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Global Marketing Management Global Product Decisions B2B. MKTG 3231-001 Fall 2013 Mrs. Tamara L. Cohen. Class # 20. Global Product Decisions B2B. Reading for this class: Course Pack #8. B2B is ‘big time’.

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global marketing management global product decisions b2b

Global Marketing ManagementGlobal Product DecisionsB2B

MKTG 3231-001

Fall 2013

Mrs. Tamara L. Cohen

Class # 20

global product decisions b2b
Global Product DecisionsB2B

Reading for this class: Course Pack #8

b2b is big time
B2B is ‘big time’

The US government is the biggest single purchaser of products & services in the country, spending > $300 billion annually.

B2B accounts for > half business activity in developed countries¹

More marketing majors begin their careers in B2B than in consumer marketing.

slide4

KEY TERMS

B 2 B :

Business Business

  • Industrial products
  • Derived demand
  • ISO 9000 certification
  • Relationship marketing
  • Content marketing
slide5

KEY CONCEPTS

B 2 B :

Business Business

  • Effect of technology on demand
  • Trade shows & relationship marketing
demand is different in global b2b markets
DEMAND is different in Global B2B Markets
  • Demand in industrial markets is more volatile.
  • Stages of industrial & economic development affect demand for industrial products.
  • Level of technology of products & services make sales more appropriate in some countries than others.
1 volatility of industrial demand
1. VOLATILITY of Industrial Demand
  • Cyclical swings in demand increased
    • professional buyers tend to act ‘in concert’
    • derived demand accelerates changes in markets
  • Minor changes in consumer demand mean major changes in related industrial demand

e.g. Boeing

      • worldwide demand for travel services related to demand for new airplanes
      • commercial aircraft industry one of most volatile
2 degree of industrialization
2.Degree of INDUSTRIALIZATION

5-stage model of economic development:

  • Traditional society- most important B2B demand associated with extraction of natural resources; e.g. many countries in Africa & Middle East
  • Preconditions for takeoff- manufacturing is starting. Primary needs typically related to infrastructure development, like construction, telecommunications, power generation equipment; e.g. Vietnam
  • Takeoff- manufacturing of consumer goods has begun. B2B needs focus on equipment & supplies to support manufacturing; e.g. Russian & Eastern European countries
  • Drive to maturity- industrialized economies. Focus on low-cost manufacturing of various consumer goods & some industrial goods; need all categories of B2B goods & services; e.g. Korea; Czech Republic
  • Age of mass consumption- mostly service economies. High-tech products & services sought mostly from other stage 5 suppliers + consumer products from stage 3 & 4 countries; e.g. Germany; Japan
slide10

Traditional society

  • Preconditions for takeoff
  • Takeoff
  • Drive to maturity
  • Age of mass consumption
3 technology market demand
3.TECHNOLOGY & Market Demand
  • Trends spurring demand for technologically advanced products
    • expanding economic & industrial growth in Asia
    • disintegration of Soviet empire
    • privatization of government-owned industries worldwide
  • Companies with competitive edge will be those whose products are:
    • technologically advanced
    • highest quality
    • accompanied by world-class service
b2b promotional activity
B2B Promotional Activity
  • Internet/Electronic Media
  • Trade Shows/Events
  • Print Advertising
  • Promotion/Market Support
  • Publicity/Public Relations
  • Dealer/Distributor Materials
  • Market Research
  • Telemarketing
  • Directories

Interactive marketing is the future for B2B marketing

slide14

Content Marketing

“Content marketing (custom media) is the creation and distribution of educational and/or compelling content in multiple formats to attract and/or retain customers.”

e.g. white papers

case studies

videos

articles

trade shows crucial part of b2b marketing
Trade Shows:Crucial Part of B2B Marketing
  • Trade shows
    • manufacturer can exhibit & demonstrate products to potential users
    • manufacturers can view competitors’ products
    • opportunity to create sales & establish relationships with agents, distributors, franchisees & suppliers
  • Online trade shows
    • useful in difficult economic / political circumstances
    • poor substitute for live trade shows
  • Secondary marketing methods

- print advertising, catalogs, web sites, direct mail

  • Total annual media budget on trade events:

Europeans 22% Americans 5%

relationship marketing in b2b contexts
Relationship Marketing in B2B Contexts
  • Not a matter of selling right product 1st time
    • instead sell continuously changed product to keep it right over time
  • Objective of relationship marketing
    • make relationship an important attribute of transaction + differentiate from competitors
  • Use Internet to facilitate relationship building and maintenance
quality is defined by the buyer
Quality is Defined by the Buyer
  • lack of universal standards
  • country-specific standards
  • metric system
  • ISO 9000 Certification = International Standard of Quality

ISO 9001 certification of a fish wholesaler in

Tsukiji

global project team
Global Project Team
  • Customer – initiate inquiry
  • Sales engineer – initial customer contact
  • Application engineer – find best product match
  • Engineering & control systems – design
  • Project manager – manage project & liaise
  • Manufacturing technicians – produce, assemble, test
  • Customer services – installation & start-up
  • Suppliers – provide materials & components
  • Service engineer – after-sales service & maintenance
support services
Support Services
  • Deliveries
  • Warranty
  • Spare parts
  • Repair and maintenance
  • Installation
  • Instructions
  • Other related services
marketing consumer services globally
Marketing Consumer Services Globally
  • Consumer services characteristics
    • intangibility
    • inseparability
    • heterogeneity
    • perishability
  • Service can be marketed
    • as industrial (B B)
    • as consumer service (B C)
business services
Business Services
  • For many industrial products, revenues from associates services > revenues from products
    • cell phones
    • printers
  • Leasing capital equipment
  • Services not associated with products
    • Boeing at-sea-satellite-launch services
    • Ukrainian cargo company rents space on giant jets
    • professional services (advertising, banking, healthcare, etc.)
after sale services
After-Sale Services
  • Installation
  • Training
  • Spare and replacement parts
    • delivery time
    • cost of parts
  • Service personnel
  • Almost always more profitable than actual sale of machinery / product
  • Crucial in building strong customer loyalty
services opportunities in global markets
Services Opportunities in Global Markets
  • Tourism – int’l tourism largest US services export
  • Transportation
  • Financial services
  • Education – 2007: >600,000 foreign students, tuition $11 billion
  • Communications – phone services
  • Entertainment – sporting events sold all over the world
  • Information – Internet, etc.
  • Health care – foreigners come here; US facilities abroad too
next class global product decisions b2c preparation read course pack 9
Next class: Global Product Decisions B2C

Preparation: Read Course Pack #9