This report analyses the business-to-business marketing in comparison to business-to-consumer marketing

Authors Avatar

E Marketing MRKT 20027


This report is about the marketing concepts prevalent nowadays and shows the growth of a new type of marketing with the rapidly increasing use of internet and new softwares. The online business-to-business marketing has enhanced the markets for suppliers and brought about new relationship in businesses. The report is giving in-depth study of the online business-to-business marketing detailing the components and the latest developments to understand the concept in a systematic manner.

This report analyses the business-to-business marketing in comparison to business-to-consumer marketing and then builds up business-to-business marketing in stages in the enroute to success section. The supply variants and relation section discusses the supply chain aspect of this marketing. Supply is the base for the marketing concept. Customer differential and practices cover the information and systems helping in customer’s preferences. The structure and sustainment section opens up the basic structure and body of online marketing concept with models operating at this period of time and future prospects. The report will help in understanding the basic principles along with new applications in the field of marketing and how businesses along the globe are responding to this new entire setup to increase their competitiveness, efficiency and the very purpose of existence.


Business-to-Business: Meaning and Comparison


Business to business marketing relates to procurement, as business requires office supplies, raw materials and manufacturing equipments. The persons who authorize the purchase are different from person who utilise these items. So the internet based procurement is much different from regular business and different factors affect the business-to-business activities. Business to business is also different from business to consumer marketing where the two parties involve are a business and a consumer. It includes shopping for apparel, automobiles, services (travel, airline tickets) .

During early days of e-commerce, the focus was on business to consumer marketing and many business models were developed. There was heavy publicity as internet had grown considerably and the consumer could browse, order and make a payment. Advertisement appears on the sites such as yahoo! similar to those on TV, radio and newspapers. Books, clothing, furniture, CD’s can be ordered and software, music is downloaded. The after sales service is through email and frequently asked questions (FAQ). So the interaction between a business and a consumer consisted of the following (Chaudhary & Kuilboer, 2002, pp. 12-15)

Promotion: Advertisement on the internet had increased from $3.3 billion in 1999 to $33 billion in 2004(estimated). The techniques used are banners, buttons and superstitials.  

Ordering: Consumers could easily access the various internet sites to order products electronically such as cosmetics even cars.

Delivery: Digital products like software, music are delivered over the Internet saving time and money.

After Sales Service:  A good customer service system adds to value of product and companies use customer relationship management software and other tools to develop a relationship with customers. Electronic support is a good complement to telephone based support.

The business-to-consumer e-commerce has also seen traditional business such as Wal Mart stores, The Gap and Staples entering the electronic channels. These types of businesses will be more successful than the pure e-commerce companies like as the companies have physical stores and returns and the customer service is available at these physical stores (Bidgoli 2002, pp. 50).

Business to business e-commerce has seen phenomenal growth as business realize that internet can help to reduce costs across the suppliers drastically. The supplier’s relationship has been reshaped by integrating production and shipping plans. The numbers of suppliers have increased due to new foreign trade rules and the suppliers may be local or foreign. This has led businesses to force suppliers to reduce prices.

Business to business transaction cycle has the following activities:

Gathering of market intelligence: Companies buy complex products and needs specifications of products and services so information is required to make selection.

Prepurchasing: This consists of steps before an order like request for proposal, quotation and negotiating contracts.

Purchasing: This consists of placing the order and the purchase orders are dispensed.

Shipping and receipt of goods: Buyers are informed of shipment schedules and receipt of goods are obtained.

Paying:  The vendors are paid according to the contract and payment instructions are issued to the banks (Chaudhary & Kuilboer 2002, pp. 25-26).

In the 1980’s Electronic data interchange (EDI) has played an important role in these activities and two different businesses exchange data between computers. Newer forms of Electronic data interchange are emerging as it is an important module, which links buyers and sellers electronically. The reliance of all businesses for supplies, utilities and services have enhanced the popularity of business-to-business e-commerce. Car companies like General motors, Ford, Daimler Chrysler have formed an auto exchange called covisint () for procurement and supply chain management. This has led to savings of millions of dollars by increasing speed and eliminating manual activities of handling paperwork. Suppliers can access online to know the inventory and replenish products in a timely manner (Bidgoli 2002, pp. 51).

Business-to-business transactions have now moved from Electronic data interchange transactions to internet based purchasing and electronic markets. There were more than 1200 ventures announced in formation of business-to-business markets and by

Join now!

the end of year 2000, 400 of these markets were functioning at some level. The computing and electronic sectors followed by motor vehicle, petrochemicals and paper are largely affected by business-to-business. It is estimated by Active Media Research that by end of 2004 online business-to-business purchases will be around 40% (Greenstein & Vasarhelyi 2002, pp. 68).

According to Jupiter, business-to-business online trade will rise to 6.3 trillion by 2005. Business-to-business reduces time inventory and prices and helps business to share accurate and relevant information and build better communications between businesses.

Differences between business-to-consumer and business-to-business marketing


This is a preview of the whole essay