Business Markets & Service Marketing

Business Markets

• Companies and organizations that purchase products for the operation of a business or the completion of a business activity– Capital equipment– Operating equipment– Supplies– Raw materials– Component parts

Demand

• Direct Demand (consumer markets)

• Derived Demand: quantity of product or service needed by a business in order to operate at a level that will meet the demand of its customers

Business Markets• Capital: land, buildings, and major pieces

of equipment• Operating Equipment: smaller, less

expensive equipment (cash registers, tools, small machines)

• Supplies: materials consumed in the operation of the business (paper, ink catridges)

• Raw Materials: materials incorporated into the products they make

• Component Parts: parts manufactured by another business incorporated into the products they make

Service Marketing

• Service Marketing: Services are intangible, inseparable, perishable, and heterogenous– Intangible: cannot be touched, seen, tasted,

heard, or felt– Inseparable: service is produced and

consumed at the same time– Perishable: services unused in a period cannot

be stored for use in the future– Heterogeneous: differences between services

due to the difference in the people who perform them

Service Quality

• The degree to which the service meets customers’ needs and expectations– Competition– Performance standards– Customer satisfaction

Service Marketing

• Planning:– nature of services affect the planning

• Promotion:– endorsements, word of mouth, personal selling

• Price:– bundling

• Product/Distribution:– distributed at the point of creation