Chapter 7 Analyzing Business Markets & Business Buying Behavior Marketing Management Tenth Edition Philip Kotler

Objectives How Business & Consumer Markets Differ Organizational Buying Situations Participants in the Business Buying Process Major Influences on Organizational Buyers Business Buyer Decision Making Institutional & Government Buying

Business vs. Consumer Markets Fewer buyers Larger buyers Close supplier-customer relationship Geographically concentrated Derived demand Inelastic demand Fluctuating demand

Business vs. Consumer Markets Professional purchasing Several buying influences Multiple sales calls Direct purchasing Reciprocity Leasing

New Task Buying Modified Rebuy Straight Rebuy Custom furniture Installed components Buildings Weapon systems Involved Decision Making New vehicles Elec. Equip Consultants Computer equip. Modified Rebuy Straight Rebuy Utilities Office Supplies Bulk chemicals

Participants in the Business Buying Process Users Initiators Influencers Gatekeepers Buyers Deciders Approvers

Major Influences on Industrial Buying Behavior Level of demand Economic outlook Interest rate Rate of techno- logical change Political and regulatory developments Competitive Social responsi- bility concerns Environmental Objectives Policies Procedures Organizational structures Systems Interests Authority Status Empathy Persuasive- ness Interpersonal Age Income Education Job position Personality Risk attitudes Culture Individual Business Buyer

Organizational Factors Purchasing- Department Upgrading Cross- Functional Roles Centralized Purchasing Decentralized Purchasing of Small Ticket Items Internet Purchasing Long-Term Contracts Purchasing- Performance Evaluation & Pro. Buyers Lean Production

Info Search/ Eval Purchase Post Purchase Problem Recognition Need Recognition General Need Description Product Specification Info Search/ Eval Supplier Search Proposal Solicitation Supplier Selection Purchase Order Routine Specification Post Purchase Performance Review

Institutional Markets Low Budgets Captive Patrons

Government Markets Domestic Suppliers Cost Minimization Paperwork Open Bids Public Review

Review How Business & Consumer Markets Differ Organizational Buying Situations Participants in the Business Buying Process Major Influences on Organizational Buyers Business Buyer Decision Making Institutional & Government Buying