Business-to-Business

Environment: Customers,
Organizations, and Markets

By: Dr. Waseem Hassan

Introduction
• Market evolution
• Competitive positioning
• Combination of Factors
• Ever-changing environment
• Opportunity to move forward
Types of Organizational
Customers
• Commercial Enterprises
• Industrial Distributors
• Value Added Resellers
• Original Equipment Manufacturers
• Users or End Users
• Government Units
• Non Profit and Not-for-Profit Organizations
• Producer Type
• Raw material Producers
• Component Parts and Manufactured Materials Producers
• Capital Goods Manufacturers
• Customer Specifications
Commercial Enterprises
• Industrial Distributors
• Act as middlemen
• Closely watch customer segments
• Value addition
• Value Added Resellers
• Unique enhancements to manufacturers’ products
• Provide systems tailored to customer needs
• Developing unique expertise in integration of many products
Commercial Enterprises
• Original Equipment Manufacturers
• Purchase goods to incorporate them in goods that they produce
• Largest volume users of goods and services
• Users or End Users
• Purchase goods and services for consumption
• Identity of the purchased product is lost
• End users try to differentiate in their product and services
Government Units
• Largest buyer
• Government owned businesses
• Complicated procurement laws
• Different from private sector
• Non standard products
• Lack of standardization
• Very profitable to do business with government
Non Profit and Not-for-Profit
Organizations
• Hospitals, Colleges, Schools etc.
• Have significant public scrutiny
• Buying habits may become similar to those of government units
Producers Types
• Raw Material Producers
• Markets more sensitive to price
• Added value un related to core products
• Few large producers
• Few large end users
• Raw material “identity”
Producers Types
• Component Parts and Manufactured Materials Producers
• Usually retain identity
• Continuous identity
• Easily differentiated from competitors
Producers Types
• Capital Goods Manufacturers
• Goods used to produce Output e.g. Machinery
• Purchase process is lengthy
• Installation, accessories, trainings attached
• Compatible with industry standards
• Customer Specifications
• Specification differentiate suppliers potential
• Suppliers seek to make attractive offerings
Classifying the Business-to-
Business Market Environment
• Classify companies on the basis of offer
• Customer organizations need identification
• Publics
• Communities interested in economic or societal effects
• These are not customers, channel members, suppliers, competitors
• Financial Publics
• Banks, lending institutions, capital firms, stock exchanges, brokerage
houses, investment institutions, financial analysts,
Classifying the Business-to-
Business Market Environment
• Independent Press
• Publish news
• Good relationships with media
• Positive image creation
• Public Interest Groups
• Minority in the population
• Seek attention on their issues
• Internal Publics
• Employees
• Work environment
• Communication
The Macro Environment
• Demographic Environment
• Economic Environment
• Sociocultural Environment
• Natural Environment
• Technological Environment
• Competitive Environment
Value Networks and Supply
Chains
• Value Chain integration with Supply Chain
• Combine elements to create value as perceived by target market
• Could be supply chain partners
• Several parties combine to create value
• Win-Win situation for all the partners
Using the Value Chain and
Supply Chain Concepts
• Motives and behavior of supply chain
• Dominant player
• Competitive clusters of partner companies
• What to outsource, develop within the company, or develop jointly?
• Need to manage partners
Changes in Markets Over Time
• Markets evolve with change in competitors, customers, channels,
technologies etc.
• Development of a Market
• Change forecasting
• The Product Life Cycle
Project Outline
• Introduction of the Company
• Background Analysis of Business
• Marketing Objectives and Strategies
• Porter’s Five Forces Model
• STP Analysis
• 4 P’s
• Product Life Cycle
• BCG Matrix
• SWOT Analysis
• PESTLE Analysis
• Business Evaluation
• Conclusion