When I was in graduate school I asked one of my marketing professors why they didn’t offer courses specifically for industrial marketing. His answer was that consumer marketing covered everything from toothpicks to houses and I should be able to find a comparable somewhere in there. Thirty five years later I still am searching.
The best way that I can explain the difference is to look at a box of cereal. Everything that goes into being able to produce that box of cereal is covered by industrial marketing and everything after the box has been produced falls under consumer marketing.
Lets look at the box itself. The person that bought it didn’t use his or her own money to buy it. There are probably about 25 companies that have the capability and capacity to produce it and the same thing applies to all of the ingredients that go into the cereal. There are a limited number of companies that can produce them and be qualified suppliers. We therefore have two of the key tenets of industrial marketing. Your goods and services are bought without someone using their own money and your customers, because of their limited number should be known or at least knowable to you. In these cases we are “breaking bulk” at a rate of less than one times ten to the second.
Compare this to what happens after that cereal box is produced. It is going to be sold to millions of people who will use their own money and cannot possible be known or knowable to you. In this case you are “breaking bulk” at a rate of at least one times ten to the eighth power.
This brings us to the use of advertising in the different arenas. In the consumer market you advertise to increase demand. In the industrial market demand is fixed and you can only increase market share. Advertising is for image, skill differentiation and tightly directed to known groups of individuals or industry groups. I think the greatest misunderstanding of these market difference was BSAF’s campaign in the 1990’s when they used the slogan “We don’t make what you buy, we make it better.” I remember watching this as it aired to millions at sporting events thinking, “OK, now what am I supposed to do?”
At Global Market Management we thrive in the industrial market. Relationships are key elements in every market and we have a network of contacts to work with your company to expand strategically. We will target key companies and individuals rather than trying to blanket a segment with a shotgun approach.