The Buying Center

Webster and Wind call the decision-making unit of a buying organization the buying center. The buying center is composed of "all those individuals and groups who participate in the purchasing decision-making process, who share some common goals and the risks arising from the decisions."9 The buying center includes organizational members who play any of seven roles in the purchase decision process:10

^ Initiators: People who request that something be purchased, including users or others.

^ Users: Those who will use the product or service; often, users initiate the buying proposal and help define product requirements.

^ Influencers: People who influence the buying decision, including technical personnel. They often help define specifications and also provide information for evaluating alternatives.

^ Deciders: Those who decide on product requirements or on suppliers.

^ Approvers: People who authorize the proposed actions of deciders or buyers.

^ Buyers: People who have formal authority to select the supplier and arrange the purchase terms, including high-level managers. Buyers may help shape product specifications, but their major role is selecting vendors and negotiating.

^ Gatekeepers: People who have the power to prevent sellers or information from reaching members of the buying center; examples are purchasing agents, receptionists, and telephone operators.

There is also a trend toward team-based buying. In one survey, 87 percent of the purchasing executives at Fortune 1000 companies see more use of teams drawn from different departments and functions to make buying decisions.11 This trend is leading to more team selling, as shown in the earlier Cutler-Hammer example.

To target their efforts properly, business marketers have to figure out: Who are the major decision participants? What decisions do they influence? What is their level of influence? What evaluation criteria do they use? When a buying center includes many participants, the business marketer will not have the time or resources to reach all of them. Small sellers concentrate on reaching the key buying influencers. Larger sellers go for multilevel in-depth selling to reach as many buying-center participants as possible. Their salespeople virtually "live" with their high-volume customers. In general, the most successful companies rely more heavily on communications to reach hidden buying influences and keep their current customers sold.12

Furthermore, the buying center can be highly dynamic, so business marketers need to periodically review their assumptions about who is participating. For years, Kodak sold X-ray film to hospital lab technicians, not noticing that buying decisions were increasingly being made by professional administrators. As sales declined, Kodak was finally forced to revise its market targeting strategy.

Was this article helpful?

0 0
Advertising With Circulars

Advertising With Circulars

Co-op Mailing means that two or more businesses share in the cost and distribution of a direct mail campaign. It's kind of like having you and another non-competing business split the cost of printing, assembling and mailing an advertising flyer to a shared same market base.

Get My Free Ebook

Post a comment