Situation 1

• Sophisticated Graphic computer industry• Industry Practice: Quoting high Prices, Heavy

discounts• Products priced 10-15% lower, Less discounts• Purchasing agents measured by superiors by

amount deducted during negotiations• Key Learning: Discounts had a significance to

buyers that “sound pricing” logic does not fulfill

Situation 2

• AT&T faced competition from a vendor with better technology

• Customer’s key decision maker : Ex-Bell employee (big-name system buster)

• Very less response time to sales threat due to lack of analysis

• Key Learning: Power, motivation & perceptions of individuals needs to be studied

Major Sales: Who Really Does The Buying

By Harsh Sharma (113)

Vishwam Agrawal (97)

Buying a Corporate Jet

• Price tag: more than $3 million• Market splits into 2 segments: – Those who already own a jet– Those who do not

• Salesperson identifies psychological and emotional needs of buying decision

Owner Market• Central decision maker: CEO• Find the kid inside and impress with raw

beauty of the plane• Major influencer & Gatekeeper: Pilot,

Technical ExpertNon Owner Market• Even more complex market• No precedent/ aviation expert exists

Q1 Who’s in The Buying Center?

• Initiator: recognizes the problem• Gatekeeper: Act as a problem/ product expert• Influencers: Who have a say in the purchase and about

what is bought• Decider: Who say Yes/ No to the purchase• Purchaser: Completes purchase, negotiates• User: Consume the Product/Service

One manager can assume Multiple roles, and vice-versa…

Buying Center

Q2 Who are the Powerful Buyers?

Q3 What do they want?

Diagnosing motivation

• Very important!!!• Basic rule of motivation

All buyers act selfishly or try to be selfish but sometimes miscalculate and don’t serve their own interests

The Buyers decision making process

1) Decompose the product/service into various benefits such as…

Product feature Price Reliability

2) Segment the potential benefit into various categories

Financial Product/service Social/Political Personal

a. Absolute cost saving

b. Cheaper than competitors

c. Will provide operating cost reductions

d. Economies of leasing versus buying

a. Pre and post sales service

b. Specific features

c. Space occupied by unit

d. Availability

a. Will purchase enhance the buyer’s standing with the buying team or top management?

a. Will purchase increase liking or respect for the buyer?

b. How does purchase fit buyer’s self concept?

Buyers Unsure that the desired

product will bring the desired benefit

Q4 How do they perceive us?

Outcome: Possible selling approaches

1) The vendor should try to make the buyer concentrate only on the promised benefits

2) The vendor should try to increase the buyer’s confidence that promised benefits will be realized

3) The vendor should try and change what the buyer wants or which class of benefits he/she responds most strongly

Thank You for your Patience…!!!