Module3_STP_RelationshipMarketing presentation

B2B marketing module 3

1. MODULE 3 Industrial Market Segmentation, Targeting & Positioning and Relationship Marketing

2. Industrial Market Segmentation Dividing heterogeneous markets into homogeneous groups Focus on organizational buyers

3. Requirements for Effective Segmentation Measurable - Size, purchasing power, profiles must be measurable. Accessible - Segments must be reachable through sales & distribution. Substantial -Large/profitable enough to serve. Differentiable - Segments must respond differently to different marketing mixes. Actionable - Firm must be able to design effective marketing programs.

4. Macro Segmentation Broad characteristics of organizations: Industry type (Pharma, IT, FMCG, Automobiles) Company size (Large, Medium, Small) Location (Domestic, Export markets) Usage patterns (High-volume vs. Low-volume buyers) Example: Steel customers – construction, automobile, infrastructure

5. Micro Segmentation Focus on buying behavior & DMU (Decision Making Unit): Purchase criteria (Price, quality, service, reliability) Buyer-seller relationship (Long-term contract vs. transactional) Decision-making style (Centralized vs. Decentralized) Personal characteristics (risk-taking, innovativeness) Example: IT buyers – cost vs. security

6. Intermediate Segmentation Combines macro + micro: 1. Classify firms by industry/size (macro). 2. Analyze DMU (decision making unit ) buying behavio u r (micro).

7. Nested Approach to Segmentation Hierarchical levels: 1. Demographics (industry, size, location) 2. Operating variables (technology used, user status) 3. Purchasing approaches (centralized/decentralized, criteria) 4. Situational factors (urgency, application, order size) 5. Personal characteristics (decision-maker’s attitude, loyalty, risk perception)

8. Other Bases of Segmentation • End-use/application • Purchase volume • Profitability • Customer loyalty • Value-based segmentation

9. Benefits of Segmentation • Identify profitable customers • Tailored marketing mix • Efficient resource allocation • Stronger customer relationships • Competitive positioning

10. Market Targeting Evaluating & selecting segments Approaches: • Undifferentiated - Single marketing strategy for all (rare in B2B). • Differentiated - Different strategies for each segment. • Concentrated (Niche ) - Focus on one or few profitable segments. • Customized - Tailored for individual clients (common in industrial markets). Example: SAP ERP solutions for corporates vs SMEs

11. Differentiation Ways to stand out: • Product (quality, features ,durability ) • Service (after-sales, training ,installation ) • Personnel (expert salesforce , technical expertise. ) • Channel (exclusive distributors , faster delivery ) • Image (brand reputation , certifications )

12. Positioning Establish brand’s unique place in buyer’s mind Bases: Price, quality, reliability, innovation Select best positioning strategy Communicate & reinforce through consistent messaging Example: Tata Steel – "Strength and Trust"

13. Relationship Marketing in B2B Focus: Long-term partnerships Principles: Lifetime value Trust & commitment Customization Technology-enabled CRM

14. Relationship Marketing Strategies • Key Account Management (KAM) • CRM tools • After-sales support • Loyalty programs • Collaborative projects Example: IBM long-term IT partnerships

15. Summary • Segmentation: Macro, Micro, Intermediate, Nested • Targeting: Undifferentiated, Differentiated, Niche, Customized • Differentiation: Product, Service, Personnel, Channel, Image • Positioning: Creating distinct buyer perception • Relationship Marketing: Trust-based long-term partnerships

16. Adversarial Model (Transactional) • Short-term orientation • Price-driven • Low trust • Competitive stance (win–lose) • Minimal collaboration Example: Commodity raw material purchases

17. Partnership Model (Collaborative) Long-term orientation Value-driven High trust & commitment Win–win approach Integrated processes Example: Toyota–supplier collaboration

18. Lifecycle Models of Buyer-Supplier Relationship 1. Pre-relationship: awareness, selection 2. Exploration: trial transactions 3. Expansion: growing trust, larger orders 4. Commitment: collaboration, contracts 5. Dissolution (if any): end of relationship

19. Stages of Buyer–Seller Relationship 1. Awareness 2. Exploration 3. Expansion 4. Commitment 5. Dissolution (Adapted from Ford’s Model)

20. Selection of Firms for Collaboration Criteria: Strategic fit Capability fit Financial stability Trustworthiness Mutual dependence Geographic/logistical fit Example: Automotive OEMs’ supplier selection

21. Production Linkages & Industrial Marketing Backward linkages: raw material suppliers Forward linkages: distributors, OEMs Co-production & JIT Industrial clusters Example: Maruti Suzuki vendor parks

22. Customer Relationship Management (CRM) Definition: T echnology -enabled and strategy-driven process of m anaging customer relationships using people, processes & IT Objectives: Customer loyalty & retention Increase lifetime value Sales force effectiveness Personalization

23. Components of CRM 1. Operational CRM – sales, marketing, service automation 2. Analytical CRM – uses data analytics for customer insights . 3 . Collaborative CRM – cross-functional integration and customer interaction

24. Benefits of CRM Better understanding of customers Improved satisfaction & loyalty Efficient forecasting Strengthened long-term partnerships Example: Salesforce CRM in B2B firms

25. Summary Adversarial vs Partnership Models Lifecycle & Buyer-Seller Relationship Stages Partner Selection Criteria Production Linkages CRM : operational, analytical, collaborative Focus : Long-term trust-based relationships