Marketing chapter 6[1]
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Marketing chapter 6[1]

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  • {"27":"Note to Instructor\nInstitutional markets are larger than the students initially may believe. An example is the Saudi health insurance market provided in the book. The Saudi government is working on expanding the health insurance sector, which in 2009 was valued at around SR5 billion (US$1.3 billion). This is expected to increase by a further SR2 billion (US$533 million) in the short term with new regulations introduced in January 2009 that will further expand the insurance scheme to Saudi nationals working\nin small and medium enterprises in the private sector.\n","22":"Note to Instructor\nThis Web link brings the class to IDES which is a search engine for suppliers. The current page shows the vast number of plastics suppliers.\n","28":"Note to Instructor \nGiven all the red tape, why would any firm want to do business with the government? The reasons are quite simple: Purchases by governments are huge. For example, the Saudi government’s spending on e-transactions is currently around Dh 3.6 billion (US$1 billion). That country’s Knowledge Economy City (KEC) in Medina is an SR 30 billion (US$8 billion) development by the Saudi General Investment Authority. It covers 4.8 million square meters and is expected to create 20,000 new jobs in knowledge-based industries. \n","7":"Note to Instructor\nThe IKEA example in the text is excellent on understanding the importance of supplier development:\nIKEA’s challenge is finding enough of the right kinds of suppliers to help design and produce the billions of dollars of affordable goods. IKEA currently relies on about 1,800 suppliers in more than 50 countries to stock its shelves.\nIKEA doesn’t just buy from its suppliers. It involves them deeply in the process of designing and making stylish but affordable furniture.\n","25":"Note to Instructor\nOnline-buying: This Sun Microsystems site helps customers who want to purchase online by providing deep information on its thousands of complex products and services. Users who still need help can take advantage of the site’s interactive features to request an immediate phone call, an email, or a live online chat with a Sun representative.\n","14":"Note to Instructor\nDiscussion Question\nHow would the purchase of a chair like the one you are sitting in be different for the University versus an end consumer like yourself buying a chair for your desk?\nIt may be difficult for students with no business buying experience to grasp the difference between business and consumer buying. Students will note how the university needs to buy more, that they need to ask users about the chairs, that they will organize more intricately for the buying effort, that they will work with the vendors for reduced prices for bulk purchases. In addition, this can tie directly to the major types of buying situations.\nDiscussion Questions\nHow could the chair be a straight rebuy versus a modified rebuy. What implications would the different situation make on the process?\n","20":"Note to Instructor \nSharp uses ads like this one to alert customers to potential problems and then provide solutions. In this ad it states that a multifunction printer can present data security problems and asks “Is your MFP a portal for identity theft?” The solution? Sharp’s data security kits “help prevent sensitive information from falling into the wrong hands.”\n","15":"Note to Instructor\nCulture and customs can strongly influence business buyer reactions to the marketer’s behavior and strategies, especially in the international marketing environment. Real Marketing 6.2 presents some examples of the differences in culture. Business buyers must watch these cultural differences, determine how they will affect the buyer, and try to turn these challenges into opportunities.\n“When doing business in a foreign country and a foreign culture— particularly a non-Western culture—assume nothing,” advises an international business specialist. “Take nothing for granted. Turn every stone. Ask every question. Dig into\nevery detail. Because cultures really are different, and those differences can have a major impact.” So the old advice is still good advice: When in Rome, do as the Romans do.\n","10":"Note to Instructor\nIn Real Marketing 6.1, we can see that the transportation and logistics giant Aramex does more than just ship packages for its business customers, it actually develops entire solutions to customers’ transportation and logistics problems; it simply asks them “How can we develop tailor-made solutions for you?”. Its client base exceeds 50,000 companies, based mainly in the Arab world, Europe, India, and America, and includes trading .companies, banks, service and information companies, manufacturing, regional distribution companies, and express companies.\n"}

Marketing chapter 6[1] Marketing chapter 6[1] Presentation Transcript

  • Ch 6 -1 Copyright © 2011 Pearson Education
  • Principles of Marketing, Arab World Edition Philip Kotler, Gary Armstrong, Anwar Habib, Ahmed Tolba Presentation prepared by Annelie Moukaddem Baalbaki CHAPTER SIX Business Markets and Business Buyer Behavior Lecturer: Insert your name here Ch 6 -2 Copyright © 2011 Pearson Education
  • Chapter Learning Outcomes Topic Outline 6.1 Business Markets 6.2 Business Buyer Behavior 6.3 The Business Buying Process 6.4 E-Procurement: Buying on the Internet 6.5 Institutional and Government Markets Ch 6 -3 Copyright © 2011 Pearson Education
  • Business Markets Business Buyer Behavior and Business Buying Process Business buyer behavior refers to the buying behavior of the organizations that buy goods and services for use in production of other products and services that are sold, rented, or supplied to others. Business buying process is the process where business buyers determine which products and services are needed to purchase, and then find, evaluate, and choose among alternative brands. Ch 6 -4 Copyright © 2011 Pearson Education
  • Business Markets Market Structure and Demand Ch 6 -5 Copyright © 2011 Pearson Education
  • Business Markets Nature of the Buying Unit • More decision participants • More professional purchasing effort Ch 6 -6 Copyright © 2011 Pearson Education
  • Business Markets Types of Decisions and the Decision Process Business buying is usually more complex, longer, more formalized and the buyer and seller are more dependent on each other. Supplier development is the systematic development of networks of supplier-partners to ensure an appropriate and dependable supply of products and materials that they will use in making their own products or resell. Ch 6 -7 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Ch 6 -8 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Types of Buying Situations Straight rebuy is a routine purchase decision such as reorder without any modification. Modified rebuy is a purchase decision that requires some research where the buyer wants to modify the product specification, price, terms, or suppliers. New task is a purchase decision that requires thorough research such as a new product. Ch 6 -9 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Types of Buying Situations Systems selling involves the purchase of a packaged solution from a single seller. Two-step process of selling: • Interlocking products • System of production, inventory control, distribution, and other services to meet the buyer’s need for a smoothrunning operation Ch 6 -10 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Participants in the Business Buying Process Buying center is all of the individuals and units that participate in the business decision-making process. It provides a major challenge as to who participates in the process: • Their relative authority • What evaluation criteria each participant uses • Informal participants Ch 6 -11 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Participants in the Business Buying Process Users are those that will use the product or service. Influencers help define specifications and provide information for evaluating alternatives. Buyers have formal authority to select the supplier and arrange terms of purchase. Deciders have formal or informal power to select and approve final suppliers. Gatekeepers control the flow of information. Ch 6 -12 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Influences on Business Buyers Ch 6 -13 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Ch 6 -14 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Influences on Business Buyers Environmental Factors Ch 6 -15 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Influences on Business Buyers Organizational Factors Ch 6 -16 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Influences on Business Buyers Interpersonal Factors Ch 6 -17 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Major Influences on Business Buyers Individual Factors Ch 6 -18 Copyright © 2011 Pearson Education
  • The Business Buying Process Ch 6 -19 Copyright © 2011 Pearson Education
  • The Business Buying Process Problem Recognition Problem recognition occurs when someone in the company recognizes a problem or need. Internal stimuli • Need for new product or production equipment External stimuli • Ch 6 -20 Idea from a trade show or advertising Copyright © 2011 Pearson Education
  • The Business Buying Process General Need Description and Product Specifications General need description describes the characteristics and quantity of the needed item. Product specification describes the technical criteria. Value analysis is an approach to cost reduction where components are studied to determine if they can be redesigned, standardized, or made with less costly methods of production. Ch 6 -21 Copyright © 2011 Pearson Education
  • The Business Buying Process Supplier Search and Proposal Solicitation Supplier search involves compiling a list of qualified suppliers. Proposal solicitation is the process of requesting proposals from qualified suppliers. Ch 6 -22 Copyright © 2011 Pearson Education
  • Business Buyer Behavior Supplier Selection and Order Routine Specifications Supplier selection is the process when the buying center creates a list of desired supplier attributes and negotiates with preferred suppliers for favorable terms and conditions. Order-routine specifications is the final order with the chosen supplier and lists all of the specifications and terms of the purchase. Ch 6 -23 Copyright © 2011 Pearson Education
  • The Business Buying Process Performance Review Performance review involves a critique of supplier performance to the purchase terms. Ch 6 -24 Copyright © 2011 Pearson Education
  • E-Procurement: Buying on The Internet E-Procurement • Online purchasing (reverse auctions or trading exchanges) • Company-buying sites • Extranets Ch 6 -25 Copyright © 2011 Pearson Education
  • The Business Buying Process E-Procurement Advantages Access to new suppliers • Lowers costs • Speeds order processing and delivery • Shares information • Sales • Service and support • Ch 6 -26 Copyright © 2011 Pearson Education Disadvantages Can erode relationships as buyers search for new suppliers • Security •
  • Institutional and Government Markets Institutional markets Institutional markets consist of hospitals, nursing homes, and prisons that provide goods and services to people in their care. Characteristics • Low budgets • “Captive” audience Ch 6 -27 Copyright © 2011 Pearson Education
  • Institutional and Government Markets Government markets Government markets tend to favor domestic suppliers and require suppliers to submit bids and normally award to the lowest bidder. Noneconomic criteria play a role: • Depressed business firms and areas • Small business firms • Minority-owned firms • Business firms that avoid race, gender or age discrimination Ch 6 -28 Copyright © 2011 Pearson Education
  • This work is protected by local and international copyright laws and is provided solely for the use of instructors in teaching their courses and assessing student learning. Dissemination or sale of any part of this work (including on the World Wide Web) will destroy the integrity of the work and is not permitted. The work and materials from this site should never be made available to students except by instructors using the accompanying text in their classes. All recipients of this work are expected to abide by these restrictions and to honor the intended pedagogical purposes and the needs of other instructors who rely on these materials. Ch 6 -29 Copyright © 2011 Pearson Education