There are three major types of buying situations.5 In a straight rebuy, the buyer reorders something without any modifications. It is usually handled on a routine basis by the purchasing department. To keep the business, “in” suppliers try to maintain customer engagement and product and service quality. “Out” suppliers try to find new ways to add value or exploit dissatisfaction so that the buyer will consider them.

In a modified rebuy, the buyer wants to modify product specifications, prices, terms, or suppliers. The “in” suppliers may become nervous and feel pressured to put their best foot forward to protect an account. “Out” suppliers may see the modified rebuy situation as an opportunity to make a better offer and gain new business.

A company buying a product or service for the first time faces a new task situation. In such cases, the greater the cost or risk, the larger the number of decision participants and the greater the company’s efforts to collect information. The new task situation is the marketer’s greatest opportunity and challenge. The marketer not only tries to reach as many key buying influences as possible but also provides help and information. The buyer makes the fewest decisions in the straight rebuy and the most in the new task decision.

Many business buyers prefer to buy a complete solution to a problem from a single seller rather than buying separate products and services from several suppliers and putting them together. The sale often goes to the firm that engages business customers deeply and provides the most complete system for meeting a customer’s needs and solving its problems. Such systems selling (or solutions ­selling) is often a key business marketing strategy for winning and holding accounts. Consider IBM and its customer Six Flags Entertainment Corporation:6

Six Flags operates 19 regional theme parks across North America featuring exciting rides and water attractions, world-class roller coasters, and special shows and concerts. To deliver a fun and safe experience for guests, Six Flags must carefully and effectively manage thousands of park assets—from rides and equipment to buildings and other facilities. Six Flags needed a tool for managing all those assets efficiently and effectively across its far-flung collection of parks. So it turned to IBM, which has software—called Maximo Asset Management software—that handles that very problem well.

But IBM didn’t just hand the software over to Six Flags with best wishes for happy implementation. Instead, IBM’s Maximo Professional Services group combined the software with an entire set of services designed to get and keep the software up and running. IBM worked hand in hand with Six Flags to customize the application and strategically implement and run it across Six Flags’s far-flung facilities, along with on-site immersion training and planning workshops. Thus, IBM isn’t just selling the software; it’s selling a complete solution to Six Flags’s complex asset management problem.

Who does the buying of the trillions of dollars’ worth of goods and services needed by business organizations? The decision-making unit of a buying organization is called its buying center. It consists of all the individuals and units that play a role in the business purchase decision-making process. This group includes the actual users of the product or service, those who make the buying decision, those who influence the buying decision, those who do the actual buying, and those who control buying information.

The buying center includes all members of the organization who play any of five roles in the purchase decision process.7

• Users are members of the organization who will use the product or service. In many cases, users initiate the buying proposal and help define product specifications.

• Influencers often help define specifications and also provide information for evaluating alternatives. Technical personnel are particularly important influencers.

• Buyers have formal authority to select the supplier and arrange terms of purchase. Buyers may help shape product specifications, but their major role is in selecting vendors and negotiating. In more complex purchases, buyers might include high-level officers participating in the negotiations.

• Deciders have formal or informal power to select or approve the final suppliers. In routine buying, the buyers are often the deciders, or at least the approvers.

• Gatekeepers control the flow of information to others. For example, purchasing agents often have authority to prevent salespersons from seeing users or deciders. Other gatekeepers include technical personnel and even personal secretaries.

The buying center is not a fixed and formally identified unit within the buying organization. It is a set of buying roles assumed by different people for different purchases. Within the organization, the size and makeup of the buying center will vary for different products and for different buying situations. For some routine purchases, one person—say, a purchasing agent—may assume all the buying center roles and serve as the only person involved in the buying decision. For more complex purchases in large companies, the buying center may include 20, 30, or even more people from different levels and departments in the organization.8

The buying center concept presents a major marketing challenge. The business marketer must learn who participates in the decision, each participant’s relative influence, and what evaluation criteria each decision participant uses. This can be difficult.

The buying center usually includes some obvious participants who are involved formally in the buying decision. For example, the decision to buy a corporate jet will probably involve the company’s CEO, the chief pilot, a purchasing agent, some legal staff, a member of top management, and others formally charged with the buying decision. It may also involve less obvious, informal participants, some of whom may actually make or strongly affect the buying decision. Sometimes, even the people in the buying center are not aware of all the buying participants. For example, the decision about which corporate jet to buy may actually be made by a corporate board member who has an interest in flying and who knows a lot about airplanes. This board member may work behind the scenes to sway the decision. Many business buying decisions result from the complex interactions of ever-changing buying center participants.

Business buyers are subject to many influences when they make their buying decisions. Some marketers assume that the major influences are economic. They think buyers will favor the supplier who offers the lowest price or the best product or the most service. They concentrate on offering strong economic benefits to buyers. Such economic factors are very important to most buyers, especially in a tough economy. However, business buyers actually respond to both economic and personal factors. Far from being cold, calculating, and impersonal, business buyers are human and social as well. They react to both reason and emotion.

Today, most B-to-B marketers recognize that emotion plays an important role in business buying ­decisions. Consider this example:9

USG Corporation is a leading manufacturer of gypsum wallboard and other building materials for the construction and remodeling industries. Given its construction contractor, architect, and builder audience, you might expect USG’s B-to-B ads to focus heavily on performance features and benefits, such as strength, impact resistance, ease of installation, and costs. USG does promote these benefits. However, its most recent corporate marketing campaign, built around its new “It’s Your World. Build It.” positioning, packs a decidedly more emotional wallop. The campaign focuses not on how USG’s products perform but on what the company and its products stand for and mean. For example, one split-image ad shows excited children building a sand castle on one side and a worker at a construction site, hard hat in hand, on the other. The headline states: “As children we imagine great kingdoms. Build them.” As one analyst concludes, “Building materials and emotion aren’t something you would link immediately, but the [USG] campaign captures a powerful sentiment about the human need to build.”

Figure 6.2 lists various groups of influences on business buyers—­environmental, organizational, interpersonal, and individual. Business buyers are heavily influenced by factors in the current and expected economic environment, such as the level of primary ­demand, the economic outlook, and the cost of money. Another environmental factor is the supply of key materials. Business buyers also are affected by technological, political, and competitive developments in the environment. Finally, culture and customs can strongly influence business buyer reactions to the marketer’s behavior and strategies, especially in the international marketing environment (see Real Marketing 6.1). The business buyer must watch these factors, determine how they will affect the buyer, and try to turn these challenges into opportunities.

Figure 6.2

A Model of Business Buyer Behavior

Organizational factors are also important. Each buying organization has its own objectives, strategies, structure, systems, and procedures, and the business marketer must understand these factors well. Questions such as these arise: How many people are involved in the buying decision? Who are they? What are their evaluative criteria? What are the company’s policies and limits on its buyers?

The buying center usually includes many participants who influence each other, so interpersonal factors also influence the business buying process. However, it is often difficult to assess such interpersonal factors and group dynamics. Buying center participants do not wear tags that label them as “key decision maker” or “not influential.” Nor do buying center participants with the highest rank always have the most influence. Participants may influence the buying decision because they control rewards and punishments, are well liked, have special expertise, or have a special relationship with other important participants. Interpersonal factors are often very subtle. Whenever possible, business marketers must try to understand these factors and design strategies that take them into account.

Each participant in the business buying decision process brings in personal motives, perceptions, and preferences. These individual factors are affected by personal characteristics such as age, income, education, professional identification, personality, and attitudes toward risk. Also, buyers have different buying styles. Some may be technical types who make in-depth analyses of competitive proposals before choosing a supplier. Other buyers may be intuitive negotiators who are adept at pitting the sellers against one another for the best deal.