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7Business MarketingProfessor Close
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Business MarketingOrganization market is larger than consumer
market (B2B marketing/industrial marketing)Easy to define need: do
not have the less rational needs of consumers (fewer
customers)Organizations purchase for:ResaleUse in businessOr to
produce other itemsB2B internet marketing is huge
(disintermediation)
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Internet B2B Trends
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Relationship MarketingDecrease in costs: changes in traditional
relationship (long-term interaction, not just 1
transaction)Cooperation (strategic alliances): Mutual goals (still
difficult; why Japanese experience during troubled times)Info.
Sharing:Provide data to enhance decisions (web Dell)Potential for
abuse (GM sends specs to others)Keiretsu
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Relationship CommitmentAdaptations:Make changes for one customer
(NUMMI; McDonalds & China potatoes)May hedge bets with multiple
suppliersOperational linkages (outsourcing: train other jobs;
IBM)Ties with internal processes (place people in plants)Allows
better coordination (Mark @ VSU, windshields, Rubbermaid)
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McDonalds in Saudi Arabia
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Legal BondsFirestone-Ford, Maytag-Hoover, B2C, over $150, 2
round trip tickets 200,000)Formalized? But locked inHand shake
allows flexibility (other risks)+
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Business CustomersProducersResellersGovernmentsInstitutions
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NAICSNorth American Industry Classification SystemUtility
maximization:Personal selling: customized, large ordersPurchasing
specs: precise description of what firm wantsDemand: derived,
inelastic, or jointMore volumeB2B = geographically concentrated
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Buying CenterRoles auto partsUsers: work with product, often
generate specs (line workers)Influencers: can modify outcome; dev.
Specs, evaluate alternatives (engineers)Buyers: complete
transaction, negotiate (purchasing manager)Deciders: select or
approve (upper/middle management; may be same as buyer)Gatekeepers:
control info. Within buying center (secretary)
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Buying Situations (1)Buying process: 3 types (goes with
individual as well)Straight rebuySmall, recurring items like office
suppliesLittle buyers time, little info neededReminder ads,
automate processPurchasing manager and no one else
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Buying Situations (2)Modified rebuy (contract with dining hall
ends)Some reviewDissatisfy: look for opportunityComparison ads:
your productYour client: protect, attention to changing needsNew
task buying (plant overseas)Unique situationLots of information,
effort, and timeDevelop product and vendor specsMany influences
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Dell Commercial
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SummaryTypes of business products, negotiationsB2B and the
internetBuying situationsMultiple influences rolesRelationship
marketingNAICSBuying centerAny questions?
