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Presentation For Industrial Marketing

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Meisam Peymankhah

on 9 November 2014

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Transcript of Presentation For Industrial Marketing

Organizational Buying Behavior


Buying Center Concept
New task

Modified Re-Buy

Straight Re-Buy
Three Buying Situations
New task
the problem or need is totally different from previous experiences. calls for thorough research – industrial plant – highest level of uncertainty.
Significant amount of information is required.
Buyers operate in the extensive problem solving stage.
new tasks are extremely strategic and financialy importance (aircrafts, military equipment, infrastructure)
Re-evaluation of alternatives and search for new information and new alternatives
less sophisticated, decision makers feel there are benefits to be derived by reevaluating alternatives.
Most likely to occur when displeased with the performance of current supplier.
Buyers operate in the limited problem solving stage.
Buyers have well defined criteria.
Modified Re-Buy
routine decision, repetitive process the problem or need is a recurring or continuing situation.
Buyers have experience in the area in question.
Require little or no new information.
Buyers operate in the routine problem solving stage.
Straight Re-Buy
1. Organizational buyers and Individual Buyers
2. Quantities.
3. Close relationships
4. Demand and Demand fluctuations
5. Trained professionals
6. Several people
Characteristics
Variations in values and behaviors across cultures affect organizations as well as individuals. Examples:
In many parts of the world, businesses and governments work more closely together than is the case in U.S.
Bribery and similar approaches for making sales are not acceptable
Job function, past
experience, and buying
motives of individual
decision participants
Roles, relative
influence, and patterns
of interaction of buying
decision participants
Goals, Objectives, and
Strategies
Organizational Position
of Purchasing
Economic Outlook:
Domestic & Global
Pace of Technological
Change
Global Trade Relations
Organizational
Buying
Behavior
Individual
Forces
Group
Forces
Organizational
Forces
Environmental
Forces
It partitions the buying process into several processes where every process determines the subsequent one. Here, the organization is regarded as a group of people who have to make a decision as a group but, also, as individuals
Webster-Wind Model
Decision-making units (DMUs) are the individuals in an organization who participate in making a purchase decision.
They function as buying centers when they consist of individuals from various areas (e.g., engineering, accounting, marketing).
Decision-Making Unit
Formal authority to sign contracts
Member of purchasing department
Influences the vendor selection
Not in technical details
Main criteria: price + terms and conditions of the contract
Buyer
Person working with the product
Interested in benefits and unobstructed function of the product to buy
Large knowhow and preconceived opinion
User
Person who brings new ideas and solutions into the company
Initiator
Controls the flow of information within the buying center
Assistant of decision maker
Influence by preparing the decision and the relevant documents
Gatekeeper
A person with high technical knowledge and practical experience
definition of minimum requirements on technical or company standards
Influencer
Right to say yes or no
Mightiest person
Decision Maker
1. Problem recognition
2. Determine product dimensions and quantity
3. Precise description of product characteristics
4. Search and qualification of potential sources
5. Acquisition and analysis of proposals
6. Evaluation of proposals and supplier selection
7. Selection of an order routine
8. Performance feedback and evaluation
Ref: Marketing Management Online Text Book by Tanner and Raymond - Principles of Marketing
Ref: Philip Kotler, Marketing Management, 9th Edition
Ref: Sheth, Jagdish, "Organizational Buying Behavior: Past Performance and future expectations", Journal of Business and Industrial Marketing, Vol.11, No.3/4, Vol.11, Pp.7-24
Ref: Sheth, Jagdish, "Organizational Buying Behavior: Past Performance and future expectations", Journal of Business and Industrial Marketing, Vol.11, No.3/4, Vol.11, Pp.7-24
Ref: Webster Frederick E. Jr. and Yoram Wind, "A General Model for Understanding Organizational Buying Behavior"
Ref: Wind, Yoram and Frederick Webster Jr., " On the Study of Industrial Buying Behavior: Current Practices and Future Trends", Industrial Marketing Management, 4(1972), Pp. 411-416
Meisam Peymankhah
Ref: Journal of Marketing, Vol. 36, April 1972, Pp.12-19.http://marketing.wharton.upenn.edu/documents/research/7215_A_General_Model_for_Understanding.pdf
Organizational Buying Process
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