1. McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

2. LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 6, YOU SHOULD BE ABLE TO: Distinguish among industrial, reseller, and government organizational markets. LO1 Describe the key characteristics of organizational buying that make it different from consumer buying. LO2 6-2

3. LO3 LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 6, YOU SHOULD BE ABLE TO: Explain how buying centers and buying situations influence organizational purchasing. Recognize the importance and nature of online buying in industrial, reseller, and government organizational markets. LO4 6-3

4. BUYING IS MARKETING, TOO! PURCHASING PUBLICATION PAPER AT JCPENNEY 6-4

5.  Business Marketing THE NATURE AND SIZE OF ORGANIZATIONAL MARKETS LO1  Organizational Buyers Industrial Markets (Industrial Firms) Reseller Markets (Resellers) Government Markets (Government Units) Global Organizational Markets  Retailers  Wholesalers 6-5

6. FIGURE 6-A FIGURE 6-A Type and number of organization establishments in the U.S.: 2007 6-6

7. MEASURING DOMESTIC AND GLOBAL INDUSTRIAL, RESELLER, AND GOVERNMENT MARKETS LO1  North American Industry Classification System (NAICS)  North American Product Classification System (NAPCS) 6-7

8. FIGURE 6-1 FIGURE 6-1 NAICS breakdown for the information industries sector: NAICS code 51 (abbreviated) 6-8

9. FIGURE 6-2 FIGURE 6-2 Key characteristics and dimensions of organizational buying behavior 6-9

10.  Derived Demand  Size of Order or Purchase  Number of Potential Buyers CHARACTERISTICS OF ORGANIZATIONAL BUYING LO2  Organizational Buying Objectives Profits Efficiency Women/Minority Suppliers/Vendors Environment 6-10

11. FIGURE 6-B FIGURE 6-B Key organizational buying criteria  Organizational Buying Criteria 6-11

12. CHARACTERISTICS OF ORGANIZATIONAL BUYING LO2 Just-in-Time (JIT)  ISO 9000  Supplier Development 6-12

13. CHARACTERISTICS OF ORGANIZATIONAL BUYING LO2  Buyer-Seller Relationships and Supply Partnerships Reciprocity Supply Partnership Sustainable Procurement 6-13

14. CHARACTERISTICS OF ORGANIZATIONAL BUYING THE BUYING CENTER LO3  Buying Center  Buying Committee  People in the Buying Center  Roles in the Buying Center Users Influencers Buyers Deciders Gatekeepers 6-14

15. CHARACTERISTICS OF ORGANIZATIONAL BUYING THE BUYING CENTER LO3  Buy Classes Straight Rebuy Modified Rebuy New Rebuy 6-15

16. FIGURE 6-3 FIGURE 6-3 The buying situation affects buying center behavior in different ways 6-16

17. Alternative Evaluation CHARTING THE ORGANIZATIONAL BUYING PROCESS STAGES IN THE ORGANIZATIONAL BUYING PROCESS LO3  Organizational Buying Behavior Purchase Decision Problem Recognition Information Search Postpurchase Behavior 6-17

18. FIGURE 6-4 FIGURE 6-4 Comparing the stages in a consumer and organizational purchase decision process 6-18

19. CHARTING THE ORGANIZATIONAL BUYING PROCESS BUYING A MACHINE VISION SYSTEM LO3  Problem Recognition Make-Buy Decision  Information Search Value Analysis 6-19

20. CHARTING THE ORGANIZATIONAL BUYING PROCESS BUYING A MACHINE VISION SYSTEM LO3  Alternative Evaluation Bidder’s List  Purchase Decision  Postpurchase Behavior 6-20

21. FIGURE 6-5 FIGURE 6-5 Product and supplier selection criteria for buying machine vision equipment emphasize factors other than price An optic component in a larger machine vision system for soft drink cans Percentage of machine vision buyers citing individual selection criteria 6-21

22.  Prominence of Online Buying in Organizational Markets ONLINE BUYING IN ORGANIZATIONAL MARKETS LO4  E-marketplaces  Online Auctions in Organizational Markets Traditional Auction Reverse Auction 6-22

23. FIGURE 6-6 FIGURE 6-6 How buyer and seller participants and price behavior differ by type of online auction 6-23