Business to Business Marketing and Business-to-Consumer Business - Research Paper Example

? Business to Business Marketing Table of Contents Introduction 3 Sales Force 3 Sales Force Vs Other methods of promotion 4 Managing the sales force 5 Going beyond Personal Selling: Use of Digital Medium 6 Relationship variables and business networks 7 Developing an effective B2B customer loyalty Plan 8 B2B and B2C 9 Difference between B2B and B2C 9 7Ps Framework of Service Marketing Mix 10 Advantages and Disadvantages of B2B and B2C in terms of SPSL 13 Conclusion 14 References 15 Bibliography 17 Introduction Business-to-business describes about the commerce transactions between two businesses. It can be occurred between a wholesaler and a manufacturer or between a retailer and a wholesaler. The other contrasting terms of B2B are B2C and B2G (Schneider, 2011, p.229). B2B branding is a typical term that used in marketing (Sarin, 2010, p.243). The volume of Business-to-Business transactions is respectively higher than the Business-to-Consumer transaction. B2B is significantly implemented in the context of collaboration and communication in marketing field. Many business organizations are now implementing social media to get connect with their business clients and consumers. However, the business organizations are using very much similar tools within the business process (Brito and Lewis, 2011, p.177). Therefore, the employees of business firms can get connected with each other. When the communication process is taking place among the employees, it can be referred to as B2B communication. Saxon Plumbing Service London Ltd. (SPSL) is a small organization that used to provide plumbing services to the SMEs in south London. Now they are trying to expand their business in by setting up a new office in Manchester. Moreover, they are trying to implement B2C process in their business. The objective of the study is to find the advantages and disadvantages of the implementation of B2C business process to both the customers and business. Sales Force Developing a new office is most certainly a right step towards the ambitious plan of expansion. The move made by the management to deploy is most certainly a right move made by the company to promote business and develop customer base. However, in order to be successful the management must organize the sales force properly to achieve desired level of output. However, the sales force may not be the solution to all the questions. Company has to rely on some other promotional techniques/ mediums to increase brand awareness and customer base. This section of the study provides a critical analysis as to how the management should organize and manage the sales force, appropriateness of the move of the company to deploy sales force and also other probable ways to increase brand awareness. Sales Force Vs Other methods of promotion According to the 4 Ps of marketing and the marketing mix concept the 4th P of the marketing mix is the promotion or communication. The elements of the promotional mix are advertisement, sales promotion, personal selling and public relations. Among these advertisement is probably the most common and popular way to reach out to masses, generate demand and brand awareness. Sales promotion is a great technique to provide promotional offers to increase brand awareness. Public relations are all about developing relationship between the public (client) and the company (Kitchen and Proctor, 2001, p.280). Personal selling on the other hand can be defined as the person to person interaction between the seller and the prospect (buyer). Keeping the on-current circumstances in mind it can be understood that advertisement, public relations seems the two best options. But there are certain constraints such as financial resources and budget. Also the company uses word of mouth or viral marketing to generate awareness and increase customer base. Personal selling is one of the best ways to develop and manage personal relationships with the client that pays rich dividend in case of generating positive word of mouth. Hence deploying sales force is most certainly a good move on the part of the company. Also as per the organizational hierarchy the business development department looks quite thin as there is only one manager. Hence keeping the expansion plan of the company in mind the company needs to employ some more sales personnel. However, mere employment of the sales force will not do the job the sales force need to managed properly to get results (Chattopadhyay, 2009, P. 370). Managing the sales force In order to manage the sales force it is suggested that the company uses sales territorial approach. A sales force can be defined as a set of existing and potential customers assigned to a sale person or a group of sales person at a given period of time. Usually the sales manager or the business development manager is usually responsible overseeing the sales units. Sales territories help the company to gain in path market coverage, develop responsibility of each sales person, evaluate the performance of the sales people, and improve customer relations. (Belch and Michael, 2005, p. 325). Also based on the organizational chart of the company it can be seen that the company does not have any business development executives. So the newly recruited sales executives needs to be given some training so that the executives become familiar with the organizational culture and also gains valuable product knowledge. It is proposed that the management follows the ACMEE model of sales training. ACMEE stands for Aims, Content, Methods, Execution and Evaluation (De, 2011, P. 178). Going beyond Personal Selling: Use of Digital Medium In today’s digital world, having a website for your business is paramount: irrespective of your business size. Today customers don’t want to step out of their comfort zones to look for products. The Internet facilitates this as it offers everything people need (Mosby and Weissman, 2005, p.121). If there is a business, people expect to find it on internet. Not having a website is called business suicide. If people can’t find the business on the internet people lose confidence & trust. Let’s compare ads on Newspapers with online presence. The results would show that the presence over the online medium far more effective than newspapers. This is because not many people read newspapers. This is because some read magazines, but most of the people use search engines. Having a website online means more visibility and exposure with your target audience. According to the case study SPSL have a website, but it acts as a ‘shop window’ only. This needs to change. As internet has become the most popular and widely used medium for information search it likely that the people requiring plumbing service in Manchester are likely to go over the internet and search for probable service providers. Therefore the SPSL needs to make sure that while the people look for plumbing or similar services the name of the company comes first in the search engine result pages. This requires the use of SEO techniques to gain higher rankings. Judging by the organizational chart provided it is most likely that the company does not have the expertise to improve the digital presence. Hence it is suggested that company may outsource it to local digital consulting firms. This will not charge the company much and yet improved digital presence will most certainly help the company to increase awareness and generate leads. A part from the website improvements the company should also consider advertising on Google maps and use of social media marketing (mainly through Facebook and Twitter) to generate awareness and create personal relationship with customers through various engagement activities. This will also help the services provided by the company go viral. Again any digital marketing firm can provide the required search engine marketing and social media marketing at an affordable price (Zarrela, 2010, p. 45). Relationship variables and business networks In order to improve marketing efficiency and effectiveness it is important for the companies to add customer relationship management as an important part of the overall corporate strategy. The companies need to follow the concept of the symbiotic marketing that emphasizes on the long term relationship between company, client and the supplier. The emergence of the Industrial Marketing and Purchasing (IMP) led to an array of systematic research efforts on the part of the B2B marketers (Wenderoth, 2009, p.10). By taking reference of the integrated gap model developed by A Parasuraman, Leonard Berry, Valerie Zeithaml, it is believed that SPSL should focus upon five key customer deliverables to develop long standing relation with the clients. Reliability: It refers to the ability of the provider to provide the service as promised by to the customer. Responsiveness: This refers to the willingness of the provider to respond the customer’s call or request. Assurance: This refers to the ability of the service provider to build up an environment of trust & faith. Empathy: This refers to the ability of the service provider’s ability to provide customized service with care. Tangible: It refers to the physical evidence or the aesthetics of the service [provider such as design, style, facilities, etc (Kotler, 2001, p. 25). Developing an effective B2B customer loyalty Plan Customer loyalty programs in B2B market are quite different from the B2C markets. In case of B2C marketing the companies may expect impulse buying; on the other hand B2B buying process is far more complex as compared to B2C buying process (Kaushik, 2009, p.301). B2B buying process involves a lot more strategy and also important inventory and buying needs. Therefore the customer loyalty should also have some key points (Motiwalla, 2008, p.307). In order to create customer loyalty SPSL should always deliver upon the promise. If the company default on own promises, then the customers will get affected as very few companies will like to stay if the actions of SPSL are affecting the revenues. Another key factor to be considered while developing B2B client retention program is the corporate policies. Most of the companies forbid the employees from accepting gifts. This means that SPSL should not focus on rewards or discounts, unlike the B2C customer segment. The loyalty program should be developed in such a way so that the whole company gets benefited, rather than individual employees. SPSL may follow some client retention programs such as free online ordering, overnight delivery. The company may even start 24/7 customer care services. This will help the clients get personalized care. This is likely to act as a huge motivational factor to continue a long term relationship with SPSL. In system SPSL should simplify the billing system, make service delivery faster and offer personalized services to make sure that the clients just keep coming back (Kolb, 2008, p.35). B2B and B2C The client base of SPSL is the wide range of commercial small and medium scale organizations. Peter and Harvey are the founders of this Saxon Plumbing Service London Ltd. Now the organization is trying to implement Business-to-Consumer business process in order to achieve more market share. This part of the report will differentiate between the B2B and B2C part of the business. 7ps framework of service marketing has implemented in this study. Finally the part will highlight the advantages and disadvantages of B2B and B2C. Difference between B2B and B2C The execution of marketing programme highly depends on two markets. The B2B market depends on various sales strategies comparing to the B2C market. The B2B sales are achieved in a longer sales cycle comparing to the B2C sales (Kotler and Pfoertsch, 2006, p.72). B2C sales are forced by highlighting the product usefulness and its advantages. On the other hand, B2B sales are based on the relationship with the customers. One of the key objectives for a B2B sales executive is to build a strong relationship with the people who used to make the decisions in customer’s business (Barlow and Thomas, 2010, p.106). The market which SPSL targets when providing its services is very much different among the B2C and B2B businesses. SPSL has focused on a narrow segment that has the needs for its services in B2B business. In B2C market, the target market is the complete sales market of consumers. There is little prejudice of potential customers. The sales cycle and period of time to achieve through sales is very much different in B2C and B2B sales. In B2C sales, the sales process is very much instantaneous (Peppers and Rogers, 2004, p.284). On the other hand B2B sales are entirely based on the reasonable decision of business value to the target audience. The sales process in B2C is very much emotional due to the status of owning its value or price. 7Ps Framework of Service Marketing Mix SPSL offers a range of plumbing services, such as leak repair, leak detection, drain cleaning, toilet repair, radiators and general maintenance. All plumbers are highly qualified in specific areas of plumbing. In an addition, they frequently concentrate on the training sessions about customer service and the further developments in this sector. The company’s service provision is 24 hours a day, 365 days a year which is quite effective. Product Although SPSL is basically a service provider, it uses the services of one fastidious wholesaler in order to buy the necessary products. These products meet health and safety regulations. Moreover, these help SPSL to meet their objectives in terms of service and quality. SPSL has implemented the services of its wholesaler known as ABC Plumbing Suppliers since the organization’s inauguration in the year 2000. The two companies have a good working relationship that may set to continue in the short-term. Price The pricing of SPSL depends on upon several factors. These include volume of client, frequency of callouts, type of service needed, and length of contract and trade location. Now SPSL has a complex pricing structure. The company tends to favour price negotiation when dealing with its clients, rather than promoting a rigid pricing strategy. The two founders, Peter and Harvey have found that arbitration is often ideal by existing and potential clients. In terms of pricing strategy, SPSL has implemented pricing towards the premium end of the market. Place SPSL is located in South London. Its centrally located base means that it’s preferably located to target a larger number of potential customers within the South London area. The company has a convoy of commercial vans that are fully equipped with necessary tools and paraphernalia. It is being assumed that Manchester will also provide the same opportunities to the business and may generate the same rewards. Promotion SPSL’s existing promotion is largely based on word-of-mouth communication as they are presently dealing with local clients in South London. The company does have a website, although this is purely inadequate for the business. In other words, it provides background to the company, range of services and testimonials, but they need to develop their website more attractively. It will help them in B2B and B2C business strategies in terms of business expansion. SPSL also need to trade fairs and occasionally advertises in local newspapers. Peter and Harvey have been fortunate that word-of-mouth has been a significant contributor to the company’s success story. It is being estimated that 90% of new customers or clients are a result of positive word-of-mouth communication. However, this cannot be solely relied upon in the future, particularly in relation to the establishment of the new office in Manchester. They need to employ other promotional strategies like social media networking, organizing of a campaign and many more. People Here the people mean the employees of this organization. An effective and skilled sales team and every single individual within the organization need to be knowledgeable and skilled. They need to practice effective customer relationship strategies in order to map, tap and cap the target market effectively. These will help the organization in terms of both B2B and B2C business process. Physical Evidence As the organization is trying to implement B2C business process in Manchester, Physical evidence of brand and company outlets are important enough. The get up of the five new offices should be very much similar. This will help to increase the brand awareness of the company in customer’s mind as it is necessary for B2C business process. Process The effective business process that includes efficient customer service is an important factor in service marketing. A B2C business process can achieve huge success by implementing effective customer services and PR in the business process. Therefore, it is necessary for SPSL to employ effective PR strategy in business process as they are implementing B2C business process in a newly developed market. Advantages and Disadvantages of B2B and B2C in terms of SPSL There are several advantages and disadvantages of both B2B and B2C business process in terms of SPSL. Considering B2B business process, SPSL has an advantage that the organization has achieved huge success in the Southern London. Successful relationship with business clients and a great deal of social bonding with its clients has become huge success for SPSL, but the inadequate and less informative website may affect the business performance of SPSL in Manchester. They need to develop their website in order to provide all kind of information about their services as it is necessary for B2B process in a new business area. The disadvantage of B2B business process is the business can attain and acquire fewer clients comparing with the B2C business process. On the other Hand, SPSL may achieve success through B2C business process as the process targets mass customers within an area. It helps to reduce several sales support services and customer services. There are several challenges that may affect the organization. Unavailability of sales force team may make it difficult for the organization to acquire new individual residential customers, as personal selling is an important aspect for B2C business process. Moreover, they need to spend huge capital for promotional activities in order to make the residential customers of Manchester to aware about its plumbing services. High sales cycle and limited market place are the two major disadvantages that need to be rectified by SPSL while they are undertaking B2C business process. Conclusion Business-to-business describes about the commerce transactions between two businesses. Customer loyalty programs in B2B market are quite different from the B2C markets. In case of B2C marketing the companies may expect impulse buying; on the other hand B2B buying process is far more complex as compared to B2C buying process. . SPSL may follow some client retention programs such as free online ordering, overnight delivery. The company may even start 24/7 customer care services. This will help the clients get personalized care. SPSL should not focus on rewards or discounts, unlike the B2C customer segment. The loyalty program should be developed in such a way so that the whole company gets benefited, rather than individual employees. SPSL has focused on a narrow segment that has the needs for its services in B2B business. In B2C market, the target market is the complete sales market of consumers. There is little prejudice of potential customers. One of the key objectives for a B2B sales executive is to build a strong relationship with the people who used to make the decisions in customer’s business. The market which SPSL targets when providing its services is very much different among the B2C and B2B businesses. References Barlow, M., and Thomas, D., 2010. 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