Transcript Business to Business Marketing

Business to Business Marketing
Professor Lawrence Feick
University of Pittsburgh
Organizational markets compared
to consumer markets
• Fewer buyers
• Larger purchases
• Derived demand
Organizational markets compared
to consumer markets (continued)
• Differences in the purchasing process
– professional buying
– the buying center
– buyclass
Organizational Buying Process
Obtain Feedback and Evaluate Performance
Select Order Routine
Evaluate Proposals and Select Supplier
Acquire and Analyze Proposals
Search for and Qualify Sources
Describe Characteristics and Quantity
Determine Characteristics and Quantity
Recognize Problem and General Solution
The Buying Center
• Participants in an organization’s buying
decision
The Buying Center
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BUYERS
DECIDERS
INFLUENCERS
USERS
Organizational buyclasses
• Straight rebuy
• Modified rebuy
• New task purchase
Figure 9.9a Chrysler’s Vendor Analysis Form
Supplier Rating Chart:
Supplier Name:__________
Shipping Location:__________
Commodity:__________
Annual Sales Dollars:__________
5
Ex.
4
Good
3
Sat.
2
Fair
1
Poor
0
N/A
Quality 40%
Supplier defect rates
SQA program conformance
Sample approval performance
Responsiveness to quality problems
Overall quality rating
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Delivery 25%
Avoidance of late or overshipments
Ability to expand production capacity
Engineering sample delivery performance
Response to fluctuating supply demands
Overall delivery rating
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Figure 9.9b Chrysler’s Vendor Analysis Form
Price 25%
Price competitiveness
Absorption of economic price increases
Submission of cost savings plans
Payment terms
Overall price rating
Technology 10%
State-of-the-art component technology
Sharing research development capability
Capable and willing to provide circuit
design services
Responsiveness to engineering problems
Overall technology rating
5
Ex.
4
Good
3
Sat.
2
Fair
1
Poor
0
N/A
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Buyer:__________ Date:__________
Comments:_______________________________________________________
Summary: comparing business to business
marketing and consumer marketing (text: Table 9.2)
Business-to-Business Marketing
Consumer-Goods
Marketing
Product
Relatively technical, exact form
often variable, accompanying
services very important
Standardized form, service
important but less than for
business products
Price
Competitive bidding for unique
items, list prices for standard
items
List prices, little individual
negotiation
Promotion Emphasis on personal selling
Emphasis on advertising
Summary: comparing business to business
marketing and consumer marketing (continued)
Business-to-Business
Marketing
Consumer-Goods
Marketing
Distribution
Relatively short, direct
channels to market
Often complex channels
with multiple
intermediaries
Customer
relations
Relatively enduring and
complex
Usually transactionfocused; relationship of
relatively short duration
Decisionmaking
process
Involvement of diverse group
Individual or household
of organization members in
members make decision
decision
Source: Based on Michael Hutt and Thomas Speh, Business Marketing Management, 5th ed. (Fort
Worth, Tex: The Dryden Press, 1995), pp. 11-13.
Implications
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Importance of relationships
Importance of personal selling
Understanding our customer’s customers
Affecting final consumer demand
Solving our customers’ business problems