Understanding Business Marketing and its Strategies
The marketing of the products and services done for the business customers like industries, government organization and private sector firms, institutions like hospitals, education societies, hotels , NGO’s, banks etc. The business customers buy the products to make other goods from it to make profit, minimize losses and earn maximum revenue for their firms and reduce cost and so on. Business Marketing is also called as Industrial Marketing or B2B marketing. Demand in business market exists because of demand in consumer market so it can be said that it has derived demand.
Value of Customer in the Business Market
The value of the customer is the amount of benefits delivered to the customer
Business market and its strategies
which can be social, economical and technical benefits received by the customers in return of the amount paid for that particular product or service offerings. The value of the customers can be expressed as benefits divided by the cost incurred and also can be expressed as benefits less the cost incurred.
Similarities between business and consumer marketing
- Business and consumer markets are similiar when it comes for deciding the target market
- Identifying the needs and wants of the customers
- Developing the product or service that would serve for the needs of the customers or the target market
Planning required in the Business market
When compared to the consumer market the planning in the business market requires some essentialities which are : –
1) A close relationship with the business strategy which would involve the capital investment and company’s implications
2) Interdependence among the functionalities which also include cross functional teams.
B2B (Business to Business Marketing Strategy)/ Business Marketing :-
- B2B Branding :- It includes aligning corporate brands, products brand, divisional brand & applying brand standards to material.
- Product or Service :- Business customers focus on creating shareholder value for themselves. revenue-producing benefits of products which are considered to be the important factor in product development & marketing cycles.
- Target Market :- It is small and it reflects more specified needs of a specific industry
- Pricing :- Business market can be easily convinced to pay premium prices if one knows how to structure pricing & payment terms well.
- Promotion :- One of the important factor and it depends on marketing communication strategy.
- Sales & Distribution :- Distribution channels and sales force greatly determine the success of a marketer. Campaign plans, Positioning statement, briefing agency, measuring results are some of the other factors which should be taken care off.
Concepts in Industrial Demand
1) Derived Demand
When the demand of business goods arise from the demand of the consumer goods.
2) Fluctuating demand or volatile demand
The demand arised for the business goods or services is likely to be more fluctuating than that of the consumer goods and services.
3) Joint Demand
This type of demand occurs when one type of industrial good is necessary only and only if the other product exists.
4) Cross – Elasticity of Demand
When the sales of one product increases there is an unusual effect in the price of the other product. This type of demand is known as cross elastic demand of business goods and services.
5) Reverse – Elasticity of Demand
In this type of demand if there is a substancial increase in the price of the product, then the demand for the product also increases and if the price is decreased the demand also decreases . These short-term reactions are opposite from what we would normally expect from business buyers.
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