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What are the four ways in which B2B firms segment their markets?
Manufacturers/Service Providers
Resellers
Institutions
Government
A typical B2B marketing transaction involves...
manufacturers selling to wholesalers selling to retailers
B2B marketing is...
the ultimate user of that product or service; more complex/more people involved
B2C marketing is...
a simple transaction
derived demand
business demand that ultimately comes from the demand for consumer goods
aka cause=B2C transaction-> effect=B2B transactions
B2B and B2C both...
-focus on serving specific types of customer markets to create value
-focus effort on key industries or segments
Manufacturers and Service Providers...
buy raw materials, components, and parts that allow them to make and market their own goods and ancillary services
Resellers consist of....
wholesalers and retailers that buy physical products and resell them without significantly altering their form
Institutions consist of...
hospitals, educational organizations, public institutions that purchase all kinds of goods and services
Government
one of the largest purchasers
ex. U.S. fed. gov. spends more than $6 trillion annually on procuring goods and services
What are the stages in the B2B buying process?
1. need recognition
2. product specification
3. RFP process
4. proposal analysis and supplier selection
5. order specification
6. vendor/performance assessment using metrics
The B2B Buying Process....
parallels the B2C process and differs in several ways. Both start with need recognition.
B2B buyers...
specify needs in writing
B2C buying decisions are...
made by individuals and DONT need formal proposals
Describe Need Recognition
when the buying organization recognizes through either internal or external sources, that it has an unfilled need
Describe Product Specification
when the buying organization writes down a list of potential specifications that vendors might use to develop their proposals
Describe RFP (Request for Proposals) Process
when buying organizations invite alternative vendors or suppliers to bid on supplying their required components of specifications
web portal
An Internet site whose purpose is to be a major starting point for users when they connect to the web
leads to cost savings due to eliminating periodic negotiations and routine paperwork
Describe Proposal Analysis, Vendor Negotiation, and Selection
when the buying organization reviews all proposals it receives, together with all members involved and narrow the process to a few suppliers (often those with existing relationships)
What key terms are discussed in Proposal Analysis, Vendor Negotiation, and Selection?
Price
Quality
Delivery
Financing
Describe Order Specification
when the firm places its order with its preferred supplier
What does the order specification include?
a detailed description of the goods, prices, delivery dates, and in some cases, penalties for noncompliance
Describe Vendor Performance Assessment Using Metrics
when the firm analyzes their vendors' performance so they can make decisions about their future purchases
more formal in a B2B setting
Identify the roles within the buying center
initiator
influencer
decider
buyer
user
gatekeeper
The Initiator
the person who first suggests buying the particular product or service
The Influencer
the person whose views influence other members of the buying center in making the final decision
The Decider
the person who ultimately determines any part of or the entire buying decision
The Buyer
the person who handles the paperwork of the actual purchase
The User
the person who consumes or uses the product or service purchased by the buying center
The Gatekeeper
the person who controls information or access, or both, to decision makers and influencers
Describe a firm's organizational culture
reflects the sets of values, traditions, and customers that guide employees' behavior
Autocratic buying center
one person makes the decision alone
Democratic buying center
majority rules in making decisions
Consultative buying center
use one person to make a decision but solicit input from others before doing so
Consensus buying center
all members of the team must reach a collective agreement that they can support a particular purchase
White papers
a promotional technique used by B2B sellers to provide information about a product or service in an educational context, thereby not appearing like a promotion or propaganda
What are the 3 different buying situations?
new buy, straight rebuy, modified rebuy
New buy (most complex)
the organization is a first-time buyer of the product or service
Modified rebuy
a situation in which the purchaser wants some change in the original good or service
Straight rebuys
when the buyer or buying organization simply buys additional units of products that have previously been purchased.
Note 
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