Q1. Differentiate between Consumer market and business market.Business Marketing
is the practice of individuals, or organizations,including commercial
businesses, governments and institutions, facilitatingthe sale of their products or services to other companies or organizationsthat in turn resell them, use them as components in products or servicesthey offer, or use them to support their operations. Also known as
, business marketing is also called business-to-businessmarketing, or B2B
marketing, for short. (Note that while marketing togovernment entities shares some of the same dynamics of organizationalmarketing, B2G Marketing is meaningfully different.While
is aimed at large demographic groupsthrough mass media and retailers, the negotiation process between thebuyer and seller is more personal in business marketing. According to Huttand Speh (2001), most business marketers commit only a small part of theirpromotional budgets to advertising, and that is usually through direct mailefforts and trade journals. While that advertising is limited, it often helpsthe business marketer set up successful sales calls.
List of important differences between Consumer market and business markets:
1.Organizational consumers purchase capital equipment, raw materials,semi finished goods, and other products for use in further production oroperations or for resale to others, whereas final consumers usually acquirethe finished items for personal, family, or household use.2.Organizational consumers are likely to require exact productspecifications. Final consumers more often buy on the basis of description, style, and color.3.Organizational consumers often use multiple-buying responsibility, inwhich two or more employees formally participate in complex or expensivepurchase decisions. Final consumers employ it less frequently and lessformally.4.Derived demand occurs for organizational consumers because thequantity of items they purchase is often based on the anticipated demand of their final consumers for specific finished goods and services; therefore,organizational consumers are less sensitive to price changes. As long as finalconsumers are willing to pay higher prices, organizational consumers will notobject to price increases.5.Demand is volatile due to the accelerator principle, whereby finalconsumer demand affects many levels of organizational consumers.