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Business to Consumer Website vs. Business to Business Essay

Website related to Marketing

  1. Introduction

With the emergence of the World Wide Web and information technology, more and more businesses are trying to adopt a new marketing approach attached or aligned with the internet. In this regard, two marketing approach under e-marketing has emerged: business-to-business and business-to-consumer. Primarily, the goal of this paper is to provide an analysis on these two online marketing approaches and have it differ with each other.

  1. Discuss B2C (Business-to-Consumer) website: Marketing

B2C is purely in retail, which mostly involves common retail marketing approach such as branding and advertising (Cronin, 2000). The integration of ecommerce in B2C involves the utilization of computer data processing and Internet communications for labor services in the production of economic transactions. Its utilization has come to evolve in the Internet age perhaps because of the discovery of the potential of the latter in communication and transaction processes.

According to Bakos (1998), the reason why organizations use Internet-centric business models resides in their efficiency in: reducing search costs by facilitating comparison of price, products, and services; reducing lead times; improving production and supply capability; managing demand; and improving personalization and customization of product offerings.

Wu (2001) stated that the business-to-consumer marketing approach can be used as an effective marketing tool to drive brand understanding and continuity of purchase because it is a medium that allows time for consumers to discover how a particular brand is relevant to their wants and needs. This is perhaps the most distinguishing advantage for online consumers – more freedom, time, and choices.

In addition, online consumers don’t have to tire themselves walking around the mall. Instead, they can scroll to various products with just a mouse-click. Wu (2001) concluded that one of the most effective market segmentation online is through benefit segmentation. Through benefit segmentation, a marketing manager can understand the benefit needs of every segment, and then select the target segment and produce an on-line marketing strategy for the target consumer.

  • Discuss B2B (Business-to-Business) website: Marketing

Business-to-business marketing is considered by companies to be a sound business strategy and more so when the electronic means is utilized (Ramsdell, 2000). For buyers, B2B marketplaces promise not only to deliver more competitive prices but also to rid the supply chain of a host of inefficiencies. For sellers, B2B creates a channel for their product distribution thus minimizing the cost of transaction attained when they themselves engage with the end-users of their products. Factors such as trust and reputation are critical, and there is also the notion of cooperative strategies based on mutual benefit rather than the simplistic idea of maximizing revenues to individual organizations (Farrely and Quester, 2003).

There is widespread research and anecdotal evidence of the importance of relationships in business-to-business markets and concepts such as the virtual value chain (Rayport and Sviokla, 1995) and cooperative supply chain structures (Holland 1996) extend the theory to market networks of separately owned organizations choosing to work closely together.

In practice, relationships in business-to-business marketing have come to mean trust that results in protective and complementary relations in Asia, and will thus include the sharing or pooling of resources (Hamzah-Sendut et al, 1990 in Abramson and Ai, 1999, p.10). In business-to-business trade among buyers and sellers, the relationship involves complex products traded where there are high levels of inter-dependencies. In these situations it is necessary to co-operate in order to maximize the opportunities for the network of companies, and to build in protection measures against opportunistic behavior, either through trust developed over time, contracts, or a combination of both (Agrawal and Pak, 2001; Ramsdell, 2000; Hollad, 1996).

Two adjacent players–the buyer and the seller–usually share information at each stage of the supply chain and transaction process, and the nature and amount of what they share depends on the quality of their relationship (Agrawal and Pak, 2001). Thus, the successful exchange of information in the transaction of B2B reflects the amount of investment and trust buyers and sellers bestow to each other.

From the supplier side, marketing, sales, and service information is also readily gathered from business partners. Building and maintaining B2B relationships is the key to success in e-commerce and, unless service is maintained, customer loss may result, more than offsetting any cost efficiencies due to introducing e-commerce technology (Archer and Yuan, 2000). Since the core of e-commerce is information and communications, support for managing customer relationships particularly trust is of primary consideration in the buyer-seller relationship (Archer and Yuan, 2000).

  1. Discuss B2C (Business-to-Consumer) website: Marketing SIMILARITIES

It can be said that marketing approach through business to consumer gives importance ot personalisation and customisation. Online companies that use b2c approach are those companies that integrated customers as part of their business strategy.  B2C involves to the direct transaction of the organization to the consumer; or in the case of a broadcaster, the direct transaction of the broadcasting organization to its viewers or listeners. Through electronic business, sharing of information, which is the core duty of broadcasting organizations, becomes faster and broadened. The e-business process then allows consumers or the audience to view and use the services of these broadcasting organizations.

Companies which use Business to consumer are usually banks, specifically the credit card system. It is said that credit card is the main choice of settlement for business-to-consumer (B2C) e-commerce transactions. Seven banks launched separate co-branded virtual credit card (i-Card, Netcard, Web mondial, Sanal Kart, Teleweb Card, eCard), suitable for online use only. To encourage e-Commerce, some banks are offering discount pricing and no liability for unauthorized use of the card together with enabling its cardholders to redeem points accumulated from shopping online.

Most of the banks are offering Business Card for small businesses to separate personal expenses from business-related expenses.  The consumer can purchase online through the use of credit card and most of the B2C companies tried ensure that their clients have credit cards. For instance, Wal-Mart.com is considered as one of the well-known b2c companies that offers and sell products online.  In 2000, the company had already launched its improved website, which now features travel services, a pharmacy, and photography center. The site also helps customers with their shopping (Shah and Phipps, 2002).

Aside form Wal-Mart, other companies that offers and sell products to online consumers include Amazon.com and ebay.com. The similarities of these websites include their ability to be available 24/7 to reach and serve more and more clients. In addition, these websites have their customer service through online chat to answer the queries of the clients. The marketing approach of these websites is to ensure that clients will be able to have quality products without going around the mall and stores and be tired.

They offer products via the internet and deliver it to the clients in the given period.  In addition, these b2c companies had warehouses to store some merchandise but essentially used telecommunications to link to suppliers who delivered directly to customers, allowing the consumer to track the transactions and take a portion of the revenue as its fee. Customers used the Internet to reach these e-tailers to inquire about products or to conduct transactions (Levy & Weitz, 2001). Many of the processes used in this kind of retailing emerged out of catalogue-retailing practices more than one century old.

  1. Discuss B2B (Business-to-Business) website: Marketing DIFFERENCES

If business to consumer sites has commonalities and similarities, business to business sites have their marketing differences. One of the major player in b2b marketing is Dell.  The company has been able to bring together both suppliers and buyers through their b2b set-up which is unique than any other industry.  Through their bb marketing,  Suppliers and buyers can influence the company’s e-commerce expertise as well as its relationships with its other strategic Internet infrastructure partners to be able to access goods and services from the plethora of companies who are mostly Dell customers (Business Wire, 2000).

Aside from Dell, Denizbank launched a B2B payment card application for settlement of Internet B2B transaction. Currently three suppliers in IT sector are using the company service. In this regard, b2b can be form information technology and finance and banking industries.  According to the study of Atakan et al. (2000) regarding e-commerce in the said countries, electronic commerce is important for their future.

Andrew et al (2000) mentioned some critical tactics for companies that use b2b such as apple, IBM and others. It is said that each of these industries have been able to create their own identity and differentiate it to others. Each of the company also has the varying cost-effective and focused as they implement their business to business relationship marketing.

 For instance in bank industry like Citibank, the bank uses data management approach which helps the company to reorganise the information and data of all the transaction in order to provide higher-quality customer service. In this data management approach, the bank  is able to link its customers to the full range of international services and manage their processing wherever it chooses, which the bank sees as a considerable competitive advantage.

Reference

Agrawal, M. and Pak, M. (2001). Getting smart about supply chain management. The McKinsey Quarterly. No.2, p 22-25. Connecticut

Andersen, P. H. (2002). A foot in the door: relationship marketing efforts towards         transaction-oriented customers. Journal of Market-Focused Management,          5,91-108.

Andrew, J.P., Blackburn, A., and Sirkin, H.L. (2000). The B2B Opportunity: Creating Advantage through E-Marketplaces. The Boston Consulting Group, Boston, MA.

Bakos, Y.J. (1998), “Towards friction-free markets: the emerging role of electronic marketplaces on the Internet’’, Communications of the ACM, Vol. 41 No. 8, pp. 35-42.

Business Wire 2008, ‘Dell, Intel and Microsoft work to expand Dell E Works products and services for web businesses’, Dell press release, Business Wire, 7 August, 2008.

Business Wire 2008, ‘Dell marketplace brings suppliers, buyers together in established B2B e-Commerce community’, Business Wire, 7 August, 2008.

Dell.com 2005, ‘Official Website’, Dell, viewed August 8, 2008, <www.dell.com>.

Bendapudi, N. & Leone, R. P. (2002). Managing business-to-business customer relationships following key contact employee turnover in a vendor firm.             Journal of Marketing. Vol. 66 (April), 83-101. 

Bingham, Jr. F. G. & Raffield III, B. T. (1990). Business to business marketing   management. Homewood: Irwin.

Bovee, Courtland L. and William F. Arens (1992), Contemporary Advertising, 4th          ed., Homewood, IL: Richard D. Irwin.

Cannon, J. P. & Homburg, C. (2001). Buyer-seller relationships and customer      firm costs. Journal of Marketing. Vol. 65 (January), 29-43.

Cooper, Philip D. and Ralph W. Jackson (1988), “Applying a Services Marketing            Orientation to the Industrial Services Sector,” Journal of Services            Marketing, 2 (4), 67-70. 

Dobler, Donald W. and David N. Burt (1996), Purchasing Supply and     Management: Text and Cases, New York: The McGraw-Hill Companies. 

Doney, P. M. & Cannon, J. P. (1997). An examination of the nature of trust in    buyer-seller relationships. Journal of Marketing. Vol. 61 (April), 35-51.

Kaplan, DM 2000, ‘Evolution of business models: The case of Dell and Compaq in Sweden’, Stockholm School of Economics, February 2000.

Kraemer, KL, Dedrick, J & Yamashiro, S 2000, ‘Dell Computer: Refining and extending the business world with IT’, The Information Society, no. 16, pp. 5-21.

Kraemer, KL & Dedrick, J 2001, ‘Dell Computer: Using e-commerce to support the virtual company’, Center for Research for Information Technology and Organizations, University of California, Irvine, CA.

Ramsdell, G. (2000). The real business of B2B. The McKinsey Quarterly. No. 3, p. 174. Connecticut

Wu, S. (2001). Benefit Segmentation: An Empirical Study for On-Line Marketing. Asia Pacific Journal of Marketing and Logistics, Vol.13, No.4; pp.3-18.  

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