Download B2B Buying Behavior

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Tuesday, September 18 – Meet in Calvin 102
 Exam 1 – Thursday, September 20
 Read Chapter 3 & 4
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› Article: Geoffery Moore, “To Succeed in the
Long Term, Focus on the Middle Term”
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Prepare to discuss:
› Chapter 4
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Find an example of a B2B ethical problem
or dilemma faced by a company
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Understand and apply the difference between
quantifiable organizational needs and the often
qualitative process used to fulfill those need
Understand how organizations develop and satisfy
the requirements for selecting and maintaining
relationships with suppliers.
Gain an appreciation for the different levels of
complexity of decisions made in the buying
process and how B2B marketer can influence the
process
Understand how organizations develop and satisfy
the requirements for selecting and maintaining
relationships with suppliers.
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Why is understanding B2B buying
behavior important to marketers?
 Why and how is the buying decision
process from and similar for consumers
relative to B2B buyers?
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Need Recognition
Information Search
Evaluation of Alternatives
Purchase Decision
Post Purchase Behavior
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What is the buying center?
 How does the buying center change for
different types of purchases?
 How does the buying center internal
culture work against rational,
quantifiable decision making – but results
in satisfying decision outcomes.
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External Factors
Internal Factors
Technology
Accounting
Management
Marketing
Legal
Production/Mfg.
Finance
Service
Stakeholders in each discipline within the buying
organization contribute expertise such that internal and
external factors are accommodated.
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Involves more Buyers
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Stakeholders in Buying Center are
driven by professional responsibilities
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Different decisions occur
simultaneously within the Buying
Center
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1. Problem recognition
2. General need description
3. Product Specification
4. Supplier/Source search
5. Proposal solicitation
6. Selection
7. Make the transaction routine
8. Evaluate performance
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Interaction is fluid and broad based
 Process is simultaneous, not sequential
 The “Track-Record” determines if supplier
is included in evoked set
 Relationships build loyalty
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Organization Needs
o Benefits of the product or service
 Individual Needs
o Based on professional activities and
functions of the job
 Individual’s Personal Needs
o Career, quality of life, recognition
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Process Flow Stages
Buying Decision Process - Steps
Definition Stage
 Problem recognition
 General need description
 Product specification
Selection Stage
 Supplier/Source Search
 Proposal Solicitation
 Contract for supplier(s)
Deliver Selection Stage
 Make the transaction routine
End Game Stage
 Evaluate performance
 Resell the job
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The first attempt at describing a solution
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The intricacy of the solution and the number of
organizational units to be involved (size of the
buying center) is determined
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Successful suppliers are involved, often in the
development of the Product Specification
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Selection may have occurred in the Definition
Stage
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If a new buy, members of the buying center may
have a “favorite” supplier
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A modified or straight re-buy will likely include
the existing suppliers
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Development activities customize the solution to
the specific technical needs (in addition to other
needs) of the customer – the Total Offering
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Meet the customer’s “way of buying” process –
integration of supply logistics with consumption
logistics
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Reinforce customer decisions made in the
selection process
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Not the end of the process, but the beginning of
the next opportunity for the supplier to serve the
customer
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Straight Re-Buy
› Buying situation that is routine
› Established solutions
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Modified Re-Buy
› Situation from New-Task Situation
› Limit exposure from competitive forces
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A need not yet faced by Organization
 New offering with new technology
 Requires many sources of information
and assistance
 Utilizes complete buying process to
investigate alternatives
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Yes. Then next
purchase
New Task
No. Then next
purchase
Definition
Re-Buy
Definition
Selection
Is the buyer
satisfied?
Solution
Delivery
Selection
Solution
Delivery
End Game
End Game
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Modified Re-Buy
Straight Re-Buy
Definition
Definition
Selection
Define changes
to process
Satisfied,
No differences
Solution
Delivery
yes
End Game
Selection
Dissatisfied
Small
Difference
no
Is the buyer
satisfied?
How different is
the next situation?
Evaluation in End Game
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Large
Difference
Solution
Delivery
End Game
To New
Task
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Is the total of all impressions that a
customer has of the firm (whether
relevant to the buying situation)
 Is similar to product positioning that
occurs with consumer goods
 Needs to be maximized in the “mind”
of the buyer

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Time Dimension
› Time fragmentation: Members come and go
› Decision cycle time
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Vertical and Horizontal Dimensions
› Vertical: number of layers of management
› Horizontal: number and types of departments
and outside consultants
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Formalization Dimension
› How well are purchasing roles and tasks defined
in purchasing policies and procedures?
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Initiator: Starts the purchasing process by
recognizing the need
Influencers: Affect decision-maker’s final
choice through recommendation
Gatekeepers: Control information into
and out of the buying center
Users: Those that use the product/service
Purchasing Agent: Person that makes
the purchase or does the paperwork
Decision-Maker: Person who makes final
decision, or chooses between
alternatives
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Situation: Purchase of new scanners to meet
contract with large state government agency
Players
› Akshay Menon – SRI’s Dallas operations head
› Margier Cabellero – production manager
› George Whitaker – Chief Financial Officer
› Gloria Sigel – Human Resources Manager
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Questions:
› Who plays which role in the buying center?
› What are the sources of risk for each?
› How would this information affect your marketing of
this product?
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall