Business to Business Marketing.

This report will discuss about marketing communications and its factor. Market communication is the process of making a link between internal and external hierarchy. Marketing communications should be prepared with a due sense of social and professional responsibility and should conform to the principles of fair competition, as generally accepted in business. All these terms will be discussed in the context of renowned retail company named UNISON.

UNISON is a company which owner of 16 people, headquartered in New York City with a development office in Europe. UNISON employs its own staff based in a national office in London and also in 13 UK regional offices. They make Unison, a set of enterprise applications that executives use to guide their team. UNISON is the UK’s biggest public service trade union. It represents 1.3 million members who deliver essential services to the public. These are services that protect, enrich and change lives (UNISON, 2014).

Task 1: Critically evaluate the key differences between B2B marketing and consumer marketing.

A type of commerce transaction that exists between businesses, such as those involving a manufacturer and wholesaler, or a wholesaler and a retailer. Business to business refers to business that is conducted between companies, rather than between a company and individual consumers. Business marketing is trading products or services by individual or organizations including commercial business, institutions, governments to other organization or business who use those as components in existing products, resell them or use them as support for their operation. These trades that take place between organizations have massive impact on economy and also benefits customer. As business sales to other business it is called B2B or Business to Business Marketing.

Models of Business to Business Marketing:

There are two models of Business to Business Marketing [B2B]. They are 1) Vertical B2B and 2) Middle B2B.

Vertical B2B: Vertical B2B is business oriented or for manufacturing. Vertical B2B can take two forms either upstream or downstream. In upstream model B2B starts from the manufacturer side from there it reaches up to commercial retailers. For example for UNISON to sell their products or services they need to manufacture the materials or man power. For that they will need parts from manufacturer of those raw materials, primary things and labor which are manufactured to be sold B2B. On the other side downstream B2B reaches from producer to distributor. For example UNISON selling its products and services to other business or commercial sectors like hospitals, town halls, universities, colleges, schools, social services and clinics (UK Essays, 2013).

Middle B2B Market: In another marketing strategy Businesses 2 Business sale takes place via a middle stage arrangement. This business side and supply side trading occurs in a common place. For example internet based sites Alibaba.com, China websites works as a middleman in the B2B marketing.

Business to Business Marketing in Commercial Sector

Business to Business marketing in commercial sector is often profit oriented and competitive. In commercial sector, most of the buyers are known to each other and most of the time they have a long time business relation. Sales or trade deals are often shared among these businesses. Marketing between businesses are based on direct sales, telesales, direct mail etc. For example if UNISON is selling services to a retailer like industry it will contact the company via their channel and there will be exclusive offers only for that industry. Sometimes businesses have to offer exclusivity to get extra business by channeling customers to a particular retailer (UK Essays, 2013).

Business to Business Marketing in Not for Profit Sector

Not for profit sector generally represents community services via corporate social responsibility. Every business has their responsibility towards the society in which they operate. B2B marketing in the not for profit sector deals with these responsibilities. For example: UNISON as a part of their corporate social responsibilities runs recycle program where they would ask for bids to give their services at a concession rate. This type of marketing is most of the time open for participation. Communication channel is normally company website, newspapers etc.

Business to Business Marketing in Public Sector

Business to Business in public sector deals with government or state owned institutes. Businesses manufacture products to sell to these institutes. Marketing for this will normally privately do or sometimes this business can bid for getting the deal. Public sector will include Central government, local authority, fire department, police and higher education institutes (UK Essays, 2013).

Business to Customer Marketing

Business to Customer marketing is business to consumer marketing. This marketing deals with marketing products to consumer. Consumer here is buyer of the products which is not business related. B2C products are products and services like food, cloths, cars, phones, houses etc.

Comparison between Business to Business and Consumer Marketing

The divergence between business and consumer marketing may apparent but some pernicious difference with complications is seen. Consumer marketing focus on prominent group via retailers and mass media whereas business marketing involve lighter and more lineal channel of dispersion. In business marketing, negotiation process that takes place between purchaser and seller become personal in compare to consumer marketing. In business marketing budget for product promotion through advertising is done by direct mail or journal. As because advertising is limited, it hardly helpful for achieve sales calls successfully (Hutt and Speh ,2004).

Some opines that there is no difference between consumer marketing and business to business marketing because main aim is marketing so it may be little matter to a person whether he/she choose consumer or business marketing. But the fact is that when a person buying a product for himself and when he purchasing products for his company is different. When marketing approaches are designed some fundamental factors appears.B2B rely on establishing relationship marketing exertion. If one wants to make B2B business focusing on consumer then it will cost money (B2B vs B2C, 2010).

Critical Analysis of B2B and B2C marketing

B2B markets are small, niche sized comprised of thousand sales prospects but B2C markets are larger in size where there are millions of consumers as sales prospect.

Purchasing process also varies. Purchasing timeframe for B2B is typically months and often takes additional time to complete the whole purchasing process. B2C sales are for shorter period. This can be as short as minutes (for example impulse buy). Purchasing process is simpler compared to B2B.

Sales process for B2B is normally consultative selling. The process works in this way. First the business understands clients’ needs and then develops a trust worthy relationship. Sometimes there are 2 level sales force related first is sellers sales force and second distribution sales force. B2C sales on the other hand are directly done to the customer or via a retailer. Selling process is much traditional ‘convincing the consumer’ that they need to have the product or service that needs to be sold (UK Essays, 2013).

B2B sales are higher ticket purchase that range from thousand pounds to millions. B2C sales are typically less and limited to thousand pounds except: car, home etc.

The B2B sales decision determined by client need and budget in hand so the decision that comes out tends to be rational. B2C decision is mostly emotional so the need for budget or need is secondary.

Brand identity also differs in its characteristics. Brand identity is created through personal relationships and consultative selling through the channel. Using social media and advertising brand identity is created in B2C market (UK Essays, 2013).

Lifetime customer valuation is higher in B2B as because the sales volume is higher and there will be possibility of repeat sales to the same business or its associates. In case of B2C it’s less because of lower cost for shifting the product and repeat sales are fewer in numbers.

These crucial factors are heavy for byplay to create its marketing strategy and tactics. These helps to refer direct chance and instruct pertinent marketing substance.

Task 2: Impact of macro economy on your organizations B2B marketing process.

Macro-economic models are used to help economists and policy makers make predictions, or forecasts, about the economy, and about the effect of changes in one economic variable, such as exchange rates, on other variables, such as prices and output.

Macro marketing Environment

Macro marketing environment incorporates all elements that regulate an organization, macro marketing environment forces can be divided into six part such as: economic, political, socio-cultural, technological, environmental and legal.

Because of globalization market environment is frequently changing. Such low barrier poses greater threat to the new products that are coming in the pipeline to the existing one. Though market environment is not acquainted with external macro environment but still what they can do is to analyses market environment carefully. They should observe economic change very carefully and then should make decision to explore their capability (Economics online, 2013).

In order to perform external environmental analysis, organizations should check the following factors: Analyses future threat, opportunities i.e. needs to perform SWOT analysis. Appraisal of the type of the environment. Scrutinize environmental determines. Identify their competitive position. Trace out main component of environmental forces.

Less consumer mean little demand and when demand is less than mean more effort to accelerate demand. To accelerate demand, marketing is essential. But the fact is that if people purchase fewer products then advertiser will spend fewer amounts. Because of economic downtown in USA in 2001, advertising dropped by 9%, and Internet advertising by 27%. This possessed serious impact on B2B marketing as because of the consumers spending slowdown, the investment of business also slow down.

Because of the deceleration of branding and other marketing contour, there is a tendency of rising direct marketing. Measurement of marketing ROI eliminated with the elimination reduction of budget. Investment bank Cowen and company overview last six economic recessions and found an increasing trend in direct marketing. However, during economic recession in 2011, online marketing was beguiled by the breakdown of Internet world wide.in 2008, US online marketing reduced of about $25.8 billion. Approximately 7% decrement from previous estimation. The main consideration is that it is 23% greater than 2007 (Economic Journal, 2007).

Opportunities and Threat

Not all the business suffers during economic downfall. Big businesses can still take advantage of their size and market relationship to attract customers even in this challenging situation. Opportunities that can turn things around for UNISON are listed below:

Keeping calm: In economic downtime it is better for the companies to increase PR networking. Additional support will come from aggressive marketing strategy. PR with a hard marketing will ensure no client is lost to other businesses. UNISON can still perform at its best by keeping existing contacts and pushing them to buy their stock(UK Essays, 2013).

Adding Value: Add additional value to the existing products or services. This will help buyers to realize they are getting more value for their money. UNISON can work along with the manufacturers to grab good deals for B2B consumers.

Service: With a limited capital it is best to work on world class B2B consumer service. This will enable businesses to give repeat order. For a large organization like UNISON it is a fairly easy task.

Threats that UNISON will have during economic crisis are listed below:

Less cash flow: During this period often business struggle with cash flow from business operations. First businesses will spend money considering recession and try to hold to cash.

Layoff and Unemployment: One of the major issues that businesses have is to get rid of employees to cut cost. While this can be minimum for UNISON but yet there will be tendency of saving (UK Essays, 2013).

Role of B2B marketing in the national and international business market place

UNISON though based in UK has also establishments in cross border. While UK market will face the most of economic crisis but yet that will have severe impact on US operations. But for a B2B business like UNISON it can always capitalize on its plus points. From the UK operations it can learn what sales and what not in this scenarios. Not necessarily that will be same in US market but yet that will give an idea. Strategy building up will be the next stage where working strategies are made to counter all the negatives surrounding the market. Close look should be given at other competitors. Communication is key here. PR departments can work on to building up relations and leads where marketing and sales department can capitalize on that. US market might get tougher with several similar competitions so adding value with services will improve business (UK Essays, 2013).

Conclusion 2:

From the above discussion it has been clearly identified Business to Business Marketing have both advantage and disadvantage due to change in macro environment. A solid marketing strategy helps a business to standout and still performs at its best during toughest period of business.

Reference 2

1. B2B vs B2 (2010), Business to Business vs Business to Customer Marketing [Online]. (Updated 2014) Available at: http://themarketingdirectors.wordpress.com/2010/02/15/b2b-vs-b2c-marketing-what-works-best-on-the-dance-floor/[Accessed 13 December 2014].

2. Beyond Knowledge (2014), Business to Business Marketing [Online]. (Updated 2014) Available at: http://www.b2binternational.com/publications/b2b-marketing/[Accessed 13 Dec 2014]

3. Economic Journal (2007), Online Journal Library [Online]. (Updated 2007) Available at: http://www.onlinelibrary.wiley.com/journal/10.1111/(ISSN)1468.../issues?...2007/[Accessed 13 December 2014].

4. Economics online (2013), Macro Economics [Online]. (Updated 2013) Available at: http://www.economicsonline.co.uk/Managing_the_economy/What_is_macro-economics.html/[Accessed 13 December 2014].

5. Marketing communications (2014), Factors of Marketing Communication [Online]. (Updated 2014) Available at:http://www.marketingcommunicationsblog.com/five-important-factors-of-marketing-communications/[Accessed 13 Dec 2014]

6. UK Essays (2014), Models of Business to Business Marketing [Online]. (Updated November 2013) Available at:http://www.ukessays.com/essays/marketing/two-models-of-b2b-marketing-essay.php[Accessed 13 December 2014].

7. UNISON (2014), UNISON [Online]. (Updated 2014) Available at: https://www.unison.com/about-us#overview/[Accessed 12 Dec 2014]

Business to Business Marketing