Composition of the buying center
The buying center refers to groups of individuals charged with the responsibility of handling the process of making purchase decisions. Members within the process vary depending on the organization represented. The composition and resulting roles of a buying center entail the following; Initiator known to be high-level management, gatekeeper controlling the flow of information, an influencer can either be internal or external and then there are the user and decision-maker endowed with the responsibility of making a final decision by controlling product requirements and finally the buyer (Hutt et al., 2002).
Purchasing Process comprises of eight different stages thus; recognition stage, general need description, product specification involving value analysis, search and evaluation of various suppliers, the fifth stage involves the submission of proposals, then selection of most desirable suppliers based on reliability, negotiation stage then finally performance review process.
The composition of the buying center varies from one firm to another depending on several factors i.e., several individuals occupying given roles another situation is where people outside the organization becoming part of the buying center, such as consultants. Then there is also a situation where different members from the same buying center have different targets and influences (Hutt et al., 2002).
Steps were taken by a salesperson in identifying influential members from the buying center
Identification of the influential members from the buying center is a very important aspect since it plays a significant role in selling. The salesperson requires a plan having important steps such as; finding important buyers, qualifying the prospective buyers, and finally finding the leads. The first step in finding the right prospects involves the use of referrals, networking, trading leads, using lists, using business and trade directories, calling customers through telephone, direct mail amongst other methods. The second step on qualifying prospects demands answers to the questions; who? Where? Why? Finally, the third step involves getting leads meaning the people to interact with regularly (Hutt et al., 2002).
Explanation of derived demand about B2B companies
Derived demand could be explained by an example from steel cord company and motor tiers company, where a major increase in the price of steel cord in radial tires will not reduce the demand for tires by a motor manufacturer though may result in searching for substitute materials. In another scenario, the demand for steel used in cars is based largely on the sales of cars and trucks each year. When there is a drop in the demand for cars because of the recession, there is a resultant drop in demand for steel.
Derived demand exists for services as well. There is also the case of silicon dioxide, where the demand for Personal Computers and related products is the only situation able to create the demand for silicon dioxide (Hutt et al., 2002).
Dow Corning target market example, the segmentation, and marketing mix approach used
The company has for the past years developed new silicon-based products enhancing their products using value-added services and at the same time utilizing end business customers. The target market is comprised of knowledgeable, maturing consumers familiar with older product technologies. This required the company to lower its prices and, at the same time, innovating new technologies to remain competitive and relevant to the market.
The company utilized the needs-based segmentation process to reach consumers. The primary segment was characterized by low pricing, reliability in quality, and constant supply. The new product offering was followed by a new branding system to eliminate any cases of confusion amongst customers. Then the positioning of the brand was ensured through the creation of relevant differentiation, which made a direct connection with the consumer’s needs and at the same time relationship with consumer base reinforced through lower pricing (Hutt et al., 2002).
Reference
Hutt, M. D. & Thomas, W. S. (2002). Business Marketing Management: B2B (10th Edition), South-Western, Thomson Learning.