Principal differences between the industrial market...

The principal differences between the industrial market and the consumer market

According to the understanding of industrial marketing as marketing of organized buyers, you can distinguish its certain differences from consumer marketing . Consider them in more detail.

1. Secondary and derivative demand. This type of demand is characterized by what depends on the primary demand, which is formed in the consumer market. So, all the changes in demand in the market В2В depend on the demand formed in the market В2С.

For example, a change in fashion on fabric in clothes leads to a reduction in purchases for one type of fabric and an increase in purchases for another type of fabric in the industrial market.

Similarly, Fokker predicts an increase in the sales of new materials from fiberglass and aluminum Glare for Airbus, which are required for the production of the A380, , which is associated with an increase in demand for passenger air travel and airline expansion.

2. The decision to purchase is made by professionals collectively. The high volume of purchases in the market B2B and accordingly the large volume of the transaction provides for a high degree of financial responsibility when it is committed. Accordingly, in order to reduce the risk, purchase decisions are made by several specialists competent in different fields. In the consumer market, the volume of one-time purchases is not large, therefore, purchases are made individually and not by specialists. For example, when buying a car, the decision is made by a future driver who does not understand it professionally.

3. Consumers and buyers in the market В2В constantly monitor information about the pace of scientific and technological progress (PTP), because only modernized and new products lead to an increase in profitability in the future. In the market B2C tracking of the latest trends in the field of science corresponds to the fashion trends and does not always meet the STP.

4. In the market В2В the buyers of the products make stringent requirements to the quality of the purchased products, as, as a rule, the quality of the purchased goods in the consumer market depends on its quality.

5. Since the purchase is carried out by organized buyers in the B2B market, the purchase volumes are quite large, and in the market B2C the purchase volumes are small. So, Michelin in the consumer market sells automobile tires, and its market is represented by all existing car owners. Nevertheless, first of all, the activity of this company depends on the automotive companies that initially install tires for new cars. This, on the one hand, ensures consistently high sales, on the other hand, car owners prefer to put mines of the brand that were already in the car.

6. The manufacturers of В2В are aware of the tastes and preferences of their customers, quite often sell products manufactured to order, for individual needs. In the consumer market, products are usually standardized.

7. The segmentation in the B2B B2B market passes by certain criteria (Chapter 11 of this textbook), in the market B2C the segmentation criteria are more are vast and less static.

8. On the market B2B buyers may not be end users, for example, in the case of wholesale and intermediary services. But in the market B2C buyers are only end consumers.

9. The B2B market sells products of a broader range than the B2C market.

10. In the industrial market, interest in goods is conditioned by the production need, and on the consumer market by the need to obtain individual goods.

11. In the B2B market, there are stickers, special prices, competitive bidding prices and negotiated prices. In the B2C market, the price is formed as a result of the chosen pricing strategy based on the existing sales channel and market type. It should be noted that the industrial market is characterized by low price elasticity, at which the price increase does not entail a serious (proportional) reduction in demand. Accordingly, non-price competition is observed in the market, in contrast to the consumer market.

For example, with an increase in steel prices, the builders of the Ferris wheels will not reduce the volume of steel purchases, unless it contributes to an increase in the cost of construction.

12. It is worth noting that the level of prices in the industrial market depends quite strongly on the characteristics of the purchased product and the degree of customer confidence. At the same time, the consumer market is extremely sensitive to the level of prices of competitors.

13. Promotion in the industrial market of goods primarily comes at the expense of personal sales and consulting, direct sales, participation of exhibitions and the Internet. For example, universities purchase computers directly from IBM, Dell , etc. Promotion in the consumer market is based primarily on advertising, the brand formed, on brand promotion.

14. In the B2B, market, distribution takes place with the help of short one-level or two-level channels of commodity circulation, with an important role being played by the availability of service in each link. At the same time, in the B2C market, there are long channels of goods movement with a multitude of intermediaries.

15. The relations that are formed between the seller and the buyer in the B2B, market are long and trusting. And the market B2C is characterized by short, one-time contacts.

16. The number of buyers is insignificant in the industrial market and is concentrated quite often in certain regions. Accordingly, the significance of each buyer is very high. The number of buyers of the consumer market is large. The international financial center is located in London, the international market for refined products and synthetic materials - in Rotterdam and Amsterdam, the production of motion pictures is concentrated in Hollywood.

17. Demand for one particular product in the industrial market increases the demand for another product, which is complementary to the first product. This dependence ensures the development of entire sectors of the economy. In the consumer market, this dependence is much lower.

18. The motives of buying on the market В2В are always rational, because they are provided with special knowledge of the participants of the purchase, motives in the market В2С are irrational, subjective, may lie in the plane because I liked .

19. The process of making a purchase in the industrial market is more complicated and time-consuming, it can take several months, and even a year. At the same time, purchase negotiations require significant special preparations and preparation. In the consumer market, the purchase process takes quite a bit of time.

20. The lease (leasing) is widely distributed in the B2B, market, as the volume of purchases often exceeds the ability of companies to pay this amount at a time. For example, the largest buyers of airliners, small jets and cars are leasing companies. In the B2C market, rental volumes are small.

21. The entrance to the industrial market is more complicated, as a rule, there are various types of barriers on the market. The entrance to the consumer market, as a rule, is easier and more accessible.

22. The role of branding and brand in the industrial market is reduced, because rational motives prevail and the purchase is made by professionals, in contrast to the consumer market.

23. For the B2B market, the dominant position primarily belongs to the push strategy (push), when the channel participants actively stimulate the distribution channel. For the B2C market, the pulling strategy (pull), is dominant in this case, there is an active influence on end users.

24. Also worth noting that the market В2В there is a pattern of using differentiated marketing, which is due in most cases to an individual approach to the consumer. In the B2C market, mass marketing is often used.

The general scheme of the differences can be represented as follows (Table 1.1).

Table 1.1

Market Marketing Differences B2C and B2B

Factors

B2C

B2B

Seller

Depersonalized

Face to Face

Consumer

Depersonalized

Face to Face

Deciding on a purchase decision

More than one

Multiple faces

Sales Method

Passive

Active

Promotion method

Advertising

Personal sales

Sales Act

Mediated

Personal interaction

Personal Impact

None

Strongly depends

Risk assessment capabilities

Difficult

Accounting for all risks

Key Innovation Factors

Design, brand

Technology, quality

Entry barriers

Avg

High

Stretching the Market

There is no complexity

Market is finite

The complexity of explaining the product

No

Seller is a product expert

Sales cycle

Short

Long

A key business factor

Logistics, advertising

Relationship databases

These differences make it possible to conclude about fundamentally different marketing approaches in the industrial and consumer markets.

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