Justin Wearne
My theory of industrial marketing is there are six important handles to pull to drive the sales and marketing in an industrial firm… research and analysis, strategy, sales force management, brand development, tenders and proposals, and marketing communications.
Regular attendance to these areas will keep the firm on track. Let’s explore each of them a little further…
A solid understanding of the market is the foundation for developing strategy. Industrial firms are quite often based on a significant investment in capital equipment, consequently decision making about what products to manufacture and what services to offer become crucial; gearing-up is costly.
Research feeds into strategy. Strategic thinking is critical for the full planning hierarchy; strategic/corporate plan, business/operating plan, marketing plan, and at the bottom – sales planning. Linking with traditional marketing practice, strategy is where the topics of price, product, and distribution are considered. The 4th ‘P’ (promotion) comes in below under the theme of marketing communications.
The key distinguishing feature between B2C and B2B firms is the reliance on direct selling. Management of the direct selling process is a critical input. For several reasons: Firstly, for industrial firms it is usually the main promotion technique, secondly sales activity is costly so it needs to be efficient and effective. Lastly, it is one of the most misunderstood areas of the B2B business. Many industrial businesses carry on for years with an engineering/technical focus; however when the work stops coming in the founders forget that it was the business relationships that they fostered at the beginning that has driven the firm’s success. Time spent on sales force engineering is well rewarded in the industrial firm. I have written several articles that you may find useful in exploring this topic.
An article about sales management; a buffalo hunter’s guide to sales planning.
Turning inside cats into outside cats; or how to get the sales force out selling.
Read about my Sales Dimension model for sales force engineering for the B2B firm.
Industrial organisations tend to be less sophisticated with branding than B2C firms. (read more about industrial branding here.), with many industrial firms thinking that branding is something that is more applicable to B2C for selling softdrinks, soap powders, and beer. However, there are some stunning examples of some outstanding industrial brands, and branding is clearly equaly as applicable to the industrial firm. Particularly when tendering. A firm’s reputation becomes a critical issue for the buyer. I have written an extensive article on this topic.
A large percentage of work won by the industrial firm will require the submission of our proposal and/or a tender. Being able to efficiently carry out this process and understanding what is required to win is another important activity.
Another distinction between B2C and B2B is the dependence on main media advertising for driving sales. Building consumer brands (FMCG) requires a continuous presence on television and radio, and without large ad spends many supermarket chains will refuse to allocate shelf space. Marketing communications have less emphasis for the B2B firm (because of the reliance on direct selling), but are still important to get right. Chief among these are corporate identity, websites, sales aids, and increasingly – digital media.
So, there it is my theory of Industrial Marketing in a nutshell. Do you have any comment?
Very interesting comments about B2B branding.
Who would doubt that technical and functional product specifications are critical in the purchase of services and products. But when it comes to the crunch – when specifications of competing products are pretty much indistinguishable – and that must apply to just about 95% of mature product markets – there is real value in having a strong brand. And this extends into creative execution. What about commodities where there isn’t differentiation? http://www.chevron.com/about/advertising/
Sales activity is critical but maybe B2B marketing communciations is the biggest arena yet for marketing communicators. And yes maybe that means direct marketing’s new powerhouse tool : newmedia/digital.
Interesting approach and robust framework.
To me one of the most intriguing parts of industrial marketing is the high service content, even when selling physical products.
I started my career selling machineparts, but soon found myself in subcontractor services, toll manufacturing, and now distribution and equipment rental.
Fell free to follow my blog B2B Marketing, at perohstrom.com.
Per Ohstrom