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MM555

Module 5: Business to Business Markets & Buying Behaviour

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Session Outline
Guest Speaker Peter Gibson Break PVT Case Analysis Digging Deeper Module 5: Brief Overview - Business to Business Markets and Buying Behaviour Next Steps Applied Project Group Work Time

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Case analysis: PVT Technologies


1. Analyse the situation analysis in this case. What is the key issue here and how appropriate are each of the four alternatives presented? Consider the issues such as profitability as well as other product management considerations. 2. How should PVT promote itself in the First Quarter 2012 and position the launch of the new 1.25MW central inverter thats been rescheduled for introduction in January? 3. What conclusions can be drawn about the evaluation and impending changes in technology, pricing and buying criteria in this business?
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Review of Module 4
1. Develop an understanding of how Consumers use products to help them define their identities in different settings. 2. Define Consumer Behaviour and identify the key elements related to CB 3. Understand why Marketers need to understand the wants and needs of different consumer segments. 4. Describe the consumer decision process 5. Gain an insight to the ways the Internet is changing consumer behavior.

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In each Module we encourage you to hunt out the latest news; explore the research and scan social media for whats new, whats important and what has piqued your interest on the topic of marketing

In the News; Out of Academia; Around the Grounds

DIGGING DEEPER

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Source: http://thisweekin.com

..What Caught Your Eye This Week?

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This Weeks Reading. ..Which Ideas Will You Hold Onto?


Muylle, S. Dawar,N. & Rangarajan, D. 2012 B2B Brand Architecture. California Management Review; Vol. 54 Issue 2, p58-71, 14p Geiger,S. & Finch,J.2011Buyer-Seller interactions in mature industrial markets: blurring the relational-transactional selling dichotomy. Journal of Personal Selling & Sales Management; Summer 2011, Vol. 31 Issue 3, p255-268, 14p, Bayyr,J,andWeinstein,A.2009 Business psychographics revisited: from segmentation theory to successful marketing practice, Journal of Marketing Management; Apr2009, Vol. 25 Issue 3/4, p315-340, 26p.

What were your top 3 concepts from the readings? Share these in class or online
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Identifying opportunities in the marketplace

MODULE 5: BUSINESS TO BUSINESS MARKETS AND BUYING BEHAVIOUR


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Marketing Management Framework


Customer
Consider factors such as decision making, values, needs & wants

Company
Or organisation. What is our Strategic Purpose? Capabilities? Weaknesses?

Context
Whats going on in the macro environment?

Competitors Collaborators
Who do we work with? Who are our partners? Who are our current and potential competitors? Where are they placed in the market?

Marketing Objectives
Based on geographic, demographic, psychographic and/or behavioural factors Consider strategic fit; potential and defensibility against competition Differentiating the market offering to create superior customer value

Positioning Analysis & Strategy


Create Value
Marketing is about creating customer value and profitable customer relationships
Product / Service People Processes Physical Evidence

Your place in the market space Core benefit proposition Unique selling proposition Positioning Statement

Planning & Implementation

Capture Value

Communicate Value
Integrated Marketing Communications (including Promotion)

Deliver Value

Price

Placement Logistics

The MM555 Marketing Management Framework draws on a number of sources including Iacobucci Curtin University is a trademark of Curtin University(2013), of Technology CRICOS Codeand 00301J Armstrong et Provider al (2012) Gibbs (2009) and includes the key factors which need to be taken into account when developing a comprehensive marketing strategy.

Implementation, Monitoring & Measuring Outcomes

Also relevant

Focus for Module 5

Segmentation

Targeting

Differentiation

Module 5: Learning Objectives

1. 2. 3. 4. 5.

Be able to distinguish among the various types of business markets Identify the major characteristics of business customers and transactions Understand several attributes of the demand for business products Become familiar with the major components of a buying centre Understand the stages of the business buying decision process and the factors that affect the process

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Business to Business Markets (B2B)


Occurs when an individual or group purchases a specific kind of product for resale, direct use in producing other products, or use in general operations
Business Markets

Producer Markets

Reseller Markets

Government Markets

Institutional Markets

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Types of B2B Customers


Individuals or business organisations that purchase products to make profits by using them to produce other products or using them in their operations Includes buyers of raw materials, as well as purchasers of semi-finished and finished items used to produce other products Manufacturers tend to be geographically concentrated and can be served more efficiently Resellers Intermediaries who buy finished goods and resell them for a profit Factors resellers consider include: * Level of demand * Space required relative to potential profit * Ease of placing orders * Availability of technical assistance * Training programs from producers Federal, state, county or local governments that buy goods and services to support their internal operations and provide products to their constituencies Organisations with charitable, educational, community or other non-business goals

Producer Markets

Resellers

Government Markets

Institutional Markets

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Dimensions of Marketing to Business Customers

Source: Pride,W., Ferrrell,O., Lukas,B.A., Schembri, S. and Nininen, O. 2012 Marketing Principles Asia Pacific Edition Cengage Learning Chapter 6. Data here drawn from the American Customer Satisfaction Index, http://www.theacsi.org
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Characteristics of B2B transactions


Large Orders Expensive Items Frequent replenishments Long-term contractual agreements Considerable marketing efforts Purchasing committees Reciprocity
An arrangement unique to business marketing in which two organisations agree to buy from each other
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Business Buying Decision Process and Factors that May Influence It

Source: Pride,W., Ferrrell,O., Lukas,B.A., Schembri, S. and Nininen, O. 2012 Marketing Principles Asia Pacific Edition Cengage Learning Chapter 6.
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Procurement Center Model


Roles in the purchase decision-making in the corporate sector
Gatekeeper
Secretary

Decision maker
Manager

Buyer
Employee

User
Employee

Influencer
Management consultant

Gatekeeper
Information

Decision maker
purchase decision vendor selection

Buyer
Purchase Price negotiations,

User
suggestions for

Influencer
criteria

collection
comparison of offers decision-making

purchase
assessment after the

discounts, and quantities


delivery conditions

preparation

purchase (qualitatively)

formulation for selection and evaluation of offers

Consider Who are the major decision participants? What decisions do they influence? What is their level of influence? What evaluation criteria do they use?
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Comparison of Business and Consumer Buying Decisions

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Textbook Resource: Kotler, Keller, Burton: Marketing Management 2009 Pearson Education Australia

Module 5: Learning Objectives Checking In..


1. Be able to distinguish among the various types of business markets 2. Identify the major characteristics of business customers and transactions 3. Understand several attributes of the demand for business products 4. Become familiar with the major components of a buying centre 5. Understand the stages of the business buying decision process and the factors that affect the process

Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J

Next Steps
Review Module 6 Materials Complete the required readings Applied Project Optional: Situation Analysis Draft Due Mon 25 Feb Working on Assignment 2 Clocky Case Study Watch for Announcements Dont forget to Dig Deeper!

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