Business Markets & B2B Buying Behavior Explained

Business Markets & B2B Buying Behavior

Understanding Business Markets

Business buyer behavior refers to the buying behavior of organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others.

Business buying process is the process where business buyers determine which products and services are needed to purchase, and then find, evaluate, and choose among alternative brands.

Market Structure & Demand

Business Decision Process Characteristics

• More complex
• More decision participants
• More professional purchasing effort
• Buyer and seller more dependent

Supplier development is the systematic development of networks of supplier-partners to ensure an appropriate and dependable supply of products and materials that companies will use in making their own products or reselling to others.

Analyzing Business Buyer Behavior

Environmental Influences on Buyers

Marketing Stimuli in B2B

• Product
• Price
• Place
• Promotion

Other Stimuli Affecting B2B Buyers

• The buying center
• Buying decision process (interpersonal and individual influences)
• Organizational influence

Key Business Buyer Responses

• Product or service choice
• Supplier choice
• Order quantities
• Delivery terms and times
• Service terms
• Payment

Major Business Buying Situations

Straight rebuy is a routine purchase decision, such as reordering without any modification.

Modified rebuy is a purchase decision that requires some research where the buyer wants to modify the product specification, price, terms, or suppliers.

New task is a purchase decision that requires thorough research, such as for a new product.

Systems selling involves the purchase of a packaged solution from a single seller.

Participants in B2B Buying Process

Buying center is all of the individuals and units that participate in the business decision-making process:

• Users
• Influencers
• Deciders
• Buyers
• Gatekeepers

Users are those that will use the product or service.

Influencers help define specifications and provide information for evaluating alternatives.

Buyers have formal authority to select the supplier and arrange terms of purchase.

Deciders have formal or informal power to select and approve final suppliers.

Gatekeepers control the flow of information.

• The Buying Center presents a major challenge:
  • Who participates in the process?
  • Their relative authority
  • What evaluation criteria each participant uses
  • Informal participants

Model of Business Buyer Behavior

Environmental Factors in B2B Buying

• Economic developments
• Supply conditions
• Technological change
• Political and regulatory developments
• Competitive developments
• Culture and customs

Organizational Factors in B2B Buying

• Objectives
• Policies