Test 2 Notes Chapter 6 Business and Organizational Customers and Their Buying Behavior Characteristics of business and organizational customers and how organizational customers are different More purchases are made by businesses and other organizations than by final customers Business and organizational customers any buyers who buy for resale or to produce goods and services producers intermediaries government units nonprofit organizations Organizational customers business to business Organization s basic need is to satisfy their own customers and clients focus on Sales reps carry target marketing to the extreme Approaches to deal with business customers internationally are less varied than reaching Purchasing specifications written description of what the firm wants to buy describe economic factors individual customers the need Customers may expect quality certification ISO 9000 way for a supplier to document its quality procedures according to internationally recognized standards Characteristics of how many different people influence a decision Purchasing managers buying specialists for their employers usually coordinate relationships with suppliers Multiple buying influence in a buying center Multiple buying influence several people play a part in making a purchasing decision Buying influences users influencers buyers deciders gatekeepers Buying center all the people who participate influence a purchase Vendor analysis a formal rating of suppliers on all relevant areas of performance goal is to lower the total costs associated with the purchases considers all of the influences Marketer that develops a marketing mix that lowers the buyers risk puts itself in a stronger position Marketing mix should satisfy both the needs of the customer company as well as the needs of individuals who influence the purchase Purchasing work may be done at a central location Requisition request to buy something Characteristics of a straight rebuy modified rebuy and new task buying New task buying when a customer organization has a new need and wants a great deal of information Straight rebuy routine purchases that have been made many times before Modified rebuy in between process where some review of the buying situation is done E commerce automatically handles a large portion of straight rebuys Critical to have a website that buyers can find Buyers like white papers and case studies o White papers reports designed to help buyers make decisions about a particular topic o Case studies learn about how other companies have addressed similar needs As buyers rely more on social networks communications from marketers may have less influence on buyers attitudes and choices Competitive bid terms of sale offered by the supplier in response to the purchase specifications posted by a buyer Characteristics of buyer seller relationships in business markets The best relationships involve real partnerships where there s mutual trust and a long term outlook Close relationships not always ideal Dimensions in buyer seller relationships o Cooperation o Information sharing o Operational linkages o Legal bonds o Relationship specific adaptations Purchasing managers for the buying firm and salespeople for the supplier usually coordinate the dimensions Cooperative relationships buyer and seller work together to achieve both mutual and individual objectives treat problems as joint responsibility Good buying organizations provide regular feedback to their suppliers who should listen Operational linkages are direct ties between the internal operations of the buyer and seller closely and respond to them firms Closer relationships involve operational linkages that lower costs and increase efficiency Negotiated contract buying agreeing to contracts that allow for changes in the purchase arrangements change in specification total requirements Outsource contract with an outside firm to produce goods and services rather than to produce them internally cuts cost Relationship specific adaptations involve changes in a firm s product or procedures that are unique to the needs or capabilities of a relationship partner Buyers often look for several dependable sources of supply to protect themselves from unpredictable events A good marketing mix is likely to win a larger share of the total business Characteristics of how retailers and wholesalers buy for their customers Retailers wholesalers buy what they think they can profitably sell Decisions to add drop lines or change buying policies may be handled by a buying committee Government in the largest customer group Chapter 7 Improving Decisions with Marketing Information Characteristics of how changes are underway in marketing information system Firms anticipate the information they will need Data warehouse place where databases are stores so that they are available when Intranet system for linking computers within a company usually limited to employees needed Decision support system computer program that makes it easy for a marketing manager to get and use information as he she is making decisions Marketing dashboard displays up to the minute marketing data in an easy to read format customized to manager s area of responsibility Marketing model statement of relationships among marketing variables enables manager to look at sales and costs expected with different types of promotion and select the marketing mix that is best for the particular target market Major problem is many managers don t think through what information they need Characteristics of the Scientific Method and marketing research Marketing research is guided by the scientific method Scientific method decision making approach that focuses on being objective and orderly in testing ideas before accepting them Decisions are based on evidence not hunches Forces an orderly research process Characteristics of how government data is inexpensive and how private sources are useful as well Most countries with advanced economies have gov agencies that help researchers get the data they need Data gov initiative to make a wide variety of gov data more readily accessible Gov data useful in estimating size of markets Private organizations regularly compile and publish data Characteristics of gathering problem specific data Primary data collection questioning and observing Qualitative research seeks in depth open ended responses o Focus group stimulates thinking and gets immediate reactions o Online truer responses aggressive