Professional Documents
Culture Documents
Jobber chap. 5
Organizational PRODUCT
CONSUMER PRODUCT
Risks
Derived demand
Negotiations
Decision-making Unit
Initiator Buyer Decider (Decision Maker) Gatekeeper
User
Decider
Influencer
Decision-making Unit
Buyers choose suppliers and negotiate purchase terms often reducing the actual purchase to a clerical task.
Initiators begin the purchase Process.
Users actually use the product. They may be the one who initiates the purchase process and may develop the product specification.
Gatekeepers control the flow of information to the buying centre. Purchasing department Staff frequently fill the role but it could be any member of the organization.
Influencers supply information and advice. Outsiders such as consultants sometimes perform the role.
Decision-making Unit
Implications.
Need to identify key actors in buying decisions. Composition and roles played in the decision making unit have implications for communications target audience and message.
Hitachi
Hitachi reinforces the benefits of its ecofriendly railtechnology by featuring its benefits for passengers in this advert.
Types.
Economic.
Choice Criteria
Technical.
e.g. reliability, delivery.
Social (Organizational).
e.g. status, office politics.
Personal.
e.g. personal risk reduction, liking/disliking.
Choice Criteria
Implications.
1. Marketing and sales appeals may need to be modified to different members of the decision-making unit. 2. Choice criteria may change over time as circumstances change. Suppliers may need to change their offerings and communications as a result.
Product type
Organizational buyer
Importance of purchase
Buy Class
Time taken for decision
New Task Modified Rebuy Straight Rebuy
Modified Rebuy
When a new task purchase is changed on repeat purchases. The buyer may require faster delivery lower prices or modified specifications. Regular suppliers become more competitive and new suppliers may be included in the selection. Moderate amounts of information are required. Example: upgrading office software.
Straight Rebuy
The buyer purchases the same products again routinely under approximately the same terms of sale. Suppliers are familiar, have provided satisfactory service in the past and may even have set up automatic re-ordering systems. Little information is required. Example: re-ordering photocopying paper.
Buy Class
Implications: 1. New Task. - big gains for those suppliers involved in the decision-making process at the start. - many people are involved and the process is long suppliers need to invest heavily in time to influence all of them. 2. Straight Rebuy. - current suppliers need to build a strong defensible position and maintain it. - potential suppliers need to reduce risk of change for purchaser.
Reverse marketing
Supplier sells by taking initiative
Traditional marketing
Supplier Reverse marketing Buyer
Relationship Marketing
Centers On:
Transactional Exchange
Centers on timely exchange of basic products for highly competitive market prices.
Collaborative Exchange
Features close information, social, and operational linkages, as well as mutual commitments.
Types of Relationships
Buyer-seller relationships positioned on a continuum with transactional exchange and collaborative exchange serving as end points.
The Relationship Spectrum
Buyers and sellers craft different types of relationships in response to: a) market conditions and b) characteristics of the purchase situation.
Spectrum of Buyer-Seller Relationships
Customer Profitability
High
Passive Product is Crucial Good Supplier Match Costly to Service, but Pay Top Dollar
Aggressive Leverage Their Buying Power Low Price and Lots of Customized Features
High
BASF
BASF illustrate its commitment to having close relations with its customers in order to improve performance.
Long term stage Several major purchases or large-scale deliveries have been made