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Summary Business and International Marketing
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Business and international marketingSession 1
Session objectives:
• Analysing B2B buying processes
• Understanding the role of different DMU members
• Distinguishing purchasing orientations
• Managing a purchasing portfolio
• Managing sourcing responsibly
1. Introduction:
What is the purpose of a business?
- Make a profit – why the company need to make a profit? Need customers to be paid,
also look at the costs
= Because the purpose of business is to create a customer, the business enterprise has two
and only two basic functions: marketing and innovation . … Marketing and innovation
produce results; all the rest are costs. Marketing is the distinguishing, unique function of the
business.
What is Marketing?
- Marketing is the science and art of exploring, creating, and delivering value to satisfy
the needs of a target market at a profit.
Significance of B2B markets
- Business to business marketing = purpose of the course. International marketing
within business marketing.
“Business marketers serve the largest market of all the dollar volume of transactions in the
industrial or business market significantly exceeds that of the ultimate consumer market. For
example, companies such as GE, DuPont and IBM spend more than 60 million a day on
purchases to support their operations”
“The purchases made by companies, government agencies and institutions account for more
than half of the economic activity in industrialized countries such as the United States,
Canada and France”
“The differences between B2B and B2C marketing are often differences of degree rather
than kind, yet the degrees of differences are substantial.”
- Difference what is important, how do they work, we are dealing with another types of
dynamics, different
- Same concepts, but difference is how they applied
B2B won’t usually have a brand impact on consumers. So marketing here is actually not
targeted in the same way as consumer goods taught before. But B2B are some of the
biggest employers with significant growth. Most of the biggest brands known to consumers
(Apple, Microsoft, Amazon etc.) have a decent B2B presence as well as their main B2C
presence.
Branding is still just as important – branding gives confidence to business consumers as well,
the amounts that are exchanged are much higher too. This means the possibility of loss/error
is higher and the businesses buying must feel reassured.
,2. B2B Buying Processes
1. Problem recognition
2. Solution determination
3. Solution description
4. Search and qualify potential suppliers
5. Obtain proposals
6. Evaluate proposals and select
7. Order
8. Performance feedback and evaluation
BuyGrid Model (Robinson)
New task Modified rebuy Straight rebuy
Problem recognition X X
Solution determination X X
Solution description X X
Search and qualify potential suppliers X X
Obtain proposals X X
Evaluate proposals and select X X
Order X X X
Performance feedback and evaluation X X X
Three buying situations:
1. New task
- A new product from a new supplier
2. Modified rebuy
- A new supplier (and same product: start from beginning) OR
- A new product (and same supplier: start from “obtain proposals”)
3. Straight rebuy
Example: HILTI who wants promotional items to support sales in building up relationships
RFI: request for information
RFQ: request for quotation (evaluate proposal)
Audit: visit
,Step 6: Evaluate proposals and select
In B2B: it is more about numbers
- It depends on the product, but I list the criteria which are important for me
- There must be input from different stakeholders, not just buying department, also
involving people like user, financial departments, they must be involved
o At the end we will see which vendor is better and we will choose him
- This making my decision process more objective, we take subjectivity out, in this
process there are involved many people and everyone has some preference for
something, to make sure that everyone will be happy at the end, important is be sure
that internal customers are satisfied
, Step 8: Supplier Evaluation
– if they are in the red zone across these criteria, I am not actually satisfied with them, I will
go to the new buying process and I will switch potential suppliers, this one is longer not
satisfied my needs
3. Decision Making Unit
The DMU consists of all the people who will play a role in the decision to purchase a product
or service. The marketing mix program must address the needs of each of these individuals
and find a way to communicate the marketing message to each of them.
A decision-making unit (DMU) is a team of people within an organisation who play a role in
the business-purchase decision-making process for products and services. These roles are
not necessary very formal (CEO,CFO) – someone in the company can say this is the people
who will make a decision, but still there could be informal roles, people who could influence
the decisions
Mostly is about internal people who are involved, but of course there can be external people
like consultants involved in decision making unit
You must align your message with your recipient – you must know what drives each decision
making unit and align your offering with that.
DMU (Decision making unit) members across the buyer processes
- Buyers
- Influencers
- Users
- Decision-makers
- Initiators
- Coordinators
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