Business-To-Business Marketing
The foundation of business-to-business marketing, as with business-to-consumer marketing, is that customer retention produces more positive results for the firm than attracting new customers, and that customer retention is a function of customer satisfaction. While the viability of prices can determine whether a business relationship can develop, a business relationship cannot be sustained solely on the basis of attractive prices. In addition to customer satisfaction, relationships and interactions with employees and management, loyalty, capabilities, delivery performance, time-to-market, service support, and the ability of suppliers to facilitate the improvement of existing products or the creation of new products are keys to developing long-term relationships. Suppliers broaden their value propositions to their customers in order to maintain those relationships when prices fluctuate in a way unfavorable to the customer. Similar to competitive prices, product quality is an essential element in the initiation of a business relationship, but cannot sustain a relationship because product quality, relative to the other aforementioned categories, has a minor impact on customer satisfaction.

Globalization has altered the development and implementation of marketing strategies in a business-to-business environment. As multinational companies relocate manufacturing and assembly operations to countries with lower labor rates, suppliers are being asked by these multinational companies to relocate to the same countries and to maintain existing standards of quality and service that were characteristic of operations in their home markets, but at lower prices. The internationalization of business-to-business activities has implications for business-to-business marketing. As suppliers develop relationships with customers that more closely resemble partnerships, the structures of country business units whose operations are relatively independent of the home country or regional management could be challenged. Business-to-business marketing decisions are heavily influenced by the structure of multinational organizations. The impact on small and medium-sized businesses can be significant. SMEs can use technology to collect data for international marketing, but many of these SMEs have not incorporated those technologies into their international marketing efforts, likely missing major market and/or marketing opportunities.

Michael Mobley