ANALYSING BUSINESS MARKETS

ORGANISATIONAL BUYING PROCESS

INSTITUTIONAL AND GOVERNMENT MARKETS
COMPETITVE STRATEGIES
 INTRODUCTION

Decision making process by which formal

organization establish the need for purchased
production and services and identify, evaluate and
choose alternative suppliers.
Features:
Heavily Influenced by derived demand.
Thorough and deep analysis
Consumer Demand in turn be impacted by external
forces i.e economic, social, political and
technological factors.
 PROCESS : STEP BY STEP

STEP 1 : PROBLEM RECOGNITION

STEP 2: GENERAL NEED DESCRIPTION
STEP 3: PRODUCT SPECIFICATION
STEP 4: VALUE ANALYSIS
STEP 5: SUPPLIER SEARCH
STEP 6: PROPOSAL SOLICITATION
STEP 7: SUPPLIER SELECTION
STEP 7: ORDER – ROUTINE SPECIFICATION
STEP 8 : PERFORMANCE REVIEW
PROBLEM RECOGNITION: The first stage of the
business buying process in which someone in the
company recognizes a problem or need that can be met
by acquiring a good or a service.
 GENERAL NEED DESCRIPTION: At this stage of
business buying Process Company describes the general
characteristics and quantity of a needed item.
PRODUCT SPECIFICATION: At this stage of the
business buying process buying organization decide on
the product and specifies the best technical product
characteristics for a needed item.
VALUE ANALYSIS: An approach to cost reduction, in
which components are studied carefully to determine if
they can be redesigned, standardized or made by less costly
methods of production.
SUPPLIER SEARCH: At this stage of organizational
buying process, the buyer searches or identify possible
potential suppliers who can supply goods and services
according to their committed product specifications.
Regular products are purchase from regular suppliers
but if the goods to be bought are new, complicated, and
costly, it needs long time to search suppliers.
PROBLEM SOLICITATION : In this stage the buyer invites
qualified suppliers to submit proposal from public media. If the
product is costly and complicated, the buyer demands detailed
proposal and if the product is technical, business organization calls for
presenting the product itself. It should meet all the required technical
specification.
SUPPLIER SELECTION: The organizational buyer evaluates the
proposal and selects the most reliable and capable supplier who can
supply products to the organization according to the requirement.
While evaluating process they can adopt several criteria such as the
past performance of the suppliers, regularity, punctuality, product
quality and quantity, goodwill, price, terms and conditions of delivery
of goods, relationship with the buyers, business efficiency and services
etc.
 ORDER – ROUTINE SPECIFICATION: The stage of the
business buying process in which the buyer writes the final order
with the chosen suppliers, listing the technical specifications,
quantity needed, expected time of delivery, return policies and
warranties.
 PERFORMANCE REVIEW: The stage of the business
buying process in which the buyer rates its satisfaction with
suppliers, deciding whether to continue, modifies or drops them.
Two types of market:

• Institutional markets

• Government markets
 INSTITUTIONAL MARKETS

Schools, colleges, hospitals, nursing home, prisons and other

organizations that provide goods and services to people in their care are
commonly known as institutional markets. This institution differs from
one another. Because they all have different motive and goals.
EXAMPLES:
Hospital patients have little choice but to eat whatever food the hospital
supplies. A hospital-purchasing agent has to decide on the quality of
food to buy for patients. Because the food is provided as a part of a total
service package, the buying objective is not profit. Nor is strict cost
minimization the goal—patients receiving poor quality food will
complain to others and damage the hospital's reputation. Thus, the
hospital purchasing agent must search for institutional-food vendors
whose quality meets or exceeds a certain minimum standard and whose
prices are low. Many marketers set up separate divisions to meet the
special characteristics and needs of institutional buyers.
 GOVERNMENT MARKETS

 The government market offers large opportunities for many companies,

both big and small. In most countries, government organizations are
major buyers of goods and services. Government buying and business
buying are similar in many ways.

 In this market, sellers are the key decision makers. Only sellers can
easily identify the factors that affect buyer behavior and their buying
decision process. Government market doesn’t need suppliers but the
government selects those types of suppliers to have the lowest bids.
Sometimes, the government makes some allowances for the suppliers
having a reputation and superior quality. The government also buy on
the negotiation contract basis.
 GOVERNMENT RELATIONSHIP
MANAGEMENT

Government Relationship Management (GRM) group to cater to the

banking and advisory requirements of the Central Government, State
Governments, Central & State Public Sector Undertakings, Boards and
other affiliates.
EXAMPLE :YES BANK has institutionalized a specialized Government
Relationship Management (GRM) group.
Government Relationship Management at YES BANK, over the past 7.5
years, has built robust relationships with more than 500 entities across
the length and breadth of the country.
 IDENTIFICATION OF COMPETITORS

Competitors are 2 types:

1. Direct Competitors
2. Indirect Competitors
For identifying direct competitors:
 Market Research
 Customer Feedback
 Check Online communities on social media
IDENTIFICATION OF COMPETITORS

For identifying indirect competitors:

 Keyword Research
 Analyzing Google’s Search Engine Results Page
 Take a Look at Paid Data
 COMPETITORS ANALYSIS

Competitor analysis is the process of evaluating your

competitors’ companies products and marketing
strategies.
This analysis will be helpful for entrepreneurs,
business owners, startup founders, product
managers and marketers.
The competitors you pick for the analysis determine
the decisions you will make.
 COMPETITIVE STRATEGIES

It refers to how a company competes in a particular

industry and seeks to gain a competitive advantages
over its rivals.
This strategy is focused to achieve above average
position and generate a superior Return on
Investment (ROI). This strategy is very important
when firms having a competitive marketplace and
several similar products available for consumers.
 COMPETITIVE ANALYSIS IN BANKING
INDUSTRY

Define your goals and objectives: By defining your goals and objectives,
you can focus your competitive analysis efforts and be more mindful of the data you are
going to collect, analyze, and act on.
Know your market: To define the market by population demographics: average
age, income brackets, educational attainment. Once you collect this data, list down which
banks and institutions in your identified market provide competing services.
Measure your reputation: To measure your reputation, take a look at user-
generated data like online reviews, social media comments, and customer feedback. 
Talk to your customers
Compare competitor content(Content includes; blog posts, social
media posts, visual media etc. )
Keep an eye on the future: By conducting banking industry competitive
analysis and monitoring your competition on an ongoing basis, you’ll get to understand
your competitors’ behavior, enabling you to anticipate their actions and stay one step
ahead.