Transcript Chapter 1 - Cengage Learning

Lamb, Hair, McDaniel
MKTG2008-2009
6
CHAPTER
Designed by
Amy McGuire, B-books, Ltd.
Chapter 6
Business Marketing
Prepared by
Deborah Baker, Texas Christian University
Copyright ©2009 Cengage Learning Inc. All rights reserved
1
Learning Outcomes
LO1
Describe business marketing
LO2
Describe the role of the Internet in
business marketing
LO3
Discuss the role of relationship marketing
and strategic alliances in business marketing
LO4
Identify the four major categories of
business market customers
Chapter 6
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2
Learning Outcomes
LO5
Explain the North American Industry
Classification System
LO6
Explain the major differences between
business and consumer markets
LO7
Describe the seven types of business goods
and services
LO8
Discuss the unique aspects of business
buying behavior
Chapter 6
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3
What Is Business Marketing?
Business
Marketing
The marketing of goods
and services to individuals
and organizations for
purposes other than
personal consumption.
LO1
Chapter 6
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Business Products
The key is intended use.
Business Products:

Are used to manufacture other products

Become part of another product

Aid the normal operations of an organization

Are acquired for resale without change in form
LO1
Chapter 6
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LO1 REVIEW LEARNING OUTCOME
Business Marketing
CONSUMER
cupboards
BUSINESS
cupboards
Coffee pot
oven
oven
folder
and pen
Chapter 6
Teddy bear
photocopier
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folder
and pen
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Measuring Online Success
Stickiness
A measure of a Web site’s
effectiveness; calculated by
multiplying the frequency of
visits times the duration of a
visit times the number of pages
viewed during each visit.
Stickiness = Frequency x Duration x Site Reach
LO2
Chapter 6
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7
Evolution of E-Business Initiatives
• Revenue generation
• Aggressive
disintermediation
initiatives
• Basic marketing
communication strategies
• Reduce costs
• Build channel
partnerships and trust
• Customer-focused
technology and
systems
• Brand building and
development
• Integrate online and
traditional media
Time
LO2 Past initiatives
Chapter 6
Present initiatives
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LO2 REVIEW LEARNING OUTCOME
The Internet in Business Marketing
Business Internet Uses
THEN
Revenue Generation
Basic Marketing Communication
and
NOW
Chapter 6
Reduce costs
Build partnerships and alliances
Build and support branding
Develop customer-focused technology and systems
Integrate online and traditional media
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LO3 Strategic Alliances
Strategic
Alliance
A cooperative agreement
between business firms
(strategic partnership).
Chapter 6
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LO3 Relationships in Other Cultures
Keiretsu
A network of interlocking
corporate affiliates.
Chapter 6
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LO3 REVIEW LEARNING OUTCOME
Relationship Marketing and Strategic Alliances
Supplier
(like Intel)
Supplier
Supplier
Company
(like Dell)
Company 1
(like Starbucks)
Company 2
(like Jim Beam)
Company
(like UPS)
Customer/
Distributor
(like Ford)
Chapter 6
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Major Categories of
Business Customers
Producers
Resellers
Governments
LO4
Chapter 6
Institutions
OEMs
Wholesalers
Retailers
Federal
Municipal
Local
Schools
Hospitals
Churches
Unions
Civic Clubs
Foundations
Nonbusiness organizations
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Colleges
Fraternal groups
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Producers
Original
Equipment
Manufacturers
OEMs.
Individuals and organizations
that buy business goods and
incorporate them into the
products that they produce for
eventual sale to other producers
or to consumers.
LO4
Chapter 6
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LO4 REVIEW LEARNING OUTCOME
Business Market Customers
Business Marketing
Producers
Resellers
Governments
Institutions
OEMs
Wholesalers
Federal
Unions
Churches
Retailers
State
Civic
Clubs
Foundations
Municipal
Other
Nonprofits
County
Chapter 6
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15
LO5 NAICS
NAICS
North American
Industry
Classification
System
Chapter 6
A detailed numbering system
developed by the U.S., Canada,
and Mexico to classify North
American business
establishments by their main
production processes.
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LO5
Example of NAICS
Hierarchy
NAICS
Level
Sector
Subsector
Industry
Group
U.S.
Industry
NAICS
Code
31-33
334
3346
334611
Computer
electronic
product
manufacturing
Mfg. and
reproduction
of magnetic/
optical media
Reproduction
of software
Description Manufacturing
Chapter 6
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LO5 NAICS
Provides a common industry classification system
Valuable tool for marketers in analyzing, segmenting,
and targeting markets
Data can be used to determine:
Number, size, and geographic dispersion of firms
Market potential / market share estimates
Sales forecasts
New customer identification
Chapter 6
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LO6
Business versus
Consumer Markets
Characteristic
Demand
Organizational
Individual
Volume
Larger
Smaller
# of Customers
Location
Distribution
Nature of Buy
Buy Influence
Fewer
Concentrated
More Direct
More Professional
Multiple
Many
Dispersed
More Indirect
More Personal
Single
Negotiations
More Complex
Simpler
Reciprocity
Leasing
Promotion
Yes
Greater
Personal Selling
No
Lesser
Advertising
Chapter 6
Business Market
Consumer Market
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LO6 Demand in Business Markets
Demand is...
Description
Derived
Demand for business products results from
demand for consumer products.
Inelastic
A change in price will not significantly
affect the demand for product.
Multiple items are used together in final
product. Demand for one item affects all.
Joint
Fluctuating
Chapter 6
Demand for business products is more
volatile than for consumer products.
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LO6 Fluctuating Demand
Multiplier Effect
(Accelerator
Principle)
Chapter 6
Phenomenon in which a small
increase or decrease in
consumer demand can produce
a much larger change in
demand for the facilities and
equipment needed to make the
consumer product.
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Types of Business Products
Major Equipment
Accessory Equipment
Raw Materials
Component Parts
Processed Materials
Supplies
LO7
http://www.sysco.com
Business Services
Online
Chapter 6
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LO7 REVIEW LEARNING OUTCOME
Types of Business Goods and Services
Extruding
machine:
major equipment
Aluminum ore:
raw material
Tool cart:
accessory
equipment
Extruded metal:
processed
material
Propeller blade:
component part
Chapter 6
Paper:
supply
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Uniforms:
contracted
service
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Business Buying Behavior
Buying Centers
Evaluative Criteria
Aspects of
Business
Buying
Behavior
Buying Situations
Business Ethics
LO8
Chapter 6
Customer Service
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Buying Centers
Buying Center
All those persons in an
organization who become
involved in the purchase
decision.
LO8
Chapter 6
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Roles in the Buying Center
Initiator
Influencers
Gatekeepers
Decider
Purchaser
Users
LO8
http://www.loctite.com
Online
Chapter 6
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Evaluative Criteria
 Quality
 Service
 Price
LO8
Chapter 6
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Buying Situations
New Buy
A situation requiring the purchase of
a product for the first time.
Modified
Rebuy
A situation where the purchaser
wants some change in the original
good or service.
Straight
Rebuy
A situation in which the purchaser
reorders the same goods or services
without looking for new information
or investigating other suppliers.
LO8
Chapter 6
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Customer Service
 Divide customers into
groups based on their value
 Create policies that govern
how service will be
allocated among groups
LO8
Chapter 6
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LO8 REVIEW LEARNING OUTCOME
Business Buying Behavior
Evaluative
Criteria
Buying
Center
Initiator
Influencer
Decider
Purchaser
User
Gatekeeper
 Quality
 Service
 Price
Buying
Situations
New buy
Straight rebuy
Modified rebuy
Customer service
Chapter 6
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