,Solution Manual For
Business Marketing Management B2B, 13th Edition Michael D. Hutt Thomas
W. Speh Douglas Hoffman
Chapter1. A Business Marketing Perspective
A. Chapter Overview
Chapter One introduces the student to the unique facets of the business-to-business
market. The chapter is pivotal to developing an effective understanding of business marketing
management, as the essence of the business market and its unique aspects are often the basis for
the development of marketing strategies.
The first section of the chapter highlights the important dimensions of B2B customers.
These key groups include commercial enterprises, governments, and Institutions. The next
section highlights the essential differences between these consumer markets and the B2B market,
and provides an insight into the nature of business product demand. Business products are
distinguished by the intended use of the product and the intended consumers. The importance of
market-sensing and customer-linking capabilities is discussed. Business marketers must develop
strong cross-functional relationships within the firm. The essentials of derived demand are
explored, highlighting how derived demand influences the demand elasticity for business
products. The need for a global market perspective is also discussed. The J.M. Smucker
Company is used as an illustrative example of the differences between business and consumer
markets, emphasizing the importance of relationships.
Section Four of the chapter examines the increasing importance of the supply chain in
business marketing. The Internet is allowing business marketers to increase the efficiency of the
ordering process and creating virtual markets where products, such as computers, are built to
order for customers. Different types of commercial enterprises are also discussed.
Section Five of the chapter discusses the classification of goods in the business market.
The underlying criteria for classification is how the product enters the production process and the
way it is treated in an accounting sense. Entering goods, foundation goods, and facilitating
goods make up the three major categories. A final section provides three illustrations of the
classification scheme for the purpose of delineating how marketing strategies are adjusted on the
basis of the business product's classification.
The chapter concludes by introducing a framework that guides the business marketing
topics that will be covered in the text.
B. Answers to Chapter Discussion Questions
1. First, it is important for Home Depot and Lowe‘s to have a market orientation to
its customers, whether they are consumers or business customers. From a strategy
perspective, the two capabilities that Home Depot and Lowe‘s should use to
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, demonstrate a market orientation are market-sensing and customer linking
capabilities.
2. Many business marketers spend considerable sums for advertising to final
consumers because of the nature of derived demand for many business products.
In the case of DuPont, advertising to final consumers should help to expand the
demand for clothing made with DuPont's fabric and thus expand the total demand
for DuPont's products.
3.
B2C B2B
Marketing Marketing
Customers Numerous, widely dispersed Few, concentrated
geographically geographically
Buying Behavior Individual Group decisions
decisions Many buying
influences
Buyer/Seller Very little close contact Very close working
relationships Interact
in product design and
problem solving
Product Standardized Complex; technical;
detailed specifications
Accompanying
bundle of services
important
Price Fixed Negotiated, bidding
process
List price for
standardized items
Promotion Heavily oriented Primary role given to
to mass personal selling
advertising
Channels Indirect, many intermediaries Direct, fewer
at each level intermediaries at each
level
4. A manufacturer of drill presses would view G.E. as a "user" because G.E.
purchases the drill press to be used in the process of producing their final
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, products, such as appliances or jet engines. A manufacturer of steel coil, on the
other hand, views G.E. as an OEM because the coil will become an actual part of
a toaster or some other appliance. Thus, the distinction is whether G.E. used the
product to produce their final products or whether it becomes part of, or is
incorporated into, the final product.
5. It depends on whether the firm is selling the customer parts of manufactured
materials and parts. For custom-made parts, personal selling and customer
relationship management activities assume an important role in marketing strategy. The
value proposition centers on providing a product that advances Toyota‘s
competitive position. The business marketer must also demonstrate strong supply chain
capabilities. Standardized parts are typically purchased in larger quantities on a
contractual basis, and the marketing strategy centers on providing a competitive price,
reliable delivery, and supporting services. Frequently, industrial distributors are
used to providing responsive delivery service to smaller accounts. For
manufactured materials and parts, the marketer‘s challenge is to locate and
accurately define the unique needs of Toyota for the items, and then uncover key
buying influentials, and create solutions to serve Toyota‘s needs profitably.
6. A customer value proposition captures the set of benefits that a supplier offers to
advance the performance of the customer organization. Here the suppliers
concentrate efforts on the attributes that matter most and develop opportunities
that provide superior value to customers which may include social, technical,
economic, or service benefits. Points of parity are elements in the value
proposition that perform similarly to competitors‘ alternatives. Points of
difference are the value elements that provide a contrast between the supplier‘s
offerings to those of their competitors.
7. The consumer classification scheme would not apply very well in the business
setting. Business buyers typically don't "shop" for products and the business
product classification scheme should reflect the purchase factors that would affect
the formulation of the business marketer's strategy. In this sense, how the product
is used and how it is treated from an accounting standpoint are important.
8. Due to the fact that companies competing on the basis of time have the ability to
conceive, develop, and introduce new products and services much faster than their
competitors, without sacrificing quality, it is obvious how this ability is a new
source of competitive advantage. As for whether or not it is the most powerful
new source of competitive advantage, that depends upon whether or not the
company competes on the basis of time (e.g., automobile manufacturer).
9. A possible argument in favor of the statement: Because there are a fewer number
of producers of major equipment (foundation goods), demand is not as responsive
to shifts in price. In contrast, there are numerous producers of general materials
and supplies, so it is easier for a customer to switch suppliers. In addition, due to
the large capital expenditures that usually accompany the purchase of foundation
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