代写Organisational Buying and Buying Behaviour
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•Lecture Week 2
Organisational Buying and Buying Behaviour
-Recommended Text: Chapter 3
•Recap from Lecture 1
•What is Business Marketing/Business Product?
•Business Vs. Consumer Marketing
•Derived Demand; Acceleration effect ; Joint Demand; Cross – Elasticity of Demand; Reverse Elasticity of Demand: Bull Wipe Effect
•Types of Business Customers
•Classification of Industrial product
•E-procurement
•Environment in Business Markets
•A General Understanding of Buying as a Process
•Buying is a process, not an event
•There are various points in the process that are referred to as “Critical Decision Points” and “Evolving Information Requirements”
•It starts with “Problem Recognition”
•Understanding the Dynamics
of Organizational Buying
Market-driven firms sense market trends and work closely with their customers and vendors. This is crucial to:
•Identify profitable market segments
•Locate buying influences within segments
•Reach organizational buyers efficiently and effectively with an offer
Each decision goes through various steps. Skipping a step can be essential to the decision-making process.
•Stepwise Buying Process
•Purchasing Objectives of Business Buyers
•Purchasing objectives
–Perfect delivery /ready availability
–Superior quality of product / service
–Lowest price
–Services
–Good long-term supplier relationship
•Personal objectives
–Higher status
–Job security
– Salary increments
–Promotions
–Social considerations
•Buying Process of Organisational Buyers
•Supplier/Vendor Analysis using Multi attribute model
•Figure 3.1 The Balanced Scorecard Framework
•Types of Buying Situations (Buyclasses)
1.New Task / New purchase
–More information, risk, decision time, people involved
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2.Modified Rebuy / Change in Supplier
–Due to existing suppliers’ poor performance, or change in specifications
–Hence, search for alternate supplier
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3.Straight Rebuy / Repeat Purchase
–Due to existing suppliers’ good performance
–Routine, low risk decision. Less information needed
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•Three Buying Situations
1. New Task
•New task – a perceived problem or need that is totally different from previous experiences.
•
•To solve it, buyers need a significant amount of information.
•
•Buyers & Influentials operate in a stage of decision- making known as “extensive problem solving” because they lack:
•Well-defined criteria
•A strong predisposition toward a particular solution
•1. New Task
There are 2 approaches to New Task purchasing:
•
1.Judgmental Situations
●
2.Strategic Decisions
•New Task - Judgmental Situations
•This is the greatest amount of uncertainty because there is little information or experience to support a decision.
•
•To overcome this, decision-makers conduct outside research to analyze key aspects of the buying decision.
•
•An example of key questions might include:
–What kind and model of production equipment should we purchase?
–Who are the available suppliers?
–Will they provide the services we need?
•New Task - Strategic Decisions
•This level of New Task purchasing is the most important because it concerns long-range planning, larger investments and increased risk if they are wrong.
•
•An example of strategic questioning might include:
–Should we develop a new product line which demands us to buy new machinery, retool what we have, and maybe even hire a different type of employee?
–What should we do?
•Marketing Consideration for
New Task Buys
Marketers can gain an edge if they:
1.Initiate problem recognition
2.Get involved very early in the decision-making process
3.Get involved early in the procurement process
4.Understand the buying organization's behavior patterns
•New Task Marketer’s Edge
•If a marketer is already established with an account, often he or she can leverage that situation into further business.
•
•This is why present suppliers continue to develop further business with their customers—they understand their prospects’ buying philosophy, developing situations and contacts.
•
•They can also create need since the prospect trusts them.
•Three Buying Situations
2. Straight Rebuy
Straight rebuy – a problem or need that is recurring or a continuing requirement.
–Buyers have experience in the area
–Require little or no new information
–Buyers operate in routine problem-solving stage
•Buying Decision Approaches
•Straight Rebuy
•Routine problem solving situations requiring routine solutions.
•
•This is the repeat business situation that every major supplier desires.
•
•MOR: Maintenance, Operation and Repair items fall into this category as do various services such as travel.
•Straight Rebuy
•Many companies review this area of business every now and then, but the edge usually goes to the supplying company.
•
•Relationships become very important.
•Marketing Challenges to Straight Rebuy
•Purchasing departments handle this situation in most cases; the determinant is who is “IN” and who is “OUT”?
•“IN” seller needs to constantly reinforce their services, meet buying expectations, continue developing relationships and be responsive to changing needs.
•
•“OUT” sellers have a much more difficult task.
•Three Buying Situations
3. Modified Rebuy
§Modified rebuy—Decision makers feel there is a benefits to reevaluating alternatives.
§
§Internal Forces:
§Search for quality improvement
§Cost reductions
•Modified Rebuy
§Buyers feel they can make significant advances if they review their buying situations on a regular basis.
§Often, changes in styles, materials or even alternative solutions facilitate this review.
§Another reason for Modified Rebuy is dissatisfaction with present supplier.
§New supplier was able to find the present supplier’s weaknesses and offered buyers new alternatives to “fix” their problem(s).
•Modified Rebuy:
Limited Problem Solving
•When a company has to replace a broken part, they may bypass the manufacturer and go to a supplier of comparable upgrades.
•Example: Your IBM printer breaks so you consider an HP printer instead.
•Buying Decision Approaches
§Simple Modified Rebuy: Involves narrow choices and minimal research.
§
§The major area of consideration is supplier relationship.
§
§Complex Modified Rebuy: Involves larger items, more research, extensive specification development, a competitive bidding process and long-term relationship development with new supplier(s).
•Buying Centre Members And Key Influentials
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•Buying centre, or purchase committee, consists of members who make buying decisions, share common objectives and risks
•
•Key influentials are the few most influential members
•
•Buying centre members are:
–Top management persons
–Technical persons: Key influentials for new task and modified rebuy situations and technical products
–Buyers / purchasers: Key influentials for straight rebuy
– Commercial persons: Finance & Marketing persons
•
•Break Time!
•Forces Influencing Organizational Buying Behavior
•Environmental Forces - Economic Influences
§Changes in the environment such as business conditions, technological advances or new legislation can affect buying plans.
§Since much of business is driven by derived demand, business marketers must be sensitive to changes in the consumer market.
§Also, the economy can determine a company’s ability or willingness to buy. If the economy is bad, companies often put off purchasing until they see a change.
•Technological Influences
§Technology is changing so quickly that yesterday’s technological advancement is today’s electronic commodity.
Example: Computers
§However, all companies need to stay alert to these changes. For example, Blockbuster is feeling the pinch of Netflix, Internet and satellite movies-on-demand.
§Technological change—especially from the Internet—is drastically changing the way companies do business.
•Organizational Forces &
Growing Influence of Purchasing
§As manufacturing has become less important, purchasing and procurement have become more important.
§Companies are outsourcing many activities such as manufacturing, marketing, accounting, etc., yet procurement remains a strong influence resulting in a shift to more professional procurement positions.
•Strategic Priorities in Purchasing
§As the purchasing profession grows, so do its goals and priorities.
§Prchasers are more ambitious, resulting in a more competitive environment. An effective marketing strategy develops stronger and deeper relationships with purchasers.
§This is the impetus for Relationship Marketing.
trategic Priorities in Purchasing
•Strategic Priorities in Purchasing
ÒDevelop fewer and deeper relationships with strategic suppliers and involve them in decision- making processes, ranging from new product development to cost-reduction initiatives.
ntralized vs. Decentralized Purchasing
•Purchasing is moving away from a transaction-based support role to a more strategic, executive level role
•
•One result of this is to centralize purchasing
•Centralized purchasing operates differently than decentralized purchasing
•Decentralized Purchasing
•Decentralized purchasing allows local branches to purchase what they need. This results in local control, and for many kinds of services this makes sense.
•
•Example: Stop and Shop buys products from local farmers.
•Disadvantages of Decentralized Purchasing
1.Difficult to take advantage of volume discounts
2.Doesn’t promote specialization
3.Makes room for corrupt activity
4.Takes power away from the purchasing group
5.Reduces options for large organizations
•Centralized Purchasing
•Forces specialization upon buyers who usually meet the challenge
•Allows for better coordination of materials purchases
•Results in better method of managing long-term supply
•Takes advantage of volume savings
•Offers better coordination between purchasing strategy and corporate strategy
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•Centralized & Decentralized Purchasing
§Many companies combine the two depending upon what is being purchased.
§
§The set budget limits at various levels; for larger repeat items, they’ll employ centralized buying.
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§For smaller, one time purchases, it may be done at the local level. (Example: Electrical repair services.)
•Models of Organisational Buying Behaviour
•Most important factors influencing organisational buyers:
–Organisational / Task – oriented
–Personal / non-task oriented
–Enviromental
–Buying Centre
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代写Organisational Buying and Buying Behaviour
