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B2B Marketing

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What Is B2B Marketing? �

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What Is Marketing?

Marketing is a process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.

Create value -> Build strong relationship -> Capture value

In B2B marketing, value is created not only for customers, but also for:

Buying organizations
Multiple decision-makers (DMU)
Long-term partnerships

Discussion Question

Ask students for examples of either national or local companies that are excellent at marketing and ask how they reflect the definition given in this slide.

Perhaps the simplest definition of marketing is engaging customers and managing profitable customer relationships.

The twofold goal of marketing is to:

attract new customers by promising superior value
grow current customers by delivering satisfaction

Sound marketing is critical to the success of every organization:

large for-profit firms
not-for-profit organizations

You already know a lot about marketing—it’s all around you:

products at your nearby shopping mall
ads that fill your TV screen and magazines, or stuff your mailbox
imaginative web sites and mobile phone apps
blogs, online videos, and social media

Today’s marketers reach you directly, personally, and interactively. They want to become a part of your life and enrich your experiences with their brands—to help you live their brands.

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What Is Marketing?

B2B marketing is the process by which firms create organizational value, build long-term interfirm relationships, and capture value through repeat contracts, renewals, and partnerships.

B2C = emotional + individual
B2B = rational + multi-person + long-term

Discussion Question

Ask students for examples of either national or local companies that are excellent at marketing and ask how they reflect the definition given in this slide.

Perhaps the simplest definition of marketing is engaging customers and managing profitable customer relationships.

The twofold goal of marketing is to:

attract new customers by promising superior value
grow current customers by delivering satisfaction

Sound marketing is critical to the success of every organization:

large for-profit firms
not-for-profit organizations

You already know a lot about marketing—it’s all around you:

products at your nearby shopping mall
ads that fill your TV screen and magazines, or stuff your mailbox
imaginative web sites and mobile phone apps
blogs, online videos, and social media

Today’s marketers reach you directly, personally, and interactively. They want to become a part of your life and enrich your experiences with their brands—to help you live their brands.

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Examples of Kuwaiti B2B Companies

Telecommunications & Technology (B2B Services)	Construction, Materials & Infrastructure	Banking & Financial Services (B2B / Institutional)
Zain Business�B2B relevance: Corporate connectivity, cloud, cybersecurity, managed services�Use for: Value proposition, solution selling, long-term contracts stc Kuwait Business�B2B relevance: Digital transformation, IoT, data centers�Use for: Account-based marketing, CRM, customer lifetime value Kuwaitnet�B2B relevance: ISP services for banks, hospitals, universities�Use for: Service reliability, switching costs	Abyat�B2B relevance: Supplies contractors, developers, project buyers�Use for: Share of wallet, cross-selling, key accounts Kharafi National�B2B relevance: Mega infrastructure projects�Use for: B2B segmentation by project size & industry Alghanim Engineering�B2B relevance: Turnkey engineering solutions�Use for: Solution bundles (product + service + experience)	National Bank of Kuwait�B2B relevance: Corporate banking, trade finance�Use for: Relationship management, lifetime value Boubyan Bank�B2B relevance: SME & corporate Islamic finance�Use for: Customized pricing, negotiated contracts

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Examples of Kuwaiti B2B Companies

Energy, Oil & Industrial (Core B2B)	Logistics, Trade & Distribution	Healthcare & Professional Services
�Kuwait Petroleum Corporation�B2B relevance: Global supplier, government & industrial clients�Use for: Complex buying center (DMU), long decision cycles National Petroleum Services Company�B2B relevance: Specialized industrial services�Use for: Differentiation through expertise, not price	Agility Logistics�B2B relevance: Supply chain solutions for governments & firms�Use for: Value proposition based on efficiency & risk reduction Kuwait Logistics City�B2B relevance: Infrastructure for regional trade�Use for: Place strategy in B2B	Taiba Hospital�B2B relevance: Deals with insurers, suppliers, government�Use for: Multi-stakeholder decision making KPMG Kuwait�B2B relevance: Audit, advisory, consulting�Use for: Trust, reputation, intangible value

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Why we need B2B Marketing?�

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To answer these questions, and a lot more!

Which industries should we serve (healthcare, education, oil & gas)?
Which social media app should we advertise in?
Which product categories (cookies, snacks, candy etc.) should we offer?
What price should we charge for our products?
Who decides: procurement, IT, finance, or top management?

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Brain Teaser

Ok, marketing = relationships. So, what’s next?

Understand what they need, want, and demand

Why should we care about what customers need or want?

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Core Marketing Concepts

Needs: the basic human requirements such as for air, food, water, clothing, and shelter

Wants: specific objects that might satisfy the need

Demands: wants for specific products backed by an ability to pay

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Understanding the Marketplace and Customer Needs

Needs

States of deprivation

Physical—food, clothing, warmth, safety
Social—belonging and affection
Individual—knowledge and self-expression

Wants

Form that needs take as they are shaped by culture and individual personality

(Not necessary, but which consumers wish for)

Demands

Wants backed by buying power (able)

Marketing is all about creating value for customers. So, as the first step in the marketing process, the company must fully understand consumers and

the marketplace in which it operates.

Discussion Question

Ask the students to

1) Give an example of a product (good or service) they purchased recently

2) Tell how that product satisfied a need, want or demand.

Human needs include basic physical needs for food, clothing, warmth, and safety; social needs for belonging and affection; and individual needs for knowledge and self-expression.

Wants are the form human needs take as they are shaped by one’s society and are described in terms of objects that will satisfy those needs.

When backed by buying power, wants become demands.

Outstanding marketing companies go to great lengths to learn about and understand their customers’ needs, wants, and demands.

http://www.marketing91.com/needs-wants-and-demands/

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Why do you need a car?

Needs: Transportation (any car)

Wants: Rolls Royce, Ferrari (not necessary)

Demands: can you afford it? If yes, then demand. If no, then stays Wants.

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Needs, Wants, Demands for B2B

In B2B, demand exists only when organizational need + budget + authority are present.

Concept	B2C Example	B2B Example
Need	Transportation	Operational efficiency
Want	Luxury car	ERP system, CRM
Demand	Can afford it	Approved budget + management approval

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Think!

Customers have needs, wants, and demand.

How do you fulfill these needs and wants?

By offering product, service, or an experience (Market offerings)

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B2B Scenario

A logistics company wants to reduce delivery delays:

Product: Route-optimization software
Service: Employee training + system integration
Experience: 24/7 support + performance reports

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Designing a Customer Value-Driven Marketing Strategy

Marketing management is the art and science of choosing target markets and building profitable relationships with them.

What customers will we serve?
How can we best serve these customers?

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Think!

Should companies target all customers?

Should a political candidate please all voters?

Why or why not?

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Should A Student Take EVERY SINGLE CLASS?

Trying to target everyone is like a student taking every single class—it’s overwhelming, expensive, and unnecessary. The key is finding the right customers and focusing on them for better results.

If a student spends time studying every single subject instead of focusing on their major, they’ll be exhausted and fail everything.

Imagine a pizza place that also sells sushi, burgers, and tacos. People would be confused—are they a pizza place or just a random food court?

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Designing a Customer Value-Driven Marketing Strategy

Market segmentation refers to dividing the markets into segments of customers. (e.g. slicing a cake/diving students based on majors)

Target marketing refers to which segments to go after.

(e.g. picking a piece of the sliced cake/ choosing marketing majors)

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To design a winning marketing strategy, the marketing manager must answer two important questions:

What customers we will serve (what’s our target market)?

How can we serve these customers best (what’s our value proposition)?

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Designing a Customer Value-Driven Marketing Strategy

Marketing Management Orientations

Production concept

Product concept

Selling concept

Marketing concept

Societal concept

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Marketing Management Orientations

Production concept:

Consumers will favor products that are available and highly affordable.

Managers concentrate on achieving high production efficiency, low costs, and mass distribution.

A good example of a production concept is India and China

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Product Concept

Consumers favor products that offer the most quality, performance, and features.

The focus is on continuous product improvements.

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Product Concept

Blackberry

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Still insisting on a keyboard!

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Designing a Customer Value-Driven Marketing Strategy

Selling concept:

Consumers will not buy enough of the firm’s products unless the firm undertakes a large-scale selling and promotion effort.

Their aim is to sell what they make rather than make what the market wants.

Focuses on creating sales-transaction rather than long term profitable relationships.

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Selling concept

Consumers will not buy enough of the firm’s products unless the firm undertakes a large-scale selling and promotion effort.

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Designing a Customer Value-Driven Marketing Strategy

Marketing concept:

Know the needs and wants of the target markets and deliver the desired satisfactions better than competitors.

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Designing a Customer Value-Driven Marketing Strategy

Marketing Management Orientations

Societal marketing:

The company’s marketing decisions should consider”

consumers’ wants,
the company’s requirements,
consumers’ long-run interests, and
society’s long-run interests.

Discussion Questions

What companies can you identify with social marketing?

What do these companies do that ties to the societal marketing concept?

Students might be familiar with many different companies that practice societal marketing through their corporate social responsibility (CSR) initiatives. Students might be familiar with local retailers who are also involved in societal marketing. They will note that these companies donate, contribute, or offer services to charities and not-for-profit organizations.

The societal marketing concept questions whether the pure marketing concept overlooks possible conflicts between consumer short-run wants and consumer long-run welfare. Is a firm that satisfies the immediate needs and wants of target markets always doing what’s best for its consumers in the long run?

The societal marketing concept holds that marketing strategy should deliver value to customers in a way that maintains or improves both the consumer’s and society’s well-being. It calls for sustainable marketing, socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs.

Even more broadly, many leading business and marketing thinkers are now preaching the concept of shared value, which recognizes that societal needs, not just economic needs, define markets.

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examples

McD cleaning the beach.
McD marathon.

Banks.

Iftaar Sa’eem in Ramadan.

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Imagine a bottled water company:

Orientation	How the bottled water company acts
Production	Builds huge factories to make water cheap and available everywhere. (e.g Abraj )
Product	Creates premium mineral water with unique filtration and fancy glass bottles. (VOSS)
Selling	Uses heavy advertising and promotions to convince people to buy more bottles.
Marketing	Researches customer needs (like flavored or vitamin water) and launches new flavors people really want.(VitaminWater or Alrawdatain Flavored water)
Societal Marketing	Uses recyclable bottles and invests in clean water projects to protect the environment and help communities. (JUST Water – Sustainable Packaging)

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Marketing orientation based on needs

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Marketing Orientations in B2B

Orientation	Core Belief	Main Focus	Role of Customer	Typical B2B Activities	When It Works Best
Production Orientation	Buyers prefer products that are easy to get and low cost	Efficiency, scale, availability	Passive buyer	Cost control, mass production, fast delivery	Commodities, raw materials, high demand markets
Product Orientation	Buyers prefer technically superior products	Quality, features, performance	Technical evaluator	R&D, certifications, product upgrades	High-tech, engineering, industrial equipment
Selling Orientation	Buyers must be persuaded to buy	Closing deals, volume	Target to be convinced	Tenders, sales pressure, promotions	One-off contracts, saturated markets
Marketing Orientation	Buyers seek solutions to business problems	Customer value, long-term relationships	Strategic partner	Account management, customization, CRM	Most B2B markets
Societal Marketing Orientation	Buyers care about ethics & sustainability	Value + social responsibility	Stakeholder	ESG compliance, sustainability reporting	Government, large corporate clients

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Capturing Value from Customers

Customer lifetime value is the value of the entire stream of purchases that the customer would make over a lifetime of �patronage.

Why only retain when you can also get more from customers?

Share of customer is the portion of the customer’s purchasing that a company gets in its product categories.

Thus, banks want to increase “share of wallet.”

Beyond simply retaining good customers to capture customer lifetime value, good customer relationship management can help marketers increase their share of customer—the share they get of the customer’s purchasing in their product categories. Thus, banks want to increase “share of wallet.” Supermarkets and restaurants want to get more “share of stomach.” Car companies want to increase “share of garage,” and airlines want greater “share of travel.”

To increase share of customer, firms can offer greater variety to current customers or they can create programs to cross-sell and up-sell to market more products and services to existing customers. For example, Amazon is highly skilled at leveraging relationships with its 237 million customers to increase its share of each customer’s spending budget.

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Think.

What can you add to your business to increase share of profits?

Landscaping:

Original: Landscaping services and maintenance
Add: Design and installation
Add: Selling landscaping materials

Car-washing:

Just car wash, or add
House cleaning and disinfecting

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How does Abyat apply this concept of “Share of customer” wallet?