Marketing 6 Business-to-Business (B2B) Marketing

6.1 B2B Marketing - 6 Business to Business Markets (B2B)Business to Business Markets (B2B) –Types of business customers –Contrast B2B with Consumer behavior –Business Buying Behavior –Trends in B2B marketing

6.2 Business Customers ProducersProducers ResellersResellers GovernmentsGovernments InstitutionsInstitutions

North American Industrial Classification System ts?_submenuId=business_0&_sse=onhttp://factfinder.census.gov/servlet/SAFFEconFac ts?_submenuId=business_0&_sse=onhttp://factfinder.census.gov/servlet/SAFFEconFac ts?_submenuId=business_0&_sse=onhttp://factfinder.census.gov/servlet/SAFFEconFac ts?_submenuId=business_0&_sse=on Businesses are grouped by similaritiesBusinesses are grouped by similarities Digits 1 & 2: major economic sector (ag, mfr)Digits 1 & 2: major economic sector (ag, mfr) Digit 3: economic sub-sector (crop production/apparel mfr)Digit 3: economic sub-sector (crop production/apparel mfr) Digit 4: industry group (grain farming/fiber, yarn, thread mill)Digit 4: industry group (grain farming/fiber, yarn, thread mill) Digit 5: industry (wheat farming/broadwoven fabric mills)Digit 5: industry (wheat farming/broadwoven fabric mills) Digit 6: subdivisions of user needsDigit 6: subdivisions of user needs

6.3 Organizational Markets I VS. Consumer Markets DemandDemand –Derived –Inelastic –Joint –Fluctuating (ripple/multiplier effect) Big VolumeBig Volume Fewer, but Concentrated CustomersFewer, but Concentrated Customers

6.3 Organizational Markets II PromotionPromotion –Heavier reliance on personal selling –Advertising limited and focused –Advertising and Marketing Promotions support Sales

6.3 Organizational Markets III Nature of BuyingNature of Buying –Formal –Complex –Lengthy –Multiple parties in buying center –Bids/Proposals –Buyers are professional

6.3 Organizational Markets IV Products / ServicesProducts / Services 1.Major Equipment 2.Accessory Equipment 3.Raw Materials 4.Component Parts 5.Processed Materials 6.Supplies 7.Services

6.3 Organizational Markets V NegotiationsNegotiations DistributionDistribution ReciprocityReciprocity LeasingLeasing

6.5 B2B. Buying Decision Process Recognize the problemRecognize the problem Form buying centerForm buying center Develop product specsDevelop product specs Supplier searchSupplier search Product / vendor solicitationProduct / vendor solicitation Supplier selection and orderSupplier selection and order Performance reviewPerformance review

6.6 BUSINESS BUYING BEHAVIOR Buying CentersBuying Centers –Initiator –Influencers / Evaluators –Gatekeepers –Decider –Purchaser –User

6.4 Types of Buying Decisions Straight rebuyStraight rebuy Modified rebuyModified rebuy New taskNew task

6.7 TRENDS in B2B MARKETING B2B Internet MarketingB2B Internet Marketing –Vast majority of Internet Sales are B2B –Offers: lower price / costlower price / cost greater selection of product/ vendorsgreater selection of product/ vendors around the clock ordering and customer servicearound the clock ordering and customer service Strategic AlliancesStrategic Alliances