Marketing, Business to Business Marketing

Marketing, Business to Business Marketing

Ranging from the different needs between a business and an individual consumer to the larger size of trades (both in terms of volume and in terms of financial value), the B2B marketing and sales activity differs from the B2C commerce through the different challenges it poses. This is also the case of B2B in Australia, where the challenges of B2B have brought about a tendency to choose e-procurement and online B2B a mean to increase the efficiency of the process and reduce overall costs.

The most simple instrument used in B2B is the website, where the company presents the most important details related to the activity it provides and to the products it offers. The Ford Motors website for Australia has a special section dedicated to business clients and representing an excellent example of B2B marketing (http://www.ford.com.au/servlet/ContentServer?cid=1137384211055&pagename=Page&c=DFYPage).The site splits the customers into two distinctive groups: corporate, government and rental customers; and small and medium customers. For each, the company provides information on how the clients can benefit from services provided by the Ford Business Centre and how it can qualify for a National Fleet Plan.

B2B provides several particularities over the usual B2C activity and this is also self-evident in Australia. First of all, B2B almost always implies the existence of an e-marketplace. An e-marketplace can be defined as "an electronic exchange where firms register as sellers or buyers to communicate and conduct business over the Internet." The e-market is however more than a simple electronic location for buyers and sellers to meet and commit to the exchange. A professional e-marketplace will also provide the assistance needed before and during the exchange and will create the overall conditions by which the buyer can lower his purchase cost and the seller can lower his overall cost of sale.

In Australia, one of the best examples of interactive marketplaces is the Australian Automotive Network eXchange (AANX). This marketplace is a private marketplace, accessible to a limited number of customers, and intended to ensure a "platform for conducting domestic and international business-to-business (B2B) e-commerce activities."

This e-marketplace provided the online connection between vehicle manufacturers and suppliers. Traditionally, vehicle manufacturers would have needed to contact a number of suppliers (most likely, they would have retained the same supplier for a longer period of time, because of high cost that change would have implied, rather than transfer to another supplier) and contract physically all the purchases they wanted to make.

With the AANX, "online data connectivity between participants for a range of applications" is made possible. Automotive producers, such as Ford Motors, Mitsubishi or Toyota are put in contact with suppliers such as Air International, Tenneco Automotive or Plexicor. This participation to the private marketplace reveals some of the important differences between the marketing and sales in the case of industrial products and sales in the case of consumer products.

First of all, the activity in the case of automotive producers is repetitive. This means that their involvement in this activity will imply a continuous contact with the suppliers, due to a constant need for supplies. Second, the orders will tend to have high volumes. Indeed, companies such as Ford Motors or Mitsubishi will likely make supply purchases for large volume car producing sets. While the cost of the purchase is decreased through e-procurement/e-purchasing, the main important asset is information. In the case of consumer products, the amount of information provided for one single contract will tend to be limited and will generally invoke only the main characteristics of the product. In the case of industrial products, as is the example with AANX, the contract between the purchaser and the seller will need to include elements such as the seller's capacity to deliver a certain amount of the supplied parts over a period of time, as well as quality limits for these.

The case of AANX had an additional requirement, because of the restricted access to the e-marketplace and many other industries most likely practice this approach as well, so as to protect data and information: the need for privacy. This was provided by the fact that the e-market was a private one, with access given only to members of the Australian automotive industry and the suppliers part of the production process.