Chapter14ProductsandServicesforBusinesses?McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.

NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.LearningObjectives14-1 Theimportanceofderiveddemandinindustrialmarkets14-2 Howdemandisaffectedbytechnologylevels14-3 Characteristicsofanindustrialproduct14-4 TheimportanceofISO9000certification14-5 Thegrowthofbusinessservicesandnuancesoftheirmarketing14-6 Theimportanceoftradeshowsinpromotingindustrialgoods14-7 TheimportanceofrelationshipmarketingforindustrialproductsandservicesIntroductionProductsinInternationalMarketsConsumergoods(business-to-consumer)Industrialgoods(business-to-business)IssuesofstandardizationversusadaptationnotasrelevantMarketingacrosscountrymarketsmoresimilarthandifferentIndustrialproductsareusedincreatingothergoodsandservicesIndustrialconsumersareseekingprofitBusinessserviceshighlycompetitivegrowthmarketDemandinGlobalBusiness-to-Business

(B2B)Markets1of5IndustrialmarketdemandBynaturemorevolatileAffectedbystagesofindustrialandeconomicdevelopmentincountryLeveloftechnologyofproductsandservicesmakestheirsalemoreappropriateinsomecountriesthanothersDemandinGlobalBusiness-to-Business

(B2B)Markets2of5TheVolatilityofIndustrialDemandHuge,cyclicalswingsindemandinherentThreefactorsexacerbateupsanddownsSellerstendbedependentonsmallnumberofcustomersProfessionalbuyerstendtoactinconcertChangesinmarketsacceleratedbyderiveddemandIndustrialdemandderivedfromconsumerdemandDemandinGlobalBusiness-to-Business

(B2B)Markets3of5TheVolatilityofIndustrialDemandcontinuedWaystomanageinherentvolatilityMaintainbroadproductlinesandmarketcoverageRaisepricesfasterandreduceadexpendituresduringboomsIgnoremarketshareasastrategicgoalEschewlayoffsFocusonstabilityDemandforTechnologyVolatileServersaresoldtocompanies;thus,thedemandforthemismorevolatilethanthedemandforpersonalcomputersbeingsoldtoindividualconsumers.HereMicrosoftacknowledgesthetechnologybustof2000initsadsforserversinboththeUnitedStatesandJapan.Inbothcountries,thepressurewasonCIOsto“domorewithless.”Executivesfaced“l(fā)argerprojects”and“shrinkingbudgets.”CourtesyofMicrosoftCourtesyofMicrosoftDemandinGlobalBusiness-to-Business

(B2B)Markets4of5StagesofEconomicDevelopmentThetraditionalsocietyPreconditionsfortakeoffTakeoffDrivetomaturityTheageofmassconsumptionDemandinGlobalBusiness-to-Business

(B2B)Markets5of5TechnologyandMarketDemandTechnologyiskeytoeconomicgrowthCountriesgroupedbyabilitytobenefitfromandusetechnologyQualityofeducationsystembestindicatorofthisdimensionTechnologycompetitiveedgeinglobalmarketsDevelopmentandapplicationofinformationtechnologyManufacturingmoreefficientwithdigitalcontrolsystems,robotsTechnologicallyadvancedproductsindemandDemandforTechnologyinDevelopingCountriesConstructionequipmentiscrucialindevelopingcountries.HereanAmerican-madecompactKobelcotrackedbackhoehelpsbuildtourismfacilitiesnearAngkorWat,Cambodia.TheAmericancompetitortogiantCaterpillarwasrecentlypurchasedbyFiat.?JohnGrahamQualityandGlobalStandards1of3PerceptionofqualityincludesmanyfactorsLeveloftechnologyreflectedinproductCompliancewithstandardsthatreflectcustomerneedsSupportservicesandfollow-throughPricerelativetocompetitiveproductsIndustrialproductqualitycanvaryacrossculturesEveninmosttechnologicallydevelopedcountriesB2BmarketersfrequentlymisinterpretconceptofqualityQualityandGlobalStandards2of3QualityIsDefinedbytheBuyerAssessedintermsoffulfillingspecificexpectationsProductorserviceexpectationsvarybybuyerandculture‘Goodquality’differentdependingonstageofdevelopmentDesigntofitneedsofmarketandwithstandclimatevariationsPrice–qualityrelationshipimportanttoconsiderMeetbasicexpectationsofspecificmarket,butnomoreDon’tspendmoneyproducingfeaturesthataren’tneededLackofuniversalstandardsachallengeinsalesQualityandGlobalStandards3of3ISO9000Certification:AnInternationalStandardofQualitySeriesoffiveinternationalindustrialstandardsManufacturerscanseekISO9000certificationOnlyacertificationoftheproductionprocessDoesnotguaranteeahigh-qualityproductorserviceShowscompanyhasqualitycontrolsysteminplacetomeetpublishedqualitystandardsGenerallyvoluntary,exceptforcertainregulatedproductsManycompaniesnowseeitasanecessitytoremaincompetitiveCertificationhelpstominimizeliabilityclaimsPrestigeofISO9000CertificationTheJapanesemanufacturerisquiteproudoftheISO9000qualityratingsforitsplantinSanJose,CostaRica.?JohnGrahamBusinessServices1of2After-salesServicesPromptdelivery,installation,partreplacements/repairsCustomertraining:maybedecidingfactorforbuyerAlmostalwaysmoreprofitablethaninitialsaleBuildscompanyreputation;leadstosaleswithnewbusinessesCreatescustomerloyalty;repeatsaleswithcurrentclientsBusinessServices2of2OtherBusinessServicesTradecreatesdemandsforinternationalservicesMostentailcompanyenteringinternationalmarkettoservicelocalclientsabroadSometangibleandcanbeexported,butsubjecttobarriersClientfollowersGlobalmarketscontinuingtogrowMoredemandforbusinessservicesMoreservicecompaniesseekinginternationalmarketsTradeShows:ACrucialPartof

Business-to-BusinessMarketing

BenefitsofTradeShowsPrimaryvehiclefordoingbusinessinforeignmarketsSellingproductsandmarketingReachingprospectiveB2BcustomersContactingandevaluatingpotentialagents/distributorsFirmsthatattendtradeshowsandusefollow-uppersonalsellingeffortsareconsistentlymoreprofitableProvidemeansformanufacturertoexhibitanddemonstrateproductsandviewcompetitors’productsAerospaceTradeShowSoyouwanttobuyanAirbus380?HowaboutkickingthetiresofoneattheParisAirShow,theworld’sbiggestaerospacetradeshow??EricFeferberg/AFP/GettyImagesRelationshipMarketingin

Business-to-BusinessContexts1of2Long-te