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What is Business-To-Business Marketing?

Article Details
  • Written By: Osmand Vitez
  • Edited By: Kristen Osborne
  • Last Modified Date: 28 October 2016
  • Copyright Protected:
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Business-to-business marketing is the advertisements of goods or services to companies rather than consumers. Many companies use raw materials, intermediate goods, or ancillary products when producing goods and services. Companies look to other companies to buy these materials, which is where business-to-business marketing comes in to play. Rather than traditional advertising methods, most companies use internal sales teams or other staff to contact potential buyers. This is necessary, as advertising business goods or services can be ineffective for increasing sales.

Manufacturers are primary users of raw materials. They need these resources in order to produce the physical goods for consumers. Under the economic theory of comparative advantage, manufacturers will purchase raw materials from other companies that offer the best service and price on the items in question. Therefore, raw materials suppliers will engage in business-to-business marketing to inform manufacturers of available materials and how these items will help the manufacturer produce a higher quality product, as well as why the manufacturer should buy the product from that particular supplier.

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Business-to-business marketing is typically specific to an industry or a group of business sectors. For example, companies in the shipping, distribution or warehouse industries will most likely use ancillary or tertiary packaging materials. Therefore, companies selling products such as stretch wrap, boxes, pallets or similar materials will target businesses in these industries. This can mean internal sales personnel will handle sales over the phone or through email correspondence. Another option is to send out sales representatives who will contact buyers in person. The sales staff is responsible for generating leads and offering contracts to businesses in order to increase revenues.

Some companies may also offer business-to-business marketing services. Much like their consumer advertising counterparts, these companies focus on working with businesses to help them sell their goods or services to other businesses. These business marketing companies work as intermediaries among different companies. Going back to the comparative advantage theory, companies selling intermediate or other business goods and services may not have the ability to specialize in the marketing of these products. Therefore, they will hire a business marketing firm to help them drive sales.

Another option in business-to-business marketing is buying leads from a marketing group. These groups gather information via websites, email inquiries, telephone conversations or other means. These “leads” are then sold to a company that is looking to market goods or services. This saves a company valuable time in generating contacts that are looking to by their products. Lead generation is quite common, meaning that companies who sell goods and services to other businesses should be able to find these leads fairly easy.

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