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CHAPTER 19
ORGANIZATIONAL BUYER BEHAVIOR
LEARNING OBJECTIVES
LO1: Describe the organizational purchase process
LO2: Summarize the external factors that influence organizational culture
LO3: Summarize the internal factors that influence organizational culture
LO4: Explain the influence of organizational buyer segments on marketing strategy
SUMMARY
LO1: Describe the organizational purchase process
Like households, organizations make many buying decisions. In some instances, these buying
decisions are routine replacement decisions; at other times, they involve new, complex purchase
decisions. Three purchase situations are common to organizational buying: straight rebuy, modified
rebuy, and new task. Each of these purchase situations will elicit different organizational behaviors.
LO2: Summarize the external factors that influence organizational culture
Organizations have a style or manner of operating that we characterize as organizational culture.
Firmo-graphics (organization characteristics such as size, activities, objectives, location, and industry
category, and characteristics of the composition of the organization such as the gender, age, education,
LO3: Summarize the internal factors that influence organizational culture
Internal factors affecting organizational culture include organizational values, perception, learning,
LO4: Explain the influence of organizational buyer segments on marketing strategy
Each of the factors discussed in this chapter is important for marketing strategy because each
contributes to the type of buyer that an organization faces. One important way to segment
LECTURE TIPS AND AIDS
1) A good way to begin this chapter is to have students discuss the organizational similarities and
differences between two distinctly different organizations such as the Red Cross and IBM. After
2) For a high-involvement purchase such as a new car, have students describe how a household
might make that decision. Then discuss how a commercial firm would make the same car
purchase decision for a company car to be driven by a salesperson. Then discuss the similarities
and differences in each decision process and purchase environment.
4) Have students discuss how households and organizations might differ in their postpurchase
analysis of an important purchase decision.
REVIEW QUESTIONS
1) How can an organization have a culture? What factors contribute to different organizational
cultures?
Organizations have a type of self-concept in the beliefs and attitudes the organization members
have about the organization and how it operates. Likewise, organizations have a type of lifestyle in
2) How would different organizational activities and objectives affect organizational culture?
The activities and objectives of organizations influence their style and behavior. However, we
cannot assume two organizations have the same organizational culture just because they share
3) What are organizational values? How do they differ from personal values?
Organizations have values with respect to risk taking, competition, hard work, problem solving,
4) What are firmographics, and how do they influence organizational culture?
This refers to the size, location, industry category, type of ownership, and employee demographics
5) Define macrosegmentation, and describe the variables used to create a macrosegmentation of an
organizational market.
Organizations with distinguishing firmographics can be grouped into market segments. These
segments, based on differences in needs due to firmographics are called macrosegments.
6) What types of reference groups exist in organizational markets?
7) What are lead users, and how do they influence word-of-mouth communication and the sales of a
new product?
8) What is a decision-making unit? How does it vary by purchase situation?
A group of individuals assigned the task of participating in an organizational decision. The size
9) How can a seller organization influence perceptions of a buyer organization?
The stages of exposure, attention, and interpretation are the same whether for organizations,
10) What are organizational motives?
Organizations have motives such as profit, security, and effectiveness. Likewise, individuals have
11) What is a two-stage decision process?
A two-stage decision process involves two discrete stages of decision making. The first stage uses
12) What is the distinction between relational and transactional exchanges?
Transactional exchanges involve single transactions, are short lived, involve few investments by
13) What are the three purchase situations commonly encountered by organizations? How do
organizations typically respond to each situation?
Straight Rebuy: This situation occurs when the purchase is of minor importance and is not
14) In what ways does the Internet play a role in the organizational decision process?
Just as the Internet has become a major force in consumer decisions, so too is it an important tool
Discussion Questions
15) Describe three organizations with distinctly different organizational cultures. Explain why they
have different organizational cultures and the factors that have helped shape the style of each.
a. The EPA is a government organization with a technical activity. The combination of these two
characteristics contributes to a unique set of objectives, activities, and organizational style.
16) Respond to the questions in Consumer Insight 19-1.
Customers are more valuable as they are more loyal and as they are lower cost to serve. Such
customers are termed “most valuable customers” for a reason – they generate the most profits and
they are likely to engage in positive WOM. This doesn’t mean they aren’t demanding, only that
they are worth the effort to satisfy.
17) Describe how Hewlett-Packard might vary in its organizational culture from the following. Justify
your response.
a) Dell Computer
18) Discuss how the following pairs differ from each other in terms of organizational activities and
objectives. Discuss how these differences influence organizational cultures.
a) Wal-mart, Target
c) Buy.com, Banana Republic
19) What role does brand/brand image play in the organizational decision process?
20) Discuss how Acer might use a macrosegmentation strategy to sell computers to businesses.
21) Discuss how a small bio-technology firm could influence the reference group infrastructure and the
lead users to accelerate adoption of its products in the market.
By placing information and making contacts with all members of the infrastructure, a firm can greatly
22) “Industrial purchases, unlike consumer purchases, do not have an emotional component.” Comment.
Most will quickly agree that organizations are simply collections of people, and because people have
23) For each of the three purchase situations described in the chapter (Table 19-2), describe a typical
purchase for the following:
a) Wendy’s
