Prof. Abha Wankhede

Definition:-

“Business Marketing is the practice of individuals, or organizations,

including commercial businesses, governments and institutions, facilitating

the sale of their products or services to other companies or organizations

that in turn resell them, use them as components in products or services

they offer, or use them to support their operations”

Is the marketing of products and services to business organizations.

◦ Commercial Enterprises-

Original Equipment Manufacturers: Nokia, Cisco, Ashok Leyland M&M

Users: Walia Auto Ancillary is a supplier to Tata Motors

Industrial Distributors/Dealers

◦ Government customers

Government undertakings: Indian Railways, State Electricity board, Defense,

MHADA

PSUs: BHEL, ONGC

◦ Institutional Customers-

Public Institutions: Government Hospitals, Municipality Schools

Private Institutions: Hotels, Schools, Colleges, Academy

◦ Cooperative Societies-

Manufacturing Units- Maharashtra Sugar cooperative Society, Kaira District

Co-operative Milk Producer.

Non-Manufacturing Units: Co-operative Banks, Housing Co-operative

Societies.

Derived Demand:-

◦ The demand for a good or service that results from the demand for another good or service.

◦ Ex.:- Pig Iron ---Steel ---Steel Sheets---Automotive part companies--Automobiles--End customer

◦ Derived from the ultimate demand for consumer goods and services in some cases.

Joint Demand:-

- Demand for product or services is interdependent on each other

◦ Ex:- Coffee Powder, Sugar & Milk in Making Coffee

◦ Ex:- Software- Operating System, Car & Fuel

Indust

rial

P

roduct

s

Supplies

Services

Lubricants, Fasteners, paints ,

Electrical Items

Supplies & Services

Iron ore, Crude oil, fruits, fish

Material & Parts

Capital items

Light equipment/

Accessories

Subassemblies

Acids, Fuel oil, Steel ,

Chemicals

Component Parts Gauges, TV tubes, Tyres,

Plants & Building

Installation or Heavy

Equipments

Hand tools, Dies, Jigs

Exhaust Pipe in Motor Cycle

Manufactured

Materials

Raw Materials

Plants, Office Building

Machine Tools, Furnaces

Legal, Auditing, Advertising,

Courier, Market Research

◦ Buying Orientation

Lowest Price:

tactics like Commodification and multi-sourcing

Eg- Government, Institutes

◦ Procurement Orientation

Quality improvement and cost reduction:

a) collaborative relationship with major suppliers:

JIT delivery scheduling,

quality assurance to attain zero defect

Integrative negotiation (benefits both)

b) working closely with functional areas: MRP Material Requirement

Planning

Eg- AMUL

◦ Supply chain Management Orientation

Focuses on how to improve the whole value chain from raw material to end users. Follows 3 philosophies

Deliver value to end users

Thru market research understand end user requirement

Outsource non-core activities

Identify the core-competency of the company

Group strategic and non strategic systems and subsystems

Outsource systems which are non strategic non competitive

Involve mature technologies and qualified suppliers

Support collaborative relationship with major suppliers

Communication, trust, cooperation, commitment between suppliers and buyers for mutual benefit

Results in lower cost and sustainable business and growth.

GE – 700,000 suppliers across thousands of entities, thru enterprise software solution

Internal Environment:-

Company Location, R&D Facilities, Production Facilities Human

Resource, Company Structure and Image of the company

External Environment:-

Micro Environment :-

Customers & Competitors

Suppliers

Macro Environment:-

Economic: business cycles, currency rate, interest rate, fiscal policies

Demographic: population growth/degrowth

Technological: start new industries and rapidly change existing

Government/Political & Legal: Bills passed for protection..SMED

Investors & NGO: impact on public and nature

Areas of Difference B2B Market Consumer Market

Market Characteristics Geographically Concentrated Geographically Disbursed

Relatively Fewer Buyer Mass Market

Product Characteristic Technical Complex Standardize

Customized

Service Characteristic Service , timely Availability

extremely Important

Somewhat Important

Buying Behavior Involvement of Various functional

area from both the ends

Involvement of family members

Purchase Decisions are performance

based and rational

Purchase decisions are mostly based

on Physiological

/social/psychological needs

Technical Expertise Relatively less technical expertise is

required

Stable Interpersonal relationship Non- Personal relationship

Areas of Difference Industrial Market Consumer Market

Channel Characteristic More Direct Indirect

Fewer Intermediaries Multiple layer of Intermediaries

Promotional Characteristic Emphasis on Personal Selling Emphasis on Mass Media

(Advertising)

Price Characteristic Competitive Bidding and Negotiated

Prices

List Price or MRP

List Price for Standard Products

Mission,Vission, Business Objectives

Strategy and Business Plan/AOP

Marketing

Technology/Pre Sales

Service

Sales

Total Market

Available market

CompanyMargins

Company Share

Retail and Consumer Business

Small and Medium Enterprise

Mid Market Segment

High Touch

Accounts

Strategic

Global A/C

Business Unit HEAD

(COO/CEO)

National Sales HEAD

National Marketing

HEAD

Product Mgmt.

Supply Chain Mgmt

System Integrator

Customer Service

National Solutions

(SME*)

* SME- Subject Matter Expert

Regional HEAD (Director)

High Touch

Accounts

Mid Market

Accounts

SME Accounts

Retails Channels

Sales HEAD (GM)

Various Support

Functions(GM)

Regional HEAD (Director)

System Integrator/

Partner Relations

Marketing operations

Projects Delivery

Finance

Post-Sales &

Customer Service

Pre-Sales &

Solutions

Sales HEAD (GM)

Various Support

Functional Heads

Service Industry HEAD

(COO/ CEO)

System Integrator/

Partner Relations

Marketing operations

Projects Delivery

Finance

Post-Sales &

Customer Service

Pre-Sales &

Solutions

BFSI Business HEAD

(COO/CEO)

Manufacturing Business HEAD

(COO/ CEO)

IT/ITES Business HEAD

(COO/ CEO)

Account Manager

Based at Regional Offices Close to Customer’s HQ

National Roles

Director level engagement 1 / 2 accounts- Nationally/Globally B2B Strategic relationship Long sales cycle

e.g. Cisco Wipro (Software development)

(vendor/partner)Cisco Wipro (Sell-thru, Sell-with)

(reseller/channel)Cisco Wipro (Customer;

Infrastructure devices for new projects)

Win-Win

System Integrator/

Partner Relations

Marketing operations

Projects Delivery

Finance

Post-Sales &

Customer Service

Pre-Sales &

Solutions

Account Manager

Strategic Account Director

Common Roles

Global Account Director

Strategic/ Global

Accounts

National account manager Operations-◦ 5 / 10 accounts per head◦ Gets credit for sales made nationally◦ Travels across geographies

Approach◦ Customer industry needs◦ Process knowledge◦ Customer behavior and aspirations ◦ Increase wallet-share (up-sell, sell additional

services/products)◦ Value selling◦ Long Sales Cycle◦ Bulk business

National account manager

Operations-◦ 70 / 100 accounts per head◦ Mix of national and local accounts◦ Liaison with local support teams of other geographies for

fulfillment and assurance

Approach◦ Customer industry needs◦ Process knowledge◦ Value selling◦ Market penetration strategy (replication of success stories)◦ Run-rate business◦ Short- sale cycle

System Integrator/

Partner Relations

Marketing operations

Projects DeliveryFinance

Post-Sales &

Customer Service

Pre-Sales &

Solutions

National Account Manager

Regional Sales Head

National Sales Head

High-Touch/ Mid-Market

Accounts

Support Functions

OEM Company

Channel Partner

SME Customer

• Training

• Empowerment

• SLA/ Business

• Service – L2/ L3

• Consulting

• Sales

• Service – L1

• Consulting

Direct Touch

• Strategic Integration

• Marketing

C-Sat, Perception of partner, Brand value,

High frequency sales update (daily)

System Integrator/

Partner Relations

Marketing operations

Projects DeliveryFinance

Post-Sales &

Customer Service

Pre-Sales &

Solutions

Account Manager

Regional Sales Head

National Sales Head

SME

Accounts

Support Functions

Channel/ Partners

Distributor/Stockiest/MTO

Territory Manager/ Zonal structure based on geography

Brand creation thru mass media

Feet on street/ retail reach

Promotions ◦ Customer pull plans and schemes◦ Distributor/dealer push plans and incentive schemes

Price Driven, premium thru product differentiation and positioning

Place – availability at customer convenience

Product – flavors/ denominations

Tight MIS and cash flow management

Stringent monitoring and continuous availability of committed service level

System Integrator/

Partner Relations

Marketing Operations

Projects Delivery

Finance

Contact Centre

Pre-Sales &

Solutions

Territory Account Manager

Regional Sales Head

Common RolesNational Sales Head

Consumers

Distributors/ Stockists

Retails/ Shops/ Point of Sale