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Business 2 Business Marketing: Session 3 (Understanding Firms As Customers)

This document discusses business to business marketing and organizational buying behavior. It explains that understanding the decision-making group within a business customer is critical for product development and sales. The 8-step organizational buying process is described, including problem recognition, specification, supplier search, selection and review. Different buying situations like new tasks, modified rebuys and straight rebuys are outlined. The importance of assessing the buying center members, their roles and influences is discussed. The document provides information on identifying an organization's needs versus individual and personal needs within the buying center.

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Divyanshu Jain
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66 views18 pages

Business 2 Business Marketing: Session 3 (Understanding Firms As Customers)

This document discusses business to business marketing and organizational buying behavior. It explains that understanding the decision-making group within a business customer is critical for product development and sales. The 8-step organizational buying process is described, including problem recognition, specification, supplier search, selection and review. Different buying situations like new tasks, modified rebuys and straight rebuys are outlined. The importance of assessing the buying center members, their roles and influences is discussed. The document provides information on identifying an organization's needs versus individual and personal needs within the buying center.

Uploaded by

Divyanshu Jain
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Business 2 Business Marketing

Session 3
(Understanding firms as Customers)
Your target customer almost surely has a decision-making
group of more than one person. Understanding this group
and explicitly mapping out each person's role and interest is
of critical importance not just for the sale, but also much
earlier in the process when you are developing the product
and all of its attributes.
Organizational buying behavior (OBB) is related
to the purchase of a product or service to satisfy
organizational rather than individual goals.

Why is this topic important?


Understanding the behavior of the organizational customer is one of the
most important challenges facing the industrial marketing manager
(like consumer behavior in consumer marketing!)
Organizational buying process
8-Step model
Step 1: Problem Recognition
Step 2: General Need Description
Step 3: Product Specification
Step 4: Supplier Search
Step 5: Proposal Solicitation
Step 6: Supplier selection
Step 7: Order Routine Specification
Step 8: Performance review
The Buying Process is simultaneous and not sequential
Buying Situations in organizations

Straight
New Task
Rebuy

Modified
Rebuy
Stage 1: Problem Recognition
A buying situation that has not been previously faced by the
New organization.
Task Significantly steep learning curve, organization seeks many sources
of information.

A buying situation that is somewhat similar to past


Modified problems/solutions
Rebuy Examines alternatives within a limited scope, involves fewer
people than a new task situation and more than a straight rebuy.

A routine buying situation with established solutions.


Straight Abbreviated steps in the process, fewer people in the buying center,
Rebuy less time to completion.
7
Industrial Sales: How to Assess Group Forces

There are three questions that need to be


addressed:

1. Who takes part in the buying process?


2. What is each members relative influence in decision?
3. What criteria is important to each member in evaluating the
supplier?

Answering these questions puts the salesperson in a better position to


become the chosen supplier.
Buying Center
Buying center can be defined as all individuals
and groups participating in the buying decision
process and who have interdependent objective
and share common risk
Decision Making Unit -The Buying Center

Who First Recognizes


the Problem
Decision Making Unit -The Buying Center

Who controls the


flow of information
Decision Making Unit -The Buying Center

The individual given


the task of sourcing
suppliers and
negotiating the final
deal
Decision Making Unit -The Buying Center

People who make the


final decision may be
senior managers or
specialists
Decision Making Unit -The Buying Center

People who have


the ear of the
deciders
Kinds of Needs
For benefits from the product or service once
it is finally purchased and used. This need
Organizations Need usually includes the technical specifications,
performance requirements and other
elements

Each professional is expected to


perform the functions of his job in a
Individuals Need way that supports the organization
needs.
Very fine line
of difference

Personal needs for career


Buying Center Members success, recognition and quality
Personal Need of life factors
ROLE PLAY EXERCISE
Evaluation guideline
Do you think the group could come of with
priorities and define the requirements for this
purchase?
Given the requirement- was their choice of
alternative right- state your views?
Give your rating out of 5.
QUESTIONS AND FEEDBACK TO
MRIDULA@XIMB.AC.IN

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