Business to business marketing
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Business to Business Marketing. Professor Lawrence Feick University of Pittsburgh. Organizational markets compared to consumer markets . Fewer buyers Larger purchases Derived demand. Organizational markets compared to consumer markets (continued). Differences in the purchasing process

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Business to Business Marketing

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Business to business marketing

Business to Business Marketing

Professor Lawrence Feick

University of Pittsburgh


Organizational markets compared to consumer markets

Organizational markets compared to consumer markets

  • Fewer buyers

  • Larger purchases

  • Derived demand


Organizational markets compared to consumer markets continued

Organizational markets compared to consumer markets (continued)

  • Differences in the purchasing process

    • professional buying

    • the buying center

    • buyclass


Organizational buying process

Organizational Buying Process

Obtain Feedback and Evaluate Performance

Select Order Routine

Evaluate Proposals and Select Supplier

Acquire and Analyze Proposals

Search for and Qualify Sources

Describe Characteristics and Quantity

Determine Characteristics and Quantity

Recognize Problem and General Solution


The buying center

The Buying Center

  • Participants in an organization’s buying decision


The buying center1

The Buying Center

G

A

T

E

K

E

E

P

E

R

S

BUYERS

DECIDERS

INFLUENCERS

USERS


Organizational buyclasses

Organizational buyclasses

  • Straight rebuy

  • Modified rebuy

  • New task purchase


Business to business marketing

Figure 9.9a

Chrysler’s Vendor Analysis Form

Supplier Rating Chart:Commodity:__________

Supplier Name:__________Annual Sales Dollars:__________

Shipping Location:__________

5 4 3 2 1 0

Ex.GoodSat.FairPoorN/A

Quality 40%

Supplier defect rates__________________

SQA program conformance__________________

Sample approval performance__________________

Responsiveness to quality problems__________________

Overall quality rating__________________

Delivery 25%

Avoidance of late or overshipments__________________

Ability to expand production capacity__________________

Engineering sample delivery performance__________________

Response to fluctuating supply demands__________________

Overall delivery rating__________________


Business to business marketing

Figure 9.9b

Chrysler’s Vendor Analysis Form

5 4 3 2 1 0

Ex.GoodSat.FairPoorN/A

Price 25%

Price competitiveness__________________

Absorption of economic price increases__________________

Submission of cost savings plans__________________

Payment terms__________________

Overall price rating__________________

Technology 10%

State-of-the-art component technology__________________

Sharing research development capability__________________

Capable and willing to provide circuit

design services__________________

Responsiveness to engineering problems__________________

Overall technology rating__________________

Buyer:__________ Date:__________

Comments:_______________________________________________________


Summary comparing business to business marketing and consumer marketing text table 9 2

Product

Relatively technical, exact form often variable, accompanying services very important

Standardized form, service important but less than for business products

Price

Competitive bidding for unique items, list prices for standard items

List prices, little individual negotiation

Promotion

Emphasis on personal selling

Emphasis on advertising

Summary: comparing business to business marketing and consumer marketing (text: Table 9.2)

Business-to-Business Marketing

Consumer-Goods Marketing


Summary comparing business to business marketing and consumer marketing continued

Distribution

Relatively short, direct channels to market

Often complex channels with multiple intermediaries

Customer relations

Relatively enduring and complex

Usually transaction-focused; relationship of relatively short duration

Decision-making process

Involvement of diverse group of organization members in decision

Individual or household members make decision

Summary: comparing business to business marketing and consumer marketing (continued)

Business-to-Business Marketing

Consumer-Goods Marketing

Source: Based on Michael Hutt and Thomas Speh, Business Marketing Management, 5th ed. (Fort Worth, Tex: The Dryden Press, 1995), pp. 11-13.


Implications

Implications

  • Importance of relationships

  • Importance of personal selling

  • Understanding our customer’s customers

  • Affecting final consumer demand

  • Solving our customers’ business problems


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