new, complex buying decisions?
What primarily characterizes business markets compared to consumer markets?
What primarily characterizes business markets compared to consumer markets?
What is the first stage in the business buying decision process?
What is the first stage in the business buying decision process?
Which of the following is a type of buying situation in business markets?
Which of the following is a type of buying situation in business markets?
What is a significant factor in the institutional market?
What is a significant factor in the institutional market?
What role does the buying centre play in business buying decisions?
What role does the buying centre play in business buying decisions?
Which of the following best describes derived demand in business markets?
Which of the following best describes derived demand in business markets?
How does the business buying decision process differ for buyers in new-task situations compared to others?
How does the business buying decision process differ for buyers in new-task situations compared to others?
What kind of governments are included in the governmental market?
What kind of governments are included in the governmental market?
Flashcards
Supplier Development
Supplier Development
A strategic approach where businesses work closely with their suppliers to ensure a consistent and reliable supply of high-quality materials and products.
Business Buying
Business Buying
The process of purchasing products or services for use in business activities.
Buying Centre
Buying Centre
All the individuals who participate in the decision-making process of a business purchase.
Business Buying Decision Process
Business Buying Decision Process
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Internal Organizational Factors
Internal Organizational Factors
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Interpersonal Factors
Interpersonal Factors
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Individual Factors
Individual Factors
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External Environmental Factors
External Environmental Factors
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New-task buying situation
New-task buying situation
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Systems selling (or solutions selling)
Systems selling (or solutions selling)
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Users (in a buying centre)
Users (in a buying centre)
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Influencers (in a buying centre)
Influencers (in a buying centre)
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Approaching users (sales strategy)
Approaching users (sales strategy)
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What is a buying center?
What is a buying center?
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How are buying center participants influential?
How are buying center participants influential?
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Why should marketers study business buying influences?
Why should marketers study business buying influences?
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What's a common assumption about business buying?
What's a common assumption about business buying?
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Is business buying solely driven by economic logic?
Is business buying solely driven by economic logic?
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What's the risk of expert recommendations in business buying?
What's the risk of expert recommendations in business buying?
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How is sustainability influencing business buying?
How is sustainability influencing business buying?
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What's the key takeaway for marketers?
What's the key takeaway for marketers?
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Environmental Factors
Environmental Factors
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Organizational Factors
Organizational Factors
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What is the business market?
What is the business market?
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What is derived demand?
What is derived demand?
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Why are business buying decisions more complex?
Why are business buying decisions more complex?
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What is a straight re-buy?
What is a straight re-buy?
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What is the buying center?
What is the buying center?
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Why is it important to understand buying center participants?
Why is it important to understand buying center participants?
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What is the institutional market?
What is the institutional market?
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What is the governmental market?
What is the governmental market?
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Systems Selling
Systems Selling
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Study Notes
Chapter 7 - Business Markets and Business Buyer Behaviour
- Mini Contents:
- Company case -IBM: the world's most valuable business-to-business brand
- Business markets
- Best practice – IKEA: involving suppliers from start to finish
- Company case - STIGA: marketing in industrial markets
- Business buyer behaviour
- The business buyer decision process
- Business-to-business digital and social media marketing
- E-procurement
- Institutional and governmental markets
- Legislation issues
Chapter Preview
- This chapter examines business customer buying behaviour, focusing on factors influencing purchases made for production, internal use, or resale.
- Businesses, like consumers, require relationship-building and value creation.
- IBM's vast business customer base accounts for a significant portion of their revenues, highlighting the importance of this market segment.
Learning Objectives
- Define the business market and differentiate it from consumer markets.
- Identify key factors influencing business buyer behaviour.
- Describe the steps in the business buying decision process.
- Compare and contrast institutional and governmental market buying decisions.
Business Markets
- Businesses often sell to other businesses (e.g., Aria, Atlas Copco, Google, KPMG).
- The public sector (e.g., infrastructure projects in Stockholm, Järna-Linköping) plays a crucial role in business markets.
Business Buyer Behaviour
- Buying behaviour of organizations purchasing goods/services for internal use or resale.
- Involves determining product/service needs, evaluating suppliers and brands, and building profitable relationships with clientele.
Business Buying Process
- A multi-step decision process involving multiple participants.
- The process is often more formalized than consumer buying decisions.
Market Structure and Demand
- Business markets often deal with fewer, larger buyers (compared to consumer markets).
- Demand is often derived from consumer demand.
- Demand (and fluctuations) are often more volatile than in consumer markets.
Nature of the Buying Unit
- Business purchases typically involve more participants and a more professional approach compared to consumer purchases.
- There are clear roles (e.g., users, influencers, gatekeepers, deciders, buyers) in the business buying centre.
Major Types of Buying Situations
- Straight Rebuy: Routine reorder without modifications.
- Modified Rebuy: An existing product/service with some changes or a new supplier.
- New Task: First-time purchase of a major product/service, requiring thorough research.
Participants in the Business Buying Process
- Buying Centre: All involved in the purchase decision.
- Users, influencers, gatekeepers, deciders, buyers are key roles within the buying centre.
Major Influences on Business Buyers
- Environmental: Economic conditions, political factors, regulatory changes, and competitive dynamics.
- Organizational: Objectives, policies, procedures, structure, and systems of the purchasing organization .
- Interpersonal: Relationships, influence of individuals within the buying centre .
- Individual: Personal factors like motives, perceptions, and preferences of individual participants.
E-procurement
- Purchasing through online connections.
- Offers advantages for both buyers and suppliers, including cost reduction and efficiency gains.
- However, e-procurement can sometimes erode long-term customer relationships depending on how it's implemented.
Business-to-Business Digital and Social Media Marketing
- Importance of using digital channels.
- Building relationships with business customers through various digital marketing approaches.
Institutional Markets
- Institutions like schools, hospitals, nursing homes, and prisons requiring goods and services.
- Often characterized by constraints, such as budget limitations, and a need for high quality.
Governmental Markets
- Government units (federal, state, and local) purchasing goods and services.
- Political considerations, legal frameworks (e.g., public procurement acts) and transparency standards are crucial components of governmental buying decisions.
Legislation Issues
- Government procurement regulations, such as those in the European Union, often favor domestic suppliers.
- Procedures and compliance regulations significantly influence governmental buying practices.
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