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5 - 1
Chapter
Chapter
5
5
Organizational
Organizational
Buying
Buying
Behavior
Behavior
5 - 2
Key Learning Points
Key Learning Points
The key differences between consumer
The key differences between consumer
and industrial marketing.
and industrial marketing.
Market segmentation for marketing to
Market segmentation for marketing to
organizations.
organizations.
Understanding why organizational buyers
Understanding why organizational buyers
make decisions.
make decisions.
Understanding how organizations make
Understanding how organizations make
purchasing decisions.
purchasing decisions.
The importance of knowing where and
The importance of knowing where and
when such purchases are made.
when such purchases are made.
5 - 3
Product & Service
Product & Service
Decisions
Decisions
“
“
When a firm markets a product or
When a firm markets a product or
service to another organization, it
service to another organization, it
is called
is called
organizational marketing,
organizational marketing,
industrial marketing,
industrial marketing,
and since the
and since the
Internet boom of the late 1990s,
Internet boom of the late 1990s,
B
B
-
-
to
to
-
-
B (business
B (business
-
-
to
to
-
-
business)
business)
marketing.
marketing.
”
”
5 - 3
- Russell S. Winer
5 - 4
Organizational Buying
Organizational Buying
Buying Centers
Buying Centers
–
–
A group of individuals who are
A group of individuals who are
collectively involved in an
collectively involved in an
organizational buying decision.
organizational buying decision.
–
–
Key distinction between consumer and
Key distinction between consumer and
industrial purchase decision making as
industrial purchase decision making as
the dynamics of group decision making
the dynamics of group decision making
differ significantly from an individual
differ significantly from an individual
’
’
s
s
decision
decision
-
-
making process.
making process.
5 - 5
Industrial vs. Consumer
Industrial vs. Consumer
Marketing
Marketing
Key Differences Between Industrial
Key Differences Between Industrial
and Consumer Purchasing Behavior
and Consumer Purchasing Behavior
–
–
Demand is derived.
Demand is derived.
–
–
Industrial products are typically more
Industrial products are typically more
complex than consumer goods.
complex than consumer goods.
–
–
Buyer
Buyer
-
-
seller interdependence via the
seller interdependence via the
supply chain.
supply chain.
–
–
Industrial buying process is more
Industrial buying process is more
complex.
complex.
5 - 6
Product & Service
Product & Service
Decisions
Decisions
Key Decisions
Key Decisions
Who Are the Customers?
Who Are the Customers?
Segmentation Variables for
Segmentation Variables for
Business Markets
Business Markets
Operating
Operating
Variables
Variables
Purchasing
Purchasing
Approaches
Approaches
5 - 6
Situational
Situational
Factors
Factors
Personal
Personal
Characteristics
Characteristics
Demographic
Demographic
5 - 7
Product & Service
Product & Service
Decisions
Decisions
Key Decisions
Key Decisions
Who Are the Customers?
Who Are the Customers?
Segmentation for Medical
Segmentation for Medical
Equipment Manufacturer
Equipment Manufacturer
5 - 7
Number of Samples Processed Per Researcher
Number of
Researchers
Using
Equipment
Many Researchers
Few Samples
Few Researchers
Few Samples
Many Researchers
Many Samples
Few Researchers
Many Samples
5 - 8
Who Are the Customers?
Who Are the Customers?
Regardless of descriptors chosen,
Regardless of descriptors chosen,
resulting segments must behave
resulting segments must behave
differently & desire different benefits.
differently & desire different benefits.
Organizations make different types
Organizations make different types
of purchases, which can be
of purchases, which can be
classified into buy classes
classified into buy classes
–
–
Straight
Straight
rebuys
rebuys
–
–
Modified
Modified
rebuys
rebuys
–
–
New task purchases
New task purchases
5 - 9
Who Are the Customers?
Who Are the Customers?
Straight
Straight
Rebuy
Rebuy
Modified
Modified
Rebuy
Rebuy
New Task
New Task
Purchase
Purchase
Buy Classes
Buy Classes
Typical of frequently
Typical of frequently
purchased routine
purchased routine
items such as paper,
items such as paper,
toner, etc.
toner, etc.
Purchase decision
Purchase decision
complexity:
complexity:
simple
simple
Time frame:
Time frame:
short
short
Number of suppliers
Number of suppliers
considered:
considered:
one
one
5 - 10
Who Are the Customers?
Who Are the Customers?
Straight
Straight
Rebuy
Rebuy
Modified
Modified
Rebuy
Rebuy
New Task
New Task
Purchase
Purchase
Buy Classes
Buy Classes
Routine purchases
Routine purchases
that have changed in
that have changed in
some way (e.g., hard
some way (e.g., hard
drive size, processor
drive size, processor
speed, amount of
speed, amount of
computer RAM.)
computer RAM.)
Purchase decision
Purchase decision
complexity:
complexity:
moderate
moderate
Time frame:
Time frame:
medium
medium
Number of suppliers
Number of suppliers
considered:
considered:
few
few
[...]... between visionaries (early adopters) and pragmatists (early majority) is called the chasm • Smaller gaps exist between other categories 5 - 14 Figure 5-2: The Chasm Model 5 - 15 Who Are the Customers? Marketing Research Implications – Data Collection • Little primary research is conducted; judgment often replaces hard data • Syndicated research and secondary sources of information are used most often... data useful for segmentation purposes • Figure 5.3 demonstrates behavioral data that may be useful for segmentation 5 - 16 Figure 5-3: Workstation Brand Mindshare Report 5 - 17 Who Are the Customers? Marketing Research Implications – Developing Target Markets • Does the segmentation scheme explain differences in the behavioral variable of interest? • How many customers are there? • What is the forecasted . consumer
and industrial marketing.
and industrial marketing.
Market segmentation for marketing to
Market segmentation for marketing to
organizations.
organizations.
Understanding. it
is called
is called
organizational marketing,
organizational marketing,
industrial marketing,
industrial marketing,
and since the
and since the
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