This document provides an overview of key concepts in business marketing based on a marketing textbook chapter. It discusses business marketing and how it differs from consumer marketing. It describes the role of the internet and relationship marketing in business contexts. It identifies four major categories of business customers and explains the North American Industry Classification System. It outlines the seven types of business goods and services and discusses unique aspects of business buying behavior such as buying centers, roles in organizations, and evaluative criteria.

1. © 2013 by Cengage Learning Inc. All Rights Reserved.1
Lamb, Hair, McDaniel
Chapter 7
2012-2013
Business
Marketing

2. Describe business marketing
Describe the role of the Internet in business
marketing
Discuss the role of relationship marketing
and strategic alliances in business
marketing
Identify the four major categories of
business market customers
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3. Explain the North American Industry
Classification System
Explain the major differences between
business and consumer markets
Describe the seven types of business
goods and services
Discuss the unique aspects of business
buying behavior
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4. Describe business
marketing
What Is Business Marketing?
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5. © 2013 by Cengage Learning Inc. All Rights Reserved. 5
What Is Business Marketing?
The marketing of goods and services
to individuals and organizations for
purposes other than personal
consumption.
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6. Business Products
• Are used to manufacture other products
• Become part of another product
• Aid the normal operations of an
organization
• Are acquired for resale without change in
form
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…The key is intended use
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7. Describe the role of the
Internet in
business marketing
Business Marketing
on the Internet
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8. the use of the Internet to facilitate
the exchange of goods, services,
and information between
organizations.
Business-to-Business Electronic
Commerce
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Measuring Online Success
Stickiness
A measure of a Web site’s
effectiveness; calculated by
multiplying the frequency of
visits by the duration of a
visit by the number of
pages viewed during each
visit.
Stickiness = Frequency x Duration x Site Reach
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10. © 2013 by Cengage Learning Inc. All Rights Reserved.10
 http://www.allbusiness.com AllBusiness provides entrepreneurs
with the knowledge and tools to start, manage, and grow their
business. The site links to hundreds of how-to articles and
provides expert answers to questions.
 http://www.microsoft.com/business Microsoft Business offers
small business solutions from security to enterprise content
management to cloud services. The site also contains practical
tips, advice, and links to how-to articles.
 http://www.quicken.com/small_business This site offers
information on starting, running, and growing a small business. It
also provides links to a variety of other Quicken sites that are
useful to small-business owners and managers.
Internet Sites for Small Businesses

11. Exhibit 7.2
Evolution of E-Business Initiatives
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12. Discuss the role
of relationship marketing
and strategic alliances in
business marketing
Relationship Marketing
and Strategic Alliances
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Relationship Marketing
 Loyal customers are more
profitable than price-sensitive
customers with little brand loyalty
 Long-term relationships build
competitive advantage
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Strategic Alliances
• Licensing or distribution
agreements
• Joint ventures
• Research and development
consortia
• Partnerships
Alliances succeed with
commitment and trust.
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Relationships
in Other Cultures
Keiretsu relationships are highly
integrated:
• Companies have executives sitting
on each others’ boards
• Maintain dedicated trade efforts
• Joint development, finance, and
marketing
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16. Identify the four major
categories of business
market customers
Major Categories of
Business Customers
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Major Categories of
Business Customers
Producers
Resellers
Governments
Institutions
• OEMs
• Wholesalers
• Retailers
• Federal
• State
• Local
• Schools • Hospitals • Colleges
• Churches • Unions • Fraternal
• Civic Clubs • Foundations groups
• Nonbusiness organizations
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18. Explain the North
American Industry
Classification System
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North American
Industry Classification System
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North American
Industry Classification System
A detailed numbering system developed by
the U.S., Canada, and Mexico to classify
North American business establishments
by their main production processes.
(NAICS)
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Example of NAICS Hierarchy
NAICS
Level
Sector Subsector Industry
Group
Industry Industry
Subdivision
NAICS
Code
51 513 5133 51332 513321
Descript
ion
Information Broadcasting
and telecoms
Telecoms Wireless
telecoms
carriers,
except
satellite
Paging

21. NAICS
• Provides a common industry classification
system
• Valuable tool for marketers in analyzing,
segmenting, and targeting markets
• Data can be used to determine:
– Number, size, and geographic dispersion
of firms
– Market potential / market share
estimates
– Sales forecasts
– New customer identification
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22. Explain the major
differences between
business and consumer
markets
Business versus
Consumer Markets
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23. Business versus Consumer Markets
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Characteristic
Demand
Volume
# of Customers
Location
Distribution
Nature of Buying
Buy Influence
Negotiations
Reciprocity
Leasing
Promotion
Business Market
Organizational
Larger
Fewer
Concentrated
More Direct
More Professional
Multiple
More Complex
Yes
Greater
Personal Selling
Consumer Market
Individual
Smaller
Many
Dispersed
More Indirect
More Personal
Single
Simpler
No
Lesser
Advertising

24. © 2013 by Cengage Learning Inc. All Rights Reserved. 24
Demand in Business Markets
Demand is... Description
Derived
Inelastic
Joint
Fluctuating
Demand for business products
results from demand for consumer
products.
A change in price will not significantly
affect the demand for product.
Multiple items are used together in
final product. Demand for one item
affects all.
Demand for business products is
more volatile than for consumer
products.
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25. © 2013 by Cengage Learning Inc. All Rights Reserved. 25
Fluctuating Demand
Multiplier Effect
(Accelerator
Principle)
Phenomenon in which a small
increase or decrease in consumer
demand can produce a much
larger change in demand for the
facilities and equipment needed to
make the consumer product.
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26. Describe the seven types
of business goods and
services
Types of Business Products
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27. Major Equipment
Accessory Equipment
Raw Materials
Component Parts
Processed Materials
Supplies
Business Services
Types of Business Products
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28. Types of Business Goods and Services
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29. Intel Buys McAfee
• Intel creates nearly 80 percent of the
microprocessors used in PCs and server systems.
• Intel’s purchase of security software maker
McAfee will allow it to produce chips that are
directly integrated with McAfee’s security
products.
• What kinds of business products were Intel and
McAfee producing, and what kinds of products will
they be producing together?
Source: Thomas Catan, Nathan Becker and Jerry A. DiColo, "Intel Bets Its Chips on McAfee: Tech Giant Strikes $7.68 Billion Deal for Security-
Software Maker, Drawing Mixed Reaction," Wall Street Journal Online. August 19, 2010,
http://online.wsj.com/article/SB10001424052748704476104575439180665843938.html.
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30. Discuss the unique aspects
of business buying
behavior
Business Buying Behavior
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31. Customer Service
Business Ethics
Buying Situations
Evaluative Criteria
Buying Centers
Aspects of
Business
Buying
Behavior
Business Buying Behavior
© 2013 by Cengage Learning Inc. All Rights Reserved. 31
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32. All those people in an organization who
become involved in the purchase
decision.
• Number of people
involved varies with
each purchase
decision
Buying Centers
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• Buying centers do
not appear on
formal organization
charts
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33. Initiator Influencers Gatekeepers
Decider Purchaser Users
Roles in Buying Centers
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34. Evaluative Criteria
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 Quality
 Service
 Price
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35. New Buy
A situation requiring the purchase of
a product for the first time.
Modified
Rebuy
A situation where the purchaser
wants some change in the original
good or service.
Straight
Rebuy
A situation in which the purchaser
reorders the same goods or services
without looking for new information
or investigating other suppliers.
Buying Situations
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36. Customer Service
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 Divide customers into groups
based on their value
 Create policies that govern how
service will be allocated among
groups
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37. Chapter 7 Video
Zappos
Zappos gives away information about making
organizational culture work for employees and
the company. The program, Insights, offers
companies assistance in building strong cultures
around core values in a variety of ways, starting
with free tours. Despite seeming like this would
give away valuable competitive information,
Zappos is expanding this service to help other
companies deliver happiness to their customers.
CLICK TO PLAY VIDEO
© 2013 by Cengage Learning Inc. All Rights Reserved.37