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business-to-business marketing
seven
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
7-2
LEARNING OBJECTIVES
LO 7-1 Describe the ways in which business-to-business (B2B) firms segment their markets.
LO 7-2 List the steps in the B2B buying process.
LO 7-3 Identify the roles within the buying center.
LO 7-4 Describe the different types of organizational cultures.
LO 7-5 Detail different buying situations.
7-3
B2B Marketing
Who is the end user?
©1998 EyeWire, IncC Squared Studios/Getty Images
7-4
B2B Markets
B2B Markets
Resellers
Institutions
Government
Manufacturers/Service providers
U.S. Census Website
7-5
Manufacturers and Service Providers
Buy raw materials, components or parts
Manufacture their own goods
Gear Expo News Clip
Car Culture/Getty Images
7-6
Resellers
Manufacturer
Reseller
RetailerCourtesy Eastman Chemical Company
7-7
Institutions
Schools, Museums and Religious Organizations
Annie Reynolds/PhotoLink/Getty Images
Royalty-Free/CORBIS
Royalty-Free/CORBIS
7-8
Government
• US Government spends $2.1 trillion procuring goods
• State and local governments also make significant purchases
• Firms specialize in selling to government
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check yourself
7-9
1.What are the various B2B markets?
7-10
B2B Buying Process
Need recognition
Product specification
RFPprocess
Proposal analysis and supplier selection
Order specification
Vendor/ performance assessment using metrics
7-11
Stage 1: Need Recognition
• Can be generated internally or externally
• Sources for recognizing new needs:– Suppliers– Salespeople– Competitors
Tim
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7-12
Stage 2: Product Specifications
• Used by Suppliers to develop proposals
• Can be done collaboratively with suppliers
Roy
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BIS
7-13
Stage 3: RFP Process (Request for Proposal)
©Toyota Motor Engineering & Manufacturing North America, Inc.
Federal Business Opportunities Website
7-14
Step 4: Proposal Analysis, Vendor Negotiation and Selection
• Often several vendors are negotiating against each other
• Considerations other than price play a role in final selection
Courtesy The Goodyear Tire & Rubber Company
7-15
Step 5: Order Specification
• Firm places the order
• The exact details of the purchase are specified
• All terms are detailed including payment
Digital Vision/Getty Images
7-16
Step 6: Vendor Analysis
(1) Key Issues(2) Importance
Score(3) Vendor’s Performance
(4) Importance x Performance
(2) x (3)
Customer Service .40 5 2.0
Issue Resolution .20 4 0.8
Delivery .10 5 0.5
Quality .30 3 0.9
Total 1.00 4.2
check yourself
7-17
1.Identify the stages in the B2B buying process.
2.How do you perform a vendor analysis?
7-18
The Buying Center
Buying
Center
Initiator
Influencer
Decider
Buyer
User
Gatekeeper
The person who first suggests buying the particular product or service
The person whose views influence other members of the buying center in making the final decision
The person who ultimately determines any part of or the entire buying decision
The person who handles the paperwork of the actual purchase
The person who consumes or uses the
product or service
The person who controls information
or access, or both, to decision makers and
influencers
7-19
Organizational Culture
Buyingculture
Democratic
Consultative
Consensus
Autocratic
The majority rules
May be multiple participants, one person makes the
decision alone
One person to make a decision but solicit input
from others before doing so
All members of the team must reach a collective
agreement that they can support a particular
purchase
7-20
Buying Situations
Buying situations
New buy
Straight rebuy
Modified rebuy
7-21
New Buy
• Purchasing for the first time
• Likely to be quite involved
• The buying center will probably use all six steps in the buying process dynamicgrapics/Jupiterimages
7-22
Modified Rebuy
• Purchasing a similar product but changing specifications
• Current vendors have an advantage
RubberBall Productions
7-23
Straight Rebuys
• Buying additional units or products that have been previously purchased
• Most B2B purchases fall into this category
Ryan McVay/Getty Images
check yourself
7-24
1.What factors affect the B2B buying process?
2.What are the six different buying roles?
3.What is the difference between new buy, rebuy, and modified rebuy?