Chapter 6 Marketing: Business to Business Marketing

Initiator

the person who first suggests buying the product or service

Influencer

the person whose views influence the other members

Decider

the person who ultimately makes the decision: what and how much to buy

Buyer

the person who handles the paperwork

User

the person who consumes or uses the product

Gatekeeper

the person who controls information or access to decision makers and influencers

B2B Marketing

process of buying and selling goods or services, for consumption by the buying organization and/or resale by wholesalers and retailers.

4 Types of Buyers & Sellers

manufacturers & producers, institutions, resellers, government

Manufacturers & Producers

buy raw materials that allow them to manufacture their own goods

Institutions

hospitals, education organizations and religious organizations (copiers, ink, food, janitorial service)

Resellers

resell manufactured products without altering their form

Government

largest purchaser of good and services (5 billion per year on aerospace and defense)

B2B Buying Process

Need Recognition

Product Specification

Request for Proposals Process (RFP)

Proposal Analysis, Vendor Negotiation and Selection

Order Specification

Vendor Performance Assessment

Need Recognition

The buying organization realizes that it has an unfulfilled need

Product Specification

The organizations considers alternative solutions and comes up with potential specifications. The vendors will use this to develop proposals

Request for Proposals Process

Organizations invite vendors or suppliers to present their service or product according to their specifications; may do this by posting on their website or inviting vendors directly

Proposal Analysis, Vendor Negotiation and Selection

Buying organization evaluates all proposals, narrows it down to just a few vendors, and negotiates with vendors (price, quality, delivery, etc). A vendor is chosen.

Order Specification

The organization places its order with its preferred supplier (or suppliers). The order includes a detailed description of the goods, prices, delivery dates, etc. The supplier sends acknowledgement that it received the order.

Vendor Performance Assessment

Firms analyze their vendors performance so they can make decisions about future purchases

Buying Center

The buying center includes anyone who is responsible for buying decisions in an organization

New Buy

buyer or buying organization purchases a good or service for the first time (buying decision is important)

Re-Buy

buyer or buying organization purchases additional units of products that had previously been purchased

Modified Re-Buy

buyer or buying organization decides to make changes to an order they made before - specifications such as desired price, quality level, etc.