Business Marketing Key Concepts What Is Business Marketing? Business Marketing The marketing of goods and services to individuals and organizations for purposes other than personal consumption. Business Products The key is intended use. Business Products: Are used to manufacture other products Become part of another product Aid the normal operations of an organization Are acquired for resale without change in form Evolution of E-Business Initiatives • Revenue generation • Aggressive disintermediation initiatives • Basic marketing communication strategies • Reduce costs • Build channel partnerships and trust • Customer-focused technology and systems • Brand building and development • Integrate online and traditional media Time Past initiatives Present initiatives The Internet in Business Marketing Business Internet Uses THEN Revenue Generation Basic Marketing Communication and NOW Reduce costs Build partnerships and alliances Build and support branding Develop customer-focused technology and systems Integrate online and traditional media Strategic Alliances Strategic Alliance A cooperative agreement between business firms (strategic partnership). Business Market Customers Business Marketing Producers Resellers Governments OEMs Wholesalers Federal Unions Churches Retailers State Civic Clubs Foundations Municipal Other Nonprofits County Institutions Producers Original Equipment Manufacturers OEMs. Individuals and organizations that buy business goods and incorporate them into the products that they produce for eventual sale to other producers or to consumers. Business versus Consumer Markets Characteristic Demand Volume # of Customers Location Distribution Nature of Buy Buy Influence Negotiations Reciprocity Leasing Promotion Business Market Organizational Larger Fewer Concentrated More Direct More Professional Multiple More Complex Yes Greater Personal Selling Consumer Market Individual Smaller Many Dispersed More Indirect More Personal Single Simpler No Lesser Advertising Types of Business Products Major Equipment Accessory Equipment Raw Materials Component Parts Processed Materials Supplies Business Services Types of Business Goods and Services Extruding machine: major equipment Aluminum ore: raw material Tool cart: accessory equipment Extruded metal: processed material Propeller blade: component part Paper: supply Uniforms: contracted service Business Buying Behavior Buying Centers Evaluative Criteria Aspects of Business Buying Behavior Buying Situations Business Ethics Customer Service Buying Centers Buying Center All those persons in an organization who become involved in the purchase decision. Roles in the Buying Center Initiator Influencers Gatekeepers Decider Purchaser Users Evaluative Criteria Quality Service Price Buying Situations New Buy A situation requiring the purchase of a product for the first time. Modified Rebuy A situation where the purchaser wants some change in the original good or service. Straight Rebuy A situation in which the purchaser reorders the same goods or services without looking for new information or investigating other suppliers. Customer Service Divide customers into groups based on their value Create policies that govern how service will be allocated among groups Business Buying Behavior Buying Center Initiator Influencer Decider Purchaser User Gatekeeper Evaluative Criteria Quality Service Price Customer service Buying Situations New buy Straight rebuy Modified rebuy