• Ajay Mohan

What is Business marketing?



Business marketing, sometimes called business-to-business marketing or industrial marketing, involves those marketing activities and functions that are targeted toward organizational customers. This type of marketing involves selling goods (and services) to organizations (public and private) to be used directly or indirectly in their own production or service-delivery operations. Some of the major industries that comprise the business market are construction, manufacturing, mining, transportation, public utilities, communications, and distribution.

One of the key points that differentiate the business from consumer marketing is the magnitude of the transactions. For example, in the early 21st century, a Boeing 747 airliner, selling for more than $300 million, could take up to four years to manufacture and deliver once the order was placed. Often a major airline company will order several aircraft at one time, making the purchase price as high as several billion dollars.

Customers for industrial goods can be divided into three groups: user customers, original equipment manufacturers, and resellers. User customers make use of the goods they purchase in their own businesses.

An automobile manufacturer, for example, might purchase a metal-stamping press to produce parts for its vehicles. Original-equipment manufacturers incorporate the purchased goods into their final products, which are then sold to final consumers. Industrial resellers are middlemen—essentially wholesalers but in some cases retailers—who distribute goods to user customers, to original-equipment manufacturers, and to other middlemen. Industrial-goods wholesalers include mill-supply houses, steel warehouses, machine-tool dealers, paper jobbers, and chemical distributors.

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