MarketingManagement.pdf

Characteristic Description Example

Professional

purchasing

Multiple buying

influences

Multiple sales

calls

Direct

purchasing

Reciprocity

Leasing

Trained purchasing agents follow

organizational purchasing policies,

constraints, and requirements to buy

business products. Many of the buying

instruments—such as proposals and

purchase contracts—are not typical

of consumer buying.

More people typically influence

business buying decisions. Buying

committees are common in the

purchase of major goods; marketers

have to send well-trained sales reps

and often sales teams to deal with

these well-trained buyers.

With more people involved in the

process, it takes multiple sales calls to

win most business orders, and the

sales cycle can take years.

Business buyers often buy directly

from manufacturers rather than

through intermediaries, especially

items that are technically complex or

expensive.

Business buyers often select suppliers

who also buy from them.

Many industrial buyers lease rather

than buy heavy equipment to

conserve capital, get the latest

products, receive better service, and

gain tax advantages.The lessor often

makes more profit and sells to

customers who could not afford

outright purchase.

Programs on the Cisco Systems Web

site allow purchasing agents to

research, select, and price new

networking systems at any hour and

obtain speedy online answers about

products, orders, and service.^2

Metal supplier Phelps Dodge uses an

“account management approach” to

reach all the key people who

influence business buying decisions in

customer organizations.^3

In the case of major capital

equipment sales, customers may take

multiple attempts to fund a project,

and the sales cycle—between quoting

a job and delivering the product—is

often measured in years.^4

Southwest Airlines,Air Madagascar,

and other airlines around the world

buy airplanes directly from Boeing.

A paper manufacturer buys chemicals

from a chemical company that buys a

considerable amount of its paper.

General Electric leases truck and car

fleets, aircraft, commercial trailers,

railcars, and other major equipment

products to business buyers.

Sources for examples:^1 John H. Sheridan, “An Alliance Built on Trust,”Industry Week,March 17, 1997,

pp. 66–70;^2 Andy Reinhardt, “Meet Mr. Internet,”Business Week,September 13, 1999, pp. 128–40;^3 Minda

Zetlin,“It’s All the Same to Me,”Sales & Marketing Management,February 1994, pp. 71–75;^4 Michael Collins,

“Breaking into the Big Leagues,”American Demographics,January 1996, p. 24.

Table 3.3 Characteristics of Business Markets—Continued

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