LECTURE 1: INTRODUCTION
DR. DILIP S. MUTUM
B2B
Marketing
(BUSI4058)
ABOUT ME
Dr. Dilip S. Mutum
Contact details
– email: dilip.mutum@nottingham.edu.my
– Twitter: @admutum
– Office: ELG03
– Tel: 603-87253754
– www.dilipmutum.com
- Office hours – Refer to the Module Outline
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ABOUT ME
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MODULE ORGANISATION
10 lecture sessions x 2 hours
2 x 1hour seminars
presentations and discussions incorporated.
Seminar 1: Wednesday 5-6pm, 3 March (week 26).
ROOM F3C06
Case Study: Stakeholder Networks in the Nigerian Oil
Sector
Seminar 2: Wednesday 5-6pm, 7 April (week 31). ROOM
F3C06
Case Study: The Corporate Incentive and Promotion
Industry
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LECTURE SCHEDULE
Lecture
Date
1 (w 21)
27/1
What is a Market? A service ecosystem approach to understanding markets.
2 (w 22)
3/2
Organisational buying behavior and market structures.
3 (w 24)
17/2
How do markets work? Creating and shaping new markets and maintaining
dynamics.
4 (w 25)
24/2
Market relations and sustainable competitive advantage
5 (w 26)
3/3
Forming business networks: business network partnership attraction
6 (w 27)
10/3
Business-to-Business marketing strategies
7 (w 28)
17/3
8 (w 29)
24/3
Innovation in business networks
9 (w 30)
31/3
Strategic Market Relations in the Digital World
10 (w 31)
7/4
Managing business networks: communication, coordination and learning in business
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networks
Lecture Topics
market
Branding and building loyalty, value, and co-creation in network partnerships
ASSESSMENT
1. 2 hour exam (50%)
2. 2,000 word group CW (50%)
CW: To be discussed in detail later
Max. 2,000 words (not incl. refs & appendices)
Deadline for submission: 22nd of April 2020
(Thursday) 3:30pm
Refer to Assessment Guidelines
Individual Assignment (100 % of total Mark)
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TEXTS YOU MAY USE:
Ellis, N. (2011) Business-to-Business Marketing:
Relationships, Networks & Strategies, Oxford University
Press, ISBN 978-0-19-955168-2
&
Brennan, R., Canning, L. and McDowell, R. (2014), Businessto-Business Marketing (3rd ed.), Sage Publication Ltd,
ISBN 978-1-4462-7373-9
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1. WHAT IS A MARKET?
A SERVICE ECOSYSTEM APPROACH
TO UNDERSTANDING MARKETS
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TODAY’S OBJECTIVES
To examine the argument that marketing
produces markets
To examine the argument that marketing
practices and theories play a significant
role in the production of markets.
To explore the view that markets are
systems, specifically service ecosystems
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THE EVOLUTION OF MARKETING
(AMERICAN MARKETING ASSOCIATION)
1935: “the performance of business activities that direct the flow of
goods and services from producers to consumers”
1985: “the process of planning and executing the conception, pricing,
promotion, and distribution of ideas, goods and services to create
exchanges that satisfy individual and organizational objectives”
2006: “an organizational function and set of processes for creating,
communicating and delivering value to customers and for managing
customer relationships in ways that benefit the organization and its
stakeholders”
2014: “the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value
for customers, clients, partners and society at large”
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B2B MARKETING DEFINED
“The marketing activities of any kind of organisation
which has exchange relationships with other
organisations or businesses
Turnbull (1994)
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BUSINESS MARKETS
(HUTT AND SPEH, 1992)
…are markets for products and services from local to
international
Bought by:
Businesses
Government bodies
Institutions
For:
Incorporation
Consumption
Use
Resale
EVOLUTION OF B2B MARKETING
Industrial Marketing: 1960s in the US
B2B Marketing: 1980s
Organisational Marketing: 2000s
1-15
SOME EXAMPLES OF
ORGANIZATIONAL BUYING
 Paper cups by McDonald's
 Computer chips by Toshiba
 Concrete by Government
 Oil by Electricity Generators
 Fertiliser by Farmers
 Accountancy services by Companies
 TV’s by Electrical Retailer
SIGNIFICANCE OF B2B MARKETS
Key B2B activities are
carried our behind the
scenes of most B2C
experiences
Upsteam
interorganisational trading
supports every end of the
market
Huge Purchasing power of
private & public sector
organisations
B2C marketers are
learning from B2B
marketing practices
B2B activities make a
major contribution to most
national economies
B2B
Markets
B2B exchanges have a
greater impact on people’s
lives thnn B2C trading
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CHARACTERISTICS OF ORGANISATIONAL
MARKETS
1. Size of the market
2. International aspects
3. Concentration of buyer power
4. The nature of demand
5. Buying process and decision making
KEY DIFFERENCES BETWEEN B2B AND
CONSUMER MARKETING
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SIGNIFICANCE OF SUPPLY/ DEMAND
CHAINS
Upstream Suppliers
(USX, Du Pont)
(Suppliers of
manufactured
materials and
Parts such as
sheet metal
or plastic resin
Direct Suppliers
(TRW,
Johnson Controls)
Purchase input
Used in creating
Power-steering
Systems (TRW) or
Car seats (Johnson
Controls)
Auto Manufacturers
(Ford, General Motors)
Auto Buyers
(Consumers)
Purchase input
used in creating
automobiles
Purchase
automobiles
Business Marketing Business Marketing Consumer Marketing
(Individuals, Households)
and
Business Marketing
(Organizations such as
Fleet Buyers)
SIGNIFICANCE OF RELATIONSHIPS AND
NETWORKS
Shifting from
short-term
transections
to long-term
relationships
Inter-firm
collaboration
underpinning
effective
S/DCM
Needing to
build
relationships
with network
of
stakeholders
Increasing
awareness of
importance
of personal/
social
networks
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THE TRADITIONAL LOGIC :
COMMAND AND CONTROL
Employee
Customer
Need to Persuade
Need to Persuade
Need to Extract Work
Need to Extract Money
Need to Tightly
Manage & Control
Need to Capture &
Control
Need to Extract
Maximum Productivity
Need to Extract
Maximum Profit
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A NEW LOGIC FOR MARKETING
From Goods to Services to Service
Service-dominant (SD) logic (Vargo &
Lusch 2004)
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HISTORICAL PERSPECTIVES ON SD LOGIC
The great economic law is this: services are exchanged for services...it is
trivial, very commonplace; it is nonetheless, the beginning, the middle, and the
end of economic science. - Fredric Bastiat 1848
What is needed is not an interpretation of the utility created by marketing,
but a marketing interpretation of the whole process of creating utility. - Wroe
Alderson 1957
The importance of physical products lies not so much in owning them as
obtaining the services they render. - Philip Kotler 1977
Customers do not buy goods or services. They buy offerings which render
services, which create value...activities render services, things render services.
- Evert Gummesson 1995
The focus is not on products, but on the consumers' value -creating processes,
where value emerges for consumers, and is perceived by them...the focus of
marketing is value creation rather than value distribution. - Christian
Gronroos 2000
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THE NEW LOGIC:
COLLABORATION
&
CO-CREATION
Look at 2006 through a different lens and
you’ll see another story, one that isn’t
about conflict or great men. It’s a story
about community and
collaboration on a scale never seen
before.
- Time, Dec. 25, 2006—Jan 1, 2007
In essence, the service revolution and the
information revolution are two sides of the
same coin.
- Roland Rust, Journal of Marketing, 2004
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GOODS-DOMINANT (G-D) LOGIC
Purpose of economic activity is to make and distribute
units of output, preferably tangible (i.e., goods)
Goods are embedded with utility (value) during
manufacturing
Goal is to maximize profit through the efficient production
and distribution of goods
Goods should be standardized, produced away from the
market, and inventoried till demanded
Firms exist to make and sell goods
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PROBLEMS WITH GOODS LOGIC
Goods are not why we buy goods
Goods are not what we fundamentally own to
exchange with others
Customer is secondary or missing
Focuses on efficiency of output rather than
effectiveness of resource application (inputs)
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SERVICES AND THE G-D LOGIC
PERSPECTIVE
Services are:
Value-enhancing add-ons for goods, or
A particular (somewhat inferior) type
good, characterized by:
1. Intangibility
2. Heterogeneity (non-standardization)
3. Inseparability (of production and
consumption)
4. Perishability
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CHARACTERISTICS OF BUSINESS SERVICES
Characteristic
Implications for services marketing
Intangibility
Services cannot be touched or owned prior to or
during delivery: marketers need to provide tangible
evidence or clues for customers
Inseparability
Services are produced and consumed simultaneously
making it hard to separate provider/client: marketers
need to prepare front line staff & educate customers
Perishability
Services cannot be stored: marketers need to try to
manage demand via promotion and/or price, and
manage supply e.g. via part-time employees
Heterogeneity
Services involve the interaction of many individuals
in production & consumption: marketers need to
ensure consistency via standardization or skilled staff
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CLARIFICATION:
SERVICE VS. SERVICES
• Services = intangible products
• Service = The process of using
one’s competences for the benefit
of some party (The application of
knowledge and skills)
• There are no “Services” in ServiceDominant Logic
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SERVICE-DOMINANT LOGIC BASICS
A logic that views service, rather than goods, as
the focus of economic and social exchange
Essential Concepts and Components
 Service: the application of competences for the benefit
of another entity
 Shifts primary focus to ―operant resources from
operand resources
 See value as always co-created
 Sees goods as appliances for service deliver
 Implies all economies are service economies
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The Emerging Reorientation
of Business
Goods Logic
Less
Global
Sustainability
More
Service Dominant
• Goods
• Service
• Tangibles
• Intangibles
• Operand Resources
• Operant Resources
• Asymmetric
More
Customer
Alienation
Less
• Symmetric
• Propaganda
• Conversation
• Value Added
• Value Propositions
• Transactional
• Relational
• Maximize
Profits
Less
Respect for
Marketing
in Firm
• Financial Feedback
More
S-D MARKETING
Co-Create
Service
Offering
CUSTOMERS
Draw
Upon
Internal
Resources
Co-Create
Value
Proposition
Draw
Upon
External
Resources
CUSTOMERS & PARTNERS
Overcome
Internal
Resistance
s
PARTNERS
Co-Create
Value
Processes &
Networks
Co-Create
Conversation
& Dialogue
Overcome
External
Resistances
Co- Production vs. Co-Creation
TRADITIONAL
PRODUCT BUSINESS
APPROACH
Customers are “passive
audience”; value is
created inside the
company with no
interference from the
customers
CO-PRODUCTION IN
SERVICES
Customers are active
players. As “partial
employees” they
participate in the
service production
within parameters
defined by the service
provider
VALUE CO-CREATION
APPROACH
Value is defined by the
customer; customer
experiences and
perceptions are essential
to value determination;
value is created in the
consumption/usage
stage (value-in-use)
“Times have changed. The focus (of marketing)
is shifting away from tangibles and toward
intangibles, such as skills, information, and
knowledge, and toward interactivity and
connectivity and ongoing relationships.”
Lusch and Vargo (2004:15)
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SUMMARY
Marketing practices and theories play a
significant role in the production of markets.
Markets are service ecosystems.
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MARKETING ACADEMIC JOURNALS
Top marketing research journals (ABDC A* journals)









European Journal of Marketing 3* ABS
Industrial Marketing Management 3* ABS
International Journal of Research in Marketing 3* ABS
Journal of Consumer Research 4* ABS
Journal of Retailing 4* ABS
Journal of Marketing 4* ABS
Journal of Marketing Research 4* ABS
Journal of the Academy of Marketing Science 3* ABS
Marketing Science 4* ABS
Most relevant practice-oriented management journals
 Harvard Business Review
 MIT / Sloan Management Review
 California Management Review
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OTHER MARKETING ACADEMIC JOURNALS (ABDC LIST)
A
B
Electronic Markets 1*
International Journal of Consumer Studies 1*
International Marketing Review 3*
Journal of Advertising 3*
Journal of Advertising Research 3*
Journal of Brand Management 1*
Journal of Business Research 3*
Journal of Consumer Psychology
Journal of Interactive Marketing 2*
Journal of International Marketing 3*
Journal of Retailing and Consumer Services
1*
Journal of Services Marketing 2*
Journal of Strategic Marketing 2*
Journal of Travel and Tourism Marketing
Journal of Vacation Marketing
Marketing Intelligence and Planning 1*
Marketing Letters 3*
Marketing Theory 2*
Psychology and Marketing 3*
Quantitative Marketing and Economics 2*
Academy of Marketing Science Review 2*
Advances in Consumer Research 2*
Asia Pacific Journal of Marketing and
Logistics
Australasian Marketing Journal 1*
Consumption, Markets and Culture 2*
Corporate Communications: An International
Journal 1*
International Journal of Advertising 2*
International Journal of Bank Marketing 1*
International Journal of Market Research 2*
International Journal of Retail and Distribution
Management 1*
International Review of Retail, Distribution and
Consumer Research 1*
International Journal of Sports Management
and Marketing
Journal of Business-to-Business Marketing
Journal of Consumer Behaviour 2*
Journal of Consumer Marketing 1*
Journal of Consumer Satisfaction, Dissatisfaction
and Complaining Behavior
Journal of Financial Services Marketing 1*
Journal of Interactive Advertising
Journal of Marketing Communications 2*
Journal of Marketing Education
Journal of Marketing Theory and Practice
Journal of Product and Brand Management 1*
Journal of Social Marketing
Qualitative Market Research: an international
journal 1*
Services Marketing Quarterly
Sport Marketing Quarterly
Source: http://www.dilipmutum.com/2014/03/australian-business-deans-council-abdc.html
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THANK YOU
Any Questions?
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