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B2B Marketing

Prof. Rubina DMello

Organizational Buying and Buyer Behaviour

THE BUSINESS BUYING PROCESS

More complex than the consumer decision process. Takes place within formal organizations budget, cost, and profit considerations.

Stages of Organizational Buying Process


Problem Recognition General Description of need Product specifications Supplier search Acquisition and analysis of proposals Supplier selection Selection of order routine Performance review

Stages in the process flow model of the buying decision process

Definition stage

Selection stage

Problem definition Solution definition Product specification


Solution provider search Acquire solution providers Customised as needed Install/test/train Operate solution Reach and result Evaluate outcomes Determine next set of needs

Problem recognition General need description Product specification


Supplier/source search Proposal solicitation Contract for supplier(s) Make the transaction routine Evaluate performance Resell the job

Deliver stage

End game stage


Straight rebuy example : buying office supplies


Stage
Definition

Result
Monthly rebuy of office supplies; office manager fills in the order form

Selection
Deliver solution End game

Minimal consideration; decided to use their regular supplier; order faxed to supplier
Supplier delivers order Supplies used; invoice arrives and is paid; supplier calls to check on satisfaction

New Task example : acquiring automated sales and customer management system
Stage
Definition

Result
Recognised problem; analysed with help of consultant; supplier helps write specifications and RFP; suppliers submit proposals

Selection

Discussions and negotiations with suppliers; supplier selected (the one who helped initially); contrat negotiated and signed
System delivered in modules; fested, user trained, system modified as needed System operated; result observed and analysed; discussions begin with supplier for acquisition of new modules and upgrades

Deliver solution End game

Intricacies of the buying decision process


Individual roles Interaction creates fluidity Relationships and loyalty Three kinds of needs

Forces influencing organisational buying behaviour


Environmental Forces

Organisational Buying behaviour

Organisational forces

Group forces

Individual Forces

Environmental forces

Economic Influences Tachnological influences

Organisational forces

Goals, objectives and Strategies Organizational positioning of purchasing


Centralization of purchasing Centralization vs decentralization

Group forces

Roles Relative influence Patterns of interaction of buying decision participants

Individual forces

Job function Past experience Buying motives

Questions for the Industrial Salesperson


1.

2.

3.

Which member takes part in the buying process? What is each members relative influence in the decision? What criteria is important to members in the evaluation process?

Members of the buying center assume different roles throughout the procurement process.

Clues for Identifying Powerful Buying Center Members