Conceptual differences between B2B and Customer Marketing.

Conceptual differences between B2B and Customer Marketing.

While on the surface the fundamentals of marketing are the same for attracting consumers, businesses, governments or institutions, there are variety of differences that make the marketing of products and services in the B2B market quite different from marketing to consumers. The 12 major differences in consumer versus B2B marketing are spelled call at the table below.

Internal to company

In business marketing, it's not possible for one department alone to develop or make a change in an offering and gain the approval of a large number of customers. during a business marketing firm, a product manager usually must act sort of a mini general manager. He/she faces every product manager’s problem of responsibility without authority. 

The business marketing manager must be ready to gain cooperation from all the other functions including engineering, information resources, and manufacturing. Especially within the manufacturing of B2B products there are often long lead times.

A furniture product manager takes the needs of the marketplace (gained from market research), and deals with an internal or external industrial designer develops concepts for a product. At the identical time, the merchandise manager must involve engineering, finance, and manufacturing to develop initial feasibility studies and price estimates for the product. 

The time interval for tooling (the forming equipment used to make the product pieces) may be close to one year. This product manager must make decisions, finalize the planning, gain cooperation from all other departments, then approve the order for the tooling while planning to introduce a product one year in advance. While consumer product managers are usually graduates of advertising agencies or corporate advertising departments, business product managers often have technical backgrounds.

The reason for this is that advertising plays such a small role in business marketing when compared to consumer marketing. additionally, product managers are frequently required to form customer visits. These visits not only give these managers important feedback, but the merchandise managers are active members of the sales team, providing expertise and thus the authority from headquarters on pricing and special packages of products and services. 

In business marketing, the marketing strategy often is the same as the overall corporate strategy. For reasons already cited, many of the firms’ functional areas must be involved within the marketing strategy. as an example, a little security division of a large corporation was faced with an opportunity to develop special security equipment for the White House in Washington, D.C. 

The salesperson presented his ideas to engineering, manufacturing and therefore the finance department and the entire division decided to pursue this exciting strategic opportunity, changing the company strategy from commercial to governmental target market segments. The investments required to form this product were significant. additionally, other departments had to vary their priorities with the new product forcing a new strategy. The gestation from time of suggestion to actual sales involving this large government contract was overflow two years, and therefore, the whole division had to change its strategy to be successful.

Customer/marketing

While emotion plays some role within the purchasing process, generally speaking, buying decisions are more rational in non-consumer markets. it's hard to justify the purchase of a new companywide computer system based on the color of the machine housings or the social relationship between the purchaser and the salespeople. 

Some rationale must be developed so as for this decision to be accepted by all members of the purchasing team. Consumer markets generally contain millions of individuals. Far fewer customers structure most non-consumer markets. as example, a provider of jet engines need turn only a few potential customers such as Airbus and Boeing, who manufacture the bulk of commercial airliners. In business marketing, Pareto’s Law is usually strongly in effect. 

In other words, a little percentage of the customers account for a very large percentage of all the business in a particular segment. as an example, within the United States, about 4 percent of all corporations account for 70 percent of all exports. This narrow base means in many markets, the buyers have more power than the sellers. 

While in consumer marketing families and other reference groups play key roles within the purchasing decision, in business markets the decision-making unit or buying center is the key. There are a variety of individuals who take specific roles and make decisions based on these roles. additionally to the number of individuals in this decision-making unit, one finds variety of locations involved. 

One large Mastercard firm assembled a team who were located in various cities throughout North America, Europe, and Asia. These individuals rarely met, but communicated by e-mail, voice mail and fax. In making a buying decision a few new computer software programs, these people took various roles and came to the choice without physically ever being in the same room.

Business buyers are characterized in several ways than are consumer buyers. Consumers are often segmented by demographic or psychographic methods while customers in business markets are segmented by factors such as industry classification codes, product applications, price sensitivity, location, the importance of the merchandise to the buying firm and customer size.

While commodities are often sold directly or through only one or two steps of distribution, business equipment and services providers often use many various channels. Most large producers sell on to large customers, while also selling through various other channels at the identical time. as an example, a roofing shingle firm is probably going to sell directly to large home builders, contractors and “big box” retailers like Home Depot within the US or B&Q in the UK, while at the identical time selling through distributors who in turn sell to smaller lumber yards, builders’ merchants, and other outlets. Each effort through different distribution channels reaching different customers requires a special marketing strategy.