Business Marketing VTU,Module 1

2,164 views

Published on

  • Be the first to comment

Business Marketing VTU,Module 1

  1. 1. BUSINESS / INDUSTRIAL MARKETING….<br /> By Prof. Raghavendran.V<br />
  2. 2. 2<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />
  3. 3. Business Marketing.... Module 1, Prof Raghavendran.V<br />3<br />
  4. 4. Now, Why we have study or know about Industrial Marketing??<br />Any answers….. <br />Business Marketing.... Module 1, Prof Raghavendran.V<br />4<br />
  5. 5. We need study BM due to….<br />Lack of marketing orientation like<br />Failure of R&D of the new products.<br />Failure to exploit & develop markets for new products.<br />Failure to innovate in distribution & keys areas of marketing.<br />Inability to refine & modify the product positioning.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />5<br />
  6. 6. Define Business Marketing.<br />Business marketing is referred as Industrial marketing or B2B marketing or organizational marketing. It is defined as marketing of products & services to business organizations. Business organizations include Manufacturing companies, PSU’s, Pvt companies, Educational institutes, hospitals, distributors, and dealers.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />6<br />
  7. 7. INDUSTRIAL MARKETING <br />Vs <br />CONSUMER MARKETING<br />Diff….<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />7<br />
  8. 8. Task for both BM & CM<br /><ul><li>Target markets.
  9. 9. Finding out needs & wants of the target markets.
  10. 10. Developing products and its services.
  11. 11. Evolving marketing strategies to reach and satisfy target customers, better and faster than competitors.</li></ul>Business Marketing.... Module 1, Prof Raghavendran.V<br />8<br />
  12. 12. Differences are…<br />BM…..<br />Geographically concentrated.<br />Technical complexity.<br />Customized.<br />Service, timely delivery and availability is very important<br />CM….<br />Geographically distributed.<br />Standardized.<br />Service, delivery and availability is somewhat important.<br />Cont……<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />9<br />
  13. 13. Difference follows…..<br />e) Involvement of various functional areas in both buyer & supplier firms.<br />f) Purchase decisions are mainly made on rational/ performance basis<br />g) Technical expertise<br />h) Stable relationship b/w buyer & Supplier<br />d) Involvement of family members.<br />e) Purchase decisions are mostly made on physiological/ social/ psychological needs.<br />f) Less technical expertise.<br />g) Non- personal relationship.<br />Cont…<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />10<br />
  14. 14. Difference follows…<br />i) More direct.<br />j) Fewer middlemen.<br />k) Emphasis on personal selling.<br />l) Competitive bidding & negotiable prices.<br />m) List prices for standard products.<br />h) Indirect.<br />i) More layers of Middlemen.<br />j) Emphasis on advertising.<br />k) List prices or MRP of the product.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />11<br />
  15. 15. Characteristics: <br /><ul><li>Market characteristics
  16. 16. Product characteristics
  17. 17. Distribution channel characteristics
  18. 18. Promotional characteristics
  19. 19. Price characteristics</li></ul>Business Marketing.... Module 1, Prof Raghavendran.V<br />12<br />
  20. 20. Industrial Demand<br />Demand for industrial products & services does not exist by itself. It is derived from the ultimate demand for consumer goods. So therefore we can say that Industrial demand is derived demand.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />13<br />
  21. 21. Joint demand & Cross elasticity of demand<br />Joint demand occurs when one industrial product is useful if other products also exists.<br />Elasticity is the change in demand from a change in price. Percentages are used to measure the relative changes. <br />Demand is “inelastic” when the percentage change in quantity demanded is less than change in prices<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />14<br />
  22. 22. Demand is “unitary”, if the percentages changes in price is matched by an equal percentage of quantity.<br />Demand is “elastic” if the percentage change in quantity is than percentage change in price.<br />This concept is very important to understand the relationship between P & Q sold.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />15<br />
  23. 23. Assignment time:<br />Explain the economics of industrial demand, with suitable examples. Minimum two examples should be citied in each category.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />16<br />
  24. 24. Reseller’s Market:<br />Resellers, like industrial firms, do not purchase goods and services for personal consumption, but so to facilitate the operations of the business. That is everything that is purchased is purchased to make a profit .<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />17<br />
  25. 25. Assignment time:<br />Brief out the reseller’s market with following characteristics.<br /><ul><li>Market
  26. 26. Product
  27. 27. Buyer
  28. 28. Channel
  29. 29. Promotional
  30. 30. Price </li></ul>Business Marketing.... Module 1, Prof Raghavendran.V<br />18<br />
  31. 31. The industrial marketing concept<br />The IM concept involves more than facilitating exchange with these customers, it is philosophical point of view that has its basis the formation of the partnership between buyer and supplier for the purpose achieving the organizational goals of the both.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />19<br />
  32. 32. Given the nature & purpose of the industrial products, a seller literally becomes a part of buyer’s technology, productivity, end market satisfaction, and profit plan – in short total corporate strategy.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />20<br />
  33. 33. 21<br />The Marketing Concept<br />Creating value for customers with goods and services that address organizational needs and objectives.<br />
  34. 34. 22<br />Marketing Concept<br />Three major components:<br />All company activities should begin with, and be based on, the recognition of a fundamental customer need.<br />A customer orientation should be integrated throughout the functional areas of the firm: production, engineering, finance, R&D.<br />Customer satisfaction is viewed as the means to long-term profitability goals.<br />
  35. 35. 23<br />Strategic Focus Grid<br />FollowerInteract<br />IsolateShaper<br />High<br />Customer Focus<br />Low<br /> LowTechnology FocusHigh<br />
  36. 36. Assignment time:<br />How would the desire for stable relationship in the industrial market affect a firm’s ability to sell its products to a manufacturer currently buying from another source?<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />24<br />
  37. 37. Type of Industrial Markets<br />Mainly classified into 4 types and they are<br />Commercial enterprises<br />Government customers<br />Institutional customers<br />Cooperative societies. <br />Business Marketing.... Module 1, Prof Raghavendran.V<br />25<br />
  38. 38. Types of Industrial customers<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />26<br />
  39. 39. Classification of Industrial Products<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />27<br />
  40. 40. Organizational Procurement characteristics<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />28<br />Supply Chain Management orientation<br />Buying Orientation<br />Procurement Orientation<br />
  41. 41. Buyer orientation<br />Purchasing firm with buying orientation has narrow and short term focus. The buyers, in these firms, follow the practices under..<br />Lowest price<br />Gain power<br />Risk<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />29<br />
  42. 42. Procurement orientation<br />Purchasing firm has a strategic focus and it is proactive, to achieve these objectives the company adopts following practices.<br />Collaborative relationship with major suppliers.<br />Working closely with other functional areas<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />30<br />
  43. 43. Supply Chain Mgmt orientation<br />Role of purchasing is further expanded to become more value-adding, and strategic operations. It focuses on<br />Deliver Value to end users<br />Outsource Non-core activities<br />Support Collaborative Relationships with major suppliers<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />31<br />
  44. 44. Purchasing in commercial Enterprises<br />Goods & services are purchased by commercial enterprises depends on the nature of the business, the size of the firm, and the volume, variety, and technical complexity of the products purchased.<br />Multiple influencers<br />Technical sophistication<br />Value analysis<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />32<br />
  45. 45. Value analysis developed by GE<br />Selection<br />Information gathering<br />Function definition<br />Generation of alternatives<br />Evaluation of alternatives<br />Presentation<br />implementation<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />33<br />
  46. 46. Purchasing in Government units<br />Widely dispersed markets<br />Complicated procurement laws<br />Understanding government contracts<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />34<br />
  47. 47. Institutional & Cooperative societies Purchasing.<br />Includes the practices of Commercial enterprises and Government.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />35<br />
  48. 48. Industrial Environment<br />Industrial Buyers and Suppliers operate in dynamic environment which changes continuously. Much emphasis discussion on environment are about ecological environment like air, water pollution & conserving natural resources.<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />36<br />
  49. 49. Types of Environment<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />37<br />Water, power, manpower, labor& transport<br />Customers & Competitors, Suppliers<br />Location, R&D, Production facilities, HR, Finance,<br />Marketing, Brand<br />Air & water pollution, solid waste disposal<br />TEMPLE-SD<br />
  50. 50. Strategies for managing industrial environment<br />Effective use of market variable such as 4P’s are not adequate for the survival & success of firms. Following steps are needful for the dynamic in nature and they are..<br />Collecting information on customers & competitors<br />Analyzing trade and govt publications.<br />Carrying Market Research & Economic forecasting within or consultancy<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />38<br />
  51. 51. Strategies will help company for the following:<br /><ul><li>Understanding changes in customers
  52. 52. Monitor the competitors actions & strategies.
  53. 53. Technological innovations
  54. 54. Changes in TEMPLE effect
  55. 55. Identify the demand of the customers and market.
  56. 56. Changes in environmental factors</li></ul>Business Marketing.... Module 1, Prof Raghavendran.V<br />39<br />
  57. 57. Types of strategies<br /><ul><li>Independent strategies
  58. 58. Cooperative strategies
  59. 59. Strategic planning
  60. 60. Backward integration
  61. 61. Forward integration
  62. 62. Horizontal integration</li></ul>Business Marketing.... Module 1, Prof Raghavendran.V<br />40<br />
  63. 63. Case let..<br />End of Module one<br />Business Marketing.... Module 1, Prof Raghavendran.V<br />41<br />

×