B2B MARKETING

Module - I
Week 49
Presented by:
Sandeep Puri
Coverage Topics
• A Guide to B2B Marketing
• Why B2B Marketing is Special?
• How B2B Marketing is different than Consumer Markets?
• Inside and Outside Sales
A Guide to B2B Marketing

We Take an example of value chain

that starts when we buy a shirt.
They don’t arrive in shop by
accident but there is a value chain
of enormous complexity that
begins with cotton production and
ultimately being processed
through various stages as shirt Raw Material Finished Product
production.
Low Added Value High Added Value
Low Level Design High Level Design

High Price Sensitivity Low Price Sensitivity

Low Brand Loyalty High Brand Loyalty
Regular Purchase Irregular Purchase

UNDIFFERENTIATED DIFFERENTIATED
 B2B vs B2C
B2B Markets have complex
01 decision-making unit (DMU)

➢ Decision making unit (DMU) in B2B is complex and potential to be unlike

households
➢ Ordering low value products could be responsibility of junior but not complex
ones is short lived – time horizon is narrow (People / Responsibilities change) than
➢ DMU
family
➢ Target Communication is amorphous – constantly changing groups and
motivations
Risk Value Typical DMU in
Purchasing B2B
Matrix in B2B
 B2B vs B2C
B2B Buyers are more “Rational”
02

➢ We carry our emotions to our workplace and sometimes are skewed to make decisions
➢ A buyer won’t make same decision for a $3000 Jacket vs $200 if latter is warm at work
➢ As Consumers we are less well informed and susceptible to whims and indulgences
➢ As Consumers we make decisions which a B2B buyer may term as ridiculous as we buy
what we want and NOT what we need
➢ A B2B buyer won’t make decisions on emotions and risk himself making trust and
security absolutely critical which makes strong emphasis on brand and reputation
 B2B vs B2C
B2B products are often more
03 complex

➢ Just as DMU the products in B2B environment are often more complex
➢ Consumer products are largely standardised than Industrial products
➢ Relatively Complex Consumer Products are chosen on fairly simple criteria
➢ B2B products have specific requirements (A technical component or a web page)
➢ Buyers of Consumer Products are generally not interested in tech details e.g. Car
➢ A Corporate buyer on other hand will differ when it comes to buy a fleet
➢ A B2B marketer needs to be fully informed on product area to deal with buyers /teams
 B2B vs B2C
Limited number of buying units in
04 B2B markets

➢ Almost all B2B markets exhibit customer distribution as per Pareto or 80/20 rule
➢ It is not unusual in large businesses to have less than 100 customers (examples)
➢ Range of spend in B2B is much larger than B2C
➢ Small number of customers of widely different size and presencee of “Key Accounts”
➢ It is important for B2B Marketer to be adept at KAM – They not only require product to
be delivered but solutions to lot of problems such as stock, teams etc
➢ Limited number of buying units and concentration presents opportunity and
expectation…and if you don’t satisfy the expectation someone else will…
 B2B vs B2C
B2B has fewer segments –
05 behavioral or need based

➢ An FMCG may have 10-12 segments whereas a B2B might have only 2-3 due to smaller
audience than tens of thousands in Consumer.
➢ Business audience behaviour is less variable than consumer
➢ The segmentation in B2B is quite similar across various Industries
Price Focused Segment : transactional outlook in small companies
Quality and Brand Focused Segment : Best product and prepared to pay
Service Focused Segment : High expectation in quality and service (time critical)
Partnership Focused Segment : Key Accounts and Strategic Supplier (Automotive)
➢ Given fewer segments it makes life of B2B marketer easy as well difficult
B2B vs B2C
Personal Relationships are more
06 important in B2B

➢ A smaller customer base is easy to talk to

➢ Sales and Technical People are almost camping at Customers and are almost on their
first name terms
➢ Importance of personal relationship is more pronounced in China and Russia
➢ The consequence is a heavy expenditure on human resources than other forms
➢ Advertising budgets for business marketers are in thousands and not millions
➢ B2B animal is different – focus on listening and cultivatingg than transactional
➢ Trade Shows are #1 promotional too for B2B and almost $18b pa spent (US examples)
B2B vs B2C
B2B Buyers are long term buyers
07

➢ Consumers do buy long term assets but incidences are rare

➢ Perpetual purchases are more common to B2B – Capital
Goods/Components/Consumables
➢ Long term purchases are backed by service agreements – Computer / Vehicles/ Machine
➢ Business Consumers are regarded more long term than Consumers as fewer are there
➢ Benefits of retention are enormous and and consequences of losing serious
Examples – BMW, Mercedes, Getrag, VW which all are intertwined
B2B vs B2C
B2B markets drive less innovation
08

➢ Most of the innovation is driven by Consumer Markets

➢ B2B companies generally are reactive and not proactive. They respond to an
innovation that has already happened
➢ B2C businesses predict trends whereas B2B respond to trends
➢ B2B marketers have both time and data to assess options
➢ As competitors are also in same position – it makes gathering quality intelligence critical
B2B vs B2C
Consumer Markets rely far more on
09 packaging

➢ Huge growth in packaging not only to protect and preserve but to transmit aspirations
➢ Consumers being less rational to business buyers this approach has proved successful
in adding perceived value to products
➢ Practically has no play in B2B where it is judged purely on technical criteria
➢ Packaging changes its dimensions in business – OEMs and Aftermarket for B2B
➢ Packaging plays more a functional role
➢ Typically spend against packaging is directed towards relationships and expertise
B2B vs B2C
Sub-Brands are less effective in
10 B2B markets

➢ Building a brand is most neglected B2B opportunity

➢ B2B branding is and can’t be compared to B2B unlike Unilever which has various sub
brands to cater to various segments of consumers
➢ In B2B markets target audience is smaller so branding needs to be coherent and at every
touch point
➢ B2B marketers should carefully implement their branding strategies (In depth later)

➢ “Less is More” – far better to have one brand than confusing raft of sub brands

➢ JCB and ESCORTS examples

Inside and Outside Sales
Role of Inside Sales to Support

➢ Inside Sales Person a key element in boosting B2B relationship

➢ A qualified lead from trade show or 1-800 number triggers inside sales
➢ Inside Sales is usually link between Marketing and Sales
➢ A qualified lead is handed to outside one to check if the buyer has MANDate
➢ With more recent SaaS model the role of Inside Sales has expanded until deal signing
➢ Inside Sales can provide demos, Video Conference and close deals efficiently

➢ Inside Sales can be a great place to start, learn, ask right questions and get mentored
 End of Module - I

For more information:

email : spuri.b2b@gmail.com
t : 98 100 28739
WA : 98 218 22739