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Definition Business marketing

Definition Business marketing. = The marketing of goods and services to commercial enterprises, governments and other nonprofit institutions For use in goods and services that they, I turn produce or For resale to other industrial customers. Definition 2. 2 essential aspects

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Definition Business marketing

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  1. Definition Business marketing =The marketing of goods and services to commercial enterprises, governments and other nonprofit institutions For use in goods and services that they, I turn produce or For resale to other industrial customers

  2. Definition 2 • 2 essential aspects -type customer -intended usage of theory and application theory based on a short case story

  3. Type of customers • Government • Institutions • Companies -users -OEM’s(origin.equipment.nanuf.) -distributors Different buying behaviors

  4. Intended usage -Manufacturing -Trade

  5. Differences BM_CM • Market structure -number of clients and suppliers -concentration more geographical concntr) -international • Nature of demand -derived demand( determined by the consumer demand) -inelastic (BM) -acceleration-effect (outsourcing)

  6. Differences BM-CM 2 • Baying behavior -professionals -motives: rational vs. emotional -purchasingproces, buying teams -relations -size and frequency of purchases • Marketing instruments • 2 additional p’s • Different composition of mark.mix

  7. Type of product • Capital goods : equipment + systems • Materials -raw materials -processes materials -components • Usage goods MRO’s (maintenance rapid office suppliers) • Services

  8. Marketing on business markets 1 • Marketing philosophies: 5x • When market oriented: • customers and his needs as starting point -Market scanning, marketinfo -internal circulation of info -competitors -segmentation/target group -adapt to changes in market

  9. Marketing on business markets 2 • Market orientation, based on 2 concepts: -external focus on relevant market parties (who is customer? marketing system/competition/suppliers etc.) -Internal focus on international coordination (coordination with ‘non marketing” departments/informing, involve others )

  10. Introduction market orientation • Change of culture • Mentality • Resistance • Teambuilding • Support top management • Communication • Project groups

  11. Transactions and relations • B/M/ = relationmarketing (personal contact,networking,cooperation) DIFFERENSES Transaction and Relationmarketing \ -”always a share” vs. “always lost” -Low vs. high cost of change -Low vs high risk in case of wrong buy -Emphasis on product, person vs. technology, supplier -Purchase less vs. very important

  12. Buying behavior • Basis business marketing • Subjects: - Buying process • Buying situation • DMU and PSU • Purchasing portfolio and purchasing strategies • Supplier management

  13. Buying process • Product and market technical phase -problem recognition -specs determination -search for potential suppliers -quotations • Commercial phase -Negotiations, choice, contract • Administrative phase -order monitoring, evaluation, feedback

  14. Buying situations • New task • Modified rebuy • Straight rebuy

  15. Buy grid model • Combination buying process and buying situations • Determination marketing strategy -Questions buy grid (combination important? Which departments c.q. persons involved? Which roles c.q. functions? Sources of information?)

  16. DMU – PSU • DMU: all persons involved in purchase. Role: - initiator/user/influencer/buyer/decider/gatekeeper/ • PSU: - Team of specialists at seller’ side -adjust to level in DMU –Tend to closer cooperation -Coordination

  17. Buying motives • Task oriented • Non-task objectives

  18. Buying strategies • Strategic products: partnership • Leverage products: competitive bidding • Bottle neck products: security supply • Routine products: system contracting

  19. Supplier Management • Changing character purchase: more strategic -less suppliers -Character of relation -more professional • Consequences for marketing policy suppliers

  20. Market Research • No fundamental BM-CM • 3 main differences -derived demand -concentration of demand -DMU and buying process

  21. Characteristics research BM • Secondary data (desk) -more usage of secondary data -sources : internal/external -Standard Industrial Classification (SIC) - (SBI)

  22. Characteristics Research BM • Collection primary data (field) -mainly qualitive research to find complex, buying motives -personal interviews • Technical knowledge required - Size of sample

  23. Market segmentation • Dividing market into groups of potential customers who are similar in needs, expectations, are response to marketing stimuli • Characteristics buyers • Criteria

  24. Requirement segmentation • Homogeneous • Reachable • Size • Measurable • Accessable

  25. Segmentation Criteria • Macro level (- organizational characteristics: SBI-code/size, usage/product application/geographical location. -Characteristics buying decision: buying situation/phase of buying process) • Micro level (- DMU characteristics: roles, decision procedures/ buying criteria/purchasing strategy. -Characteristics DMU – members: function, experience/ loyalty to supplier/ life style, personality/ age, sex, education, etc.

  26. Product levels • Core products (why is the customer buy?) -BM: solutions for problems • Tangible products (components, packaging, design) • Augmented(Service, delivery time)

  27. Quality • Product orientation • User orientation • Production orientation

  28. Types of product • Catalogue products • According specification • Tailer made (unique product only for 1) • Services

  29. Service • Characteristics -untangible -production and consumption at the same moment -heterogeneous -no stock -no property (of client)

  30. Service • Pre sale service • Transaction related service (customer service) • After sales service

  31. Service BM-CM • Tailor-made • Large technological component • Production at site of customers • More emphasis on business than person

  32. Distribution • Most strategic marketing instrument • Functions distribution channel • Main aspects distribution policy

  33. Design Channel structure • Distribution objectives (depends on marketing and goals/ availability/ lowest costs/ max. control/ max. saleseffort/ optimal back up/positive image/market feedback) • Limitations and conditions (right intermediates available?/ product characteristics/ customer needs/ budget/strategy competition/ geographical distribution clients/ tradition) • Channel tasks (commercial/ financial/ logistical) • Channel alternatives (length channel/number of levels/type intermediate-agent or industr.distributor/number of distr./#of chaneel • Evaluation and choice

  34. Direct&Phisical distribution • Direct: (limited # of clients/ geographical concentration/large orders/high margin/ specialistic support required/JIT (just in time you need it) delivery • Physical: (Logistic management=materials management + physical distribution/ trade offs/ customer services/ make or buy (financials&commercials reasons, personal and equipment))

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