Date post: | 01-Nov-2014 |
Category: |
Business |
Upload: | siddharth-nath |
View: | 3,559 times |
Download: | 2 times |
Chapter 1
The Unique Nature of Industrial Marketing
2
Industrial Marketing
Also called: Business-to-Business (B2B) and Organizational Marketing.
Definition: the creation and management of mutually beneficial relationships between organizational suppliers and organizational customers.
Customer can be private firm, public agency, or nonprofit organization.
3
The Marketing Concept
Creating value for customers with goods and services that address organizational needs and objectives.
4
Marketing Concept
Three major components:All company activities should begin with,
and be based on, the recognition of a fundamental customer need.
A customer orientation should be integrated throughout the functional areas of the firm: production, engineering, finance, R&D.
Customer satisfaction is viewed as the means to long-term profitability goals.
5
Follower Interact
Isolate Shaper
Customer Focus
Low Technology Focus High
High
Low
Strategic Focus Grid
6
Market Orientation
Acquire intelligence from the external environment.
Disseminate that intelligence throughout the organization.
Respond to the intelligence: take action.(Kohli and Jaworski 1990, Journal of Marketing)
7
Marketing Mission Statement
State in terms of meeting customer needs, not in terms of products or technologies.
Marketing Myopia (Levitt 1960 HBR)
8
Marketing Activities
Identify customer needsResearch customer behaviorDivide market into manageable segmentsDevelop new products/servicesEstablish/negotiate pricesDeliver, install, service productsEnsure adequate and timely supply of products
at correct placeAllocate resources across product linesCommunicate with customersEvaluate/control marketing programs
9
Marketing Mix
Limited number of variables under Marketing’s control to create position that is attractive to the target market segment.
Four PsProductPricePromotionPlace (Distribution)
10
External Environment
Characterized by:Degree of StabilityComplexityDiversityHostility
11
External Environment
Six EnvironmentsTechnologicalEconomicSocial/Cultural (Customer)Political/LegalNatural/ClimaticCompetitive
12
So what’s different about B2B?
Marketing ConceptMarketing MixMarket SegmentationProduct Life Cycle
All apply in both B2C and B2B.
13
So what’s different about B2B?The technical characteristics of the
product are important.
These products directly affect the operations and economic health of the customer.
The customer is an organization rather than an individual consumer, or family.
14
Five Major DifferencesBetween B2B and B2C
Products/Services being marketedNature of demandHow the customer buysCommunication processEconomic/Financial factors
15
Products/Services
More complexFunctional vs. Symbolic AttributesLarge unit dollar value/Large quantitiesCustom/TailoredVarious Stages from raw material to
finished goods.Foundation, Entering, Facilitating Goods
16
Raw Material Extraction
Material Processing
Manufacturing Parts/Subassembly
Assembly
Distribution
Wholesale/Retail Trade
Final Consumers
Facilitators
Firms in Production Chain
17
Nature of Demand
Derived
Joint/Shared
Concentrated
Inelastic
18
How Customer Buys
Group Process
Formal
Lengthy
Loyal
Decisions based on risk and opportunity
19
Communication
Personal selling more important than mass paid advertising
Support sales with other promotional activities: advertising in trade journals, catalogs, trade shows, direct mail, WWW.
Message focused on technical, factual, and descriptive content.
Multiple audience members.
20
Economic/Financial Factors
Competition oligopolisticPower/Dependency relationshipsReciprocity:Doing business with
companies that do business with them.Economic variables: interest rates,
inflation, business cycle