class 1 - intro Flashcards
what are the 3 types of B2B consumers + examples ?
Commercial Customers: These include manufacturers, wholesalers, and retailers who purchase goods for resale or production.
Institutional Customers: Organizations such as schools, hospitals, and nonprofits that buy products for operational purposes.
Governmental Customers: Federal, provincial, and local government entities that procure goods and services for public use.
what are some key diffences between B2B and B2C? (8)
- B2B marketing relies more on personal selling and relationship management, while B2C marketing often emphasizes advertising and mass communication.
- The decision-making process in B2B markets is typically longer and involves multiple stakeholders, compared to the more straightforward B2C purchasing process.
- B2B customers are organizations, while B2C customers are individual consumers, leading to different marketing strategies and approaches.
- B2B demand is derived from B2C demand, meaning that the demand for business products is influenced by consumer demand for final goods.
- The dollar value of B2B transactions significantly exceeds that of B2C transactions, indicating a larger market size.
- Individual transactions in B2B markets are typically larger than those in B2C markets, reflecting the nature of bulk purchasing.
- B2B markets have fewer customers compared to B2C markets, leading to a more concentrated customer base.
- B2B demand is generally more inelastic to price changes, meaning that price fluctuations have less impact on the quantity demanded.
what are some marketing strategies in B2B
B2B marketing strategies often include direct sales, trade shows, and networking events to build relationships with potential clients.
Digital marketing plays a growing role in B2B, with companies utilizing SEO, social media, and email marketing to reach business customers.
Personalization and customization of marketing messages are crucial in B2B to address the specific needs of different organizations.
B2B VS B2C : consumer type
B2B : organisations (business, government, institutions)
B2C : indifidual consumers
B2B VS B2C : purchase volume
B2B : large volume
B2C : small volume
B2B VS B2C : marketing approach
B2B : personnal selling, relationship making
B2C : advertising, mass marketing
B2B VS B2C : demand sensitivity
B2B : more inelastic to price change
B2C :more elastic to price change
B2B VS B2C : decision process
B2B : group decision-making
B2C : individual decision making
what is derived demand ?
Derived Demand refers to the relationship between the demand for industrial products and the demand for consumer products, where the former is influenced by the latter.
why is it important to understand derived demand for B2B?
The concept is significant for strategic planning, as it allows businesses to anticipate changes in demand based on consumer trends.
Derived demand plays a critical role in the relationship between B2B and B2C markets, influencing pricing and production decisions.
Businesses can leverage insights from derived demand to identify growth opportunities and potential market shifts.
give one example of derived demand.
Steel: The demand for steel is influenced by consumer demand for automobiles and construction, as these industries require steel for production.
why is it important to understand fluctuating demand for B2B ?
Fluctuating demand in B2B markets requires marketers to monitor consumer demand patterns closely, as these can change rapidly.
Understanding demand elasticity is crucial for B2B marketers, as it affects pricing strategies and inventory management.
what is the bullwhip effect and what can it cause ?
The bullwhip effect illustrates how minor fluctuations in consumer demand can lead to significant variations in demand at different levels of the supply chain.
This phenomenon can result in inefficiencies, such as overproduction or stockouts, if not managed properly.
what can we do to minimize the bullwhip effect?
Businesses can mitigate the bullwhip effect by improving communication and collaboration across the supply chain.
Utilizing real-time data and analytics can help businesses better forecast demand and respond to changes more effectively.
why is it important to understand consumer demand ? ( 3 factors)
- By being aware of consumer trends, B2B marketers can identify potential growth opportunities and adjust their strategies accordingly.
- Understanding the price sensitivity of consumers can inform B2B pricing strategies and product offerings.
- Make a more informed decision-making : B2B marketers should leverage data analytics to track consumer behavior and preferences.
what is demand elesticity ?
Demand elasticity refers to how sensitive consumer demand is to changes in price or other factors.
A high elasticity indicates that consumers will significantly change their purchasing behavior with price changes, while low elasticity suggests less sensitivity.
why is it important to undertand demand elasticity ?
Businesses can identify growth opportunities by analyzing consumer demand trends.
Understanding demand elasticity helps in pricing strategies, product development, and marketing campaigns.
what are the 3 types of industrial goods?
- entering goods
- foundation goods
- facilitating goods
what are entering goods ?
Entering goods are raw materials that become part of the final product. (ex : steel)
what are foundation goods ?
Foundation goods are capital assets (ex : machinery)
what are facilitating goods ?
Facilitating goods support the production process but do not become part of the final product, such as maintenance supplies (ex : machine lubricant)
what are the marketing strategies for entering goods (customized & standardized)?
For customized goods : personal selling and relationship marketing
For standardized goods : competitive price, reliable delivery and supporting services
what are the marketing strategies for foundation goods (customized & standardized)?
Both customized and standardized : service capabilities, personal selling, relationship marketing and the product itself
what are the marketing strategies for facilitating goods (customized & standardized)?
customized : personal selling, relationship marketing & differentiated products
standardized: catalog listings, competitive pricing, reliable delivery
what is market-sensing capability?
Market-sensing capability involves the ability to detect and respond to market changes effectively.
what is customer-linking capability?
Customer-linking capability focuses on building and maintaining strong relationships with customers.
what is a value proposition?
A customer value proposition outlines the benefits a supplier offers to enhance customer performance.
what is the point of parity (POP)?
Points of Parity (POP) ensure basic expectations are met
what is points of differentiation (POD)?
Points of Differentiation (POD) highlight unique attributes.
give an example of POP and POD
A logistics provider may have on-time delivery as a POP and AI-driven analytics as a POD.
