1. Introduction to Business-to-Business (B2B) Marketing

2. What Is Marketing?
the process of planning and executing
the conception (product), pricing, promotion, and distribution
of ideas, goods, and services
to create relationships
that satisfy individual and organizational objectives.”

3. BUSINESS MARKETING MARKETING OF GOODS AND SERVICES TO:IS
MARKETING OF GOODS AND SERVICES TO:
Companies
Government Bodies
Institutions (i.e. hospitals)
Non-Profit Organizations (i.e. American Red Cross)
FOR
USE IN PRODUCING THEIR PRODUCTS AND/OR TO FACILITATE THEIR OPERATIONS

4. What Distinguishes B2B from B2C?
B2B: goods or services are sold for any use other than personal consumption
Note: It is not the nature of the product; it is the reason for the transaction.

5. B2B versus B2C Marketing Characteristic B2B Market B2C Market
Sales volume
Greater
Smaller
Purchase volume
Number of buyers
Fewer
Many
Size of individual buyers
Larger
Location of buyers
Concentrated
Diffuse
Buyer-seller relationship
Closer
More Impersonal
Nature of channel
More direct
Less direct
Buying influences
Multiple
Single/Multiple
Type of negotiations
More complex
Simpler
Use of reciprocity
Yes No
Use of leasing
Less
Key promotion method
Personal Selling
Advertising

6. BUSINESS TO BUSINESS: IT IS ALL ABOUT DEMAND
DERIVED DEMAND
The demand for a company’s products comes from (derived) the demand for their customer’s products.
Most demand comes from consumers.
JOINT DEMAND
Two products are used together and demanded together – Both products are consumed at the same time

7. Other Characteristics of Business Demand
Inelastic Demand
Fluctuating Demand

8. Major Uses of B2B Products
For additional production (e.g., components are combined into subassemblies and become part of the finished product)
For use in operations, but not part of the finished product
For resale

9. Classifying Business Goods & Services
3 Main Categories of Products
Entering Goods
Become part of the finished product
Cost assigned to the manufacturing process
Foundation Goods
Capital Items
Typically depreciated over time
Facilitating Products
Support organizational operations
Handled as overhead expenses

10. Classifying Business Goods & Services
Entering Goods
Raw Materials
Farm products & natural products
Only processed as necessary for handling & transport
Require extensive processing
Manufactured Materials & Parts
Any product that has undergone extensive processing prior to purchase
Component Materials require additional processing
Component Parts generally do not require additional processing

11. Classifying Business Goods & Services
Foundation Goods
Installations
Major long-term investment items
Buildings, land, fixed equipment, etc.
Accessory Equipment
Less expensive & short-lived
Not considered part of fixed plant
Portable tools, PC’s, etc.

12. Classifying Business Goods & Services
Facilitating Products
Supplies
Any supplies necessary to maintain the organization’s operations
Services
Maintenance & Repair support
Advisory support
Logistical support

13. Categories of B2B Customers
Commercial enterprises
Indirect channel members and facilitators
OEMs (original equipment manufacturers)
Users = customers
Governmental organizations
Institutions