Deck 6: Understanding Customers: Business-To-Business Markets

Question 1

Business products experience fairly elastic demand.

Answer 1

False

Question 2

There are two types of end user purchases-capital equipment and sundries.

Answer 2

False

Question 3

Users in the B2B buying process have enhanced responsibilities in new purchase and modified re-buy situations when product specifications are being set for the purchase decision.

Answer 3

True

Question 4

A buying center is a permanent group of people at a B2B company that decides on each new purchasing decision.

Question 5

It is often the case that the purchase decision itself in the B2B market involves trade-offs between equally important evaluation criteria and equally qualified vendors.

Question 6

Dealing with complaints,resolving customer problems,and making sure the company is meeting customer expectations are critical to ensuring customer satisfaction in the B2B market.

Question 7

Access to information and relevant individuals in the buying center is controlled by goalkeepers.

Question 8

Many people believe marketing is focused primarily on consumers-the ultimate users of the product.The fact that they experience marketing as a consumer contributes to this belief.

Question 9

Business markets tend to concentrate in certain locations in the United States as a result of suppliers wanting to be located close to one another.

Question 10

Risk tolerance is an organizational factor that differs among companies trying to decide on a particular vendor.

Question 11

It is realistically not possible to separate the individual agendas people bring to the buying center from the purchase decision.

Question 12

B2B companies often have a few companies that represent a large portion of their sales.This means that losing one large customer has striking implications for the company.

Question 13

When a company wants to create or maintain a strategic relationship with a client company,it will be good for the company if its sales team gets involved with the creation of an RFP with the client.

Question 14

The consumer buying process takes longer and is more complex than the B2B buying process.

Question 15

While many companies operate in the business-to-consumer markets,all companies operate in a business-to-business market.

Question 16

One of the toughest challenges facing salespeople in a new or modified re-buy situation is getting access to the right people.

Question 17

The NAICS codes list all of a particular companies business sectors.A company can be listed in several different categories.

Question 18

Influencers are any individuals,both inside and outside the organization,with relevant expertise in a particular area that is used by the buying center in making the final decision.

Question 19

A person who acts as an influencer in the buying center cannot be a decider.

Question 20

Customers in the B2B market place demand not only a personal relationship with their vendors but also an efficient one.

Question 21

In straight rebuy situations,companies that are not on the approved list are called _____.

A) Preferred suppliers
B) Out suppliers
C) Standard suppliers
D) Variable suppliers
E) Alternate suppliers

Question 22

Which of the following is NOT a characteristic of a B2B market?

A) Fewer but larger customers
B) Demand for products is derived from consumer demand
C) Supply chain is direct from suppliers to manufacturers
D) Impersonal relationship with the customers
E) Complex buying process

Question 23

When you re-order products that are used on a consistent basis,it is called a ________.

A) Purchase
B) Order on demand
C) Two-bin inventory system
D) Modified order on demand
E) Straight rebuy

Question 24

Apple will not buy more processors from Intel if Intel lowers the price nor will it buy fewer chips if Intel raises the price.This is an example of ________.

A) Inelastic demand
B) Elastic demand
C) Codependent demand
D) Derived demand
E) Fluctuating demand

Question 25

Business-to-business demand is said to be relatively inelastic.This means that _________.

A) As the price increases demand goes up
B) Changes in demand are not significantly affected by the price
C) As demand goes down price goes down with it
D) Demand and supply are independent of each other
E) As the price decreases demand goes down

Question 26

When General Motors is familiar with a product and supplier,but still seeks additional information in the market place,it is called a ________.

A) Straight rebuy
B) Modified rebuy
C) New purchase
D) Filtered buy
E) None of the above

Question 27

Compared to B2B markets,which of the following is a characteristic of a B2C market?

A) Fewer but larger customers.
B) More complex supply chain.
C) Complex buying process.
D) Inelastic product demand.
E) Geographic concentration of suppliers.

Question 28

Business-to-business markets are:

A) Identical to business-to-consumer markets
B) Similar in most ways to business-to-consumer markets
C) Different in several ways to business-to-consumer markets
D) Different in every way from business-to-consumer markets
E) None of the above

Question 29

Compared to B2C markets,B2B markets are characterized by ________.

A) Buying decisions made by individuals
B) Simple buying processes
C) Elastic product demand
D) Higher value placed on each customer
E) Impersonal relationships

Question 30

It is said that B2B demand is more _____________ in general than B2C demand for products or services.

A) Elastic
B) Bimodal
C) Inelastic
D) Systemic
E) Price-sensitive

Question 31

Small changes in consumer demand can lead to considerable shifts in business product demand and it is referred to as the ____________.

A) Deceleration effect
B) Transverse effect
C) Modified effect
D) Acceleration effect
E) Trickle effect

Question 32

The relationship between consumer demand for products and demand for B2B products is said to be _______________.

A) Upward sloping demand
B) Downward sloping demand
C) Derived demand
D) Equal demand
E) Elastic demand

Question 33

A supply chain is ________________________.

A) The synchronized movement of goods through the channel
B) The network of retail chains that stock a company's products
C) The financial chain that leads from consumer to the producer
D) The sequence of movements coordinated through air space
E) The collegial relationship between two groups of suppliers

Question 34

Per capita the largest B2B market in the world is:

A) Japan
B) All countries are about the same
C) United States
D) Australia
E) None of the above

Question 35

Compared to B2B markets,B2C markets are characterized by:

A) A larger volume of individual purchases.
B) A larger number of customers.
C) The strategic location of buyers.
D) Complex supply chains.
E) None of the above

Question 36

The three main types of buying situations can be characterized as ___________.

A) Straight rebuy, mid-level rebuy, and new purchase
B) Straight rebuy, modified rebuy, and new purchase
C) Slight rebuy, non-evaluative rebuy, and new purchase
D) Buy, rebuy, and non-buy
E) None of the above

Question 37

Wooden Lifestyles is a manufacturer of household furniture.If consumers are not buying its furniture,then there is no need for the company to purchase lumber.This indicates that the demand for lumber is __________.

A) Unitary demand
B) Downward sloping demand
C) Derived demand
D) Equal demand
E) Elastic demand

Question 38

B2C markets can be characterized as being more ________ than B2B markets.

A) Conservative
B) Liberal
C) Impersonal
D) Personable
E) Likeable

Question 39

Which of the following describes a straight rebuy?

A) Reorder products that are rarely used
B) Put reorders into a buying center to reconsider the supplier
C) Reorder products that are used on a consistent basis
D) Develop a list of suppliers to rank them by price
E) Reorder products after an extensive information search

Question 40

The buying process for B2B markets ___________ than B2C markets.

A) Is more complex
B) Is quicker
C) Has fewer people involved
D) Is more psychological in nature
E) All of the above

Question 41

Jefferson Wainright is happy over the growth of the company.As manager of the production floor,he wants to expand by adding another workstation to increase the capacity of the floor.Jefferson creates a buying center to evaluate various combinations of machines for the new station.The buying center gives him a list of the machine preferences ordered from 1 to 3.After reviewing the list,he orders machine 2 due to the past experience with the manufacturer.Jefferson is playing the role of a _________.

A) Gatekeeper
B) Manager of purchasing
C) Influencer
D) Manager of the floor
E) Decider

Question 42

Which of the following observations is true about resellers?

A) Resellers sell products to other businesses or consumers
B) Resellers do not sell products to businesses
C) Resellers serve as an early warning system to OEMs
D) Resellers manufacture products for end users
E) Resellers do not directly sell products to end users

Question 43

Gatekeepers are important to the buying process because they _________.

A) Initiate the buying process
B) Have position power in the organization
C) Control access to key participants in the buying center
D) Control access to the building site of the buying center
E) Make the final purchase decision

Question 44

Hoffman Dirkbond is a senior executive in manufacturing.He has been concerned about the age of the equipment and decides to do a study to evaluate the time and money lost due to equipment failure.He decides to bring his research to the monthly board meeting.In this way Dirkbond is playing the role of ___________ in the buying process.

A) Gatekeeper
B) Initiator
C) User
D) Decider
E) None of the above

Question 45

NAICS codes now include __________.

A) USA
B) USA and Canada
C) USA, Canada, and Mexico
D) All of the Americas, North and South
E) All NATO nations

Question 46

Gatekeepers are important in the B2B buying process because ____________.

A) They limit the number of vendors in a given buying process
B) They can create product specifications that block vendors
C) They control access to key people
D) All of the above
E) None of the above

Question 47

Jose is the machine press operator in a small manufacturing facility.He has been on the job for 7 years and has taken extensive training courses with respect to his machine.Jose will most probably play the role of a(n)__________ in the buying process.

A) Influencer
B) User
C) Decider
D) Operator
E) Key holder

Question 48

Sam Celeski is a salesman with an industrial supply house.He discovers that Ingersoll Rand is going to make a large purchase of equipment and has created a buying center to get the purchase done.Sam's first job is to _______________.

A) Discover the budget for the purchase
B) Develop criteria for the purchase
C) Discover the most important influencer
D) Discover who is part of the buying center
E) Develop a presentation for the buying center

Question 49

NAICS codes are a classification of businesses that ___________.

A) List the primary output of the business
B) Each company gets only one code
C) Are used across the US, Mexico, and Canada
D) Defines 20 major business sectors
E) All of the above

Question 50

Materials,repairs and operational supplies and services,are generally purchased through a ______________.

A) Buying center
B) Buying committee
C) Bid at time of need
D) Straight rebuy
E) Contractual liturgy

Question 51

While making a purchase decision,engineers are frequently called on to detail product requirements and specifications.In this case,the engineers are playing the role of ________.

A) Influencers
B) Users
C) Deciders
D) Initiators
E) Product engineers

Question 52

Deciders are an important group because ________.

A) They make the ultimate purchase decision
B) They decide what characteristics the product should possess
C) They decide what price the company should pay
D) They have sole control over who is allowed to be a vendor
E) None of the above

Question 53

The single largest buyer of goods and services in the world is ____________.

A) General Electric
B) Wal-Mart
C) The United States Government
D) The Russian Government
E) None of the above

Question 54

With respect to buying centers,____________.

A) It is difficult to identify the members
B) The only important people are users and influencers
C) Gatekeepers initiate the buying process
D) Influencers can not be deciders
E) Influencers are the people who control access to key people

Question 55

In the buying process the "user" is characterized as __________________.

A) The actual consumer of the product
B) The actual leader of the buying group
C) The actual evaluator of the product
D) The consultant to the buying group
E) None of the above

Question 56

An initiator is ____________.

A) Any person who starts the purchase process
B) A senior executive that makes a decision that requires new resources
C) A "user" who re-orders when supplies run low
D) All of the above
E) None of the above

Question 57

Home Depot buys home products and then resells them to consumers,building contractors,and other professionals in the construction industry.This puts them in the category of businesses called _________.

A) Mixed use enterprise
B) Resellers
C) Value added enterprise
D) Retail merchandiser
E) End sellers

Question 58

Maryanne has noticed that one of the manufacturing teams has lost productivity over a six month period of time.She puts together a document that describes the productivity loss and does a study to determine the cause.She finds that one of the key machines in the process breaks down often.Maryanne asks several machine manufacturers to submit their proposals.Maryanne is playing the role of a(n)________.

A) Influencer
B) Gatekeeper
C) Initiator
D) User
E) Decider

Question 59

Moore Diversified Services decides to create a group that is made up of people from the purchasing department,senior management with financial knowledge,and engineers with design expertise.It is common for this group to be called a(n)_________.

A) Ad hoc group
B) Party planner
C) Selling partner
D) Buying center
E) Post hoc group

Question 60

In the buying process there is one group that can play a critical role.This group is often the first to recognize the problem based on a need and they help define the product specifications.This group is called ___________.

A) Deciders
B) Gatekeepers
C) Users
D) Influencers
E) Buyers

Question 61

A big industrial firm is interested in evaluating the potential purchase of a machine.In order to do this,managers should look at ___________.

A) Maintenance cost for the first year of ownership alone
B) One-time purchase price
C) Total costs over the life of the machine
D) Cost plus insurance on the machine
E) Cost plus the service contract on the machine

Question 62

The most fundamental criterion in vendor selection is ____________.

A) Serviceability
B) Price
C) Reliability
D) Location
E) Intangibility

Question 63

There are at least two methods to build a list of potential suppliers once product specifications have been outlined.One of the methods is to use the cumulative experience of the company over time.The second method is _______.

A) Buying a list from a list broker
B) Using supplier search websites like Thomas Global Register
C) Asking all sales people to respond to the RFP
D) Creating a list from the Yellow Pages
E) Going to several trade shows and finding suitable suppliers

Question 64

Industrial sellers often include with the RFP a ________.

A) Strong financial analysis of the purchase
B) Strong request to be the sole source for the contract
C) Grease payment to smoothen the process
D) Financial incentives to make the purchase in the form of free service
E) None of the above

Question 65

A unique characteristic of a nonprofit organization is:

A) Nonprofits use a buying triad instead of a buying center
B) The profit sector pools their money for purchases
C) The vendor list is shorter in the nonprofit sector
D) Nonprofits have a limited number of resources compared to their profit counterparts
E) All of the above

Question 66

Financial criteria in the purchase of a complex product for the business market include __________________.

A) All costs evaluated against the stated life of the product
B) All costs evaluated for one year
C) Value, which is the relationship between price and quality
D) The service requirements of a product
E) None of the above

Question 67

Once a purchase decision is made,the purchase decision process continues and is called _____________.

A) Cognitive dissonance
B) Purchase evaluation process
C) Post mortem analysis
D) Post-purchase evaluation
E) None of the above

Question 68

A fundamental criterion in vendor selection is the vendor's ability to meet contractual obligations including delivery times and service schedules.This concept is called ______.

A) Supplier choice
B) Dependability
C) Reliability
D) Sustainability
E) None of the above

Question 69

_____ provide critical feedback after the product purchase and,as a result,their responsibility is enhanced in new purchase and modified rebuy situations when product specifications are being set for the purchase decision.

A) Gatekeepers
B) Influencers
C) Initiators
D) Users
E) Deciders

Question 70

Request for proposal (RFP)is the process of ___________.

A) Getting people to lower the price
B) Achieving strategic advantage over competition
C) Exciting suppliers to join our supply chain
D) Putting product specifications into a document for distribution
E) Finding out the most valuable customers

Question 71

A request for proposal (RFP)____________________.

A) Is the end point for vendors in the B2B market
B) Is the starting point from which vendors put together their product solution
C) Seeks information from the customers regarding the product performance
D) Is not a very time consuming part of the sales process
E) Evaluates the performance of sales personnel

Question 72

When a marketing company responds to an RFP,_____________.

A) It presents clearly how the marketing company's products will meet the product specifications detailed in the RFP
B) It makes a case for selecting the marketing company by presenting any additional information such as unique product features it possesses
C) It succinctly presents the superior service of the marketing company
D) All of the above
E) None of the above

Question 73

Sellers are well aware that industrial buyers of products __________________.

A) Need only the highest quality products
B) Need products certified by an international organization
C) Need a range of products with different qualities and price levels
D) Need only the lowest priced products
E) None of the above

Question 74

The business market purchase decision process is triggered by someone inside the company who _____________.

A) Is a department head
B) Is a member of the procurement department
C) Identifies a need
D) Attends a meeting to brainstorm
E) Has a lot of information about the product to be purchased

Question 75

When responding to an RFP,the B2B marketer may __________.

A) Use CRM or custom software to make all proposals look uniform
B) Assign it to only one person in the organization
C) Give the same proposal to all prospective clients
D) Let only the sales team read the proposal
E) None of the above

Question 76

In a business market purchase decision process,the '_______' stage comes immediately before 'search for suppliers' stage.

A) Problem recognition
B) Response to RFP
C) Define the need and product specifications
D) Make the purchase decision
E) Post purchase evaluation

Question 77

When a company solicits RFPs from suppliers with an open vendor search,the goal is to __________________.

A) Get several proposals which would help in negotiating with the preferred vendor
B) Get one good response from the preferred vendor
C) Get a lot of responses so the firm can focus only on price
D) Get proposals in order to get competitive intelligence
E) All of the above

Question 78

In a business market purchase decision process,which stage follows the 'search for suppliers' stage?

A) Problem recognition
B) Seek sales proposals in response to RFP
C) Define the need and product specifications
D) Make the purchase decision
E) Post purchase evaluation

Question 79

Accountants,purchasing agents,engineers,and other players in a buying center perceive the evaluation of products in different ways which makes a buying center:

A) Less effective than a center handled only by purchasing.
B) More effective since individuals with different perspectives gives a well-rounded view of the purchase decision.
C) Chaotic since there are so many different view points for a product evaluation.
D) All of the above.
E) None of the above.

Question 80

Product choice in the B2B market depends upon _______.

A) Price, product, and distribution criteria
B) Financial, subjective, and objective criteria
C) Objective, subliminal, and price criteria
D) Financial, value, and service criteria
E) None of the above