GROUP 9 – Organizational Markets  External Search: It is by soliciting

proposals from known suppliers

Mary Denise N. Bontogon and Christine Joy S.
or through public notice.
Rosales
4. PROPOSAL EVALUATION
ORGANIZATIONAL MARKETS  Proposals are invited from suppliers.
The proposals are evaluated to
Are markets in which companies and individuals
determine whether the products
purchase goods for purposes other than personal
meet performance specifications.
consumption. Their marketing is focused on
5. PURCHASE DECISION
corporate goals, return on investment and technical
 The supplier is selected.
suitability, rather than the styles, fads and
Negotiations are made. An order is
perceived values found in consumer markets. The
placed.
main organizational market types are producers,
6. POST-PURCHASE BEHAVIOR
resellers and institutions.
 The performance of product and
WHAT ARE THE TYPES OF ORGANIZATIONAL supplier is evaluated at this stage.
MARKET? Actual performance is compared
with specifications.
1. PRODUCERS - Producers have a long-term
view of markets since their needs change WHAT ARE THE TYPES OF ORGANIZATIONAL
slowly. As a result, marketing to producers BUYING DECISIONS?
is usually based on long-term relationships.
1. NEW TASK - It involves the purchase of
2. INDUSTRIES - Industries are business
products or services that the organization
organizations that purchase goods and
has never bought before, or has not
services for the purpose of producing other
purchased for a long period of time.
products and services or for use in their
2. STRAIGHT REBUY - Pertains to
production and operating processes.
organizational purchases which have
3. RESELLERS - Include wholesale
exactly the same specifications as
companies and retailers, as well as niche
previously purchased.
suppliers that specialize in particular areas
3. MODIFIED REBUY
where they have expertise. The key factor
- This can be a rebuy with some change in
for marketing to resellers is to be aware of
specification.
their added-value proposition.
- Provide competitors with a rare opportunity
4. INSTITUTIONAL - Includes governments
to cut into other suppliers’ supply contacts.
and non-profits. Marketing to these
organizations is highly specialized, with THREE TYPES OF ORGANIZATIONAL
marketers relying on long-term relationships MARKETS (ACCDG. IN THE BOOK)
as well as large, one-time opportunities.
1. Industries – are business organizations that
ORGANIZATIONAL BUYING DECISION purchase goods and services for the
purpose of producing other products and
1. NEED RECOGNITION
services or for the use in their production

The buying process starts when and operating processes.
individuals recognize a problem or 2. Resellers – are entities that buy goods and
need. services in order to resell them at a profit
2. PRODUCT SPECIFICATION (most commonly distributors, wholesalers,
 This stage involves development of and retailers).
product performance specifications 3. Government – comprise of government
to solve the problem. agencies or units at all levels that purchase
 goods and services for the purpose of
3. SUPPLIER SEARCH producing public services or to transfer
 Possible suppliers for the product them to third parties that need them.
are searched and located at this
stage. Suppliers are identified
through:
 Internal Search: The sources can
be company files, catalogs,
market information system and
purchase department, etc.
 GROUP 10 – Organizational Buying Roles
Organizational Segmentation Variable
by: Charez E. Natal and Justine Kaye S. Delos
Reyes
Organizational Buying Roles
The buying center has three principal aspects:
composition: the size, hierarchical levels and
functional areas involved;
influence: those individuals with the most
influence in the buying process;
roles: the identification of different roles played
by buying center members
A buying center includes all members of the
purchasing organization who play any of six
roles in the purchase process:
1. INITIATOR – first identifies the need to
buy a particular product or service to
solve an organizational problem
2. INFLUENCER – influence (their) views
in the buying center's buyers and
deciders
3. DECIDER – ultimately approves all or
any part of the entire buying decision
whether to buy, what to buy, how to buy,
and where to buy
4. BUYER – holds the formal authority to
select the supplier and to arrange terms
of condition
5. USER – consumes or uses the product
or service
6. GATEKEEPER – controls information or
access or both, to decision makers and
influencers.
The model structured industrial buying
processes that are characterized by the
following:
 multi- person involvement levels
 extensive internal and external
coordination effort
 long lead times
Isolating the important player involves:
1. Isolate the personal stakeholders
2. Follow the information flow
3. Identify the experts
4. Trace the connections to the top
5. Understand the role of the purchasing
department
ORGANIZATIONAL MARKET
SEGMENTATION
Factors that would be analyses at this level
would be:
1. Industry sector
2. Size of the organization
3. Geographic location
4. End use application
Organizational markets can also be segmented
according to the characteristics of the decision-
making unit; this is sometimes called micro
segmentation
1. The structure of the decision-making unit:
2. The decision-making process:
3. Structure of the buying function:
4. Attitude towards innovation:
5. Key criteria used in reaching decision on a
purchase:
6. Personal characteristics of decision makers:
A more systematic method of organizational
market segmentation has been developed
called the nested approach.
This method moves through layers of
segmentation variables, starting with the
demographics of the organization (the macro
level) down through increasingly sophisticated
levels, reaching the complex areas of
situational factors and personal characteristics.
This approach effectively establishes a
hierarchical structure in which to undertake the
segmentation process.
There is a balance to be struck with this
approach between the macro level, which is
generally inadequate when used in isolation,
and the micro level, which may be too time-
consuming and expensive to establish and
operate in markets with limited potential.