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1. UNIT V
INDUSTRIAL BUYING BEHAVIOR

2. INDUSTRIAL BUYERS
Individuals, organisations, or government agencies that make a
purchase decision regarding raw material, products and
services, components for finished goods are known as
organisation buyers.
 Consumer- purchase goods for personal consumption
 Industrial Buyer – purchase products on behalf of their
business or organization.
Usually the buying decisions in an organisation are taken by
buying centres which may consists of the top management or
the members of the procurement committee or any other
department.

3. CHARACTERISTICS OF
ORGANISATIONAL BUYING BEHAVIOUR
 Every organisation is unique
 There is a long time lag between efforts and results
 It is a rational as well as emotional activity
 It is a formal activity
 It is a multi-person activity
 There are few industrial buyers and many individual buyers.
 Organisation buyers usually buy in bulk.
 Role of middle man is reduced as the buyers buy directly in
bulk from manufacturers.
 Organisations generally have an inelastic demand

4. FACTORS INFLUENCING
ORGANISATIONAL BUYING BEHAVIOUR
External Environmental Factors
 Economic Conditions:
 Regulatory Changes:
 Political Environment
 Social Environment
 Competition
Internal Organizational Factors
 Buying Objectives
 Organizational Structure
 Policies and Procedures
 Technological Levels
 Manpower Skills

5. ---CONTD…
Interpersonal and Individual Factors
 Participation and Authority
 Interpersonal Conflict
 Education and Awareness:
 Risk Taking Ability
 Individual Factors

6. ORGANIZATIONAL BUYING DECISION
PROCESS
Following are the stages in the Organizational Buying process:
A Buying Centre consisting of members of the organization participate
in the purchase process and take relevant decisions according to
different buying situations.
Stage-1 – Problem/Need Recognition
Stage-2 – General Need Description
Stage-3 – Development of Product Specification
Stage-4 – Supplier Search
Stage-5 – Acquisition and Analysis of Proposal
Stage-6 – Evaluation and Selection of Suppliers
Stage-7 – Selection of an order routine
Stage-8 – Performance evaluation and Feedback

7. SERVICES AND SERVICES MARKETING

8. SERVICES
AMA define services as - “Activities, benefits and satisfactions which
are offered for sale or are provided in connection with the sale of
goods.”
 Services are the non-physical, intangible parts of our economy, as
opposed to goods, which we can touch or handle.
 Services, such as banking, education, medical treatment, and
transportation make up the majority of the economies of the rich
nations. They also represent most of the emerging nations’
economies.
 The world economy nowadays is increasingly characterized as a
service economy. This is primarily due to the increasing importance
and share of the service sector in the economies of most developed
and developing countries. In fact, the growth of the service sector
has long been considered as indicative of a country’s economic
progress.

9. CHARACTERISTICS OF SERVICES
 Intangibility
 Heterogeneity/Variability
 Perishability
 Inseparability/Simultaneity of production and
consumption

10. TYPES OF SERVICES
 Core Services: A service that is the primary purpose of the
transaction. Eg: a haircut or the services of lawyer or teacher.
 Supplementary Services: Services that are rendered as a
corollary to the sale of a tangible product. Eg: Home delivery
options offered by restaurants above a minimum bill value.

11. DIFFERENCE BETWEEN GOODS AND SERVICES
Goods Services
A physical commodity A process or activity
Tangible Intangible
Homogenous Heterogeneous
Production and distribution are separation from
their consumption
Production, distribution and consumption are
simultaneous processes
Can be stored Cannot be stored
Transfer of ownership is possible Transfer of ownership is not possible

12. SERVICES MARKETING - DEFINITION AND ITS
IMPORTANCE
Service marketing is defined as the integrated system of business
activities designed to plan, price, promote and distribute
appropriate services for the benefit of existing and potential
consumers to achieve organisational objectives.
The objects of services marketing are the achievement of
organisational goals like making profits, establishing
leadership, long term survival and growth and the satisfaction
of consumers by rendering excellent services. The concept of
services marketing covers the following aspects:
 selling services profitably to target consumers and prospects
 delivering maximum satisfaction to consumers of services;
and
 positioning the service firm in the market.

13. NEED FOR SERVICES MARKETING
 Increase in the Disposable Income
 Increasing Specialisation
 Changing Lifestyles
 Professional Excellence
 Information Explosion

14. 7 PS OF SERVICES MARKETING
(SERVICE MARKETING MIX)
 Product
 Place
 Promotion
 Pricing
 People
 Process
 Physical Evidence

15. CONSUMER COMMUNICATION

16. DEFINITION AND MEANING OF CONSUMER
COMMUNICATION
Communication is defined as the flow of information from a
sender to a receiver with the latter having a proper
understanding of it.
This could assume two forms,
 it could be personal via interpersonal communication between
the marketer and the salesperson or the dealer; or
 ii) it could be impersonal via a channel or a media (print,
audio-visual etc.)

18. COMPONENTS OF THE COMMUNICATION
PROCESS
 Sender
 Media/channel
 Receiver
 Feedback
 Noise