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Chapter 7: Business Marketing

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Designed & Prepared by Laura RushB-books, Ltd.

Introduction to

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Learning Outcomes

Describe business marketing

Describe the role of the Internet in business marketing

Discuss the role of relationship marketing and strategic alliances in business marketing

Identify the four major categories of business market customers

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Learning Outcomes Explain the North American Industry Classification System

Explain the major differences between business and consumer markets

Describe the seven types of business goods and services

Discuss the unique aspects of business buying behavior

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Business Products

The key is intended use.Business Products:• Are used to manufacture other

products• Become part of another product• Aid the normal operations of an

organization

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Online B-to-B Marketing Tools

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•Blogs•Social Networking Sites•Twitter•Video•Mobile Marketing

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Measuring Online Success

Stickiness- A measure of a Website’s effectiveness; calculatedby multiplying the frequency ofvisits times the duration of a

visit times the number of pagesviewed during each visit.

Stickiness= Frequency x Duration x Site Reach

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Strategic Alliances

A cooperativeagreement between

business firms (strategic partnerships).

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Relationships in Other Cultures

Keiretsu- A network of interlocking corporate

affiliates.

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Major Categories of Business Customers

• OEMS

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Producers Resellers Governments Institutions

• Wholesalers

• Retailers

• Federal• Municipal• Local

• Schools• Churches• Civic Clubs• Hospitals• Unions• Foundation

s• Organizatio

ns• Colleges • Fraternal

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NAICS

NAICS (North American IndustryClassification System)- A detailednumbering system developed bythe United States, Canada, and

Mexico to classify North Americanbusiness establishments by

their main production processes.

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NAICS

• Provides a common industry classification system

• Valuable tool for marketers in analyzing, segmenting, and targeting markets

• Data can be used to determine:

– Number, size, and geographic dispersion of firms

– Market potential / market share estimates– Sales forecasts– New customer identification

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Demand in Business Markets

DerivedDerived Demand for business products results from demand for consumer products.Demand for business products results from demand for consumer products.

InelasticInelastic A change in price will not significantly affect the demand for product.A change in price will not significantly affect the demand for product.

JointJoint Multiple items are used together in final product. Demand for one item affects all.Multiple items are used together in final product. Demand for one item affects all.

FluctuatingFluctuating Demand for business products is more volatile than for consumer products.Demand for business products is more volatile than for consumer products.

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Fluctuating Demand

Phenomenon in which a small increase or decrease in

consumer demand can produce a much larger change in demand for

the facilities and equipment needed to make the consumer product.

Multiplier Effect (Accelerator Principle) -

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Types of Business Products

Major EquipmentMajor Equipment

Accessory EquipmentAccessory Equipment

Raw MaterialsRaw Materials

Component PartsComponent Parts

Processed MaterialsProcessed Materials

SuppliesSupplies

Business ServicesBusiness Services

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Business Buying Behavior

Customer ServiceCustomer Service

Business EthicsBusiness Ethics

Buying SituationsBuying Situations

Evaluative CriteriaEvaluative Criteria

Buying CentersBuying Centers

Aspects of Business

BuyingBehavior

Aspects of Business

BuyingBehavior

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Roles in the Buying Center

InitiatorInitiator InfluencersInfluencers GatekeepersGatekeepers

DeciderDecider PurchaserPurchaser UsersUsers

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Evaluative Criteria

1. Quality

2. Service

3. Price

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Buying Situations

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New buy – A situation requiring the purchase of a product for the first time.

Modified Rebuy – A situation in which the purchaser wants some change in the original

good or service.

Straight Rebuy – A situation in which thepurchaser reorders the same goods or

services without looking for new informationor investigation other suppliers.

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Customer Service

•Divide customers into groups based on their value

•Create policies that govern how service will be allocated among groups

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