Business-to-business
From Wikipedia, the free encyclopedia
Business-to-business (or B2B for short) is a marketing strategy which involves the transaction of goods or services between businesses (as opposed to relations between businesses and other groups, for example consumers or public administration).
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[edit] How B2B marketing is used
B2B transactions tend to take place within one category of products or service. For example, an enterprise dealing with agricultural products will search for a bulk buyer within the agriculture category.
B2B marketing is generally considered more complex than B2C marketing, as there is often more than one decision-maker involved in a B2B sale on the buyer's side.
The term is also often used by multi-level marketing companies as a euphemism for door-to-door sales practices involving cold calling and street pitching of low quality merchandise.
[edit] E-Marketplaces
[edit] Vertical e-Marketplace
A Vertical e-Marketplace spans vertically up and down every segment of one specific industry. Each level of the industry has access to every other level, which greatly increases collaboration. Buyers and Sellers in the industry are connected to increase operating efficiency, and decrease supply chain costs, inventories, and cycle times. This is possible because buying/selling items to customers in a similar industry standardizes needs, therefore reducing the need for outsourcing many products.
[edit] Horizontal e-Marketplace
A Horizontal e-Marketplace connects buyers and sellers across many industries. The most common type of materials traded horizontally across industries are MRO’s (Maintenance, Repair, and Operations materials). These items are so popular because they are crucial to the daily running of a business, no matter what industry (or what level of that industry) you are in. These articles are mainly business and consumer articles. Many corporations have these bought directly on-line by the maintenance team in order to relieve the purchasing department.
[edit] No-frills e-Marketplace
Developed in response to customers wanting to purchase products without service (or with very limited service). The approach parallels the B2C offering of no-frills Budget Airlines.
The subject of several Havard and IMD articles/case-studies, no-frills B2B e-marketplaces enables the effective de-bundling of service from product via clear "business rules". This provides the basis of differentiation from conventional B2B sales/purchasing channels.
[edit] Etymology
The term "business-to-business" is today used in marketing, but it was originally coined to describe the electronic communication relations between businesses or enterprises in order to distinguish it from the communications between businesses and consumers B2C.
Formerly the term tended to describe industrial marketing or capital goods marketing only. However, today it is widely used to describe all products and services used by enterprises.
[edit] See also
Electronic commerce
