BUAD301 Midterm: BUAD301 Exam 2 Study Guide

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Business Administration

I. Chapter 6 – Business and Organizational Customers and Their Buying Behavior 1) Business and Organizational Customers- any buyers who buy for resale or to produce others goods and services a) Types i) Producers of goods and services ii) Intermediaries- wholesalers and retailers iii) Government units iv) Nonprofit organizations b) Referred to as the business to business market c) Fewer buyers but dollars spent on average are greater d) Members of the buying center(people who participate in the purchase) want good relationships with their suppliers e) Purchasing managers- buying specialists for their employers f) Multiple buying influence- means that several people—perhaps even top management—play a part in making a purchase decision. i) Users- production line workers on their supervisors ii) Influencers- engineers who help write specifications or supply information for evaluating alternatives iii) Buyers- purchasing managers who have the responsibility for working with suppliers and arranging the terms of sale iv) Deciders- people who have the power to select or approve the supplier for large purchases v) Gatekeepers- people who control the flow of information within an organization g) Requisition- request to buy something 2) Model of Business and Organizational Buying a) Step 1: Define the Problem i) Problem recognition ii) Describing the need iii) Specifying the product (1) Purchasing Specifications- a written description of what the firm wants to buy iv) ISO 9000-way for a supplier to document its quality procedures according to internationally recognized standards b) Step 2:The Buying Process i) Establishes a buying process (1) New-task buying- occurs when a customer organization has a new need and wants a great deal of information (2) Straight rebuy- routine repurchase that may have been made a few times before (3) Modified rebuy- in-between where some review of the process is done ii) Gather information (1) Search engine (2) Buyers want sites with useful content (3) Buyers use recommendations iii) Solicit proposals from suppliers (1) Can be a brochure, catalog, or over the phone conversation iv) Buyers ask for competitive bids to compare offerings v) Evaluate and Select Supplier (1) Vendor analysis- a formal rating of suppliers on all relevant areas of performance not just the lowest price c) Step 3:Managing Buyer-Seller Relationships in Business Markets i) Just-in-time delivery- sometimes it’s better if a supplier gives the buyer what they need just before the customer needs it instead of having a lot of inventory ii) Negotiated contract buying- means agreeing to contracts that allow for changes in the purchase arrangements iii) Outsource- contract with an outside firm to produce goods or services rather than to produce them internally 3) Manufacturers Are Important Customers a) Few manufacturers b) Concentration in big metropolitan areas c) North American Industry Classification System codes- groups of firms in similar lines of business 4) Producers of Services—Smaller and More Spread Out a) Many firms but the firms are very small b) Buying is informal c) Online buying or e-commerce is popular II. Chapter 7 – Improving Decisions with Marketing Information 1) Effective Marketing Requires Good Information/ Changes are Underway a) Marketing Research- procedures that develop and analyze new information about a market b) Marketing Information System- to avoid one-at-a-time marketing research projects, they use this organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions i) Makes information available and accessible ii) Big Data- data sets too large and complex to work with typical database management tools (1) Organizes this data into a data warehouse- a place where databases are stored so that they are available when needed iii) Converts this data into useful information for managers (1) Answers the who what where how much and when (2) It becomes knowledge when the manager answers how and why iv) Intranet- a system for linking computers within a company v) Decision support system (DSS)-a computer program that helps make it easy for a marketing manager to obtain and use information (1) Marketing dashboard- displays up-to-the-minute marketing data in an easy-to-read format (2) Marketing model- a statement of relationships among marketing variables. It allows managers to look at the sales (and costs) expected with different types of promotion and select the marketing mix that is best for a particular target market vi) Some companies don’t push for MIS because of cost 2) The Scientific Method to Marketing Research a) Marketing research process i) Step 1: Defining the Problem (1) Narrow down research objectives ii) Step 2: Analyzing the Situation (1) Situation analysis- an informal study of what information is already available in the problem area (a) Should find relevant secondary data (i) Sometimes MIS will already have some of this information (2) Research proposal—a plan that specifies what information will be obtained and how—to be sure no misunderstandings occur later iii) Step 3: Getting Problem-Specific Data (1) Questioning (a) Qualitative Research- seeks in-depth, open-ended responses, not yet or no answers. (i) Non-directive interviews- where an interviewer asks questions that stimulate in depth answers (ii) Focus group interview (b) Quantitative Research- which seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics (i) Survey Questionnaires 1. Mail and online surveys are common and convenient 2. Response rate- low and respondents may not be representative 3. Telephone Surveys- fast and effective 4. Personal interview surveys- can be in-depth (c) Market research online community- an online group of participants who are joined together by a common interest and who participate in ongoing research. Combines qualitative and quantitative approaches. (d) Observing- focuses on a well-defined problem 1. Ethnographic research- studying someone in their own environment 2. Common in advertising research 3. Observing website visitors 4. Check out scanners a. Customer panels- a group of customers who provide information on continuing basis (e) Experimental method- researchers compare the response of two (or more) groups that are similar except on the characteristic being tested. iv) Step 4: Interpreting the Data (1) Statistical packages- easy-to-use computer programs that analyze data (2) Population- the total group they are interested in (3) Sample- a part of the relevant population (4) Confidence intervals- the range on either of an estimate that is likely to contain the true value for the whole population (5) Validity- concerns the extent to which data measure what they are intended to measure v) Step 5: Solving the problem vi) III. Chapter 8 – Elements of Product Planning for Goods and Services 1) What Is a Product? a. Product- the need-satisfying offering of a firm. b. Quality- a product’s ability to satisfy a customer’s needs or requirements. i. Relative quality- used when comparing to competitors 2) Whole Product Lines Must Be Developed Too a. Product Assortment- the set of all product lines and individual products that a firm sells. b. Product line- set of individual products that are closely related. c. Individual product- a particular product within a product line 3) Branding Is a Strategy Decision a. Branding-the use of a name, term, symbol, or design—or combinatio
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