Prof.

Sameer Karna

BUSINESS MARKETING
IS MARKETING OF GOODS AND SERVICES TO:
Companies
Government Bodies Institutions (i.e. hospitals)

Non-Profit Organizations (i.e. American Red Cross)

FOR

USE IN PRODUCING THEIR PRODUCTS

AND/OR TO FACILITATE THEIR OPERATIONS

NATURE OF THE BUSINESS MARKET

NATURE OF THE BUSINESS MARKET

Companies also buy services, such as legal, accounting, office-cleaning, and other services.

Some firms focus entirely on business markets.

Example: Caterpillar, which makes construction and mining equipment. Diverse market, everything from a box of paper clips to thousands of parts for an automobile manufacturer.

B2B versus B2C Marketing

Characteristic
Sales volume Purchase volume

B2B Market
Greater Greater

B2C Market
Smaller Smaller

Number of buyers
Size of individual buyers Location of buyers Buyer-seller relationship Nature of channel Buying influences

Fewer
Larger Concentrated Closer More direct Multiple

Many
Smaller Diffuse More Impersonal Less direct Single/Multiple

Type of negotiations
Use of reciprocity Use of leasing Key promotion method

More complex
Yes Greater Personal Selling

Simpler
No Less Advertising

Categories of B2B Customers

Commercial enterprises
Indirect channel members and facilitators OEMs (original equipment

manufacturers) Users = customers

Governmental organizations

Institutions

B2B Marketing is Different!

There are fewer customers and they require

dependable relationships and a high level of service.

Marketing tends to be done by personal selling

(one-on-one) calls to the customer.

Specialized media such as trade journals, sales

brochures, web sites, trade shows are used rather than traditional mass media.

THE PURCHASE DECISION PROCESS

Sellers must navigate organizational buying processes that often involve multiple decision makers. Purchasing process usually more formal than in consumer market.

Purchases may require bidding and negotiations.

BUYER-SELLER RELATIONSHIPS
Often more complex than in consumer market.

Greater reliance on relationship marketing.

EVALUATING INTERNATIONAL BUSINESS MARKETS

Business purchasing patterns differ from country to country.

Global sourcing Purchasing goods and services from suppliers worldwide.

Can bring significant cost savings but requires adjustments.

THE MAKE, BUY, OR LEASE DECISION

Firms acquiring needed products can get them in one of three ways: Make the goods or provide the service in-house. Purchase it from another organization. Lease it from another organization. Producing the item may be cheapest route, but most firms cannot make all of the products they need. Many companies purchase many of the goods they need. Companies can spread out costs through leasing.

THE ORGANIZATIONAL BUYING PROCESS

THE BUYING CENTER CONCEPT

Buying center Participants in an organizational buying action.
BUYING CENTER ROLES

After Sales Services Strategies

What do customers want/need?
After sale services

Confirmation/Payment Tracking delivery (Fedex, UPS, Dell, ) Return/refund Repair/Recall Product information Sales vs Marketing Technical support

How to meet those wants/needs?

After Sales Services Strategies

What one retailer does?
Trigger event 1: Customer first registers on site

(but does not buy).

Trigger event 2: Customer first purchases online. Trigger event 3: Customer does not purchase for

an extended period

After Sales Services Strategies

Trigger event 1: Customer first registers on site (but does not

buy).
2 days after registration e-mail sent offering phone assistance and 5

discount off first purchase to encourage trial.

After Sales Services Strategies

Trigger event 2: Customer first purchases online.
Immediate order confirmation 5 days after purchase e-mail sent with link to online customer

satisfaction survey asking about quality of service from driver and picker (e.g. item quality and substitutions). Two-weeks after first purchase - Direct mail offering tips on how to use service and 5 discount on next purchases intended to encourage re-use of online services. Generic monthly e-newsletter with online exclusive offers encouraging cross-selling Bi-weekly alert with personalised offers for customer. After 2 months - 5 discount for next shop Quarterly mailing of coupons encouraging repeat sales and crosssales

After Sales Services Strategies

Trigger event 3: Customer does not purchase for an

extended period
Dormancy detected Reactivation e-mail with survey of how the

customer is finding the service (to identify any problems) and a 5 incentive. A further discount incentive is used in order to encourage continued usage to shop after the first shop after a break.

B2B Success story Dell Computers

Background
One of the most successful e-commerce company 1st

company to reach $1 Billion in online sales

Source of profit B2C 15% B2B 85% (servers, storage products, network switches & services) No middlemen 4 days of inventory & factory direct shipment Offering customers choice & control (order tracking) Challenges Saturated market of online buyers Not able to reach non-internet buyers Increasing competition

THANK YOU