Chapter 7: Business Marketing Flashcards
Define Business to Business Marketing
Active connection between businesses to ensure needs are met
- Trust, Mutual Respect, Relationships
Define Business vs. Consumer Marketing
The passive buyer role in consumer marketing is changing as a result of technology, specifically, social media and the internet. Consumers are taking a more active role in the exchange
Define Consumer Marketing
The buyer is the ultimate user of the product/service
Define Business Marketing
Providing to other users (not dealing with the end user)
Define the Network and Relationships with Businesses
Business relationships are more complex, as they involve greater commitment from both sides, and thus more company resources and effort. (Commitment and Trust being key)
Define the Business Marketing Network
Buyers, Sellers, and other Third Parties
Define Sales Approach
Generate leads and new business through persuasion
Define Marketing Management Approach
Developing and product and marketing it - passive consumer
Define Network Approach
Research the factors and forces around a firm, and understand the environment.
- Leads to development of relationships through interaction over time
Define Interaction
The culmination of a number of transactions between two business entities that builds over time. It includes negotiations, discussions, customizations, and anything that is apart of the relationship between two organizations
Whats the Difference between Business to Business and Business to Customers
- Market Characteristics
- Product Change
- Buying Process
- Marketing Mix
Marketing Characteristics (differences between b-b and b-c)
Fewer customers, but larger orders, demand is more inelastic (less sensitive to price change). Consumer Market: If price changes by $1, must lose a lot of customers as they are more sensitive to price change. Business Marketers are less sensitive to price change
Product Change (differences between b-b and b-c)
Products technical in nature, purchased based on specifications, mainly raw and semi-finished goods, heavy emphasis on delivery time, technical assistance, after sale service, financing (not just paying cash, have other options)
Buying Process Characteristics (differences between b-b and b-c)
Buying decisions more complex, Competitive bidding, negotiated pricing, complex financial agreements (negotiation involved), buying criteria and objective specified, and many people are involved in decision making (not just one)
Marketing Mix (differences between b-b and b-c)
Direct selling and physical distribution often essential, advertising more technical, promotions emphasize personal selling, price often negotiated
What are the Fundamental Aspects of Business Marketing
The importance of relationship between buyer and seller in a business interaction
Define Demand as a Fundamental Aspects of Business Marketing
Demand in business markets is driven by comparatively fewer buyers, there are aspects of demand that are important to consider. These include derived, inelastic, joint, and fluctuating demand.
Define Customers as a Fundamental Aspects of Business Marketing
Far fewer customers, much easier to identify, more geographically concentrated, trust results in buying from each other, ethical, illegal, creates relationships
Define Major Equipment as types of Business Products
Large and expensive purchases that depreciate over time (e.g., buildings, machinery)
Define Accessory Equipment as types of Business Products
Smaller in size and expense than major equipment, this equipment is more standardized and often sold to consumers as well (e.g., power tools, printers)
Define Raw Materials as types of Business Products
Unprocessed or untapped materials that are extracted or harvested for consumption of further processing (e.g., oil, canola, potash)
Define Component Parts and Materials as types of Business Products
Finished products ready for assembly or requiring very little in the way of further processing to become part of other products (e.g., engines, pulp paper, chemicals)
Define Services as types of Business Products
Not necessarily part of the final product but do have an impact on the customer’s willingness to buy and maintain a relationship
Define Producers
Profit-orientated individuals and organizations that use purchased
