1 / 41

Chapter 6

Chapter 6. Business-to-Business (B2B) Marketing. Chapter Objectives. Explain each of the components of the business-to-(B2B) market. Describe the major approaches to segmenting business-to-business (B2B) markets. Identify the major characteristics of the business market and its demand.

job
Télécharger la présentation

Chapter 6

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Chapter 6 Business-to-Business (B2B) Marketing

  2. Chapter Objectives • Explain each of the components of the business-to-(B2B) market. • Describe the major approaches to segmenting business-to-business (B2B) markets. • Identify the major characteristics of the business market and its demand. • Discuss the decision to make, buy, or lease • Describe the major influences on business buying behavior. • Outline the steps in the organizational buying process. • Classify organizational buying situations. • Explain the buying center concept. • Discuss the challenges of and strategies for marketing to government, institutional, and international buyers.

  3. Nature of the Business Market • Business-to-business marketing: organizational sales and purchase of goods and services to support production of other goods and services for daily company operations or for resale • B2B: a popular acronym for the business-to-business market

  4. Like final consumers, organizations purchase products and services to fill needs • Their primary need is meeting the demands of their own customers • Business buying decisions: • Are more formal • Involve complex interactions among many people • Must consider the organization’s goals

  5. Components of the Business Market • Commercial Market: Individuals and firms that acquire goods and services to support, directly or indirectly, production of other goods and services • Trade Industries: Retailers and wholesalers who purchase goods for resale to others. • Reseller: often used to describe the wholesalers and retailers that operate in the trade sector

  6. Kmart and Sears reselling Martha Stewart paints

  7. Government Organizations: Include domestic units of federal, state, local and foreign governments • IRS buys products to provide federal tax service

  8. Institutions: includes a wide variety of organizations, both public and private, such as hospitals, churches, universities, museums, and not-for-profit agencies.

  9. B2B Market – The Internet Connection • Internet plays an important role in B2B marketing • 90 percent of all Internet sales are B2B transactions • Differences in Foreign Business Markets • Must be willing to adapt to local customs and business practices

  10. Segmenting B2B Markets • Demographic Segmentation: demographic characteristics define the useful segmentation criteria for business markets • Using Demographic Segmentation in Business Markets

  11. Customer-Based Segmentation: dividing a B2B market into homogenous groups based on buyers’ product specifications • North American Industrial Classification System (NAICS): classification used by NAFTA to categorize the B2B marketplace into details that market segments -- -- replaced the Standard Industrial Classification (SIC) System

  12. Segmentation by End-Use Application: segmenting a business-to-business market based on how industrial purchasers will use the product • Segmentation by Purchase Categories • Centers on the purchasing situation • Organizations may use complicated purchasing procedures • Firms also structure their purchasing functions in specific ways (e.g. centralized purchasing departments)

  13. Characteristics of the B2B Market • Geographic Market ConcentrationU.S. business market is more geographically concentrated than the consumer market • Manufacturers concentrate in certain regions of the country • Certain industries locate in particular areas to be close to their customers • For example, suppliers of automobile components and assemblies frequently build their plants close to their customers

  14. Sizes and Numbers of BuyersBusiness market features a limited number of buyers • Use statistical information to estimate the size and characteristics of business markets is available • Federal government is largest single source of such statistics

  15. The Purchase Decision ProcessBusinesses must understand the dynamics of the organizational purchasing process • B2B suppliers often must work with multiple buyers • Decision-makers at several layers may influence final orders • Process is more formal and professional than with consumers

  16. Buyer-Seller RelationshipsMore intense than consumer relationships • Require better communication among the organizations’ personnel • Primary goal of B2B relationships is to provide advantages that no other seller can, for instance: • Lower-prices • Quicker delivery • Better quality and reliability • Customized product features • More favorable financing terms

  17. Genuine JD stressing the importance of business relationships

  18. Evaluating International Business MarketsBusiness purchasing patterns often differ from one country to the next • Companies must weigh quantitative and qualitative data • Global sourcing: purchasing goods and services from suppliers worldwide

  19. Chubu Electric practices global sourcing

  20. Derived Demand: demand for a resource that results from demand for the goods and services that are produced by that resource • Volatile Demand: changes in demand that are disproportionate to normal trends • Joint Demand: demand for a product that depends on the demand for another product used in combination with it • Inelastic Demand: demand that, throughout an industry, will not change significantly due to a price change. • Inventory Adjustments: Just-in-time inventory policies (JIT & JIT II)

  21. Business Market Demand • Derived Demand – the demand for corn derived from demand for ethanol • Volatile Demand – the lower demand for new housing construction results in lower demand for lumber, concrete, plumbing items • Joint Demand – greater demand for gasoline will cause greater demand for motor oil • Inventory Adjustments • Just-In-Time inventory policies require suppliers to deliver inputs for production just as the production process needs them • Just-In-Time II brings supplier representatives into the customer’s facility to better manage supply

  22. Microprocessors: An Example of Derived Demand

  23. The Make, Buy, or Lease Decision • Three Basic Options: • Make the good or provide the service in-house • Purchase it from another organization • Lease it from another organization

  24. The Rise of Outsourcing • Using outside vendors to produce goods and services formerly produced in-house • Outsourcing • May be cost effective • Allows a firm to obtain specialized technological expertise • Frees up the company to focus on its core competencies

  25. An outsourcing service for reducing risk and increasing productivity

  26. Problems with Outsourcing • Many companies discover their cost savings to be less than half the figure promised by vendors • May require signing a multiyear contract that eliminates most or all benefits in a year or two • Potential internal security problems • Potential problems with suppliers who fail to deliver goods probably or provide required services • Possible union difficulties • Risk of losing touch with customers

  27. The Business Buying Process • Influences on Purchase Decisions: • Environmental Factors • Organizational Factors • Multiple Sourcing: purchasing from several vendors • Interpersonal Influences

  28. The Role of the Professional Buyer • Professional buyer (merchandisers): technically qualified employees who are responsible for securing needed products at the best possible prices • Systems integration: Centralization of the procurement function within an internal division or as a service of an external supplier • Category Captain: A firm designates a major supplier as their systems integrator. This supplier assumes responsibility for dealing with all of the suppliers for the firm.

  29. Model of the Organizational Buying Process

  30. Stage 1: Anticipate or recognize a problem/need/opportunity and a general solution • Stage 2: Determine the characteristics and quantity of a needed good or service • Stage 3: Describe characteristics and the quantity of a needed good or service • Stage 4: Search for and qualify potential sources • Stage 5: Acquire and analyze proposals • Stage 6: Evaluate proposals and select suppliers • Stage 7: Select an order routine • Stage 8: Obtain feedback and evaluate performance

  31. Whole FoodsSelecting a supplier

  32. Classifying Business Buying Situations • Straight RebuyingRecurring purchase decision in which a customer repurchases a good or service that has performed satisfactorily in the past • Modified RebuyingPurchase decision in which a purchaser is willing to reevaluate available options for repurchasing a good or service

  33. New-Task BuyingFirst-time or unique purchase situation that requires considerable effort by the decision Makers • ReciprocityPolicy to extend purchasing preference to suppliers that are also customers

  34. Analysis Tools • Value analysis: systematic study of the components of a purchase to determine the most cost-effective ways to acquire items • Vendor analysis: assessment of supplier performance in areas such as price, back orders, timely delivery, and attention to special requests

  35. The Buying Center Concept • Participants in an organizational buying action • Buying center roles played by various participants in the purchase decision process include: • Users – initiate purchase request, develop specifications • Gatekeepers – control information • Influencers – provide information • Decider – actually chooses good or service • Buyer – has formal authority to select supplier

  36. International Buying CentersDifferentiated from domestic buying centers since: • Their members are often more difficult to identify • May include more participants than buying centers in U.S. firms • Team sellingIntroducing other associates in addition to salespeople into selling situations to reach all members of a customer’s buying center

  37. Developing Effective Business-To-Business Marketing Strategies • Challenges of Government Markets • Government purchasing procedures • Bids: written sales proposals from vendor • Specifications: written descriptions of needed goods or services • Online with the federal government

  38. Challenges of Institutional Markets • Widely diverse buying practices • Multiple buying influences may affect decisions • Group purchasing is an important factor • Challenges of International Markets • Widely diverse attitudes and cultural patterns • Local industries, economic conditions, geographic characteristics and legal restrictions also must be considered • Remanufacturing: production to restore worn-out products to like new condition

  39. End of Chapter Six

More Related