Chapter 7: Organizational Buyer Behavior
Chapter Objectives
1. Understand the organizational buying process.
3. Identify the major influences on organizational buyers.
5. Identify and describe the group markets in the hospitality industry.
Teaching Suggestions
The following explanations and suggestions are outlined based on the Chapter Objectives.
1. Understand the organizational buying process.
Compared with consumer purchases, a business purchase usually involves more buyers
2. Identify and discuss the importance of the participants in the organizational buying
process.
The decision-making unit of a buying organization, sometimes called the buying center,
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making process, who share common goals and the risks arising from the decisions. Six
participants in the purchase decision process: users, influencers, deciders, approvers,
buyers, gatekeepers.
Assign your students different types of organizational events in your market area and ask
them to research these events and analyze the participants in the purchase decision
process. Ask them to answer the following questions:
3. Identify the major influences on organizational buyers.
Organizational buyers are subject to many influences as they make their buying
4. List the eight stages of the organizational buying process.
Problem recognition, general need description, product specification, supplier search,
5. Identify and describe the group markets in the hospitality industry.
The group business market is often more sophisticated and requires more technical
Chapter Outline
I. The Nature of Organizational Buyers. Their purchases often involve large sums of
money; complex technical, economic considerations; and interactions among many
people at all levels of the organization. Buyer and seller are often very dependent on each
other. [Slide 7-3]
II. Participants in the Organizational Buying Process [Slide 7-4]
A. Users. Users are those who use the product or service.
B. Influencers. Influencers directly influence the buying decision but do not
themselves make the final decision.
C. Deciders. Deciders select product requirements and suppliers.
D. Approvers. Approvers authorize the proposed actions of deciders or buyers.
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III. Major Influences on Organizational Buyers [Slide 7-5]
A. Environmental factors. Organizational buyers are heavily influenced by the
current and expected economic environment.
B. Organizational factors. Each organization has specific objectives, policies,
procedures, organizational structures, and systems related to buying.
IV. The Organizational Buying Process [Slide 7-6]
A. Problem recognition. The buying process begins when someone in the company
recognizes a problem or need that can be met by acquiring a good or a service.
B. General needs description. The buyer goes on to determine the requirements of
the product.
V. Group Markets [Slide 7-7]
A. Conventions. Conventions are usually the annual meeting of an association and
include general sessions, committee meetings, and special-interest sessions. A
trade show is often an important part of an annual convention.
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B. Association meetings. Associations sponsor many types of meetings, including
regional, special-interest, educational, and board meetings.
VI. Dealing with Meeting Planners. When negotiating with meeting planners, it is important
to try to develop a win-win relationship. Meeting planners like to return to the same
property.
VII. The Corporate Account and Travel Manager. A nongroup form of organizational business
Answers to Discussion Questions
1. What is derived demand? Give an example of derived demand for a hotel in your
town.
Derived demand means that the demand for hospitality and travel products from
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2. The buying center consists of six roles. Why is it important for marketers to
understand these roles?
Marketers have to be able to successfully communicate with and service all of the buying
3. Discuss the major environmental influences that affect the purchase meeting space
by IBM (or another corporation of your choice) for its sales meetings.
This is a great topic for class discussion. Organizations such as IBM are heavily
influenced by the current and expected environmental influences. Leaders at IBM will be
aware of the environmental influences and adjust their purchase of hospitality and travel
4. How would a catering sales manager handle a mother and daughter making
major corporation wishing to get a quote on a regional sales meeting, which he or
she has already done in five other cities?
This is also a good topic for class discussion. During the discussion, analyze the
similarities and differences in the sales approach for each of these customers. For
example, the mother and daughter planning the wedding most likely never have done this
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5. How can a hotel sales representative identify who is responsible for purchasing
meeting space, banquets, and rooms for corporate travelers in the corporate
headquarters of an insurance company?
Often the salesperson can simply ask. Some companies have a dedicated in-house