B2B MARKETING

Module 5
Product Management
B2B PRODUCT OFFERINGS

ADAPTATION SPACE

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Physical
attributes
elements
Service

Core
benefit

Advice giving
CATEGORISING PRODUCT LINES

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Catalogue Business
(proprietary) services
products

Custom- Custom-
built designed
products products
PRODUCT PORTFOLIO AQUCAR™: Water treatment microbiocide portfolio
including glutaraldehyde, glut/quat blends, DBNPA,
bronopol, OPP and dimethyl-oxazolidine available
globally for use in biofouling control, anaerobic
microbial control, and fluid preservation
Agro-sciences Battery Materials: Differentiated solution for
Construction battery cycle life improvement through a proprietary
coating process.
Electronics & Communications FUELSAVER™: Antimicrobial agent for preserving

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Energy Storage fuels, registered by the U.S. EPA for use as a
biocide and fuel additive for diesel oil, fuel oil or
Healthcare & Medical kerosene

Home & Office Heat Transfer Fluids: DOWTHERM™ Q Heat

transfer fluid additive for waste heat recovery in oil
Infrastructure applications

Nutrition OUDRACool™: Solid epoxy resins for low

temperature set and long-lasting protection
Oil & Gas OUDRACure™: Curing agents offering a systems
approach to extending durability
Packaging
OUDRASperse™: Waterborne dispersions,
Personal Care & Apparel manufactured without any added solvents
Renewable Energy OUDRATherm™: Advanced epoxy resins for
extreme high temperature and harsh conditions
Transportation
OUDRATough™: Advanced epoxy resins for
Water damage tolerance, corrosion protection and
durability
IIFT Kolkata MBA 2021-23
GROWTH PROSPECTS
 Important customer groups providing explosive
future growth opportunities

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 Non-consumers: lacking the skills, training or
resources to purchase
 Undershot consumers
 Overshot consumers
 DISRUPTIVE INNOVATION

 Firms possessing the capacity

and capability to innovate
may fail when the innovation

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does not address the
foreseeable needs of current
customers
 These firms had their
competitive antennae up,
aggressively invested in new
products and technologies and
listened astutely to their
customers
DISRUPTIVE STRATEGIES
 Low-end test  New market test
1. Customers at low  A large population can
end of the market be defined who lack

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2. Eager to purchase a money / equipment /
‘good enough’ skill to acquire the
product at a lower product / service
price and/or
3. Create a business  Present customers
model that can yield have to go to an
profits from this low inconvenient location
end of the market to use this
IIFT Kolkata MBA 2021-23
PRODUCT STRATEGY
 Positioning – place occupied in a particular
market

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 Measuring organisational buyer’s perceptions and
preferences in relation to competition
 Perception based on bundle of attributes viz. quality,
service, etc. → emphasise on attributes having
central role
POSITIONING PROCESS

Identify Survey existing

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determinant and potential
Identify relevant
attributes customers for
competitive
customers use to rating of all
products
differentiate and options against
select each attribute

Determine Examine fit

Select Positioning
product’s current between
or Repositioning
position in each preferences and
Strategy
segment current position
STRATEGY OPTIONS

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Increase
Increase difference
importance of between
attribute to competition’s
customers and self’s
products
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ORGANISING FOR INNOVATION
 It is not about serendipity
 Organisational innovativeness

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 Create an environment where creative individuals
can operate within an inter-organisational context
that harnesses their creativity
 Features of an innovative firm
 Commitment to long-term growth
 Willingness to include risky opportunities within a
balanced portfolio of activities
 Mutual respect amongst individuals and inclination
to work across functions
 Readiness to accept change and failure
 Combination of suitable specialisation and diversity
of knowledge
PROJECT CLASSIFICATIONS

• Incremental enhancements
Derivative • Product and/or process

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• Design and components shared by a
Platform product group
• Several changes in product and process

• New core product/process

Breakthrough • Fundamentally different from previous
generations

• Knowledge creation
R&D • New materials and technologies leading to
commercial development
 IIFT Kolkata MBA 2021-23
‘CIVIC OF THE SKY’
STAGES OF NPD

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Test
Idea Screening Planning Developing Launching
generating marketing

• Analysing the • Concept

business • Features
case • Prototypes
• Business • Marketing
planning support
 LACUNÆ IN B2B NPD PROCESS

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Going through Insufficient Lack of market Insufficient
the motions speed orientation checks
• In structuring • Unaware of • Insufficient • Making a
activities TTM customer fuzzy
• In • Not enough input business case
documenting overlapping • Irregular • Allowing
activities stages customer expenses to
• Stages left to contact rise before
single during NPD uncertainties
departments have reduced
 MOST INNOVATIVE FIRMS - 2018 (FORBES)
12 month
Sales Market Cap ($
Growth bn, as on Innovation
Rank Firm (%) May/Jun 2018) Premium
1 ServiceNow 39.02 31.6 89.22
2 Workday 36.07 29.3 82.84

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3 Salesforce.com 24.88 97.0 82.27
4 Tesla 67.98 51.1 78.27
5 Amazon.com 30.80 777.8 77.40
6 Netflix 32.41 141.9 71.23
7 Incyte 38.93 28.6 70.59
Hindustan
8 11.49 50.1 67.20
Unilever
9 Naver 19.36 22.1 64.62
10 Facebook 47.09 541.5 64.42
The difference between the market capitalization and a net present value of cash flows from existing businesses
(based on a proprietary formula) = the bonus given by equity investors on the educated hunch that the company
will continue to come up with profitable new growth. Firms must have $10 billion in market cap, spend at least 1%
of their asset base on R&D and have seven years of public data.
RELATIONSHIPS AND INNOVATIONS
 The innovation team game extends beyond the firm
 Suppliers and customers can be sources of ideas as

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well as capabilities
 Aspects
 Type of innovation project
 Degree of innovativeness required
 Degree of knowledge-sharing
 Formality of knowledge-sharing mechanism
 ‘Getting
Protecting
through the
‘Getting your ideas Appearing
mud’
into the to be
mud’ neutral

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NPD THROUGH NETWORKS

 ‘Open innovation’ (Prahalad & Krishnan, 2008) or

‘distributed co-creation’ (Bughin et al, 2008)
 Downstream co-creation

 Staying power in pursuing activities

 Resources to push through projects
 Put less optimistic projects on hold
 IIFT Kolkata MBA 2021-23
SERVICES FOR
BUSINESS MARKETS
STEELCASE
 https://www.steelcase.com/products/collaboration/mediascape/

 https://www.steelcase.com/services/consulting/

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How is a value proposition developed?
What is the focus of value creation?

What is the starting point when designing offerings?

Where is the emphasis in quality?

How do you perceive the customer’s role in the process?

How do you sustain differentiation and customer loyalty?
 CONTINUUM

Goods Services
Dominant Dominant

Office Machinery PC Telecom Meeting Advertising Janitorial Freight Management

supplies systems & transport consulting
Lubricants hotel
cleaning
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CLASSIFICATION

Product-
Marketing Professional Information Financial
related

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Product
Inventory
Delivery MR Consulting purchase
management
financing

Installation
Billing
& Advertising Accountancy SCM
management
maintenance

After-sales Export Data Credit

Legal
training advice aggregation evaluation

Banking &
Warranty
insurance
SERVICE ATTRIBUTES

 Search

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 Can be evaluated before purchase
 High for goods
 Experience
 Can be evaluated during the service delivery process
 Credence
 Can take a long time to evaluate – even after the process
is over
MARKETING IMPLICATIONS

Lack of
Intangible Perishable Variable Inseparable
ownership

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Develop
systems to Effective Promote
minimise screening and advantages of
Plan capacity deviation and recruitment non-ownership
around peak human error
demand

Productisation
Training of
Automate personnel to Flexible
get it ‘right’

Pricing and
promotion to
even out
demand Prepackage the Training
Make tangible Reduced
service customers
through
concrete cues
PRODUCTISATION
 Product equivalent of service
 Make more product-like, repeatable and tangible

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 Prototyping the customer’s process
 Concept of the service
 Range of services provided
 Service delivery process
 Quality and level of service
 Personnel
 Physical product accompanying the service, if any
IIFT Kolkata MBA 2021-23
STAGES OF SERVITISATION
Manufacturing and/or distribution
capabilities
1

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Services complementing products
2

Marketing product-service combinations

3
ROQ
 Basic assumptions (Rust, Zahorik & Keiningham, 1995)
 Quality is an investment

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 Quality efforts must be financially accountable
 It is possible to spend too much on quality
 Not all expenditures are equally valid

 Expenditure on service quality – diminishing

returns
 Managers - Where? How much? When to
reduce/stop?
Improvement

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Effort

Service Quality
Improvement

WOM
Perceived Service
Quality & Customer
Satisfaction
Attraction of New
Customers
Customer
Retention

Cost Reduction
Revenues &
Market Share

Profitability
PRICING
 Can be used to manage the timing of demand and
align with capacity
 Power utilities (off-peak hours), resorts & hotels

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(conferences)
 Isolate service profitability
 Cost-to-serve?
 Bundling
 Pure or mixed
PROMOTION
 Tangible cues
 Physical evidences

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 Service guarantees
 Performance documentation
 Training and certification of personnel

 Corporate brand
 Trade journals
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THANK YOU!!