1) The buying decision process as a general concept and as applied to
commercial / industrial buyers.
In business organizations, the various participants who are involved in the purchasing decision making process are initiators, users, influencers, deciders, approvers, buyers and gatekeepers. The gatekeepers are the important participants in the industrial buying process as they are the focal point for entry into the firm. They constitute the decision–making unit of a buying organization termed as the buying centre. The business buyers have the advantage of seeking the highest economic, social, service and technical benefit with respect to a market offering’s cost.
Supplier selection – Based on certain characteristics, the buyer will determine parameters to select the suppliers based on price, reputation, product reliability, and service reliability and supplier flexibility. Order – Routine Specifications : Here negotiation on the order takes place with the final supplier selected by the buying centre. Performance Review – the suppliers will be periodically checked and evaluated on their performance in-order to identify the gap between the actual and the expected performance.
2) Describe how the business environment is analysed, segmentation,
The major environmental factors that influences and affects the buying behaviour as an industrial customer are environmental factors like the level of demand, the economic outlook, social responsibility acts, technological and political change; Organizational factors speak on the objectives, strategies, policies, plans and systems etc; Interpersonal factors highlight on the status, empathy, interests, power, authority etc; Individual factors such as age, income, education, job designation, culture, social class etc. are the requirements to be looked upon;
The overall market dynamics can be studied by understanding the levels of market segmentation. Segment marketing, niche marketing, local marketing and individual marketing are some of the ways of micro marketing. Some of the variables for segmenting business markets are Demographics where-in the industry details, company size and the location have to be decided; Operating variables which includes technology, user or nonuser status, customer capabilities in the buying process have to be worked upon;
Purchasing approaches – The way the customer approaches while buying the industrial goods, Situational factors- like size of the order, urgency; and Personal characteristics – buyer-seller similarity relationship, loyalty between the firm and the customers and attitude towards risk are chief parameters while segmenting.. These are the important bases for segmenting the market in case of industrial or business buyers.
Selecting one or more of the market segments, which yields better returns at minimum cost and improved profits, is known as the process of targeting. The firm could use certain patterns for targeting such as single-segment concentration, selective specialization, product specialization, market specialization and full market coverage.
Positioning is what you do to the minds of the consumers. The various differentiating or positioning categories will be product, services, personnel, channel and image. Different positioning strategies adopted could be attribute positioning, benefit positioning, application, user, competitor positioning, price positioning and product-category positioning.
3)Some of the patterns for market coverage are based on the segment’s overall attractiveness and firm’s objectives and resources. In Single segment concentration – the company selects just one single segment, which implies a product in a single market. In selective specialization – the firm selects certain segments, which are supposed to be lucrative, and which are more attractive. Product specialization – The firm focuses on a single product in all the available market to spread the business risk. Market specialization – the firm constitutes on serving a certain focused market with the acceptability of various products. Full Market coverage – The firm attempts to serve all the markets and all the products considering the whole market as one globe.
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