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Chapter 4
Organizational
Buyer Behavior
McGraw-Hill/Irwin
Business Marketing, 4/e
Copyright © 2009 The McGraw-Hill Companies, Inc. All rights reserved
4-2
SELLING BUSINESS TO BUSINESS
SUCCESSFULLY. UNDERSTANDING WHAT
MAKES BUYERS BUY
THE THEORIES OF BUYER MOTIVATION
•
BUYING DETERMINATES THEORY
•
ROLE THEORY
•
BEHAVIOR CHOICE THEORY
-
THINK: WHAT FACTORS AFFECT THE BUYER?
THINK: WHAT ROLE IS A BUYER PLAYING?
THINK: WHAT STEPS WILL A BUYER TAKE?
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Business Marketing, 4/e
Copyright © 2009 The McGraw-Hill Companies, Inc. All rights reserved
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BUYING DETERMINANTS THEORY
Environmental factors
Market factors
Organizational
factors
Individual
factors
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Business Marketing, 4/e
Exhibit 4-1
Copyright © 2009 The McGraw-Hill Companies, Inc. All rights reserved
4-4
BUYING CENTER ROLES
PERSON
•Secretary
ROLE
•Initiator-reports that fax
keeps breaking down
•Vice President
•Controller-sets budget for
purchase of new fax
•Office Manager
•Gatekeeper-gathers review
from vendors.
•Secretary & Office Manager
•Influencers-view demonstrations
narrow choices
•Office Manager
•Recommender-recommends a
•Vice President of Operations
particular product to decision
maker
•Decision Maker – Selects fax to
purchase
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Business Marketing, 4/e
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4-5
DIMENSIONS OF BUYING CENTERS
•
TIME DIMENSIONS
•
•
•
•
•
TIME IS HIGHLY FRAGMENTED: Many participants for short
time participation
TIME IS NOT FRAGMENTED: Same people stay through entire
process
VERTICAL DIMENSIONS
•
How many layers of management are involved in decision-making
HORIZONTAL DIMENSIONS
•
How many departments are involved in decision-making
FORMALIZATION DIMENSION
•
Purchasing tasks and roles are guided and enforced by written
procedures and policies
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TIME FRAGMENTATION INFLUENCES
SELLER’S MARKETING EFFORTS
INVOLVEMENT INFLUENCE
NUMBER OF DECISION MAKERS
HIGHLY
FRAGMENTED
MANY
A LITTLE
FEW MINIMALLY
A LOT FRAGMENTED
TIME SPENT ON DECISION STAGES
DECISION CYCLE TIME INFLUENCE
SIZE OF BUYING CENTER
LONGER
LARGE
DECISION CYCLE A LITTLE
SMALL
A LOT
SHORTER
DECISION CYCLE
EXPERIENCE OF DECISION MAKERS
Sales objective is to move to the right on the continuum
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Business Marketing, 4/e
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RECOGNIZING THE
BUYER’S DILEMMA: RISK
THERE ARE THREE KINDS OF RISK TO OVERCOME
•
FINANCIAL RISK
•
•
•
POTENTIAL FOR LOST REVENUE WITH
FAULTY PRODUCT
PERFORMANCE RISK
•
PRODUCT WON’T PERFORM AS INTENDED
SOCIAL RISK
•
THE PURCHASE WILL NOT MEET APPROVAL OF A
REFERENCE GROUP
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Business Marketing, 4/e
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OVERCOMING RISK
•
THREE OPTIONS BUYERS USE TO REDUCE
RISK
•
•
•
GATHER MORE INFORMATION FROM
MORE SOURCES
USING LOYALTY TO PRESENT SUPPLIERS—
BUILD TRUST
SPREAD THE RISK BY USING MORE
DECISION MAKERS OR GETTING MORE
SUPPLIERS
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Business Marketing, 4/e
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USING INFORMATION TO REDUCE RISK
SOURCES OF INFORMATION
Commercial
Personal selling
Trade shows
Telemarketing
E-mail
Sales literature
Advertising
Websites
Direct mail
Noncommercial
Word of mouth from
colleagues,
consultants, and
coworkers
Trade publications
Personal
Impersonal
EXHIBIT 4-5
4-10
BEHAVIOR CHOICE MODEL
1. IDENTIFY SITUATION
Company and self-orientation
2. EVALUATE PERSONAL RELEVANCE
Determine Rewards
3. ASSESS ACTION ALTERNATIVES AN
REQUREMENTS
4. CHOOSE A BEHAVIOR STRATEGY
Defensive or Offensive
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Business Marketing, 4/e
EXHIBIT 4-6
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4-11
EXPANDED BUYING DETERMINANTS THEORY
Environmental factors
Market factors
Organizational Factors
Extrinsic reward systems
Role expectations
Corporate culture and
intrinsic rewards
Cross-functional
purchasing teams
Policies supporting
vertical and horizontal
dimensions
Individual factors
Experience: new buy straight
rebuy
Choice of reward-Role orientation
Valence of reward
Probability perceptions
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Business Marketing, 4/e
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4-12