What are the different approaches to marketing industrial and consumer goods?How these goods are marketing
Consumer goods refer to the goods that are purchased for personal, including for family and household use and for personal gifting. In contrast contrast industrial goods refer to goods purchased for use by industrial and business establishments. The industrial goods are purchased mostly of resale, with of without processing. It also includes consumables required for operation and maintenance of equipment and facilities used by these establishments. Generally the nature of industrial goods and consumer goods are quite different but there are some material falling in the category of both consumer and industrial goods. For example, food ingredients are purchased by large hotels and restaurants for business use as well as by consumers for domestic use.
Thus the difference in marketing of consumer and industrial goods is more because the nature of purchasing behavior for consumer and industrial goods rather than because of nature of the goods. Industrial goods are generally purchased by a few customers in large quantities. In comparison consumer goods are purchased by large number of people in smaller quantities. These limited buyers of industrial goods are generally concentrated in some specific geographic location rather than spread out like buyers of consumer goods. The purchase decision for industrial goods is often taken by a team of people rather than individuals. The buyers are professionally skilled in buying and generally have to follow some procedures laid down by ther companies. The buying decision is taken more on the basis of objective consideration of factors like price and quality, rather than subjective. Also for industrial buyers, service rendered by sellers in terms of timely availability of material and responsiveness to requirement of the buyers is much more important.
Because of these differences between industrial and consumer goods, different approaches are suitable for the two. The following aer some of the main features of industrial marketing as compared to consumer goods marketing.
- First and foremost, industrial marketing requires much greater emphasis on building long term relationships with customers. This also implies that sellers mus provide ongoing service to the customers and respond promptly to request for information and technical support.
- General advertisements, particularly appealing to the emotions, less important for industrial marketing. Instead industrial marketing requires more stress on providing relevant technical and commercial information.
- For large one time purchases, industrial buyers use method of formal competitive bidding. Such methods are almost non existent for consumer marketing. Therefore industrial marketers must be well skilled in selling under this kind of competitive bidding.
- It is necessary to understand requirements of each customer and respond accordingly, rather than offer a common marketing mix to all customer based on general market research, as is the common practice in consumer marketing.
- One to one communication between customer and seller organization should be more intensive as compared to that required in consumer marketing. On the other hand advertising plays a marginal role in industrial marketing.