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Global Marketing Management Global Product Decisions B2B MKTG 3231-001 Fall 2013 Mrs. Tamara L. Cohen Class # 20.

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Presentation on theme: "Global Marketing Management Global Product Decisions B2B MKTG 3231-001 Fall 2013 Mrs. Tamara L. Cohen Class # 20."— Presentation transcript:

1 Global Marketing Management Global Product Decisions B2B MKTG Fall 2013 Mrs. Tamara L. Cohen Class # 20

2 Global Product Decisions B2B Reading for this class: Course Pack #8

3 B2B is big time The US government is the biggest single purchaser of products & services in the country, spending > $300 billion annually. B2B accounts for > half business activity in developed countries¹ More marketing majors begin their careers in B2B than in consumer marketing.

4 B 2 B : Business KEY TERMS Industrial products Derived demand ISO 9000 certification Relationship marketing Content marketing

5 B 2 B : Business KEY CONCEPTS Effect of technology on demand Trade shows & relationship marketing

6 B2B interactions

7 DEMAND is different in Global B2B Markets 1.Demand in industrial markets is more volatile. 2.Stages of industrial & economic development affect demand for industrial products. 3.Level of technology of products & services make sales more appropriate in some countries than others.

8 VOLATILITY of Industrial Demand 1. VOLATILITY of Industrial Demand Cyclical swings in demand increased –professional buyers tend to act in concert –derived demand accelerates changes in markets Minor changes in consumer demand mean major changes in related industrial demand e.g. Boeing worldwide demand for travel services related to demand for new airplanes commercial aircraft industry one of most volatile

9 Degree of INDUSTRIALIZATION 2. Degree of INDUSTRIALIZATION 5-stage model of economic development: 1.Traditional society - most important B2B demand associated with extraction of natural resources; e.g. many countries in Africa & Middle East 2.Preconditions for takeoff - manufacturing is starting. Primary needs typically related to infrastructure development, like construction, telecommunications, power generation equipment; e.g. Vietnam 3.Takeoff - manufacturing of consumer goods has begun. B2B needs focus on equipment & supplies to support manufacturing; e.g. Russian & Eastern European countries 4.Drive to maturity - industrialized economies. Focus on low-cost manufacturing of various consumer goods & some industrial goods; need all categories of B2B goods & services; e.g. Korea; Czech Republic 5.Age of mass consumption - mostly service economies. High- tech products & services sought mostly from other stage 5 suppliers + consumer products from stage 3 & 4 countries; e.g. Germany; Japan

10 1.Traditional society 2.Preconditions for takeoff 3.Takeoff 4.Drive to maturity 5.Age of mass consumption

11 TECHNOLOGY & Market Demand 3. TECHNOLOGY & Market Demand Trends spurring demand for technologically advanced products –expanding economic & industrial growth in Asia –disintegration of Soviet empire –privatization of government-owned industries worldwide Companies with competitive edge will be those whose products are: –technologically advanced –highest quality –accompanied by world-class service

12 B2B Promotional Activity Internet/Electronic Media Trade Shows/Events Print Advertising Promotion/Market Support Publicity/Public Relations Dealer/Distributor Materials Market Research Telemarketing Directories Interactive marketing is the future for B2B marketing

13 Social Media is up-and- coming

14 Content marketing (custom media) is the creation and distribution of educational and/or compelling content in multiple formats to attract and/or retain customers. e.g. white papers case studies videos articles Content Marketing

15 Trade Shows: Crucial Part of B2B Marketing Trade shows –manufacturer can exhibit & demonstrate products to potential users –manufacturers can view competitors products –opportunity to create sales & establish relationships with agents, distributors, franchisees & suppliers Online trade shows –useful in difficult economic / political circumstances –poor substitute for live trade shows Secondary marketing methods - print advertising, catalogs, web sites, direct mail Total annual media budget on trade events: Europeans 22% Americans 5%

16 Trade shows



19 Relationship Marketing in B2B Contexts Not a matter of selling right product 1 st time –instead sell continuously changed product to keep it right over time Objective of relationship marketing –make relationship an important attribute of transaction + differentiate from competitors Use Internet to facilitate relationship building and maintenance

20 Quality is Defined by the Buyer lack of universal standards country-specific standards metric system ISO 9000 Certification = International Standard of Quality ISO 9001 certification of a fish wholesaler in Tsukiji

21 Customer – initiate inquiry Sales engineer – initial customer contact Application engineer – find best product match Engineering & control systems – design Project manager – manage project & liaise Manufacturing technicians – produce, assemble, test Customer services – installation & start-up Suppliers – provide materials & components Service engineer – after-sales service & maintenance Global Project Team


23 Support Services Deliveries Warranty Spare parts Repair and maintenance Installation Instructions Other related services

24 Marketing Consumer Services Globally Consumer services characteristics –intangibility –inseparability –heterogeneity –perishability Service can be marketed –as industrial (B B) –as consumer service (B C)

25 Business Services For many industrial products, revenues from associates services > revenues from products –cell phones –printers Leasing capital equipment Services not associated with products –Boeing at-sea-satellite-launch services –Ukrainian cargo company rents space on giant jets –professional services (advertising, banking, healthcare, etc.)

26 After-Sale Services Installation Training Spare and replacement parts –delivery time –cost of parts Service personnel Almost always more profitable than actual sale of machinery / product Crucial in building strong customer loyalty

27 Services Opportunities in Global Markets Tourism – intl tourism largest US services export Transportation Financial services Education – 2007: >600,000 foreign students, tuition $11 billion Communications – phone services Entertainment – sporting events sold all over the world Information – Internet, etc. Health care – foreigners come here; US facilities abroad too

28 Next class: Global Product Decisions B2C Preparation: Read Course Pack #9

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