Selling to B2B «

Posts Tagged ‘Selling to B2B’

Segmentation

Friday, October 16th, 2009

By Carl Da-Costa-Greaves

What is segmentation?
If we think about the mass population as one big blob (the market). Within this ‘blob’ there are chunks. Certain chunks look like each other, act like each other and share the same needs. If you then identify the biggest chunks based on their similar needs and wants then you’ve effectively ‘segmented’ them from the masses.

Image courtesy of Spiderling-Art

General Segmentation Methods:
•   Demographic; Stage in life, Geographic, Geo-demographic, Age
•   Psychological; Motives, Attitudes, Values, Opinions
•   Decision Making Process; Extended problem Solving, Limited Problem solving, Routine Purchase, Impulse, Involvement
•   Decision Making Unit; Individual, Family, Business,
•   Social Factors; Family, Reference groups, Culture, Sub-culture
•   Relationships; Societal impact, Close, Distant, Stakeholders

Types of segmentation;
Consumer segmentation, Socio-economic Groupings, Lifestyle, Organisational and
International Segmentation.

When to use Segmentation?
The whole purpose of segmenting a market is to allow your marcomms and sales promotions to focus on the prospects that are “most likely” to purchase your products and services. Branding and marketing campaigns can then be tailored to the segment, rather than using a one size fits all approach.

What does it achieve?
•   Focus efforts on those segments where the greatest sales, profitability or awareness can be generated.
•   Can adapt products to the customers in target segments through a greater understanding of needs.
•   More satisfied customers – communication and products are more relevant to them.
•   Create greater differentiation leading to greater standout from your competitors.

Rules:
•   Homogeneous – everyone within it is similar (but won’t be identical)
•   Distinct – groups are recognisably different from each other
•   Identifiable – can assign customers to segments
•   Accessible – communication and service delivery
•   Profitable – every customer could be a segment, but would not be profitable
•   Actionable – have the resources to exploit
•   Stable – not likely to change in the short term

Key steps:
1 Audit and analyse the organisation’s current position, capabilities, objectives and constraints.
2 Identify the segmentation variables and segment the markets.
3 Develop profiles of each segment.
4 Evaluate the potential and attractiveness of each segment.
5 Select the target segment(s).
6 Identify the positioning concept within each target segment.
7 Select and develop the appropriate positioning concepts.
8 Develop the marketing mix strategy.

Top Tips:
•   Market segments need to be evaluated and ranked for possible targeting.
•   Evaluation is typically based on:
–   Size of segment
–   Growth prospects
–   Profitability
–   Competitive pressure
–   Fit with company objectives

Tags: Business to Business, marketing, Promotion, Selling to B2B
Posted in How To Do... | 2 Comments »

B2B Marketing

Monday, October 12th, 2009

By Carl Da-Costa-Greaves

What is B2B Marketing?
B2B Marketing is where a proportion or all of your marketing efforts goes towards promoting goods or services to businesses whose main transactions are with other businesses. For example, If you consider the action of selling computers to a company, or the maintenance of networks under a services agreement, both are transactions between two companies and considered business to business or B2B for short.

B2B marketing is now one of the fastest developing fields of marketing. New technologies bring more businesses together, thereby companies start to ‘tap up’ each other far more sharply. Technology also makes the world a smaller place. So it becomes essential for sales and marketing experts to understand and apply the principles of B2B marketing.

CRM

Characteristics of the industry;
• Fewer but larger buyers
• Demand often derived from consumer demand – e.g. car industry buys steel because consumers buy cars
• Volume and value of transactions are usually higher
• Buying unit differs – more rational approach, more people involved
• Buying /selling process usually more formalised

When to use it?
Used as a management process to identify and capture the interest of potential prospects. This information is then tracked using a formal sales process and Customer Relationship Management software (CRM). Each suspect or prospect that has been identified through marketing efforts can be further escalated to the next stage of the business to business relationship via a number of focused Brand Communication and sales promotion efforts.

What do you achieve from B2B Marketing?
Converting prospects into customers is an important objective of B2B marketing. If managed correctly then a prospect should convert to a customer. At this point, the relationship management aspect and customer relationship should not end there. Instead of thinking about the sales process in a traditional way, like a funnel; where prospects pop out the end as a customer, think of it like an hour glass; the efforts are greater at first, reducing as the relationship grows, at the point until the sale is made; then the focused efforts begin again and increase with frequency, until we reach a re-buy. At this point the process repeats.

So, as a prospect reaches the sales conclusion then it’s not merely enough to service the buyer’s contract and deliver the goods. Just as much effort should be expended in after service marketing and further relationship building with CRM, in the form of service, support, updates etc.

Key steps:
1) Ensure that you have a complete and up-to-date database available
2) Devise a sales process and track through a CRM database
3) Plan effective promotions and regular contacts directly aimed at the needs of prospects
4) Create the desire and show customers how they can purchase
5) Integrate all communications, both online and offline, to ensure a coherent message

Tags: Business to Business, Customer Relationship Management, marketing, Promotion, Selling to B2B
Posted in How To Do..., Marketing | 3 Comments »