Understanding Market: Organizational vs Consumer

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Questions and Answers

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. (correct)

Consumer market decisions are usually made by several people, while organizational market decisions are usually made by individuals.

Organizational market purchases are often made based on brand reputation or personal recommendations, while consumer market purchases are made according to precise technical specifications.

Organizational market purchases involve competitive bidding and price negotiations, while consumer market purchases are usually made at 'list price' with cash or credit cards.

What differentiates purchases in the organizational market from those in the consumer market?

Purchases in the organizational market are based on emotional responses to products or promotions, whereas consumer market purchases are made based on rational criteria.

Organizational market purchasers often make quick decisions, while consumer market decisions are usually made by individuals.

Buyers in the organizational market engage in long-term relationships, while buyers in the consumer market engage in limited-term or one-time relationships.

Organizational market purchases are frequently made on impulse, while consumer market purchases are often made after careful weighing of alternatives. (correct)

How do purchases in the organizational market differ from those in the consumer market?

Purchases in the organizational market are based on rational criteria, while consumer market purchases are made based on emotional responses to products or promotions.

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. (correct)

Organizational market purchases are often made based on brand reputation or personal recommendations, while consumer market purchases are made according to precise technical specifications.

In the organizational market, decisions are frequently made by several people, whereas in the consumer market decisions are usually made by individuals.

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. Signup and view all the answers

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. Signup and view all the answers

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. Signup and view all the answers

What is a characteristic of products frequently purchased directly from the producer?

They usually involve high risk and high cost Signup and view all the answers

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 Signup and view all the answers

How can market segmentation be defined?

As a method to identify preference segments by asking buyers about product attributes Signup and view all the answers

What type of preference pattern in a market shows no natural segments?

Homogeneous preferences Signup and view all the answers

What is one benefit of market segmentation?

Analysis of market segments enabling decisions about marketing activities intensity Signup and view all the answers

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 Signup and view all the answers

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 Signup and view all the answers

What is a benefit of identifying preference segments through market segmentation?

Developing effective marketing plans based on scattered consumer preferences Signup and view all the answers

What is a characteristic of the promotion strategy for products frequently purchased directly from the producer?

It emphasizes personal selling Signup and view all the answers

What is a characteristic of the promotion strategy for products usually purchased from someone other than the producer of the product?

Mostly involves advertising Signup and view all the answers

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.

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Description

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.