foreign [Music] I welcome you to the class of business to business marketing so this is a new elective which I have floated for the benefit of all students basically from the field of management Commerce people who are working in the industry so that they can get a you know fair amount of idea what business to business marketing is all about right so let me give you a brief what am I going to cover in this course so we will talk about the business to business marketing environment and then ah what is the model of the you know business buying Behavior or the buyers behavior in the business Market then how segmentation targeting and positioning is done in this market right because we can all understand that business market and consumer Market is slightly different in fact there is a significant difference between them how the segmentation has to be done what is the targeting approach and how you should position your product one more thing is for example you know people talk about Brands now for example you talk about Hindustan Unilever limited you talk about godrej you talk about Procter and Gamble so these are some Brands which come very readily to your mind and your recall value is very high but when I talk about brands in the B2B Market it is slightly difficult for many people to comprehend because they might not have seen the products they might not have used the products or if they have used also they might not be discussing it very frequently so looking into these things the question emerges is brand an important component of the B2B Market or not should branding be when done in this market so this is one question that pertinent question that comes in this subject the other things that we will be covering is how the product a new product development happens in the B2B market right how pricing is done right because we all know pricing plays a very vital role so how pricing is done in the B2B Market then how you know the distribution or availability of the products is done and by hand even how promotion is done right so all these different elements and including you know the aspects like demand forecasting you know is also equally important so as a reader or as a you know student of this course you should be very clear about how B2B Market is different from the B to C Market right so you know one thing that is very often said that business Market is a very ah is a rational market right and this Market ah is different because it has no emotions is a very little emotions involved in it it's not an impulsive decision that you take in this market rather its on facts and its highly rational because the point is if one mistake happens then the effect is quite large and it has a cascading effect so that is why B2B Market is a is a intelligent man's Market you can say right from a marketer's point of view I would say like that so I welcome you all to this course and ah in between what I would like to say is that we will introduce some small caselets in the course to make it more enriching more interesting so that you can ah participate with me and try to solve those and troll to you know learn better right so I welcome you again to the course of business to business marketing so ah thank you for joining this course right so like let us look at this so this is a cycle right we all can see a a beautiful cycle now but when we talk about a cycle the first thing that comes to our mind is a let us say if you are an Indian then a hero cycle or a bsslr cycle or even cycle but do we even think about it how is the cycle made and what comprises this cycle right so you can see the cycle has certain ah different parts the tubes the tires the rim The Handlebar the seat right then the bearings so all these are different from each other right and when you assemble this together then you get a beautiful cycle right but if you look at the background then it is something that a general person would not know about it right so whereas this tube come from how where is this tire come from who is the manufacturer of these rims so we do not look at it generally what we do is we look at the overall cycle so so that is ah one thing that is more important from a B2B marketers point of view where the B2B marketer deals with these kind of products and he is at the back end right so at stand staying at the back end he tries to get all these different products and assemble it and try to help you getting a end product which is directly used by the consumer ok now lets see how do you define so business markets can be defined as a set of all individuals and organizations that Acquire goods and services that enter into the production of other products or Services which are sold rented or supplied to others now in simple terms if I would like to explain you is the business marketer stays at the back end as I said background and tries to gather all those raw materials work in components parts and all which are given to the you know supply to the oems and the oems then finally developed a com Complete product and they sell it to the end consumer which is generally people like you and me right generally but it could be also organizations so ah when I am talking about customers at the end so the customer can be you me right can be Industries can be organizations can be schools can be colleges can be hospitals can be government institutions can be factories everyone right so the difference between this business market and consumer Market lies in who is basically the buyer right so if the buyer is another business house another organization then it is the case of a business market right but if it is sold to a single retail consumer then it comes to the category of consumer market so this is the difference consumer products or consumer markets right ok now look at this example lmw now Lakshmi Machine Works is a company that you know produces machines which are sold to textile mills now this textile manufacturers textile mills use these machines of lmw and produce garments and you know other things and the apparel manufacturer also uses these products so you can see the chain the ones from the machine lmw it goes to the textile mills who produce Yarns or other things and then they give it to the apparel manufacturers who put their brands like for example you know several Brands you can think of Gap you can think of Louis Philips you can think of vanus and shirts or anything right and finally it is the end consumer who who buys it so the end consumer might not be aware the contribution of lmw Lakshmi machine works for his output that he is carrying in his basket ok so this is why maybe maximum he knows about is the the closest brand which is the Apple manufacturer but he is not aware that there are lot of people involved in this process like the textile mill and the Machine producer because of them this end product is being able to produce this end product ok so the B2B Market is sometimes also called as industrial Market producers Market or a business market right so we have seen that it is the set of all individuals and organizations that Acquire goods and services that enter into the production of other products and services that are sold rented or supplied to others this is the definition right and it's a market where which is highly concentrated in nature right so you will not see lot of retail customers you will not see that in the business market right it is composed of few large customers and who buy in bulk maybe right so as I ah just showed you the example of Lakshmi Machine Works which is a you know which is located at coimbatore India is a leading textile manufacturing you know Machinery manufacturer whose business markets consist of textile males in India as well as in other regions like the Asian and other countries right now these textile mills sell Fabrics of cotton or wool to the Garment manufacturers who are also the business customers and finally this process goes on till a shirt or trouser or you know a sari or any attire is made and then the consumers are the individual which is you and me will finally buy it right so this is how a normal process of business or industrial Market looks like right let us look at some of the B2B products so now if you look at it for example Safety and Security products now everyone all of you are using nowadays virus antivirus for example right so for antivirus or you know for you know home security purposes certain kind of equipments devices so this come under the category of you know B2B products right because an individual is not directly consuming it right he is not consuming it so it may be used for a you know for a colony for a office for a factory anything so it comes the Safety and Security products are a part of the B2B products then you have metal and minerals products right you have you know electronic and communication machines OK you have building constructions materials then you have office equipment and supplies now every office there is a lot of supplies for example paper you know pins ah cartridge so they all will be coming under the ah you know B2B product category fuels and oil products ok then you have industrial gases textile products explosives then you have ITN Consulting right so your famous names like IBM you have Infosys you have Wipro you have cognizance you have you know ah industrial houses like Siemens now as an end consumer you can understand that you are not going to buy anything directly from Infosys right so you may be using a product that Infosys develops on its own and sells it to other organizations which then make some product or some some service which is may be useful for a retail consumer otherwise you and me will not never go to Infosys to buy a product directly for our domestic consumption ok then you have you know wrapper manufacturing right you have some e-commerce platforms for example Udan India Mart right if you have heard about this ah you know organizations they help you to sell appliances products across their platform right one of the largest companies in the globe is Home Depot for example they say they say lot of the stuff like you said Amazon like an Amazon for the B2B products right you see lot of these products from you know ah let us say building construction materials to their all kinds of services everything that you can think of to make a to build a house to build a office everything they sell it on their platform commercial vehicles for example Lift Trucks Earth moving equipments right chemicals Tata chemicals if I if I the names come to me to my mind like Tada chemicals so these are some of the you know products that are very ah much famous and they are very popular and besides this I can give you four few more examples like walls bearings ah you know ah industrial pipes ah then ah temperature control devices then Precision Instruments steel ah conveyor belts assemblers you know exhausts so there are ah even you know n number of products even to some extent you can understand that many of these products in a smaller version that you see in your domestic consumption the same thing in a larger ah you know magnitude or a larger specification you will see it being used in a industrial consumption right for example fan now domestic we have fans we also have industrial fans of large sizes right we have coolants so we have equivalence use of coolants in the factories also now this coolant can be used in refrigerator the same can be used in large machines in the industry right now ah if I give you some you know names for example let us say some B2B companies right so what are they basically Iron and steel companies you have for example jsw right then you have Tata steel sale which is the government price in India Sr Jindal so you have lots of these companies which are into the Iron and Steel right so similarly for if you look at ah you know electronic equipments manufacturing you have companies like Suraj electricals bhul ABB one of the largest in the world right then you have competent griefs MCO so these are companies which come into the category of the B2B companies right which manufacture electrical and electronic parts next you have ah you know ah tires and commercial vehicles manufacturers ah and their items for example some of the companies involved are Tata Motors Bal Krishna Industries ah one of the you know a very good company and then you have kalyani Bharat Forge Bharat Forge is one if I am not wrong the second ah largest producer of forging products in the world then you have JK tires Bridgestone right so these are some examples a few more if you want to see in the it and Technology space you have ah IBM HCL TCS Tech Mahindra and B pro right so as we have already discussed B2B marketing is the process of one business Market to you know Supply or you know produce products and services for another business right so this definition is very important for you to understand because why because the simple reason is that not all products are exclusively different some products can be utilized by a retail consumer also and the same product can be used by and can be purchased by an organization also let us take in case of a ceiling fan for example now you may buy a ceiling fan in your for your home so that is a retail consumption but the same thing can be purchased by IIT roorkee or any other university right a large University like in India or anywhere so they will have a centralized purchasing now when one organizations let us say IIT roorkee purchases fans yearly right from let us say havells have else is a company so I am just giving example have else it could be any company for that right so when it purchases ah so there is a transaction that happens between two business units so when the transaction happens between two business units one organization is a business organization the other buying organization is also a business organization in that case we say its a b to B marketing right ok so why it is needed because the output of one company is becomes an input for another in order to improve its operations ok now let us look at this example now how many of you have heard vardhaman textiles I do not know but its a large textile manufacturing company since 1965 okay now what the man text has is manufacturing products like Gap h m Old Navy so these are some of the clients for that right but few people might be knowing about the Monte styles and everybody might be knowing and most of you might be knowing these Brands so it is very simple and easy to understand that we are more aware about the B to C or the consumer Brands right but we are not much aware about the industrial or the B2B Brands right so the this elective in this course our basic uh you know emphasis is to discuss and talk more about this background you know back end operations or the people who are involved in the back end and what is their role and how important they are in the entire consumption process ok some more examples so this is a I think many of you might be having an Apple phone right now the Apple depends on different components for its components ok now lets see now you have the camera lens comes from largen Precision Company Limited so they get this camera lens from this company then you have display from sharp and LG ok now metal case from Catcher And ah they have the microprocessor from Samsung so now one Apple phone which we are using may be has so many different parts of which we are less interested or least interested or we do not show interest right but the Apple phone is nothing but a combination or an assembly of all these different items right so you can understand that for Apple to manufacture its products right these companies are very important and these companies they are part of the business to business marketing right similarly if you look at the SARS software right as a service ah you know a component if you see now Erp accounting softwares right payment providers project management data management Etc these are different services that you get right and they provide you different services so all these are different services that are generally ah used by you know manufacturers and different companies again large Industries because it helps them to systemize their production processes to streamline their entire functional different functional units so today most of the companies are using this kind of services for their you know to optimize their efforts right and to increase their profits let us take this example of Dell where ah I will try to explain how b2c and B to B is different right now when Dell sells the product directly to you and me it is a case of a B to C but when Dell sells it to let us say you know IIT or University or a hospital you know all the computers right or even a company like Reliance or anybody so that is the case of B to B right so many companies have customers which are both end consumers directly you know the retail consumers like us and also the organizations so this case if you see B to C you have individuals and households ok so the products which they buy are let's say like PCS printers simple services and you know Consumer Electronic items and when you come to B to B you know the businesses institutions in government basically largely so you have Enterprise storage servers complex Services right and other offerings so this is generally the difference and you will be surprised to know that companies who are catering to both B to C and B2B consumers the amount of you know Revenue that they generate from the B to B ah counterpart is very very high in comparison to the b2c revenue so that is why it is very important for us to understand that how B to B is important and vital for any Organization for its growth right and if you are a student let us say of management or any other course let me tell you most of you will be working in the space of B2B why because you are not going to sell a product to the to a household right very rare very rare but otherwise generally you will be selling it to one another organization may be which or any dealer or distributor which also is a part of the B2B not B two c so if I say in a small way that most of the young guys young friends and people who are working they actually are working in the B2B space and ah very less ah chances are there that you will be directly encountering the B to C right now the question comes which is bigger in size B to C or B to B by at this time by through the way I have explained I think you must have got some ah you know ah idea whether B two c is a larger marker or B two B is a larger market right so in in this condition you will see that b two c is actually comparatively very small right and B to B is quite large right lets see so ah I have brought this if you can see ah does your organization Market its product Services mainly to other businesses or directly to Consumers right so if you look at this is a graph which talks about the USB of economic analysis which tells about the b2c market size right from 2006 to 2018 so this was the data I had got so and the growth is from ah not from 2006 before 2006 2005 you can say so eight point five trillion dollars to it moved to fourteen point two trillion dollars so almost a jump of let us say ah more than 100 percent right not hundred percent slightly less than hundred percent ah in between this in this time period of 10 years right 10 to 12 years on the other hand if I compare you know the B2B market so which is at 14. 4 trillion and it goes up to 23. 1 trillion so in percentage terms if you see the growth might be ah similar or even maybe it may be same right but if you look at the absolute value now there is a growth of almost nine trillion dollars right which is absolutely huge right and obviously you can see the depression in 2010 8 to 10 that was the time when the crisis recession had happened in the world right so you can make a comparison that ah the absolute value has moved from 14.
4 trillion to 23. 1 trillion which is almost a 9 trillion jump right so this says that the B2B Market is significantly bigger than the b2c market right now you can see this ah chain this example the ratio of B to B versus B to C is 1. 5 is to 1.
7 times right that means ah B to B is 1.
