Transcript ch07-CASEx - Gonzaga University Student Web Server

Part 3
CUSTOMER BEHAVIOR
AND E-MARKETING.
Dr. Chen, Principle of Marketing
6: Consumer Buying Behavior
7: Business Markets and
Buying Behavior
8: Reaching Global Markets
9: Digital Marketing and Social
Networking
Dr. Chen, Principle of Marketing
Chapter 7
Business Markets and Buying
Behavior
Professor Jason C. H. Chen, Ph.D.
School of Business Administration
Gonzaga University
Spokane, WA 99258
[email protected]
Dr. Chen, Principle of Marketing
Marketing Applications
 2. Identify organizations in your area that fit each business
market category: producer, reseller, government, and
institutional. Explain your classifications.

 Students’ answers will vary, but they should fit the following
general classifications described in the text:
 Producer markets purchase products to use them to produce
other products.
 Reseller markets buy finished goods and resell them for profit.
 Government markets include federal, state, county, and local
governments that buy goods and services to support internal
operations and provide products to their constituencies.
 Institutional markets are organizations with non-business goals.
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 3. Indicate the method of buying (description, inspection,
sampling, or negotiation) an organization would be most
likely to use when purchasing each of the following items.
Defend your selections.
 a. A building for the home office of a light bulb manufacturer

Negotiation
 b. Wool for a clothing manufacturer

Inspection
 c. An Alaskan cruise for a company retreat, assuming a
regular travel agency is used

Description
 d. One-inch nails for a building contractor

Sampling
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 4. Purchases by businesses may be described as new-task,
modified rebuy, or straight rebuy. Categorize the following
purchase decisions and explain your choices.
a. Bob has purchased toothpicks from Smith Restaurant Supply
for 25 years and recently placed an order for yellow
toothpicks rather than the usual white ones.
b. Jill’s investment company has been purchasing envelopes
from AAA Office Supply for a year and now needs to
purchase boxes to mail year-end portfolio summaries to
clients. Jill calls AAA to purchase these boxes.
c. Reliance Insurance has been supplying its salespeople with
small personal computers to assist in their sales efforts. The
company recently agreed to begin supplying them with
faster, more sophisticated computers.
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 4. (cont.)
a. Bob has purchased toothpicks from Smith Restaurant Supply for 25 years
and recently placed an order for yellow toothpicks rather than the usual white
ones.
Ans: This is a modified rebuy purchase because the purchase is changed on
subsequent orders or the requirements of a straight-rebuy purchase have been
modified.
b. Jill’s investment company has been purchasing envelopes from AAA Office
Supply for a year and now needs to purchase boxes to mail year-end portfolio
summaries to clients. Jill calls AAA to purchase these boxes.
Ans: This is a straight rebuy purchase because it is a routine purchase of the
same products with approximately the same contract terms
c. Reliance Insurance has been supplying its salespeople with small personal
computers to assist in their sales efforts. The company recently agreed to
begin supplying them with faster, more sophisticated computers.
Ans: This is a new-task purchase because it is an initial purchase of an item to
be used to perform a new job or solve a new problem.
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Internet Exercise
 Boeing

 Boeing is the second largest aerospace and
defense contractor in the world,
manufacturing commercial and military
aircraft. Visit the company’s website at
www.boeing.com.
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 1. At what types of business markets are
Boeing’s products targeted?

 Boeing targets several B2B markets. With its
commercial airplanes, it targets producer
markets because commercial airlines
companies use the airplanes in day-to-day
operations. With its defense, space, and
security products, Boeing targets government
markets.
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 2. How does Boeing address some of the concerns of business
customers?

 The four primary concerns of business customers are _____,
______,
price quality
supplier relationships
service, and _______
__________. Boeing has developed business
units that help to reduce the concerns of business customers. One
business unit, Boeing Capital Corporation, “arranges, structures, and/or
provides financing to facilitate the sale and delivery of Boeing
commercial and military aircraft, satellites and launch vehicles.”
 This helps its customers to deal with the high price of its product. To
mitigate quality and service concerns, Boeing provides “a broad range
of services to support its aircraft - from the time the airplane is
delivered to the customer until the airplane goes out of service. These
services help our customers improve fleet utilization, reduce costs,
manage information, upgrade or reconfigure their airplanes, and ensure
passenger well-being.” Boeing is also transparent and shares
information about its suppliers directly on the website.
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 3. What environmental factors do you think affect demand for
Boeing products?

 Demand for Boeing products could be influenced by several
environmental factors. Students’ answers may include the following:
 Political - government spending, debates over the role of aerospace,
debates over government support and/or management of commercial
airline industry
 Economic - changes to the economy, business spending, consumer
spending on travel
 Sociocultural - consumer support of the defense industry
 Technological - new technologies
 Legal and Regulatory - government support and/or management of
the commercial airline industry, pollution regulations, consumer
safety regulations
 Environmental - pollution, airline efficiency
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Video Case 7.1
 DALE CARNEGIE FOCUSES ON
BUSINESS CUSTOMERS
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 Summary

 This case shows how a company that provides a
valuable service thrives in the B2B market. Dale
Carnegie was a successful entrepreneur and speaker
famous for his book, How to Win Friends and
Influence People. His self-named firm trains
business people and members of the government on
how to connect with customers and colleagues.
Dale Carnegie focuses on helping companies to
develop powerful business relationships by learning
to listen and interact well, both face-to-face and
through digital communications.
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 1. How would you apply Dale Carnegie’s methods
if you were trying to make a sale to a company
with a large buying center?

 The buying center is the group of people involved
in making such purchase decisions. Dale
Carnegie’s philosophy is that a marketer trying to
appeal to a large buying center should take the time
to listen to the concerns of users, influencers,
buyers, deciders, and gatekeepers, connect with all
groups, and address all of their needs.
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 2. From a marketing perspective, why would
people who work for the U.S. Department of
Veteran Affairs be as interested in taking a Dale
Carnegie course as people who work for
American Express?

 Government agencies such as the Department of
Veterans affairs have customers too—the people
that they serve. Because of this, it is important for
members of the government to understand how to
connect with their colleagues and with their
constituencies.
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 3. Which concerns of business customers should Dale
Carnegie’s marketers pay close attention to when
selling training services to a company like American
Express?

 Although all four concerns (price, quality, service, and
supplier relationships) may have a role, Dale
Carnegie’s marketers should pay close attention to
quality and service. They may be searching for a great
long-term customer service experience.
 Companies want to get the best quality information and
training and may want ongoing support when they deal
with challenging situations and hire new employees.
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