Upload
ali-raza-merchant
View
1.109
Download
1
Tags:
Embed Size (px)
DESCRIPTION
This is part 4 of my 15 lecture series class for Integrated Marketing Course at IOBM Karachi
Citation preview
IMC 2011 by ARM
Session 3
Ali Raza Merchant
IMC CourseBusiness-to-Business
Buyer Behaviour
IMC 2011 by ARM
Defining various types or categories of business-to- business buyers
Major roles associated with making purchases, called the business buying center
Steps of business purchasing decision are outlined
Important new factors and issues in business-to-business sales are discussed
Topic Content Summary
IMC 2011 by ARM
Business-to-Business Customer Types
IMC 2011 by ARM
Types of Products
•Many types of goods and services are sold to business-to-business market place
•These can include services like employee medical insurance, cleaning & maintenance services etc
•Each requires a distinct marketing approach
Major Equipment
Component Parts
Accessories
Process Materials
IMC 2011 by ARM
Business Customers & What They Buy
Type of Goods & Services
Manufacturers
GOVT.
Institutions
Wholesale /
Distributors
Retail
Major Equipment
Accessory Equp
Component Parts
Process Materials
Maintenance Sup
Operating Supp
Raw Material
Operating Serv
Professional Serv
IMC 2011 by ARM
Business Buying Centers 1. Users
3.
Influencers
2. Buyers
Actual Users of Product or Service such as Secretarial Staff (Stationery), Factory Workers (Tin Cans/ RM) or HR (Hiring Services)
Responsible for making purchases
In large organizations buyers can be purchasing agents or members of purchase department in a company
Who shape purchasing decisions by providing information specs or criteria e.g. Engineers
4. Deciders
Individuals who authorize buying decision
Can by CFO, VP, MD
5.
Gatekeeper
Controls flow of info to members of buying center
Lets them know if certain alternatives have been rejected
IMC 2011 by ARM
Was set up by AK Sumar and MNA in the 1960’s, during Ayub Khan’s Govt.
Was unique in many ways as it was unconventional in its advertising – never used models
Had a high quality fabric manufacturers’ perception among consumers due to which it commanded higher price
In the early 1990’s MFTM was a large textile company in Pakistan with a 50 50 emphasis on dressing fabrics for local as well as home textile products for export
MFTM was a vertically integrated unit with spinning, weaving, bleaching & dying, printing and stitching units
Mohd. Farooq Textile Mills (MFTM) - Backgrounder
IMC 2011 by ARM
Mohd. Farooq Textile Mills (MFTM)
IMC 2011 by ARM
MFTM was manufacturing Lawn Fabric for women, 100% Cotton Fabric, Wash & Wear Fabric for the local market
Production for local market was marketed through two distributors under the supervision of Head of local sales
The brand was well respected and commanded a higher price, which affording consumers were willing to pay
Local market was not the company’s business focus
Interesting Facts About MFTM
IMC 2011 by ARM
MFTM exports were growing at a phenomenal rate
The export market was value added and allowed the company to make greater margins, particularly in view of the govt. rebates and foreign exchange earnings
The company sold home textile products to manufacturers and retail store brands in Germany, France, Holland & Switzerland
The flagship product were 100% Satin for Home Textiles which included single and double bed sets i.e. Quilt Cover and Pillow
In addition to Satin the company also manufactured Flannel and 100 Cretonne, a comparatively low priced cotton fabric
The average gross margin of Satin was 45%
The company did not have its own brand for exports – it was a toll manufacturer for other brands like Luxorette, Irisette, Carfour, La Redoute, Kaufhoff, Neckermann etc
Interesting Facts About MFTM
IMC 2011 by ARM
Home textile Portfolio
IMC 2011 by ARM
Home textile Portfolio
IMC 2011 by ARM
Pakistan was one of the markets that was limited in its export of textiles through quota
Quota meant that a manufacturer could only export a particular category of textile goods to a country if they possessed quota in value terms
Therefore, if MFTM had an order of $100,000 for home textiles from Europe, it needed to have equivalent quota to ship the goods. If not they could buy quota from a manufacturer with surplus quota
Quota was barrier tariff created by USA, Europe and Australia to restrict Pakistani textiles which were low cost and were eating away their own textile industry
Since MFTM sold high priced Satin products its export value resulted in higher quota every year
Exporter Quota – A Barrier to Entry
IMC 2011 by ARM
Management Structure of MFTMChief
Executive
Director Mills
Head of Spinning
Head of Weaving
Head of Dying
Head of Printing
Head of Finished Folding
Stitching Master
Director Marketing
G.M.Exports / Home Textiles
Head of Local Sales
Director Finance /
Admin
Purchase Manager
Manager Finance
Manager Administratio
n
Manager Logistics
Asstt. Manager
Documentation
IMC 2011 by ARM
MFTM Purchase Decision Home Textiles
(Labels & Packaging)
Grey Cloth
Spinning
Requirements included:
•Labels for Wash Instructions
•Inlay Cards
•PE or PP Bags for Packing
Raw Cotton was the main input material
Also required was polyester for blended yarn
Chemicals for sizing yarn
Parts and maintenance for weaving looms
Bleaching, Dying & Printing
Chemicals & dyes for fabric processing
Screens for printing
Parts & maintenance
Stitching
Thread and accessories for stitching
Stitching machines spares & maintenance
Manager Purchase
IMC 2011 by ARM
B2B Buying Process
Identification of Need
Establishment of Specs
Identification of
Alternatives
Evaluation of
VendorsSelection
of Vendors Negotiati
on of purchase
terms
IMC 2011 by ARM
Dual Channel MarketingDUAL CHANNEL
MARKETING When a firm sells virtually
the same products or services to both consumers
and businesses
Spin off Sales
Consumers who use officially given
product by Company buy same
for personal use
Image Concerns
Marketers have to be careful that image projected in one market does not
damage the other
Difference v/s Similarities
• Use different messages
• Create different brands
• Use multiple channels or different
channels
Products like Digital Cameras, Calculators, Computers, Fax, Cell phones
Kodak imaging products
First B2B then Consumers