118 CHAPTER6ANALYZINGBUSINESSMARKETS ANDBUYERBEHAVIOR
als, when a machine breaks down and requires new parts, when purchased material
turns out to be unsatisfactory, and when a purchasing manager senses an opportunity
to obtain lower prices or better quality. Externally, problem recognition can occur
when a buyer gets new ideas at a trade show, sees a supplier’s ad, or is contacted by a
sales representative offering a better product or a lower price. For their part, business
marketers can stimulate problem recognition by direct mail, telemarketing, effective
Internet communications, and calling on prospects.Stage 2: General Need Description
Once a problem has been recognized, the buyer has to determine the needed item’s
general characteristics and the required quantity. For standard items, this is not a very
involved process. For complex items, the buyer will work with others—engineers,
users, and so on—to define the needed characteristics. These may include reliability,
durability, price, or other attributes. In this stage, business marketers can assist buyers
by describing how their products would meet such needs.Stage 3: Product Specification
With a general need description in hand, the buying organization can develop the
item’s technical specifications. Often, the company will assign a product value analysis
(PVA) engineering team to the project. Product value analysisis an approach to cost
reduction in which components are carefully studied to determine if they can be
redesigned or standardized or made by cheaper methods of production.
The PVA team will examine the high-cost components in a given product,
because 20 percent of the parts usually account for 80 percent of the costs of manu-
facturing it. The team will also identify overdesigned product components that last
longer than the product itself, then decide on the optimal product characteristics.
Tightly written specifications will allow the buyer to refuse components that are too
expensive or that fail to meet the specified standards. Suppliers, too, can use product
value analysis as a tool for positioning themselves to win an account. By getting in early
and influencing buyer specifications, a supplier can significantly increase its chances
of being chosen.Buyphases
New Modified Straight
Task Rebuy Rebuy- Problem recognition Yes Maybe No
- General need description Yes Maybe No
- Product specification Yes Yes Yes
Buyphases 4. Supplier search Yes Maybe No - Proposal solicitation Yes Maybe No
- Supplier selection Yes Maybe No
- Order-routine specification Yes Maybe No
- Performance review Yes Yes Yes
Source:Adapted from Patrick J. Robinson, Charles W. Faris, and Yoram Wind,Industrial Buying and
Creative Marketing(Boston:Allyn & Bacon, 1967), p. 14.Table 3.4 Buygrid Framework: Major Stages (Buyphases) of the Industrial
Buying Process in Relation to Major Buying Situations (Buyclasses)