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Revised v49 ch7 business_markets_kristine_bacsal_flores 1

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Revised v49 ch7 business_markets_kristine_bacsal_flores 1

  1. 1. Chapter 7 ANALYZING BUSINESS MARKETS Kristine Bacsal-Flores Marketing Management MBAH Top 10 Concepts kristinebacsalflores.blogspot.com
  2. 2. Analyzing Business Markets <ul><li>Overview: Organizational buying </li></ul><ul><li>Concepts </li></ul><ul><li>Business markets: </li></ul><ul><ul><li>differ from consumer markets </li></ul></ul><ul><ul><li>are affected by buying situations </li></ul></ul><ul><ul><li>have 7 types of participants </li></ul></ul><ul><ul><li>are influenced by several factors </li></ul></ul>kristinebacsalflores.blogspot.com
  3. 3. <ul><ul><li>5. Marketers need to target efforts. </li></ul></ul><ul><ul><li>6. T he buying process occurs in 8 stages. </li></ul></ul><ul><ul><li>7. Internet facilitates procurement. </li></ul></ul><ul><ul><li>8. Buyer-supplier relationships are important. </li></ul></ul><ul><ul><li>9. Beware of opportunism. </li></ul></ul><ul><ul><li>10.Institutions and governments are business markets. </li></ul></ul>kristinebacsalflores.blogspot.com
  4. 4. Organizational Buying <ul><li>The decision-making process by which formal organizations </li></ul><ul><ul><li>establish the need for purchased products and services </li></ul></ul><ul><ul><li>Identify, evaluate and choose among alternative brands and suppliers </li></ul></ul>kristinebacsalflores.blogspot.com
  5. 5. Concept 1 The business market differs from the consumer market <ul><li>Business market </li></ul><ul><ul><li>organizations that acquire goods and services used in the production of goods and services that are sold, rented or supplied to others </li></ul></ul>kristinebacsalflores.blogspot.com
  6. 6. Concept 1 The business market differs from the consumer market kristinebacsalflores.blogspot.com Few, large buyers Close relationships Professional purchasing Multiple sales calls
  7. 7. <ul><li>Geographically concentrated buyers </li></ul><ul><li>Derived, inelastic, fluctuating demands </li></ul>Concept 1 The business market differs from the consumer market kristinebacsalflores.blogspot.com
  8. 8. <ul><li>Examples </li></ul><ul><li>Kotler: Goodyear contracts from car makers </li></ul><ul><li>Local: Philam insurance package sold to companies vs sold to individuals </li></ul><ul><li>Medical: spectacles sold to optical shops vs individual patients </li></ul>Concept 1 The business market differs from the consumer market kristinebacsalflores.blogspot.com
  9. 9. Utilities Office Supplies Bulk chemicals New vehicles Elec. Equip Computer equip. Office building Security systems Concept 2 Buying situations affect business decisions kristinebacsalflores.blogspot.com <ul><li>Involved Decision Making </li></ul>Modified Rebuy New Task Buying Straight Rebuy
  10. 10. <ul><li>*EXAMPLES </li></ul><ul><ul><li>Kotler: modified rebuy - Orica Ltd </li></ul></ul><ul><ul><li>Local: straight - internet providers - PLDT SUN Globe – good coverage; improve speeds </li></ul></ul><ul><ul><li>Medical: new and modified - phaco machines and model improvements/ enhancements </li></ul></ul>Concept 2 Buying situations affect business decisions. Add value to facilitate rebuys kristinebacsalflores.blogspot.com
  11. 11. Concept 3 Participants play any of 7 roles Approvers Buyers Gatekeepers Initiators Influencers Deciders Users Buying Center kristinebacsalflores.blogspot.com
  12. 12. <ul><li>Examples </li></ul><ul><ul><li>Kotler: surgical gown supplier for hospitals </li></ul></ul><ul><ul><li>- purchasing VP/OR admin/MDs </li></ul></ul><ul><ul><li>Local: textile suppliers for RTW companies </li></ul></ul><ul><ul><li>eg Kamiseta, Bayo </li></ul></ul><ul><ul><li>Medical: viscoat in NKTI pharmacy </li></ul></ul>Concept 3 Participants play any of 7 roles Approvers Buyers Gatekeepers Initiators Influencers Deciders Users
  13. 13. Concept 4 Various factors influence buying centers kristinebacsalflores.blogspot.com
  14. 14. <ul><li>Kotler: choice of surgical gowns </li></ul><ul><li>Local: environment - handicraft companies producing lahar-based products following Mt Pinatubo eruption </li></ul><ul><li>Medical: personal - eye center spectacle purchasing </li></ul>Concept 4 Various factors influence buying centers kristinebacsalflores.blogspot.com
  15. 15. Concept 5 Business marketers must target efforts to efficiently acquire and keep customers <ul><li>Who are the decision makers </li></ul><ul><li>What decisions do they influence </li></ul><ul><li>What is their level of influence </li></ul><ul><li>What evaluation criteria do they use </li></ul>kristinebacsalflores.blogspot.com
  16. 16. <ul><li>Examples </li></ul><ul><ul><li>Kotler: Symantec executive sponsorship program </li></ul></ul><ul><ul><li>Local: IT systems for hospitals </li></ul></ul><ul><ul><li>Medical: pharma companies sending MDs (KOLs) to conferences </li></ul></ul>Concept 5 Business marketers must target efforts to efficiently acquire and keep customers kristinebacsalflores.blogspot.com
  17. 17. Problem Recognition Post Purchase Purchase Info Search/ Eval Need Recognition Concept 6 8 stages in the buying process kristinebacsalflores.blogspot.com Product Specification Proposal Solicitation Supplier Selection Order Routine Specification Performance Review
  18. 18. <ul><li>Examples </li></ul><ul><ul><li>Kotler: need description and product specification - Hewlett-Packard “trusted advisor; everything is possible” </li></ul></ul><ul><ul><li>Local: problem recognition - Jollibee seafood offerings for holy week </li></ul></ul><ul><ul><li>Medical: supplier search - for alternative intraocular lenses (eg MSM, Hoya) </li></ul></ul>Concept 6 8 stages in the buying process kristinebacsalflores.blogspot.com
  19. 19. Concept 7 Internet facilitates procurement: e-procurement <ul><li>Direct extranet links to major suppliers </li></ul><ul><li>Buying alliances for lower raw material prices </li></ul><ul><li>Company buying sites </li></ul>kristinebacsalflores.blogspot.com
  20. 20. <ul><li>Examples </li></ul><ul><ul><li>Kotler: Covisint </li></ul></ul><ul><ul><li>Local: PLDT Clark Telecom using BuySite applic of Bayan Trade </li></ul></ul><ul><ul><li>Medical: procuring hospital supplies on line </li></ul></ul>GM, Ford, Chrysler Concept 7 Internet facilitates procurement: e-procurement kristinebacsalflores.blogspot.com
  21. 21. Concept 8 Buyer-supplier relationships affect business processes. <ul><li>Basic buying and selling </li></ul><ul><li>Bare bones </li></ul><ul><li>Contractual transaction </li></ul><ul><li>Customer supply </li></ul><ul><li>Cooperative systems </li></ul><ul><li>Collaborative </li></ul><ul><li>Mutually adaptive </li></ul><ul><li>Customer is king </li></ul>kristinebacsalflores.blogspot.com
  22. 22. <ul><li>Examples </li></ul><ul><ul><li>Kotler: Motoman and Stillwater Technologies (collaborative) </li></ul></ul><ul><ul><li>Local: The Oasis and Hizons (cooperative) </li></ul></ul><ul><ul><li>Medical: pharma companies and Mercury (customer is king) </li></ul></ul><ul><ul><li> </li></ul></ul>Concept 8 Buyer-supplier relationships affect business processes. kristinebacsalflores.blogspot.com
  23. 23. Concept 9 Opportunism is a form of cheating relative to a contract. Buyer Supplier Monitor C H E A T kristinebacsalflores.blogspot.com
  24. 24. <ul><li>Examples </li></ul><ul><ul><li>Kotler: Ford and Lear Corporation </li></ul></ul><ul><ul><li>Local: Smartmatic </li></ul></ul><ul><ul><li>Medical: IT supplier of NKTI </li></ul></ul>Concept 9 Opportunism is a form of cheating relative to a contract. kristinebacsalflores.blogspot.com
  25. 25. Concept 10 Institutions and Governments are also business markets. <ul><li>Institutions: </li></ul><ul><ul><li>Schools, hospitals, nursing homes, prisons </li></ul></ul><ul><li>Low budgets </li></ul><ul><li>Captive clientele </li></ul><ul><li>Examples </li></ul><ul><li>Kotler - ARAMARK Corp and US prisons </li></ul><ul><li>Local – NBS supplying schools </li></ul><ul><li>Medical – Fresenius and NKTI; pharma companies and private hospitals </li></ul>kristinebacsalflores.blogspot.com
  26. 26. <ul><li>Governments </li></ul><ul><li>Spending decisions based on public review </li></ul><ul><li>Strict protocols followed – bidding, red tape </li></ul><ul><li>Examples </li></ul><ul><li>Kotler – ADI Technology spending on bids </li></ul><ul><li>Local – NBN deal </li></ul><ul><li>Medical – supplier bidding at PGH </li></ul>Concept 10 Institutions and Governments are also business markets. kristinebacsalflores.blogspot.com
  27. 27. SUMMARY <ul><li> - Business markets differ from consumer markets. </li></ul><ul><ul><li>Buying situations affect business markets </li></ul></ul><ul><ul><li>Business participants play any one or a combination of 7 roles </li></ul></ul><ul><ul><li>Organizational, environmental and personal factors influence business markets </li></ul></ul>kristinebacsalflores.blogspot.com
  28. 28. <ul><ul><li>Marketers need to target efforts. </li></ul></ul><ul><ul><li>8 stages in the buying process. </li></ul></ul><ul><ul><li>Internet facilitates procurement. </li></ul></ul><ul><ul><li>Buyer-supplier relationships are important. </li></ul></ul><ul><ul><li>Beware of opportunism. </li></ul></ul><ul><ul><li>Institutions and governments are business markets </li></ul></ul>SUMMARY kristinebacsalflores.blogspot.com
  29. 29. CONCLUSION <ul><li>Business markets </li></ul><ul><li>Dynamic </li></ul><ul><li>Marketers need to create and capture value </li></ul><ul><li>Adjust to changing customer needs </li></ul>kristinebacsalflores.blogspot.com
  30. 30. Chapter 7 ANALYZING BUSINESS MARKETS Kristine Bacsal-Flores Marketing Management MBAH Top 10 Concepts kristinebacsalflores.blogspot.com

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