16 Questions
What is the main difference between the organizational market and the consumer market?
Purchases made for personal consumption in the consumer market, while in the organizational market, purchases are made for some purpose other than personal consumption.
What differentiates purchases in the organizational market from those in the consumer market?
Organizational market purchases are frequently made on impulse, while consumer market purchases are often made after careful weighing of alternatives.
How do purchases in the organizational market differ from those in the consumer market?
Purchases in the organizational market involve competitive bidding and price negotiations, while consumer market purchases are usually made at 'list price' with cash or credit cards.
What sets apart the decision process in the organizational market from that of the consumer market?
Decisions in the organizational market usually involve several people, while decisions in the consumer market are usually made by individuals.
How do purchases for the organizational market differ from purchases for the consumer market?
Purchases for the organizational market often involve competitive bidding and price negotiations, while consumer market purchases are usually made at 'list price' with cash or credit cards.
What distinguishes decisions in the organizational market from those in the consumer market?
Decisions in the organizational market involve interdependencies between buyers and sellers, whereas decisions in the consumer market often engage in lengthy decision processes.
What is a characteristic of products frequently purchased directly from the producer?
They usually involve high risk and high cost
What type of demand is generally associated with products frequently purchased directly from the producer?
Demand derived from demand for other goods and services, generally inelastic in the short run
How can market segmentation be defined?
As a method to identify preference segments by asking buyers about product attributes
What type of preference pattern in a market shows no natural segments?
Homogeneous preferences
What is one benefit of market segmentation?
Analysis of market segments enabling decisions about marketing activities intensity
What is a characteristic of products usually purchased from someone other than the producer of the product?
They are generally low risk and low cost
What type of demand is generally associated with products usually purchased from someone other than the producer of the product?
Demand based on consumer needs and preferences, generally price elastic
What is a benefit of identifying preference segments through market segmentation?
Developing effective marketing plans based on scattered consumer preferences
What is a characteristic of the promotion strategy for products frequently purchased directly from the producer?
It emphasizes personal selling
What is a characteristic of the promotion strategy for products usually purchased from someone other than the producer of the product?
Mostly involves advertising
Study Notes
- Organizational markets refer to purchases made for business purposes, not for personal consumption.
- Consumer markets involve purchases for individual or household use.
- Organizational markets involve purchases made by someone other than the user, often with careful consideration and complex financial arrangements.
- Consumer markets involve decisions made by individuals and purchases based on personal preferences and emotions.
- Market segmentation is a way to divide a market into distinct groups based on various characteristics, such as preferences or demographics.
- Homogeneous preferences indicate a market with consumers who have similar preferences, with existing brands clustering around the middle of the scale.
- Diffused preferences indicate a market with consumers who have widely varying preferences, making it difficult to identify natural segments.
- Clustered preferences indicate a market with distinct preference clusters, or natural market segments.
- Benefits of market segmentation include increasing sales volume, developing effective marketing plans, enabling decisions, and understanding consumer needs.
Test your knowledge of the differences between organizational market and consumer market. Explore the distinctions in purchases, decision-making processes, and usage patterns between the two markets.
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