Chapter 6 Business-to-Business (B2B) Marketing Flashcards Preview

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Flashcards in Chapter 6 Business-to-Business (B2B) Marketing Deck (35)
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1
Q

Define B2B

A

Organizational sales and purchasing of goods and services

2
Q

Business to Business Marketing

A
  • Product
  • Promotion
  • Distribution
  • Customer relations
  • Decision making process
  • Price
3
Q

Product

A

Relatively technical in nature, exact form often variable, accompanying service very important

4
Q

Promotion

A

Emphasis on personal selling

5
Q

Distribution

A

Relatively technical in nature

6
Q

Customer relations

A

Relatively enduring and complex

7
Q

Decision making process

A

Diverse group of organization members make decision

8
Q

Price

A

Competitive bidding for unique items and list prices for standard items

9
Q

Influences in B2B markets

A
  • Environmental
  • Organization
  • Interpersonal
10
Q

Define Commercial Market

A

Individuals and firms that acquire products to support production

11
Q

Define Trade Industries

A

Retailers and wholesalers that purchase for resale

12
Q

Define Customer

A

Dividing a business-to-business market into homogenous groups based on buyers’ product specifications

13
Q

Segmentation by End-Use

A

Based on how industrial purchasers will use the product

14
Q

Segmentation by Purchasing Categories

A

Segmenting according to organizational buyers characteristics

15
Q

Characteristics of the B2B market

A
  • More concentrated than the consumer market
  • Certain industries locate in particular areas to be close to customer
  • Due to the internet, business markets may become less geographically concentrated
16
Q

Categories of Business Market Demand

A
  • Derived Demand
  • Inventory Demand
  • Volatile Demand
  • Inelastic Demand
  • Joint Demand
17
Q

Define Derived Demand and provide an example

A

The linkage between demand for a company’s output and its purchases of resources
Example: Demand for computer microprocessor chips is derived from demand for personal computers

18
Q

Define Volatile Demand and provide an example

A

Demand is more volatile in business markets; created by derived demand
Example: Demand for gas pumps may be reduced if demand for gas slows down

19
Q

Define Joint Demand and provide an example

A

Demand for a product that depends on the demand for another product used in combination with it
Example: If the supply of lumber falls, the drop in housing construction will affect the demand for concrete

20
Q

Define Inelastic Demand and provide and example

A

Derived throughout an industry; will not change significantly due to a price change
Example: Construction firms will not necessarily buy more lumber if prices fall unless the overall demand for housing increases

21
Q

Define Global Sourcing

A

Purchasing goods and services from suppliers worldwide

22
Q

Define Sole Sourcing

A

Buying entirely from just one vendor

23
Q

Define Offshoring

A

Movement of high wage jobs from one country to low cost overseas locations

24
Q

Define Nearshoring

A

Moving jobs to vendors in countries close to the business’ home country
Example: Canada is an attractive nearshoring location for U.S. firms

25
Q

Define Outsourcing

A

Using outside vendors to provide goods and services formerly produced in house

26
Q

Reasons for Outsourcing

A
  • Cost reduction
  • Quality and speed of software maintenance and development
  • Greater value
27
Q

Problems with Offshoring and Outsourcing

A
  • Cost savings are less than expected
  • Security concerns over proprietary technology or customer data
  • Reduces company’s ability to respond quickly to marketplace
  • Creates conflict between outside non-union and in house union workers
  • Can negatively affect employee morale and loyalty
28
Q

Influences on Purchase Decisions

A
  • Environmental Factors
  • Organizational Factors
  • Interpersonal Factors
29
Q

Environmental Factors

A
  • Economic, political, regulatory, competitive and technological considerations influence business buying decisions
  • Natural disasters
30
Q

Organizational Factors

A
  • Marketers must understand their customer’s organizational structures, policies and purchasing systems
  • Many companies use multiple sourcing to avoid depending too much on a sole supplier
31
Q

Interpersonal Infleunces

A
  • People can influence B2B purchase decisions

- Sales personnel must have a good technical understanding of their products

32
Q

Define Merchandisers

A

Trade sector buyers who secure needed products at the best prices

33
Q

Define Systems Integration

A

Centralization of the procurement function within an internal division or as a service of an external supplier

34
Q

Define Category Advisor

A

Trade industry vendor who develops a comprehensive procurement plan for a retailer to buy

35
Q

Stages in the Business-to-Business Buying Process

A
  1. Recognize a problem and find a general solution
  2. Determine the characteristics and quantity of a needed good or service
  3. Describe characteristics and quantity of a needed good or service
  4. Search for and qualify potential sources
  5. Acquire and analyze proposals
  6. Evaluate proposals and select suppliers
  7. Select and order routine
  8. Obtain feedback and evaluate performance