MKTG 350 1st EditionExam # 2 Study Guide Chapters: 7-10Test 2 Study GuideChapter 7Definition of B2B marketing- refers to the process of buying and selling goods and services to be used in the production of other goods and services, for consumption by the buying organization and/or resale by wholesalers and retailers. Characteristics of B2B buying- more complex and require multiple members of both buying and selling organizationDerived demand- a business only ever needs to buy a product because it has a consumer that has a demand for that finished good along the lineManufacturers, resellers, institutional, government buyers- 1. Resellers- Manufacture reseller reseller, Wholesaler buys product and markets up the price when they sell to resellers, Reseller- brokers 2. Institutions- Schools, museums, hospitals, and religious organizations, Not necessarily for profit, USC—buys paper, contract with black board, licensing rights, buildings, 3. Government- Spends 2.1 trillion producing goods. Biggest buyer (mostly defense), State and local governments also make significant purchases (school, lunch rooms), Firms specialize in selling to government , Buy according to bid – under a certain amount you can buy, over 500 you need written quotes, over 1000 you have to go to a bidding (who wants to buy the product) government is required to buy the lowest bid 4. Manufacturers/ services providers- Buy raw materials, components or parts, Manufacture their own goods, Buy lens and metal and make a light bulb, Emphasis onpersonal selling (sales reps) NAICS – and how to use it- - north American industry classification system  first 2 digits mark the industry the rest get into specifics retailers women’s retailer  women’s underwear retailer (allows for easy buy and sell raw materials) Stages in B2B buying- 1. Need recognition, 2. Product specification, 3. RFP process, 4. Proposal analysis and supplier selection, 5. Oder specification, 6. Vendor/ performance assessment using metricsNeed recognition – sources- can be generated internally (employees) or externally -Sources for recognizing new needs externally (suppliers, salespeople, competitors) Product specs- used by suppliers to develop proposals (can be done collaboratively with suppliers) EX- Playground—age of children, supplies (safe) mulch, what slides are made out of, state playground man RFPs- request for proposal – written document that says this product is now open for bid – for the right to supply our companyNegotiation-reviews proposals and gets the best deal by making counter offers Vendor analysis- – how we felt about this purchase situation - Key issues- customer service, issue resolution, delivery, qualityExhibit: different roles in buying center- Initiator- comes up with the idea—doesn’t haveto be an official person (it guy, front desk person, etc0 Influencer- has the ear of the decision maker User- the company/ department (USC housing) need the input of all the users  Buyers—does the paperwork and sign the check – someone in accounting office  Decider—the one person who ultimately says yes or no (most important person in the buying center)  Gatekeeper—controls the flow of information through the organization – someone in an official or unofficial position (funnels the right bids, doesn’t connect rude person to main contact) Exhibit: types of organizational culture- democratic culture, consultative, autocratic, consensus Exhibit: 3 type of organizational buying-new buy, modified rebuy, straight rebuy- Newbuy- never bought before—don’t exactly know what you are buying – risk involved (go thorough all of the steps carefully and use all members of the buying center) – no one has advantage. Straight rebuy—buying more of the exact same thing—buy new bushes after they were ran into on football field. Modified rebuy—committed to a producer – leased so new computer every so often – committed to the pcs because they understood the product (getting cd opposed to floppy disks) dell has advantage because they have been the previous seller Chapter 8 Globalization aka. Off-shoring – know different types of off-shoring- the process by which goods, services, capital, people, information, and ideas cross international boarders. Started in manufacturing—cheaper to make abroad and ship. Now knowledge—banking (financial advice), medicine (take x-ray and send it to anyone in the world to analyze), call centers (India), Factors that aid in globalization- law, educated workforce, changing demographicsWTO – major function- world trade organization (1994)—only organization to deal with global rule of trade (160 members), virtually all world trade Exhibit: components of a country market assessment- Economic analysis using metrics, infrastructure and technology, distribution channel, government agencies, sociocultural factors GDP, GNI, HDI- GDP- the value of goods and services produced in a country in a year, Gross national income- GDP + income from American companies that operate abroad, Human development index- developed by UN, Measures the relative world economic health, Look at life expectancy at birth, educational attainment, and if average income is sufficient enough to meet the basic needs of life Marketing size and population growth – where, quickly/slowly, increase/decrease - Population growth – more prosperous countries have a lower birth rate . Urban vs. Rural – easier to do business in urban areas. India is popular with economic growth because of urbanization, education growth 4 key elements of infrastructure & technological capabilities- Transportation systems, communication, distribution channel, commerceTariffs- tax on imported goods (to make domestic goods more attractive financially) Quotas- restricting number of goods that come into a countryDumping- take a product into other country and sell below cost (if you cant sell it all)Countertrade- goods and services that are paid for with other goods and services (bartering) Trading bloc- is a type of intergovernmental agreement, often part of a regional intergovernmental organization, where regional barriers to trade, (tariffs and non-tariff barriers) are reduced or eliminated among the participating states.5 cultural dimensions (Hofstede’s cultural dimensions concept)- Power distance- how you accept social inequality. Uncertainty avoidance- rules and laws about how to behave. Individualism-