Business-to-Business Marketing

what is business marketing?

marketing of goods and services to companies, governments, institutions, and non-profit organizations for use in producing their products and to facilitate their operations

what distinguishes business-to-business (B2B) from business-to-consumer (B2C)?

in b2b, goods and services are sold for any use other than personal consumptions

it is nit the nature of the product; it is the reason for the transaction

what is an example of a b2c transaction?

you buying a gear to fix your mountain bike

what are examples of b2b transactions?

ford buys the same gear to fix a machine

xerox buys soft drinks for its cafeteria

you start a landscaping business and purchase a lawnmower

the u.s. government buys anything

is sales volume greater or smaller in the b2b market compared to the b2c market?

b2b: greater

b2c: smaller

is purchase volume greater or smaller in the b2b market compared to the b2c market?

b2b: greater

b2c: smaller

is number of buyers greater or smaller in the b2b market compared to the b2c market?

b2b: smaller

b2c: greater

is size of individual buyers greater or smaller in the b2b market compared to the b2c market?

b2b: greater

b2c: smaller

is the location of buys more concentrated or less concentrated in the b2b market compared to the b2c market?

b2b: concentrated

b2c: less concentrated

is buyer-seller relationship closer or more impersonal in the b2b market compared to the b2c market?

b2b: closer

b2c: more impersonal

is nature of channel more or less direct in the b2b market compared to the b2c market?

b2b: more direct

b2c: less direct

are buying influences more complex or simple in the b2b market compared to the b2c market?

b2b: more complex

b2c: simple

is there use of reciprocity in the b2b market compared to the b2c market?

b2b: use of reciprocity

b2c: not use of reciprocity

is the use of leasing greater or less in the b2b market compared to the b2c market?

b2b: greater

b2c: less

what is the key promotion method in the b2b market?

personal selling

what is the kep promotion method in the b2c market?

advertising

what is the biggest difference between the b2b and b2c markets?

the size of individual buyers

what is derived demand?

the demand for a company’s product that comes from the demand for their customers products

ex: selling corn syrup for frosted flakes, walmart only buying what customers will buy

what is joint demand?

when two products are used together and demanded together

both products are consumed at the same time

ex: pb & j

what are characteristics of business demand?

derived demand

joint demand

inelastic demand

fluctuating demand

what are the major uses for b2b products?

additional production

use in operations

resale

what are the three main categories for business goods?

entering goods

foundation goods

facilitating products

what are entering goods?

goods that become part of the finished product

cost is assigned to the maufacturing process

what are foundation goods?

capital items with a fixed cost that is depreciated over time

what are facilitating products?

products that support organizational operations and are handled as overhead expenses

what are the types of entering goods?

raw materials

manufactured materials and parts

what are raw goods?

farm products and natural products

only processed a necessary for handling and transport

requires extensive processing

what are manufactured materials and parts?

any product that has undergone extensive processing prior to purchase

component materials require additional processing

component parts do not require additional processing

what are the types of foundation goods?

installations

accessory equipment

what are installations?

major long-term investment items

ex: buildings, land, fixed equipment

what is accessory equipment?

less expensive and short-lived products that are not considered fixed

ex: portable tools, pc’s

what are the types of facilitating products?

supplies

services

what are supplies?

anything necessary to maintain the organizations operations

what are examples of services?

maintenance and repair support

advisory support

logistical support

what are the categories of b2b customers?

commercial enterprises

government organizations

institutions