Business-to-Business Marketing

Abstract

Organisational markets are very diverse. A business customer may be a single-person enterprise or a global corporation. The products and services sold to business customers may be technologically very simple (a sweeping broom) or hugely complex (a turnkey manufacturing plant, or a strategy for the takeover of a key competitive rival). Consequently, a debate has raged in the literature about whether business-to-business marketing is essentially the same as consumer marketing, or is a substantially different practice. Where there are many, small customers and the technology is simple, marketing communications and distribution tends to follow similar patterns to those found in consumer markets. However, where there are few, large customers, and particularly where technology is complex and fast changing, the emphasis shifts from an impersonal marketing management process to the management of inter-firm relationships. Impersonal marketing communications and indirect distribution channels are inappropriate under these circumstances; personal relationship management (Key Account Management), direct distribution, and adapting to the needs of individual customer organisations become the dominant strategy. In the practice of business-to-business marketing management, it is not as simple as this, however. Many firms will have a few large customers for whom a relational marketing strategy is appropriate, and many smaller customers for whom it probably is not. Key strategic decisions surround the treatment of individual customers. Marketing resources must be invested wisely; time spent building a relationship with a customer who turns out to be unprofitable is money wasted, while handling a potentially important customer with insufficient care may lead to the loss of profitable business.

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