B2B Final Exam Study
Based on the previous questions (A1 and A2), all the elements that are included in the business marketer's promotional mix include _______________________, _______________________, _________________________, and ____________________________.
Advertising, personal selling, sales promotion, and public relations
Can you think of any more you believe that should be considered for the effective B2B communication elements?
Digital marketing and product placement
True or false: Business to business service firms are more likely to emphasize transactional strategies as opposed to relationship strategies:
False
True or false: Service quality encompasses the procedures, policies, and processes a firm uses to resolve customer service problems promptly and effectively.
False
True or false:A pure service, by definition, accompanies the sale of a physical product.
False
True or false: Demand for services is rarely steady or predictable enough to avoid service perishability
True
True or false: Hybrid service offerings can be classified on the basis of whether the provider promises to perform a deed or to achieve a certain performance outcome.
True
True or false: Research indicates that manufacturers typically earn a very high percentage of gross profits from the aftermarket, though it accounts for a very much smaller percent of revenue
True
Inventory Turnover
cost of goods sold/average inventory
What is the first decision (or action) you need to make to have a successful business-to-business advertising program?
set advertising objectives and define the target market.
Frequency of advertising recommended is _______ insertions per year for a monthly publications and ______ to _____ insertions (with a minimum of ______ in a weekly publication.
six insertions per year; 26 to 52 insertions with a minimum of 13 in a weekly publication
Example of browser in B2B marketing
The Dell community has partnered with Google Chrome to make Chrome the main web browser on Dell products.
Explain why Trade-Shows can be a profitable investment in B2B marketing? What percentage of the trade-show visitors are classified as "buying influencers"?
Trade shows can be a profitable investment in B2B marketing because these exhibits help to recruit more potential customers than before. The typical exhibitor in a trade show comes in contact with four to five potential purchases per hour on the show floor. This allows more many new customers and purchases to be made, bringing in more profits and sales than before the trade show. Trade shows also allow more brand and product messaging to be delivered to a relatively large and interested audience at one time. Eight-three percent of trade show visitors are classified as "buying influencers."
State the impact on TR by the price decision.
Since the price is elastic, total revenue will increase.
A B2B marketing manager reduced the price on a brand of an auto part by 10 percent and observed a 25 percent increase in quantity sold. Compute the price elasticity of the brand for the situation.
(25%/10%)=2.5 E=2.5
Push strategy
-Aims at making customers aware of the product or brand. -Uses sales force, trade promotion, and money to promote and distribute the product to the final customer. -Focuses on resource allocation. -No communication demanded for product information
Pull strategy
-Encourages the customer to seek the brand. -Uses advertising and promotion to instigate customer demand product from channel partners. -Concerned with responsiveness -Communication of products or information is demanded by the buyer
Suppose a company is using manufacturer's representatives (independent agents) to sell its products. These representatives receive an 8 percent commission. The company is considering hiring its own salespeople and has estimated that the fixed cost of managing and paying their salaries would be $1 million per year. The sales people will also receive a 4 percent commission on sales. The company has sales of $25 million and sales are expected to grow by 15 percent next year. Would you recommend the company to switch to its own salesforce? Show your work to answer the question based on break-even analysis.
0.08 (SL) = 0.04 (SL) + 1,000,000 0.04 (SL) = 1,000,000 SL = 1,000,000/0.04= $25,000,0000
What are the six promotional activities the trade-show can accomplish for B2B firms?
1) An effective selling message can be delivered to a relatively large and interested audience at one time. 2) New products can be introduced to a mass audience. 3) Customers can get hands-on experience with the product in a one-on-one selling situation. 4) Potential customers can be identified, providing sales personnel with qualified leads. 5) General goodwill can be enhanced. 6) Free publicity is often generated for the company
In p. 271, authors say, "one-time ads are generally ineffective." Explain three reasons.
1) Even the most successful business publication advertisements are seen by only a small percentage of people who read a magazine, visit a social media platform, or watch a television program. 2) Several exposures are required before a message "sinks in." 3)The reading audience, television viewers, and social media audience varies from month to month.
What are the six reasons that personal selling is the dominant element of B2B marketing communication?
1) It is the most persuasive communication tool available. 2) All of the steps in the personal selling communication are incorporated. 3) Personal selling is the most effective at the purchase stage for consumers. 4) Problems can be handled satisfactory or answered. 5) Personal selling can be flexible to meet the changing needs of the customer. 6) It makes it possible to collect customers' information (feedback) for a better understanding of their insights.
In Pp. 264-265, the authors state that a primary role of business-to-business advertising is to enhance the reputation of the supplier. What are some other roles of business-to-business advertising? State at least two
1. Advertising for B2B also plays a role in creating awareness for companies. 2. Another role that advertising plays for B2B is to increase sales efficiency.
What are the three methods for organizing the sales force mentioned in the chapter? List them in order first, and then explain in detail for strengths and weaknesses for each.
1. Geographical organization 2. Product organization 3. Market-centered organization
What are the three reasons why the salesperson is the primary communication vehicle in business to business marketing?
1. The salesperson increases company and product awareness. 2.Finally, the salesperson helps to gain perception on customer insight into buying decisions and attitudes. 3.The salesperson generally have a high product knowledge, service, and enthusiasm, which creates a connection with consumers
Suppose you are a sales manager for a large car dealer in a large metropolitan city. What are some administrative duties of your job?
1.) Build internal relationships 2.) Forge relationships with customer organization 3.) Manage the customer engagement process 4.) Enhance internal reputation
CSI reaches 200,000 people in the primary target audience, and costs $2000 for a 30-second spot on station WALB-TV in Albany, Georgia. Compute CPM for CSI.
2,000/(200,000/1,000)=$10. The CPM for CSI is $10.
If a daily newspaper has 300,000 subscribers and charge $5000 for a full page ad, what will the CPM for the daily newspaper? Show your work step by step to get the answer.
5,000/(300,000/1,000)=200 5,000/300=$16.67 The CPM for the daily newspaper wouldbe $16.67.
Wiki
A collaborative web site on which users can develop and edit information content through their web browser
Popup
A graphical user interface (GUI) display area, usually a small window, that suddenly appears ("pops up") in the foreground of the visual interface.
Discussion forum
A web site on which participants can contribute online discussions by posting opinions and questions related to particular subjects.
Show marketing
An exhibition where companies in a specific industry showcase and demonstrate their new products and services
Blog
An online journal by an individual expressing opinion
CPM (cost per thousand)
CPM = Page Rate / (Circulation/1000).
Now decide in the following two magazines in 2013 which one of the magazines is the better buy on a CPM basis. Car & Driver: Page rate of $206,464 with a total circulation of 1,206,360 Road & Track: Page rate of $113,734 with a total circulation of 603,990
Car & Driver: 206,464/(1,206,360/1,000)= 206,464/1,206.36=$171.15 CPM=$171.15 Road & Track: 113,734/(603,990/1,000)= 113,734/603.99=$188.30 CPM=$188.30 Car & Driver is the better buy on a CPM basis because it is cheaper ($171.15 versus $188.30 for Road & Track).
According to the voice lecture, the four most desired skills for the salespeople are:
Communication skills, relationship building skills, empathy skills, and persuasive skills
Example of search engine in B2B marketing
Dell also partners with Google to be their main search engine on their products. Dell also utilizes search engine marketing by studying user generated content through Google to make sure their brand is one of the top websites to pop up when certain keywords are typed into a search engine.
Example of Wiki in B2B marketing
Dell attempts to keep their name off Wikipedia (the most popular Wiki site), because users can provide content about their brand that can be inaccurate and false.
Example of a blog in B2B marketing:
Dell publishes blogs in five different languages.
Example of show marketing in B2B marketing
Dell representatives attend and have a booth at small business events, exhibitions, and trade shows to showcase their products and software.
Example of Web 2.0 in B2B marketing
Dell utilizes Web 2.0 on their computer products; they also use Web 2.0 to utilize cloud marketing, search engine marketing, and internet marketing based on user-generated content (not available on Web 1.0)6WikiA
Example of discussion forum in B2B marketing
Dell utilizes several online support forums that allow users to ask questions and find answers about computers, servers, mobile devices, and other offerings.
Example of social network in B2B marketing
Dell utilizes social media platforms such as Facebook, Twitter, Instagram, LinkedIn, Snapchat, and more to create content for their existing and potential customers.
Example of popup in B2B marketing
Dell's analytics track what their users search and click on, and ads for their brand pop up based on clicks of buttons or automatic intervals based on intervals that the software has set.
EOQ
Economic Order Quantity
A B2B marketing manager reduced the price on a brand of an auto part by 10 percent and observed a 25 percent increase in quantity sold. State what type of price elasticity it is.
Elastic
In the summer of 2017, Melody Food Service increased the price of hamburger patties from $2.00 to $2.15 per patty to their wholesalers and realized the sales increased from 20,000 pound to 19,000 pound. State what type of price elasticity it is
Elastic Demand
Suppose a B2B firm has been so gratified with the PR strategy that the managers of the firm think no need of any other promotional tools even though the firm has a sufficient fund for marketing communication. Since they are so successful with the PR strategy only, do you agree with the firm's managers on the use of any other promotional tools? What is your idea; for agree or disagree? State your own idea based on the study of the chapter.
No, I do not agree on the B2B firm's decision to cut all other promotional tools. The public relations strategy may be going well for the firm, but that does not mean that something will not happen in the public eye and change the PR strategy in an instant. There is also always room for improvement, meaning the PR strategy may be working very well, but it is not perfect. It would be one thing if the firm had no room in their budget for other marketing communication strategies and that is why they only decided on a PR strategy, but there is more room in the budget. It would be useful for the firm to not utilize other communication strategies, because as I stated earlier, there is always room for improvement. The firm could only be promoted even more if they had more than one promotional strategy. I believe the firm should also utilize one or more of the following promotional strategies: personal selling, nontraditional or traditional advertising, and/or sales promotion.
__________________________ is the most important demand-stimulating force in the business marketer's promotional mix.
Personal selling
However, the voice lecture states there are four instead of three. The fourth one mentioned in the voice lecture is _________________________.
Public relations
Explain how public relations can be used effectively for B2B marketing communication. Give your own creative ideas for the answer.
Public relations are extremely important in B2B because it helps to build trust with clients. B2B public relations must sell the company first and then the product or service second. Public relations can be used effectively for B2B by targeting a business audience and selling products between two businesses
What is public relations in marketing communication?
Public relations in marketing communications is a strategic communication process that builds mutually beneficial relationships between organizations and their publics. Public relations professionals can work for managing the image of a company, individual, organization, or government.
Is the push or pull strategy more effective for B2B marketing? Explain.
The pull marketing strategy is more effective for B2B marketing. This is because the pull strategy is more productive for B2B sales. The pull strategy in B2B marketing also helps to instigate customer demand for the product and brand demand from channel partners, so that companies can spend less money on advertising and more on product creation.
Web 2.0
The second stage of development of the World Wide Web, characterized especially by the change from static web pages to dynamic or user-generated content and the growth of social media.
Social network
Web sites comprised of online profiles for individuals and groups that distribute content to others
Did Melody Food Service make a right decision in pricing for this situation? Yes or No and explain why..
Yes, Melody Food Service made the right decision in pricing for this situation. Since the price is elastic, there is an increase in price and therefore, an increase in the quantity demanded. Since the slight price increase resulted in an overall increase in quantity purchased resulted in a higher revenue, the company is making more profits.
break-even analysis
a method of determining what sales volume must be reached before total revenue equals total costs
Search engine
a program that searches for and identifies items in a database that correspond to keywords or characters specified by the user, used especially for finding sites on the web.
Browser
a program with a graphical user interface for displaying HTML files, used to navigate through the web
Sales managers must monitor the performance of his forces for two reasons. They are:
a. To determine whether objectives are being attained b. To identify problems, recommend corrective action, and keep the sales organization in tune with changing competitive and market conditions
In the beginning of the chapter, the authors states that business marketing communications consists of ____________________, ___________________and ______________________.
advertising; sales promotion; personal selling
The ability to forge connections across internal units is ___________________________ skills.
boundary-spanning
Benefits of solution centered marketing strategy include: a.) new avenues for growth. b.) ustained differentiation and customer loyalty. c.) Both a and b. d.) Neither a or b.
c.) both a and b 1) New avenues for growth 2) Sustained differentiation and customer loyalty
In evaluating service quality, customers focus on: a.) empathy. b.) responsiveness. c.) assurance. d.) reliability. e.) all of the above
e.) all of the above 1) empathy 2) responsiveness 3) assurance 4) reliability
Treating customers as individuals exemplifies ________________________dimension of service quality.
empathy
What is the last decision (or action) you need to take to have a successful business-to-business advertising program?
evaluate the advertising effectiveness
Services are _______________________ to the customer experience that every B2B firm provides.
fundamental
Name a product you think that is 100 % tangible
Cell phone
Annual ordering cost: [(24,000/536.66)x1.2] Annual ordering cost: 44.72x1.2 Annual ordering cost: 53.66
Annual ordering cost: [(24,000/536.66)x1.2] Annual ordering cost: 44.72x1.2 Annual ordering cost: 53.66
Compare your EOQ with 10,000 units they are currently ordering each time to say yes or no.
565.69 is less than 10,000. No, Arirang Company is not efficient in the supply chain management.
Arirang Company plans to sell 200,000 widgets during the year. The firm orders 10 times a year for the equal units of the quantity. The cost of carrying one widget in inventory is $0.20 per year and the cost of placing one purchase order is $80. (Use two digits after the decimal point). What is the current total carrying cost for Arirang?
$200,000x0.2=$40,000
. Arirang Company plans to sell 200,000 widgets during the year. The firm orders 10 times a year for the equal units of the quantity. The cost of carrying one widget in inventory is $0.20 per year and the cost of placing one purchase order is $80. (Use two digits after the decimal point). What is the current total cost for carrying and ordering for Arirang?
$800,000+$40,000=$840,000
Go to Table 11.1 and choose the five most important controllable elements out of the ten at your own discretion. List them in the order of importance and explain each clearly.
1) Customer service 2) Transportation 3) Inventory control: 4) Materials handling: this element increases the speed of, and reduces the cost of, picking orders in the warehouse and moving products between storage and the transportation carriers. 5) Plant and warehouse location
5 Cs in B2B Pricing
1. Company objective in setting prices 2. Customer demand 3. Competition 4. Costs of products and services 5. Channel members
List the four key distribution responsibilities by the distributors in p. 209 and explain each in brief.
1. Contact: Reach all customers in a defined territory through an outside sales force that calls on customers or through an inside group that receives telephone orders. 2.Product availability: Provide a local inventory and include all supporting activities: credit just-in-time delivery, order processing, and advice 3. Repair: Provide easy access to local repair facilities (unavailable from a distance manufacturer) 4. Assembly and light manufacturing: Purchase material in bulk, then shape, form, or assemble to user requirements
What are the three key differences between the marketing channels and the supply chains we had discussed in Exercise 1 of the course?
1. Marketing channels are part of the marketing mix, while supply chains are not. 2. The supply chain is broader than marketing channels. 3. Marketing channels are customer facing rather than product facing.
List the five dimensions of service quality and explain in brief.
1. Reliability: exceptionally delivering the promises made to consumers 2.Responsiveness: Being willing to help your consumers. 3.Assurance: Inspiring trust and confidence. 4.Empathy: Treating customers as individuals. 5.Tangibles: Representing the service physically.
Four Common Objectives in B2B Price Setting? List them in order and explain each.
1. Target ROI 2. Market share 3. Meeting competition 4. Social responsibility
What are the two concepts calculating logistics costs. List and explain them in detail.
1. Total cost of ownership: this concept determines the total cost of acquiring and then using a given item from a particular supplier. 2. Activity-based costing: used to measure the cost of performing specific activities and then tracing those costs to products, customers, and channels that consumed the activities.
What are the two concepts mentioned in the text that can help in adding value to customers: List them and explain each in detail below.
1. Total-costs approach: The total-cost approach to logistical management guarantees to minimize total logistical costs in the firm and within the channel. Within the total-cost approach, costs of individual logistical activities are interactive (the decision about logistical variable affects some or all the others). The interactions among logistical activities are described as cost trade-offs because a cost increase in one activity is trades for a large cost decrease. Just-in-time systems:Under the just-in-time system, suppliers carefully coordinate deliveries with the manufacturer's production schedule, often delivering products just hours before they are used. The objective of this system is to eliminate waste from the production process by requiring the delivery of the specified product at the precise time and in the exact quantity needed.
Arirang Company plans to sell 200,000 widgets during the year. The firm orders 10 times a year for the equal units of the quantity. The cost of carrying one widget in inventory is $0.20 per year and the cost of placing one purchase order is $80. (Use two digits after the decimal point). What is the current total ordering cost of Arirang Company?
10,000x$80=$800,000
Arirang Company plans to sell 200,000 widgets during the year. The firm orders 10 times a year for the equal units of the quantity. The cost of carrying one widget in inventory is $0.20 per year and the cost of placing one purchase order is $80. (Use two digits after the decimal point). What is the current average inventory level for Arirang Company? Show work here. (Remember average inventory is divided by the quantity ordered divided by 2).
200,000/10=20,000 units 20,000/2=10,000 units
The chapter says that _____________ percent of the U.S. GDP is sold through indirect channels.
60
Only ____________ % of customers experience "superior services" but ____________ % of B2B firms believe that they deliver "superior services."
8%; 80%
Consumer Goods Pricing Act (1975)
A federal law that gives retailers the right to establish a product's final price
What is the hybrid offering? Why is it more relevant to services than to tangible products?
A hybrid offering is a combination of services and goods that, when put together, offer more customer benefits than if they were used or sold individually. This concept is more relevant to services than products because it is typically easier to market tangible products than it is services. This is because it is easier to establish credibility for products than services. When services are paired with products in a hybrid offering, it makes it easier to market that service and establish it's credibility.
Revenue drivers
Add incremental value by facilitating revenue or margin expansion; all areas of revenue generation within the organization
Indirect Traceable Costs
All costs, fixed or variable, that can be traced to a particular product, customer or territory (e.g., general plant overhead)
Miller-Tydings Act (1937)
Amended anti-trust laws to allow agreements to resell products at fixed retail prices in situations involving sales of trademarked good to a company's retail dealers.
The Romney Company is a restaurant supplier which sells a number of products to various restaurants in the area. One of a product is a special meat cutter with a disposable blade. The blade is $3.00 per unit. The annual demand for the blade is 24,000. The ordering cost is $1.20 and the carrying cost is $0.20. 2) Compute the ordering cost using [(D/Q) x O]
Annual ordering cost: [(24,000/536.66)x1.2] Annual ordering cost: 44.72x1.2 Annual ordering cost: 53.66
Compute the average number of days to sell the inventory for the year 2016 and 2015 state if P&G is getting better or worse in efficiency. Explain what the numbers you got mean in terms of supply chain management. Use 365 days per year. Use two digits after the decimal.
Average number of days to sell 2016: 365 days/6.79=55.76 days (56 days) Average number of days to sell 2015: 365 days/7.64=47.77 days (48 days) These calculations show that effective supply chain management resulted in a less amount of days in 2015 than the number of days in 2016.
Non-ownership is a unique service characteristic. From the following list, choose the marketing implication most closely related to this characteristic. a.) Need to use promotion and pricing to even out demand patterns. b.) Need to emphasize the benefits of reduced labor and overhead. c.) Use strict quality control standards. d.) High-level training for service personnel.
B) Need to emphasize the benefits of reduced labor and overhead
Compare the two answers in 4 and 5 in terms of marketing strategies for the price, place and promotion. How should you manage them in terms of their differences? Promotion aspect
Cell phones are promoted compared to their older models andoften include financial promotions. When a new model of a cell phone comes out, their new features are included in the marketing strategy. When the new features are compared to older features, it is exciting to consumers. Cell phone marketing strategies also include financial promotions, where consumers can save money if they buy at a certain time or id they bundle their cell phone with another cell phone or start a new service. For example, Apple promotes their new iPhone XR by offering buy one and get the other half off. This saves consumers money, but ultimately brings in more sales for Apple. Facebook also includes financial/promotional incentives for their consumers. For example, a business can increase the awareness of their post by spending more money (the more a business spends on advertising, the more people that will see it).Facebook also includes promotions for businesses that sponsor or invest in their company. For example, Toyota is a huge sponsor for Facebook. Because they invest a large amount to Facebook, they get special advertising incentives that other companies don't.
Compare the two answers in 4 and 5 in terms of marketing strategies for the price, place and promotion. How should you manage them in terms of their differences? Place aspect
Cell phones are sold in-person and online. In-person, they are sold in carrier stores. Online, they are sold directly through the carrier's website (att.com), or through a wholesaler (Walmartor Amazon). Cell phones can be marketed digitally through online advertisement or commercials,or physically by billboards. Since Facebook is an intangible service, it is a little more difficult to market. Since Facebook is an online service, it is mostly marketed through other online platforms, such as Google.
Direct traceable (attributable) costs
Costs, fixed or variable, are incurred by and solely for a particular product, customer, or sales territory (raw materials)
Cost drivers
Create value by providing economic savings; the unit of an activity that causes the change in that activity's cost
___________________________represents the internal and subjective response a business customer has to any direct or indirect contact with a company
Customer experience
___________________________ encompasses every dimension of a company's offering--------- product and service features, advertising, ease of use, reliability, the process of becoming a customer, or the way problems are resolved--------not to mention the ongoing sales relationship.
Customer service experience
Research on new service success suggests that: a.) the determinants of success for new services closely resemble those found for successful new products. b.) a well managed service development process is crucial. c.) successful projects provide clear customer benefits. d.) all of the above. e.) (b) and (c) only.
D. All of the above
The concept of tangibility helps the manager to: a.) focus clearly on the firm's total market offering. b.) recognize that a change in one of the elements of the marketing offering may completely change the offering in the view of the customer. c.) determine how a service will marketed. d.) all of the above. e.) (a) and (b) only.
D. All of the above 1) focus clearly on the firm's total market offering 2) recognize that a change in one of the marketing offerings may completely change the offering in the view of the customer 3) determine how a service will be marketed
____________________combine products and services into innovative value propositions for customers.
Hybrid offerings
__________________________________________ is the manufacturer's capacity to integrate the product and service elements of the offering early in the development process to tap the full potential for revenue generation and/or cost reduction.
Design-to-service capability
Name a business and a function in the downstream of the supply chain in Figure 11.1
Distributor; Hansen Motor
Recent research shows that business-to-business service firms are more likely to emphasize: a.) relationship strategies as opposed to transactional strategies. b.) arms-length strategies. c.) the total buyer-seller process d.) all of the above. e.) (a) and (c) only.
E) A and C only: relationship strategies are opposed to transactional strategies and the total buyer-seller process
The Romney Company is a restaurant supplier which sells a number of products to various restaurants in the area. One of a product is a special meat cutter with a disposable blade. The blade is $3.00 per unit. The annual demand for the blade is 24,000. The ordering cost is $1.20 and the carrying cost is $0.20. Find EOQ for this situation. Using two digits after the decimal point in computation, show all the work that you have reached the EOQ in units.
EOQ: square root of 2x24,000x(1.2/0.2) EOQ: square root of 288,000 EOQ: 536.66
Is Arirang Company efficient in the supply chain management? Explain why. a. Compute EOQ where Total Carrying cost is equal to Total Ordering cost.
EOQ= square root of 200,000x10x(0.2x0.8)= Square root of 320,000 EOQ=565.69
Name a service you think that is 100 % intangible
Why do five empty FedEx jets roam over the U.S. every night? Wouldn't it be a waste?
FedEx has five empty jets roaming over the United States every night for heavy demand times. Often, when a consumer orders an item online and they click "overnight shipping," those items are picked up by the FedEx jets that start their trip empty and canactually be delivered overnight, even if the distribution center is across the country from the receiver. The jets are also in the air for backup, in case of technical or weather issues. This is very smart on FedEx's behalf; no, it is not a waste. It is not a waist because FedEx is applying to service quality of assurance. Having those extra jets in the air reassures consumers that they will get their items on time no matter what.
From marketing point of view, who do you think that determine the quality of service? Make your answer very brief here: __________________________________
I think the consumer determines the quality of service because they are the ones who actually pay for and experience services.
How to tell if a price is elastic or inelastic
If E is greater than 1, price is elastic. If E is less than 1, price is inelastic.
What is a touchpoint in B2B marketing? Is the customer experience a touchpoint? Explain how a B2B manager can realize a touchpoint.
In B2B marketing, touchpoints are instances that a customer has direct contact with the product or service itself, or with representatives of it by a third party. Yes, customer experience is a touchpoint. Because a touchpoint is anytime a customer or potential customer comes in contact with the brand, the overall customer experience would count as a touchpoint, or sometimes several touchpoints. Understanding touchpoints can help B2B managers design better customer experiences overall. A B2B manager can realize when a touchpoint happens by creating a customer service map. This map provides key touchpoints and interactions between customers and the company. This map is a great tool for B2B managers to keep track of and use their touchpoints to generate better customer experiences
Read B2B TOP PERFORMER in p. 211 to answer why Intel uses manufacturers' representatives. (It is boxed article under Why Intel Uses Reps).
Intel uses manufacturers' representatives because there were problems that arose when they used distributors. When Intel used distributors, the organization had little sales organization, few customer relationships, and were often questioned by OEMS if they had renewed interest in embedded segments. Intel was not able to get their product lines if front of the appropriate target audience, so they decided to switch to manufacturers' representatives to fix these problems.
List the four common situations where manufacturers' representatives are used.
Large and small firms 2.Limited market potential 3. Servicing distributors 4. Reducing overhead costs
The channel of distribution is the marketing manager's ______________________ to the market.
Link
Explain why logistics is critical to business marketers.
Logistics are critical to business marketers because they are a key part of the supply management chain. The supply management chain, which implements plans to create and physically create the inventory, collect raw materials to produce the product, and sell the product to outside markets. Logistics has the ability to reduce delivery time, pinpoint customer issues, control quality, and provide extra services. All these aspects are important to business marketers because logistics directly impacts marketing, and
Explain why logistics is critical to the customer.
Logistics are critical to customers because it is a determining factor of customer service. Supplier logistical service translates in product variability. The customer reduces the risk that the productions process will be interrupted. Consistent delivery not only enables the buyer to program more effectively, but also allows the buyer to reduce inventory costs. Effective logistics will cause the customer to have a positive experience, leading to brand-loyal customers.
Explain why logistics is critical to other supply chain participants
Logistics is critical to other supply chain participants because logistical systems directly affects a distributor's ability to service users and control costs. The nature of the B2B supply chain affects the warehousing requirements of a supplier. A supply chain using distributors offsets the need for warehousing, which is a service to the supplier. Efficient and effective logistics are key to lower costs, which can either lead to price increases or decreases, depending on the effectiveness of the logistics. All these factors affect other aspects of the other supply chain members. A supplier's logistical system directly affects a distributor's ability to control cost and service to end users.
Create a channel structure of the food industry (Use chocolate bars, for example) and a channel structure of the hospital industry to compare and contrast. You may use the Coca Cola Company in Atlanta, GA and Deaconess Hospital in Evansville, IN. Coca Cola:
Manufacturer - Distributor Distributor - Wholesaler Distributor also - retailer Wholesaler - retailer Retailer - Consumer
The link between ___________________ and _______________ is the channel of distribution, but it is not the supply chain.
Manufacturers; customers
Clayton Act of 1914
Outlawed certain anticompetitive practices not prohibited by the Sherman Act, including price discrimination, tying contracts, exclusive dealing, interlocking directorates, and buying the corporate stock of a competitor
Sherman Antitrust Act (1890)
Outlawed monopolies and practices that restrained trade, such as price fixing
____________________________means that services cannot be stored or stockpiled; if they are not provided at the time they are available, the lost revenue cannot be recaptured
Perishability
Robinson-Patman Act (1936)
Prohibits any form of price discrimination that has the effect of reducing competition among wholesalers or retailers
Why is services fundamental to every B2B firm?
Services are fundamental to every B2B firm becausemarketing firms are service firms. B2B firms are selling their service of marketing to other brands.There is more to B2B marketing than just the tangible items that consumers can feel, hold, or see. There are many elements in B2B marketing that are intangible, and services are a huge part of those elements. B2B firms must know how to market their intangible elements as well, and these include services. These intangible services include digital marketing, social media, and more. Marketing firms provide intangible services, things that their clients cannot feel or hold, that help their clients to get their brand or product known to the public. Without these services, there would be no B2B firms because they do not sell actual "tangible" products. Services play a critical role in marketing programs of many B2B firms, whether their primary focus is on the service itself or if the service provides a path for growth.
Economic value
The cost savings and/or revenue gains that customers realize by purchasing the firm's products instead of the next-best alternative (the reference value)
Create a channel structure of the food industry (Use chocolate bars, for example) and a channel structure of the hospital industry to compare and contrast. You may use the Coca Cola Company in Atlanta, GA and Deaconess Hospital in Evansville, IN. Deaconess Hospital:
Supplier warehouse - Transport (Distributor) Transport - wholesaler Wholesaler - Transport (distributor) Transport - Hospital Hospital - medical clinic Medical clinic - Patient consumption
Do you see your diagrams show that one of the two channels is longer than the other? Explain why one is longer than the other with your own knowledge learned from the course.
The Deaconess distribution channel is longer and therefore more complex than the Coca Cola distribution channel. This is because there are two levels of transport (distribution) in the hospital distribution channel, which makes it longer. This is also because the medicine in the hospital distribution chain mustgo through two channels before it reaches patient consumption, unlike the Coca Cola channel which gets to consumer consumption in one step, instead of two.
Listen to the VLs and explain difference between upstream and downstream in B2B marketing.
The difference between upstream and downstream in B2Bmarketing is that one is focused on long-term situations and the second is focused on more short-term situations. Upstream marketing is focused on strategies and long-term tactics, while downstream marketing is focused on short-term tactics and supporting sales efforts. Upstream marketing in B2B focuses on where the market is moving and using future tactics to keep track of this, while downstream marketing in B2B focuses on research and collaborating with the sales team. Downstream marketing focuses on strategies that communicate the value proposition of the company or product. Downstream marketing focuses on product positioning, competition, promotions, and brand messaging. Upstream marketing focuses on sustainability, innovation, new markets, and budget.
1. The B2B marketers generally modify the existing channels to satisfy end-user needs that is the primary goal of the distribution channel. Among the six steps you will take in designing a new marketing channels in p. 213, what is the first step you need to take? Explain why it should be the first step.
The first step that needs to be taken in designing a new marketing channel is to help the end-user focus and define customer segments. Customer segmentation helps B2B marketing firms classify potential consumer groups based on their demographics, wants, needs, and more. Defining customer segments should be the first step in designing a new marketing channel because it can help to center the importance of the product from the customer's perspective in order to see what direction the new market channel should take.
All figures in millions (000,000) 2016 Net sales: $65, 299 Inventories: $4,716 Cost of Goods Sold: $32,909 Net Income: $10,604 2015 Net sales: $70,749 Inventories: $4,979 Cost of Goods Sold: $37,056 Net Income: $7,144 Compute the 2016 and 2015 inventory turnover for P&G and state if it is getting better or worse. Explain what the number you got mean in terms of supply chain management. Use no more than two digits after the decimal. Use two digits after the decimal.
The formula to use: Inventory turnover = CGS/AI Inventory turnover for 2016: $32,909/$4,847.50= 6.79 Inventory turnover for 2015: $37,056/$4,847.50= 7.64
Compare the two diagrams of marketing channels you have just created and tell me the key differences.
The main difference in the diagrams of the marketing channels for Coca Cola and Deaconess is that they are two different industries. The difference in the industries (food vs. service/medicine) causes there to be different intermediaries in the distribution channels. For example, the Coca Cola distribution channel starts with the manufacturer, while the hospital distribution starts with the supplier warehouse. Next, the Coca Cola distribution chain goes to the distributor, which then goes to wholesalers, retailers, and then to consumer for consumption. Coca Cola can also go directly from the distributor to the retailers, skipping the wholesaler altogether. The Coca Cola distribution channel only has one level of distributor, from the manufacturer to the wholesaler. The Deaconess distribution channel has two levels of distributors (transports), from the medicine supplier warehouse to the wholesaler, and from the wholesaler to the physical hospital. This difference is key when comparing the two distribution channels, because it makes the Deaconess distribution channel longer and more complex. Another key difference is that in the Coca Cola distribution channel there is a retailer channel, while there is no retailer channel for Deaconess.
Compare the two answers in 4 and 5 in terms of marketing strategies for the price, place and promotion. How should you manage them in terms of their differences? Price aspect:
The price for cell phones is very dependent on the price of the competing brands' cell phonesand howmuch revenue the company can bring for certain prices on the market. Since Facebook is a free platform to use and the company makes a lot of money off of investors, they must determine other factors for price. These include charging users and businesses to advertise on Facebook and selling credits for online games such as FarmVille. The companies who invest in Facebook get a lot of online marketing from the platform (the more they pay Facebook, the more views their page or advertisement will get, advocating for their brand).
price elasticity of demand
The rate of percentage change in quantity demanded attributable to a percentage change in price (not the same at all prices)
Commodity value:
The value that a customer assigns to product features that resemble those of competitors
Compare the two answers from 2) and 3). Are they equal or very close?
They are equal at 53.66.
Two primary intermediaries in business marketing channels are __________________________ and ____________________________________. Between the two, the former sell about _______ percent of all business markets.
industrial distributors; manufacturers' representatives
Name a business and a functions in the upstream of the supply chain in Figure 11.1.
Transportation; nucor steel
Other channels are indirect - that is, some type of _______________ sells or handle the products.
intermediary
Is it true that direct channels with no middlemen cost less are the best and better than indirect channels? Choose YES or NO by circling one of the two and explain why your answer is right based your study in the course. You should be very clear in Yes or No. Then explain.
Yes, it is true that the direct channels with no middlemen are less costly than indirect channels. However, it may be more expensive at the beginning of the process to start a direct channel versus an indirect channel. Direct channels will have the expensive costs of warehouses, trucks, delivery staff, and logistics, versus indirect channels that require no start up costs. However, once these systems are set up, there are no other expenses in direct channels. In indirect channels, there are no start up costs, but a lot higher and expensive costs once the systems are in place.
In the summer of 2017, Melody Food Service increased the price of hamburger patties from $2.00 to $2.15 per patty to their wholesalers and realized the sales increased from 20,000 pound to 19,000 pound. Compute the price elasticity for the problem
[(23,000-20,0000)/(23,000+20,000)/2]/[($2.15-$2.00)/($2.15+$2.00)/2]= [(3,000/43,000)/($0.15/$4.15)/2=E=1.93
Price elasticity of demand formula
[(New quantity demanded-Initial quantity demanded)/(New quantity demanded+Initial quantity demanded)] / [(New price-Initial price)/(New price+initial price)]
The supply chain for electric motors starts from___________________.
iron ore mining
Some channels are direct - the manufacturers must perform _____________________________.
all the marketing functions needed to make and deliver products.
Perishability is a unique service characteristic. From the following list, choose the marketing implication most closely related to this characteristic. a.) Need to use promotion and pricing to even out demand patterns. b.) Use physical cues in promotions to help customers evaluate service quality. c.) Emphasize strict quality control standards. d.) High-level training for service personnel.
a.) Need to use promotion and pricing to even out demand patterns.
In conceptualizing the service product, the service offer refers specifically to: a.) detailed service elements that will make up the total services package. b.) general benefits the service company will provide to the customer. c.) benefits sought by customers. d.) overall process of assessing and responding to customer needs.
a.) the detailed service elements that will make up the total services package
_____ encompasses the procedures, policies, and processes a firm uses to resolve customer service problems promptly and efficiently. a.) A value network b.) Service recovery c.) Service quality d.) Service loyalty e.) Service offering
b) service recovery
Service variability is a unique service characteristic. From the following list, choose the marketing implication most related to the characteristic: a.) buyer-seller interaction requiring that the service be done \"right\" b.) planning capacity on the basis of peak demand c.) emphasizing strict quality control standards d.) using pricing and promotion to even out demand peaks and valleys e.) None of the above applies specifically to service variability.
c.) Emphasizing strict quality control standards
If a firm provides maintenance and repair services to its installed base of products at a customer location, then a.) the service attributes can be evaluated before purchase. b.) the core service demand is inelastic. c.) product usage data can be systematically gathered and used to tailor service offerings that advance customers' goals. d.) all of the above. e.) (a) and (b) only.
c.) product usage data can be systematically gathered and used to tailor service offerings that advance the customers goals
The degree of tangible-intangible dominance of an industrial offering refers to the: a.) simultaneous production and consumption of the service. b.) variability in the quality of the service. c.) perishability of the offering. d.) non-ownership of the service purchased. e.) relative importance accorded, by the buyer, to tangible versus intangible elements.
e.) Relative importance accorded, by the buyer, to tangible versus intangible elements
In following a "solutions" strategy for B2B services. solution effectiveness can be enhanced by the supplier by: a.) out a blueprint to guide employees on creating a solution b.) Documenting the history of prior customer solution engagements c.) Developing complimentary incentives for all of the staff that may be involved d.) Only a and c e.) Correct All of the above
e.) all of the above 1) laying out a blueprint to guide employees on creating a solution 2) Documenting the history of prior customer solution engagements 3) Developing complimentary incentives for all of the staff that may be involved
When the marketer emphasizes reductions in staff, overhead, and capital as potential benefits to the purchaser, this relates to the service characteristic of: a.) variability. b.) perishability. c.) simultaneous production and consumption. d.) intangibility. e.) lack of ownership.
e.) lack of ownership
The first step in understanding a customer's experience is to develop a _________________map.
life-cycle
Instances where the customer has direct contact with either the product or service itself or with representatives of it by a third party, such as a channel partner are known as____________________.
touchpoints
In Go to Market Strategy, Lawrence G. Friedman states that you must build an accurate customer fact-base that clarifies who _________________________________________________, what _________________________________________________, how _________________________________________________, how __________________________________________________, and what ____________________________________________________.
who the customers are in your target market, what they buy, how they buy it, how they want to buy it, and what would motivate them to buy more of it from you.