exam 2 review

exam 2 review - CHAPTER 6 Business Marketing LO 1 What is...

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CHAPTER 6 – Business Marketing LO 1 – What is Business Marketing? o Business marketing is the marketing of goods and services to individuals and organizations for purposes other than personal consumption. o Importance In size, the business market is substantially larger than the consumer market. Everything on the consumer market has already been purchased on the business market. o Key characteristic of business products is intended use, not physical characteristics. o Defining Characteristics of Business Products Used to manufacture other products Major/accessory equipment Becomes part of another product. Raw and processed materials, component parts Aid the normal operations of the organization Supplies, business services Are acquired for resale without modification Retailers and wholesalers LO 2 – Business Marketing on the Internet o Business to business electronic commerce is the use of the Internet to facilitate activities between organizations. o $800 million in the U.S. and $1.8 trillion in the European Union. o Measuring Online Success Three important things to measure are recency, frequency, and monetary value. Recency Customers who have made a purchase recently are more likely to purchase again in the near future.
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Frequency Identify repeat and frequent buyers. Monetary Value Big spenders are the most profitable (duh). Stickiness is a measure of the combination of frequency, time spent on the web site, and number of pages viewed during each visit. Marketers can use this to measure the effectiveness of changes. o Trends in B2B Internet Marketing The best online strategy integrates conventional and internet marketing strategies. Disintermediation means eliminating intermediaries such as wholesalers or distributors from the marketing channel. Dell sells directly to business buyers and consumers. This has happened more slowly than expected on the internet and has become less of an initiative than it originally was. Evolution of Initiatives Revenue Generation Cost Reduction Aggressive disintermediation initiatives build channel partnerships and trust Basic marketing communication strategies customer-focused technology and systems LO 3 – Relationship Marketing and Strategic Alliances o Seek and establish ongoing partnerships with customers. o Strategic Alliances A strategic alliance (strategic partnership) is a cooperative agreement between business firms. Licensing or distribution agreements, joint ventures, R&D consortia, and partnerships. Relationship commitment means that a firm believes that an ongoing relationship with some other firm is so important that it warrants maximum efforts at maintaining it indefinitely.
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Trust exists when one party has confidence in an exchange partner’s reliability and integrity. o
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exam 2 review - CHAPTER 6 Business Marketing LO 1 What is...

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