SELF TEST #3: Defining the Size and Purpose of Roles
Why do customers have a need for Secondary, Tertiary and Other roles in their relationships?
What are the main reasons for a Secondary role supplier to be in a relationship?
Answer: Secondary suppliers usually offer one of the following benefits. First, back-up supply to ensure availability; second, service or price information; third, a special product not carried by the Primary supplier.
What are the main reasons for a Tertiary and Other role supplier to be in a relationship?
Answer: Tertiary and Other suppliers usually offer one of the following benefits. First, service leverage or price leverage, where the customer is attempting to improve the service level or the reduce the price level of the Primary and Secondary suppliers. A Tertiary and Other supplier may also exist to offer special products not carried by the Primary or the Secondary suppliers.
If a Secondary role supplier is offering back-up supply to his customer, where on the Customer Buying Hierarchy would this benefit fall?
Answer: Reliability. The Secondary role is ensuring the customer that he will have product even when the Primary supplier fails.
Where on the Customer Buying Hierarchy would price information fall?
Answer: Reliability. The customer does not believe that the Primary supplier is always giving him an appropriate price. Therefore, he seeks a Secondary supplier to give him that information. This is an example of the Secondary supplier providing Reliability in the information that the customer receives.
Where in the Customer Buying Hierarchy would the benefit of price leverage fall?
Answer: Price. The customer uses price leverage strictly to get a lower price. The supplier in the price leverage role, whether Secondary or Tertiary, is offering low price as his unique benefit.
What is the difference between price information and price leverage?
Answer: Price information is a role reason, usually in the Secondary role, where the customer seeks a "peer" of the primary supplier in order to ensure that the customer knows what competitive pricing is in the marketplace. Price leverage, on the other hand, is something entirely different. Price leverage is a role reason, usually in the Tertiary or lower role, though occasionally in the Secondary role, where the customer uses a Price Shaver competitor to force its suppliers in higher roles to offer it a lower price.
Where on the Customer Buying Hierarchy would a special product fall?
Answer: Function. Normally, a special product is a Function purchase for the customer. However, if several suppliers in the marketplace offer this special product, then it is a Convenience benefit for the customer, who purchased the special product from the supplier who was able to get it to him in the shortest amount of time.
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