Analyzing Business Markets for prepare best strategy for your business.ppt

Business Market Research

1. Analyzing
Business Markets

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Chapter Questions
•What is the business market, and how
does it differ from the consumer
market?
•What buying situations do
organizational buyers face?
•Who participates in the business-to-
business buying process?

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Chapter Questions
•How do business buyers make their
decisions?
•How can companies build strong
relationships with business customers?
•How do institutional buyers and
government agencies do their buying?

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What is Organizational Buying?
Organizational buying refers
to the decision-making process by
which formal organizations establish
the need for purchasing products and
services, and identify, evaluate, and
choose among alternative brands
and suppliers.

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Top Business Marketing Challenges
•Expand understanding of customer needs
•Compete globally as China and India
reshape markets
•Master analytical tools and improve
quantitative skills
•Reinstate innovation as an engine of growth
•Create new organizational models and
linkages

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Characteristics of Business Markets
•Fewer, larger buyers
•Close supplier-
customer
relationships
•Professional
purchasing
•Mutiple buying
influences
•Multiple sales calls
•Derived demand
•Inelastic demand
•Fluctuating demand
•Geographically
concentrated buyers
•Direct purchasing

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Buying Situation
Straight rebuy
Modified rebuy
New task

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The Buying Center
Initiators
Users
Influencers
Deciders
Approvers
Buyers
Gatekeepers

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Of Concern to Business Marketers
•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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Stages in the Buying Process:
Buyphases
•Problem recognition
•General need description
•Product specification
•Supplier search
•Proposal solicitation
•Supplier selection
•Order-routine specification
•Performance review

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Table 7.2 Buygrid Framework

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Forms of Electronic Marketplaces
• Catalog sites
• Vertical markets
• Pure play auction sites
• Spot markets
• Private exchanges
• Barter markets
• Buying alliances

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Methods of e-Procurement
•Websites organized using vertical hubs
•Websites organized using functional
hubs
•Direct extranet links to major suppliers
•Buying alliances
•Company buying sites

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Table 7.3 Vendor Analysis

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Handling Price-Oriented Customers
Limit quantity purchased
Allow no refunds
Make no adjustments
Provide no services

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Methods for Researching
Customer Value
•Internal engineering
assessment
•Field value-in-use
assessment
•Focus-group value
assessment
•Direct survey
questions
•Conjoint analysis
•Benchmarks
•Compositional
approach
•Importance ratings

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Conjoint analysis 
is a
statistical technique used
in market research to
determine how people
value different attributes
(feature, function,
benefits) that make up
an individual product or
service.

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Benchmarking 
is comparing one's business processes and
performance metrics to industry bests and best practices from
other companies. Dimensions typically measured are quality, time
and cost.
Compositional Approach:
An approach to attitude measurement where the overall preference for
an object is obtained by summing the evaluative rating of each attribute
multiplied by the importance of that attribute.

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Order Routine Specification
Stockless
purchase plans
Vendor-managed
inventory
Continuous
replenishment

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Establishing Corporate Trust
and Credibility
Expertise
LikeabilityTrustworthiness

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Factors Affecting
Buyer-Supplier Relationships
Availability of
alternatives
Supply market
dynamism
Complexity of
supply
Importance of
supply

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Categories of Buyer-Seller Relationships
1.Basic buying and
selling
2.Bare bones
3.Contractual transaction
4.Customer supply
5.Cooperative systems
6.Collaborative
7.Mutually adaptive
8.Customer is king

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1, Basic buying and selling—
These are simple,routine exchanges with moderate levels of
cooperation and information exchange.
2. Bare bones—
These relationships require more adaptation by the seller and
less cooperation and information exchange.
3. Contractual transaction—
These exchanges are defined by formal contract and generally
have low levels of trust, cooperation, and interaction.
4. Customer supply—
In this traditional custom supply situation, competition rather
than cooperation is the dominant form of governance.

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5. Cooperative systems—
The partners in cooperative systems are united in operational
ways, but neither demonstrate structural commitment through
legal means nor adaptation.
6. Collaborative—
In collaborative exchanges, much trust and commitment lead to
true partnership.
7. Mutually adaptive—
Buyers and sellers make many relationship-specific adaptations,
but without necessarily achieving strong trust or cooperation.
8. Customer is king—
In this close, cooperative relationship, the seller adapts to meet
the customer’s needs without expecting much adaptation or
change in exchange.