Organizational buying-behavior
description
Transcript of Organizational buying-behavior
Organizational buying behavior
B2B Marketing
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Organizational buying behavior Consumer vs. Organizational buying
behavior Main types of buying situations in B2B Stages of decision in B2B Roles in B2B procurement Influences on organizational behavior Buying centres in summary
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Consumer vs. Organizational buying behavior
Decisions made by consumers are quite simple Organizational buying processes are more
complicated, there are several phases and steps Different buying behavior for different products and
target groups Simple consumer goods like food and beverages are
bought very spontaneously – influenced by advertising and product presentation
For premium consumer goods (expensive clothes, computers) – buying behavior is getting more rational – comparison
Private investment goods – price bargaining
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B2B products – organizational procurement starts
More than one person involved Buying process follows certain rules Price comparison, standardisation,
tenders = Ausschreibungen)
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B2B systems
involve more capabilities and greater workloads
From the buyer‘s and the supplier‘s side decision has more extensive consequences
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B2B facilities
Industrial plants Manufacturing installations Office buildings
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Main types of buying situations in B2B Straigtht rebuy – routine decision, repetitive process
(energy, office supplies, raw materials, wood, cigarettes), component suppliers for the automotive industry – little or no new information
Modified rebuy – more complicated but less sophisticated: cars, trucks, computers, consulting – modified rebuys are often treated too uncautious
New task – calls for thorough research – industrial plant – highest level of uncertainty. Strategic new tasks are of extreme strategic and financial importance (aircrafts, military equipment, infrastructure) – re-evaluation of alternatives and search for new information and new alternatives
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Buying phases
Problem recognition General need description Product specification Supplier search Proposal solicitation Supplier selection Order routine specification Performance review
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Stages of decision in B2B procurement Backhaus developed a widely usable model
to distinguish between 5 phases of procurement
Preliminary application (initiation phase) Tender proposal Negotiation Processing of order Warranty and services
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Preliminary application
Recognition of a problem (need) and a general solution
Released by top management = operating department or external consultants
Result request for an offer addressed to a number of potential suppliers
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Tender preparation phase
Determination of characteristics and quantity of needed items
Search for and qualification of potential sources
Supplier has to provide an offer Tries to be incomparable with his
competitors Customer tries to make the offer best
comparable
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Negotiation phase
= core selling process Comprises acquisition and analysis of
proposals, evaluation of proposals and selection of suppliers
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Processing phase/warranty/ service phase
Contains selection of an order routine Realisation of the transaction along
with the fixation of after sales service tasks
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Roles in B2B procurement – buying center concept
Group of people involved in the buying process – buying center
Webster/Wind model shows 5 different roles – not institutionalised
This causes probleme in identifying and targeting the right people within the decision process
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Buying center
Role keepers have different tasks – not mandatory
Buyer User Initiator Gatekeeper Influencer
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Buyer
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
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User
Person working with the product Interested in benefits and
unobstructed function of the product to buy
Large knowhow and preconceived opinion
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Influencer
A person with high technical knowledge and practical experience
definition of minimum requirements on technical or company standards
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Gatekeeper
Controls the flow of information within the buying center
Assistant of decision maker Influence by preparing the decision
and the relevant documents
(Scriptum p 33-34 + summary)
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Decider
Right to say yes or no Mightiest person
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Initiator
Person who brings new ideas and solutions into the company
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Specific marketing considerations in the industrial facilities business Long decision taking process High risk Complex buying center The specific competitive situation
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Product policy
Focuses on innovation Has to care for high flexibility in
research and development And manufacturing and assembling
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Price
Strict bid and tender rules High transparency Add value with service offering to
achieve a differentiating position Another aspect: financing and
sourcing models
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Distribution policy
Focus on negotiation phase Provide excellent people in the selling
center High technical knowledge
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Communication
Problem solver! Proving success with comparable
tasks Reference projects!