I was looking into how B2B marketing varies from the regular one and here are my notes:
- Businesses have more complex buying procedures - it is not just one or two people deciding on spending some money. The company might have several departments involved in preparing the specifications and reviewing options, experts might be employed to provide expertise etc. This means that it’s much harder to establish who your target group really is: a certain department, a person in that department, an expert or the CEO?
- B2B buyers are more rationale – decisions are made more on the basis of what is needed vs. what is desired. If you are able to identify what a given company/department objectively need, you can target your customer well. You do not need to guess what a person might want.
- B2B products are more complex
- B2B target audience is usually smaller – your product is likely targeted at a limited amount of companies. The product is likely to be more complex and more expensive but you will make much less sale than an H&M store does. That also means that more effort can and should go into each sell. That also means that there are less need-based segments.
- B2B is based on personal relationships – this results in part from the complexity of products, buying process and the small number of buyers. Because the sale takes more time and is a more complex process a personal relationship and trust are developed. Personal customer service is therefore extra important.
- B2B markets have less segments than consumer ones – on average 3 or 4 segments. It is a result of a smaller target audience but also of less variations in particular needs of this audience. These segments typically are (according to B2B International):
- A price-focused segment, which has a transactional outlook to doing business and does not seek any ‘extras’. Companies in this segment are often small, working to low margins and regard the product/service in question as of low strategic importance to their business.
- A quality and brand-focused segment, which wants the best possible product and is prepared to pay for it. Companies in this segment often work to high margins, are medium-sized or large, and regard the product/service as of high strategic importance.
- A service-focused segment, which has high requirements in terms of product quality and range, but also in terms of aftersales, delivery, etc. These companies tend to work in time-critical industries and can be small, medium or large. They are usually purchasing relatively high volumes.
- A partnership-focused segment, usually consisting of key accounts, which seeks trust and reliability and regards the supplier as a strategic partner. Such companies tend to be large, operate on relatively high margins, and regard the product or service in question as strategically important.
This is just part one of my notes on the topic of B2B marketing and communication. More will come shortly.