B2B purchases differ from B2C purchases in many ways even though they both meet a need. B2B buying varies in the sense that a company has policies and purchasing processes in place that decide the order in which the buying decision is made.
For B2B marketers, it’s important to understand the characteristics of B2B buying behavior (including the purchasing process as well as the influencers involved) in order to create effective marketing programs to reach the buyers.
The different characteristics of B2B buyer behavior are :
1.Market characteristics :
- Demand for B2B products is derived: What this means is that the demand for B2B industrial services and products is derived from or is driven by consumer demand for goods and services. For e.g. the demand for Computer Associates’ Enterprise security software is dependent on the volume of online consumer purchases. If consumers are not driving increasing sales on online shopping sites by buying more from online sellers(thereby triggering a need for safer online systems), then online retailers will not consider CA’s suite of security products or anyone else’s for that matter. Derived demand is thus based on expectations of future consumer demand.
- Customers are few and purchase orders are large: Clear enough. Typical order size varies from hundreds of thousand dollars to a few million dollars.
2. Product/service characteristics:
- In the B2B purchasing world, products and services are technical in nature and are bought on the basis of their specifications.
- Many of the products in B2B sales tend to be raw or semi-finished. For e.g. Microsoft’s Office suite is not entirely developed by Microsoft – some of the other pieces are developed by external teams with the expertise and upon completion the piece of coding is sent to Microsoft’s team and integrated within the main suite.
- Key decision factors in B2B purchasing involve reliability of delivery schedules, technical support and post-sales customer support.
3. Buying process characteristics:
- B2B buyers follow established purchasing policies and procedures which are set in place by the company’s purchasing department. RFPs are typically common for high-tech, high spec products.
- Processes exist in place for evaluating sellers and their products and services.
- The buying influencers are many and many parties participate in the purchasing decision.
4. Characteristics of the marketing mix:
- Direct selling to organization buyers is the typical rule. So, many firms send their promotional material to heads of purchasing departments.
- Typically, B2B advertising and other promotional material is technical in nature.
- Pricing is never set in stone. It’s set as part of a protracted negotiation where it’s evaluated as part of a broader situation where the seller and product qualities play a large role in the decision-making process. Bulk discounts are also typically the rule.
- Relationship marketing is the key here, and different levels of the organization participate in the buying/selling process especially if the sale is a big ticket sale.
It’s important for online marketers to recognize the makeup of B2B buyers as this will help them communicate with them more effectively. While a buyer might be on Facebook, it wont make sense to create a Facebook group but perhaps a LinkedIn group. He might also be willing to follow your tweets. And, if your email newsletter provides him with value, he’ll be sure to browse through it.
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