2. Features Of Business Markets
Fewer, larger buyers
Close supplier-customer relationship
Professional Buying
Several buying influences
Derived demand
Inelastic Demand
Geographically concentrated buyers
Direct Purchasing
3. Business Buying Behaviour
Buying behaviour of organisations
that buy goods and services
for use in the production of other products and
services
or for the purpose of reselling
or renting them for profit
4. Business Buying
Process
The decision process
by which business buyers determine
which products and services
their organisations need to purchase
and then find, evaluate and chose
mong alternative suppliers and brands.
5. Business Buying Process
Order Routine Specification
Proposal Solicitation
Supplier Selection
General Search
ProblemNeed Description
Recognition
• Final order to chosenasked to submit
Qualified buyers are supplier
Performancefrom ofand
Product Specification select service
• Can resultvendors product orsupplier
Review proposal
Find best Review
Characteristics internal(Launching a
• proposals specifications, quantity
Technical
• new of internetrated
Satisfaction is
Desired be done
Use product)
It should needed technically
Quantitysupplier attributes and their
needed, expected delivery time,
• Kind of proposal depends on thereturn
• Also result task, externalthe complexity
Continuation, modification
relative of doing reduce or
Newer the from greater costexit
Value analysis to it
Processimportance is simple for
policies, warranty are decided
complexity of the product
• factors(Somebodyplace a better offer
Negotiation takes
of supplier search having
standard items
Vendor managed inventory
• Should be marketing documents
6. Buying Situation
Straight Rebuy
1.
2.
3.
4.
Reorder without modification
Handled on a routine basis
Based on past buying satisfaction
Buyer simply chooses from list of suppliers
Modified Rebuy
Product specification, prices, suppliers are
changed
2. Involves more decision participants
1.
New Task
1.
2.
3.
First time purchase
Greater risk and cost
Even larger decision participants
7. Participants In Business Buying
Process
Influencers
Users
Buyers
Deciders specifications supplier
• HelpUsually initiate the buying
• define
Gatekeepers evaluation of
• Formal authority to select
• Provideor informal decision makers
Formal info for
•
•
•
•
process
Control for terms Information
Arrangethe flow ofof purchase
In routine define product are deciders
alternatives
• Help buying buyers
Eg: Assistants, Secretaries
In complex purchses buyers might
or approvers
Technical personnel are more
specification
includehigh level officers to negotiate
important influencers
8. Buying Center
All the individuals or
units that play a role
in the purchase
decision making
process
9. Buying Center’s Features
Is not formally fixed
Buying roles assumed by different
people for different purchase
Size depends on type of purchase
Point of importance is to understand
who are the participants and what
influence they have
10. Influence on Business Buying
Behaviour
Environmental
Individual
Organisational
• Economic Developments like demand, cost
Interpersonal
etc.
• Objectives
Age
•
•
•
•
Supply • Policies (different for avavilable
conditions
Education
Authority
and scarce materials) and
• Procedures
Job position
Status
Technological Change
• Systems
Personality
Persuasiveness
Political Regulatory Developments
• Structure
Risk Attitude
Competitive Depvelopments
11. Institutional Market
• Consists of schools, hospitals, prisons
• Provide goods and services to people in
their care
• Differ in terms of their objectives
• Have different buying needs
• Marketers need to have separate division
to cater to these needs
12. Government Market
• Major buyer of goods and services
• In US there are 82000 buying units
• Success here lies in identifying the key
decision maker
• Usually bids are submitted and lowest bid
wins
• Favour domestic players
