Marketing Chapter 4

• Derived demand is demand that springs from, or is derived from, a source other than the primary buyer of a product
• The demand for b2b products is based on derived demand
• B2B Marketing: Smaller more specialized target markets, complex solution, Smaller above the line advertising, Longer sales cycle, Relationship oriented, Less personal (more value driven)
• B2C Marketing: Larger target market, product oriented, Larger "above the line" advertising, shorter sales cycle, relationship with product, very personal.
• Joint Demand: Two products that are used together and demanded together
• Fluctuating Demand: A small change in demand by consumers that have a big effect throughout the chain of businesses that supply all the goods and services that produce it
• Acceleration Effect: A given percentage rise in consumer demand that can lead to a much larger percentage increase in demand
• Producers: Companies that purchase goods and services that they transform into other products
• Resellers: Companies that sell goods and services produced by other firms without materially changing them.
• Governments: Biggest purchaser of goods and services in the world.
• Institutional Markets: Nonprofit organizations.
• Buying Centers: Groups of people within organizations who make purchasing decisions.
• Initiators: People within the organization who first see the need for the product.
• Users: The people who actually use the product.
• Influencers: May or may not use the product but have experience that can help improve the buying decision.
• Gatekeepers: People who will decide if and when you get access to members of the buying center.
• Deciders: Makes the final purchasing decision.
• Stages in the B2B Buying process:

  1. A need is recognized
  2. The need is described and quantified
  3. Potential suppliers are searched for
  4. Qualified suppliers are asked to complete responses to requests for proposal
  5. The proposals are evaluated and suppliers selected
  6. An order routine is established
  7. A post-purchase evaluation is conducted and the feedback is provided to vendor
• New Buyer: Purchases product for first time.
• Modified Rebuy: Wants change in original buy.
• Straight Rebuy: Buys same product as usual.
• Ethical Marketing:

  1. Empathy
  2. Honesty
  3. Transparency
  4. Promise-keeping
  5. Sustainability
• Sell-side site: When a company sets up a website in order to sell products from many different buyers
• Buy-side Site: When a company sets up a website on which it can purchase from multiple sellers that go to that site to do business with that company