This document discusses building loyalty in business markets. It outlines key differences between consumer and business markets, noting that business markets have fewer customers, larger transactions, and customized products or services where usage determines value. It then presents a typology of benefits for customers as tangible financial, non-tangible financial, tangible non-financial, and non-tangible non-financial. The document explains how benefit stacks and decision maker stacks differ for typical customers. Finally, it introduces levels of a loyalty ladder and types of customers from most valuable to underperformers based on their position on the loyalty ladder and the seller's cost to serve them.

1. Building Loyalty in Business
Markets
By Prof. Das Narayandas
Submitted by “Group 5”
Ajay Parmar
Aditi Kapoor
Sanjeev Bhugra
Delhi School of Business

2. CONSUMER MARKET
 Large number of buyers with
similar wants
 Transactions usually small in
value
 Products can be mass produced
 Customers perception
determines product value
BUSINESS MARKET
 Fewer customers
 Transactions tend to be larger
 Customized product or service
 Usage of the product or service
determines its value
Distinction

3. A Typology of Benefits
 Tangible Financial Benefits
Have value that sellers can communicate and buyers can verify
 Non-tangible financial benefits
Benefits with value that sellers can convey but buyers cannot easily
validate
 Tangible Non-financial benefits
Have value that is difficult for sellers to quantify, even though buyers
perceive it
 Non-tangible Non-financial benefits
Have value that both sellers and buyers are unable to quantify, especially in
monitory terms

4. The Benefit Stack and Decision Maker Stack
TYPICAL CUSTOMER BENEFTIS OFFERED
Highly competitive price and Quality
Manufacturing Plants on Four Continents
Internet based order placement, tracking
and billing system
24/7 customer response facility with radio
links to trucks
Customized manufacture and delivery of
products to meet plants daily needs
Willingness to handle changes in customer
needs with 12 hours notice
Sunday, holiday and 24/7 delivery, when
required
Just in time delivery
SELLER
TYPICAL PURCHASE TEAM MEMBERS
Warehouse Manager
Purchase Manager
Logistics Officer
Maintenance Manager
Factory Manager
Chief Marketing Officer
CFO
Supply Chain Head
COO
CEO (on occasion)
SELLER
Least
Important
Most
Important

5. Levels of Ladder
Wants to grow the
relationship
Endorses Products
Resists competitors
blandishments
Is willing to pay
premiums
Seeks to collaborate on
new product development
May Invest in you

6. Type of Customers
Most Valuable
customers
Partners
Commodity
Buyers
Under
Performers
Sellers cost of Serving Customers
Low High
BuyersPositiononloyaltyladder