Marketing - Chapter 7

Terms in this set (29)

The basic philosophy and practice of marketing are the same whether the customer is a business organization or a consumer.
Purchase volume: Business customers buy in larger quantities than consumers.

Number of customers: Business marketers have fewer customers than consumer marketers. An advantage is that it is easier to identify buyers, monitor customer needs, and build personal relationships. A disadvantage is that each customer becomes crucial, especially for those manufacturers who have only one customer.

Location of buyers: Business customers are more geographically concentrated than consumers.

Distribution structure: Business products typically have shorter channels of distribution, and direct channels are common. On the other hand, consumer products pass through a distribution system that may include the producer, the wholesaler(s), and the retailers.
Nature of buying: More people are involved in a business market purchase decision than in a consumer purchase. Representatives from quality control, marketing, finance, and purchasing may be grouped in a buying center.
Nature of buying influence: Typically, more people are involved in a single business purchase decision than in a consumer purchase.
Type of negotiations: Negotiation is more common in business marketing decisions and may take months to work out the final contracts.
Use of reciprocity: Business purchasers often choose to buy from their own customers. It is not unethical or illegal unless the exchange is coerced.
Use of leasing: Businesses commonly lease expensive equipment to reduce capital outflow, keep state of the art products, and gain tax advantages.
Primary promotional method: Business marketers emphasize personal selling, especially for expensive, custom-designed products.
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