B2B Market Research

There are many differences between consumer and B2B markets. The differences do not necessarily lie in the products themselves, but in the way these products are exchanged, and the relationships which exist. In our experience, we find that business-to-business markets are characterised in the following ways:

• Complexity Of The Purchase Decision. The purchase decision is often complex (as the value of many purchases is often very high), and there are often many people involved – for example, research and development staff, purchasing staff, accountants, suppliers, external consultants. Seldom are decisions taken by individuals.
  
  
• Derived Demand. All demand in B2B markets is derived from demand in a consumer market. For example, demand for clothing will lead to a value chain that might include millers that take a raw material and turn it into a fibre, textile mills that take the fibre and turn it into fabric, garment manufacturers who take the fabric and turn it into clothes, retailers who buy these clothes to sell in their stores, and consumers who purchase the end product. Depending upon where you are in the value chain will determine how much contact you have with the end consumer, and your interactions with other members of the value chain. If there are any problems further up or down the value chain, this in turn can affect other members of the value chain in terms of ability to meet customer demand
  
  
• Less Choice, Or Ability To Switch Supplier. When operating in a B2B market, if supply of a product is interrupted, it can be difficult to substitute or switch suppliers. There can be many reasons for this. The company may operate in a market where there are few alternatives available. Even if there are alternatives available, simply switching may have time and cost implications for the manufacture of goods
  
  
• Smaller Customer Base. B2B markets are often characterized by smaller numbers of customers. Often, companies may have hundreds, rather than thousands (or millions) of customers. A smaller customer base opens up many more opportunities in terms of relationship building and personal contacts
  
  
• Personal Customer Relationships. To sell goods, many companies personally visit their key customers, thus providing a chance for strong personal relationships to develop. Indeed, in many markets this is a key selling mechanism
  
  
• High Value Spend. Many transactions can be very large in value. In many markets, the Pareto rule applies – that 80% of value will be driven by 20% of customers
  
  
• Technical Products. Products themselves can be technical in nature, with customers wanting very exact information about what the product is or is not capable of – for example, technical data sheets, technical performance data
  
  
• Differences In The Ways In Which Product Benefits Are Marketed. Many industrial companies do not have the marketing communications budgets of larger companies. Advertising campaigns are often smaller, targeted and based on opportunities to see, feel and touch the product itself – trade shows and word of mouth still play a vital role 

The differences in B2B markets can represent many challenges for the marketer. Here are some examples of questions that we have helped to answer in the past:

• Who makes the decision?  Who can I target in my marketing communications?
  
  
• If products are fixed into the lifecycle of a plant, what would happen if I made changes to the product?  Would people still use it?
  
  
• Our image is so tied up in our parent brand name.  Now that we have been taken over and have lost the right to lose this, what will the impact be?
  
  
• What do my key accounts think of us?  Are they satisfied with the service we provide them?
  
  
• How aware are people of the company brand and the individual product brands?  How does this compare to other companies and products in the market?
  
  
• What do customers think are the key issues that the industry faces moving forwards, and how can we react to these changes and change our marketing approach to better meet needs?
  
  
• How can we stretch our brand?  Which types of markets should the brands be extended to and which should they not?
  
  
• What do our customers expect from us? How does this compare to our actual performance?
  
  

Are customers prepared to pay a price premium for anything in this market?  How much can I charge?

If you have a B2B market research project in mind, feel free to get in touch. We would be happy to put forward a research proposal or discuss more informally how you could progress things. You can call us on +44 (0)1663-732721 or contact us through our online form: contact us.

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