ba 303 c1
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BA 303
BUSINESS 2 BUSINESS
MARKETINGCHAPTER ONE
The chapter is pivotal to developing aneffective understanding of businessmarketing management, as the essence
of the business market and its uniqueaspects are often the basis for thedevelopment of marketing strategies.
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BA 303-B 2 B MARKETING
Every marketerwhether focused on consumer orbusiness markets must embrace a marketorientation which places the consumer first and
uses superior information about customers tomanage marketing efforts. It is, however,important to understand how consumer andbusiness market environments differ.
WE ARE IN BUSINESS TOCREATE AND SERVICE ACUSTOMER. CUSTOMERSATISFACTION IS PARAMONT
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B 2 B MARKETINGWE STRIVE TO CUSTOMER DRIVE
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Business Marketing
Process of determining
needs and developing
marketing mixes for
organizationsThe nature of the customer
and how the product is used
distinguishes
business and consumer goods
marketing
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Characteristics of Business Markets
D
erived demandBusiness consumer demand is derived
from demand for the final products of
which they become a partFluctuating demand
Since demand is derived, the business
marketer must monitor and forecastdemand in final consumer
markets
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Business and Consumer
Marketing: A Contrast
Emphasis on personal selling
The service component of the product
offering plays a key role
Protracted price negotiations for individual
products are common
Business marketers typically sell direct to
large accounts
Relational emphasis
Building a long term relationship is the goal
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Business Market Customers
Commercial enterprisesUsers
Purchase goods for use in
making other productsBuy equipment and machinery
that are employed to manufacture
other products
Original equipment manufacturers
Buy products which will be
incorporated into a finished product
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Business Market Customers
Commercial enterprisesDealers and distributors
Purchase business products for
the purpose of reselling them to usersand OEM's
. Business middlemen which
facilitate the distribution process
Understanding the classificationsprovides guidelines for effective
strategy formulation
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Business product categories
Entering goods
. Become part of the finished
product of the purchaser
Raw materials andmanufactured goods
Treated as expense items
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Foundation goods
Used to produce productsInclude installations
(buildings, equipment) and
accessory equipment (lightfactory equipment, office
equipment)Treated as capital items
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Facilitating goods
Supplies and services tosupport the organization's
operations
Include supplies, repair, andmaintenance items and
servicesTreated as expense items
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1. General Motors costs may be higher because
they are not taking advantage of the
distinctive competencies of auto parts suppliers.These suppliers are often able to
make selected parts more effectively and efficiently
because they concentrate on
creating competence in a very narrow line ofproducts. In other words, auto parts
suppliers are able to deliver superior value as a
result of their distinctive
competencies in a limited product line. Amanufacturer's decision rules on what
to buy or make should be based on analyses of
those products and processes for
which they have a distinctive competence.
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2. Many business marketers spend
considerable sums for advertising to finalconsumers because of the nature of
derived demand for many business
products.In the case ofDuPont, advertising to
final consumers should help to expand
the demand for clothing made withDuPont's fabric and thus expand the total
demand for DuPont's products.
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