b 2 b marketing & crm - buyer seller relationship

8/2/2019 B 2 B Marketing & CRM - Buyer Seller Relationship

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B 2 B Marketing & CRM-

Buyer -Seller Relationship

M.M.S- 3 rd Sem

Haresh Pursnani


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Buyer-Seller Relationship


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Buyer-Seller Relationship Learning Objectives

1. To understand the various aspects of buyer and sales

representative interaction, including the perceptions and the

roles played by them.

2. To know the major factors which influence buyer-sellerrelationship.

3. To know the methods used by industrial marketers (or

sellers) to influence industrial customers (or buyers), such as

sales presentation and negotiations.

4. To understand the special dealing, between buyers and

sellers, such as reciprocity and dealing with customers,

importance of customers service is also emphasized.


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BuyerSeller Interaction

A Conceptual Framework


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Relationship Marketing

The task of creating strong customer bond or

loyalty is called relationship marketing .

Barry and Parasuram have suggested three

approaches for developing strong customer

bond.

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Firstapproach is to add financial benefits tothe customer relationship.

For example, giving volume discount orrewarding the customer with free spare-parts

kit.

However, these benefits can be imitated bycompetitors, and hence can not be used to

differentiate permanently.


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The secondapproach is to give social benefits, in addition to

financial benefits.

The company sales persons learn buyers individual needs andwants and then offer individualized services.

For example, depending on individuals needs and wants, use

problem solving languages, including solving personalproblems, such as hotel booking or making travel

arrangements.


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The thirdapproach is adding structural ties to

financial and social benefits.

For example, supplying special equipment or service,such as training customers maintenance engineers.


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Both of us win or win win style

This style is generally used for customers, suppliers,

employees, relatives and so on, where long-term

healthy relationships and mutual satisfaction areimportant.

Here, the negotiations are held for mutualsatisfaction, with emphasis on development of

genuine relationships based upon trust and

understanding, where both sides win.


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Building an environment of trust and confidence, much before

the final negotiation. Be polite and humble, which helps the

customer to communicate easily.

The initial focus, during the final negotiation, should be on

getting the agreement to the general statement of the

problems. In other words, initially, identify the problems

rather than solutions.

The emphasis during negotiation should be on end results

or needs, rather than on the means


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Both sides should then work together, pooling

their resource, ideas and sharing information

to solve the problem stated earlier.

Avoid defensive posture. Be amendable (i.e.

responsive to correction) if negotiation

climate is favorable.

If possible, avoid legalist or contractual

approach.


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You Win, I lose style

This styles is sometimes used by sales / marketing persons

with demanding and highly cost-conscious industrial

customers, who feel satisfies if they have driven the seller to

lose in the bargain.

Once a sales person knows such an approached of the

industrial customers, he creates an environment, at the final

stage of negotiation, that he has lost in the deal (although

actually he has gained) but he is accepting the terms in viewof long terms business relationship .


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Type of Relationships

A business marketer may begin a relationship with GE as a

supplier (one of many), move to a preferred supplier status

(one of a few), and ultimately enter a collaborative

relationship with GE (sole source for particular items).

Buyers and sellers craft different types of relationships in

response to market conditions and the characteristics of the

purchase situation.

Observe in Figure 4.1 that buyerseller relationships are

positioned on a continuum, with transactional exchange and

collaborative exchange serving as the end points.


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Managing Buyer- Seller Relationships

To develop specific relationship marketing strategies for a

particulars customer, the business marketer must understand

that some customers select a collaborative relationship,

whereas others prefer a more distant or transactional

relationship.

the typical characteristics of relationship at the end points of

the buyerseller relationship spectrum :


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Type of Relationships

Central to every relationship is an exchange processwhere each side gives something in return for a

payoff of greater value.

Transactional exchange centers on the timely

exchange of basic products for highly competitive

market prices.

Moving across the continuum relationships become

closer or more collaborative (close) versus

transactional (distant ) exchange


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Value- Adding Exchanges:

Between the two extremes on the relationship continuum are

value- adding exchanges, where the focus of the selling firmsshifts from attracting customers to keeping customers.

The marketer pursues this objective by developing a

comprehensive understanding of a customers needs andchanging requirements, tailoring the firms offerings to those

needs, and providing continuing incentives for customers to

concentrate most of their purchases with them.

To illustrate, Dell Computer provides a customized Web page

for each of its premier corporate customers that individual

employees in the customer organization can access for an

array of information and technical support services.


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Strategy Guidelines

The business marketer manages a portfolio of relationshipswith customers- some of these customers view the purchase

as important and desire a close, tightly connected buyer-

seller relationship; other customers assign a lower level of

importance to the purchase and prefer a looser relationship .

Given the differing needs and orientations of customers, the

business marketers first step is to determine which type of

relationship matches the purchasing situation and supply-

market conditions for a particulars customer.

Second, a strategy must be designed that is appropriate for

each relationship type.


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Managing High- and low cost

to serve customers

What causes some customers to be more expensive than

others ?

Activity based costing provides a solid foundation for

measuring and managing the profitability of individual

customers

high cost to serve customers for example, desire

customized products, frequently change orders, and require a

significant amount of presales and post sales support.

By contrast, low- cost to serve customers purchase standard

products, place orders and schedule deliveries on a

predictable cycle, and require little or no pre sales or post

sales support


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IDENTIFYING PROFITABLE

CUSTOMERS

Cost to Serve & Margins


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Customer relationship

management: the process Customer relationship management (CRM) is a cross-

functional process for achieving.

a continuing dialogue with customers

across all their contact and access points, with

personalized treatment of the most valuable customers,

to ensure customer retention and the effectiveness of

marketing initiatives.

CRM is the bundling of customer strategy and processes,

supported by relevant software for the purpose ofimproving

customer loyalty and, eventually, corporate profitability.


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Acquiring the Right Customers:

Customer relationship management directs attention to twocritical assets of the business to business firm:

its stock ofcurrent and potential customer relationships and

its collective knowledge of how to select, initiate, develop,and maintain profitable relationships with these customers.

Customers portfolio management, then, is the process of

creating value across a firms customer relationships- fromtransactional to collaborative- with an emphasis on balancing

the customers desired level of relationship against the

profitability of doing so.


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Instituting the best Processes:

The sales force assumes a central relationship-management

role in the business market.

Technical service and customer service personnel also assume

implementation roles that are important and visible in buying

organizations.

Successful relationship strategies are shaped by an effective

organization and deployment of the personal selling effort

and close coordinator with supporting units, such as logistics

and technical service.


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Best Practices at IBM:

In serving a particular customer, a number of IBM employeescome into contact with the customer organization. To ensure

consistent strategy execution.

IBM identifies customer- contact roles for each of its

accounts, specifies desired measurable actions for each role,

and monitors the customers degree of satisfaction with each

role .

The IBM client representative assigned to the customer is the

relationship owner, but the account team may include other

specialists who complete a project for the customer (Project

owner) or solve a particular customer problem (problem

resolution owner).


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customer- relating capability

To excel at customer relationship management, a

firm requires a customer- relating capability.

This capability, best nurtured in a market-drivenorganization, includes a strong relationship

orientation among employees, a rich and widely

used information base, and systems, processes, and

incentives that enable personalized solutions for

customers.


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THANK YOU

b 2 b marketing & crm - buyer seller relationship

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