Buying Behavior of Organizations Research

Buying Behavior of Organizations

The advertising, promotional and selling strategies that are commonplace in consumer products are known for their reliance on evoking emotions, communicating the unique value of benefits, and seeking to create a unique identity for a given brand over the long-term. Business-to-consumer (B2C) marketing and selling, heavily reliant on their ability to create and sustain a strong emotional bond with prospective and current customers, are often considered the more visceral and emotionally-defined brands relative to their more logical and utilitarian-based business-to-business (B2B) counterparts (Bellizzi, 2009). The intent of this analysis is to evaluate four recent studies that illustrate how this balance of power is shifting from B2C-oriented brands to B2B, and how the richer, more unique non-utilitarian aspects of branding and marketing are impacting sales and customer relationships.

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Assessment of Using Non-Utilitarian Factors to Encourage Business-To-Business Purchases

In the study, Using Non-Utilitarian Factors to Encourage Business-To-Business Purchases (Bellizzi, 2009) the researcher relies on a literature review-based methodology to evaluate the non-utilitarian factors that contribute to greater business-to-business (B2B) purchases or buying. The common research tools and platforms used in academia are seen in the bibliography of the cited article, which collectively served as the researcher’s data collection instrument. The organizational and individual demographics reflect a cross-section of academic and B2B marketing and selling experts.

The study’s findings suggest that B2B marketers need to move beyond the rational, highly quantifiable aspects of their products and embrace more of the concepts of B2C marketers who evoke emotions with their brands. The study states that B2B marketers often are so engrained in the functional performance of their products that they do not anticipate or even make an effort to create a lasting brand identity that resonates emotionally with customers (Bellizzi, 2009). The authors recommend B2B marketers consider how best to bring greater brand identity and symbolism into their campaigns to more to align with how B2B customers are making decisions (Bellizzi, 2009). The author contends that the future of B2B marketing and sales will be more orientated towards its B2C-counterparts, where the emotions evoked by branding, intensive use of symbolism and continual progression of messaging dominate. There are several significant limitations of the study including its lack of empirical data, and the defining of recommendations based more on the authors’ preferences and less on actual data. The author makes one convincing argument by the example of a B2B marketer of a business jet, yet many more are needed in order to fully humanize the more logical, clinical branding of B2B marketing more effectively.

Assessment of Building Customer Commitment in Business-To-Business Markets

In Assessment of Building Customer Commitment in Business-To-Business Markets (Chang, Wang, Chih, Tsai, 2012) the researchers evaluate how trust can be better initiated and maintained within business-to-business (B2B) selling and service relationships. The researcher specifically focus on the dimensions and perceptions of trust on the part of customers in long-term relationships with companies their firms have been working with on complex projects in some cases for years. In studying the stability and continued performance of complex B2B selling and service strategies, the researchers conclude that the most critical aspects of building trust must center on the evolving set of new needs and requirements over assuming a continuation of the past into the future (Chang, Wang, Chih, Tsai, 2012). The industry that forms the basis of the study is the Taiwanese timber distribution market.

The methodology is based on a sampling frame of 1,300 customers of timber suppliers throughout Taiwan, in addition to those customers who maintain relationships directly with timber suppliers (Chang, Wang, Chih, Tsai, 2012). This methodology is deliberately designed to take into account the value chain of timber producers in the island nation. To ensure a representative sample was achieved, the researchers randomly sampled 70% of customers in each district of the nation including the northern, middle, southern and eastern areas of the island. A total of 900 surveys were initially mailed with a response rate of 67% achieved (Chang, Wang, Chih, Tsai, 2012). Of the 900 initially sent out in the first phase, 78 were incomplete, resulting in 522 usable questionnaires overall. The methodology was also tested for response error and the researcher ascertained there wasn’t any (Chang, Wang, Chih, Tsai, 2012).

The data collection used was a manually-administered survey packet that included a cover letter, survey booklet and postage-paid return envelope. These items were all mailed to the respondents along with remainder cards sent approximately two weeks after the initial mailing. The respondents were told this was an academic study to further assure them of the confidentiality of the data.

All respondents were business owners and senior management, with 74.7% being male and 25.3% being female. The distribution of respondents by industry demographic included 41.2% builders, 22.8% contractors, and 36% timber-related manufacturer companies (Chang, Wang, Chih, Tsai, 2012). Distribution of employee size by firm also showed the majority are small to mid-sized businesses with between 20 and 50 employees.

The study findings indicate that the greater a given salesperson’s ability to inspire trust through transparency and authenticity, in addition to being trusted to fulfill commitments they make, the higher the level of customer bonding achieved (Chang, Wang, Chih, Tsai, 2012). The study looked at how the long-term relationships between customers and suppliers evolved over time. This aspect of the study showed how powerful trust is over the long-term, as suppliers and customers who had been able to create a highly trusted relationship had been able to overcome significant setbacks that impacted the industry overall (Chang, Wang, Chih, Tsai, 2012). The supplier and customers over the long-term in this industry forma very powerful foundation of trust that also accelerates the ability to deal with uncertainty on both sides of the purchasing relationship. These findings are very atypical in a traditional B2B relationship which is often driven by highly structured and logical approaches to managing relationships. The limitations of this study however include the lack of insight into how deal volumes and the construction boom that occurred in Taiwan affected overall trust. The study shows that in aggregate the greater the investment in authenticity and transparency the more of a trust-based foundation is achieved, yet there needs to be more of a specific series of scenarios to test this hypothesis more thoroughly. The study also only focused on one industry and didn’t look at the ancillary businesses that also contribute to the Taiwanese timber value chain.

Assessment of a Framework of Brand Value in B2B Markets:

The Contributing Role of Functional and Emotional Components

Determining if effective B2B marketing and relationship-based selling can transform brand, goods and services value to relationship value is the premise of this study (Leek, Christodoulides, 2012). This is often the progression of business-to-consumer (B2C) brands that seek to associate a given emotion or symbol with their specific brand. The world’s best known brands do this exceptionally well including Harley-Davidson, Nike and others. The researchers have completed a thorough literature review and a small sample of ten exploratory interviews with B2B supplier managers to define a framework of brand value applicable to brand value (Leek, Christodoulides, 2012). The framework includes the factors of quality, technology, capacity, infrastructure, after sales service, product capabilities, and depth of reliability technologies and processes. (Leek, Christodoulides, 2012). The researchers sough to also show how the orchestration of these factors together could lead to an exceptionally positive brand experience for a customer interacting with a brand from a business-to-business (B2B) context. This methodology of combining a literature review and ten exploratory interviews is unique in that the researchers seek to create a balanced qualitative and in-depth analysis of the most salient attributes that lead to long-term B2B purchasing satisfaction and the strengthening of relationships over time (Leek, Christodoulides, 2012). The ten in-depth interviews resembled a Delphi Sample in that the experts were asked for their specific viewpoints on B2B marketing and the continual strengthening of customer relationships.

The specifics of the methodology included the definition of five manufacturing and five service companies, obtained through a convenience sampling approach that specifically focused on the sectors of aluminum, safety systems, food suppliers, electronic equipment, IT systems, direct marketing services, financial services and personnel solutions (Leek, Christodoulides, 2012). The in-person surveys concentrated on how the emotional and cognitive elements of branding were used for creating an effective long-term level of trust and transparency in long-term B2B relationships. All interviews were completed face-to-face and lasted between 40 minutes and 1 hour. The interviews were recorded and transcribed for later use in the analysis, where content analysis was used for interpreting and classifying the results (Leek, Christodoulides, 2012).

Demographics of the respondents were senior managers and leaders of the respective manufacturing companies interviewed, many of them at the VP level or above. The study findings show that the linearity that the researchers assumed to be in place in the B2B markets did not match the level of performance in the B2C industries. It did show however that the longer-term aspects of B2B marketing and selling, including the willingness to participate in shared forecasting and replenishment in advanced supply chain programs was beginning to revolutionize brand identity and reputations as well. The orchestration of all aspects of B2B marketing is significantly more complex and challenging as well, a point shown in the discussions. The researchers did find enough causality to create a model of value-driven marketing, and it does show that only through a continual focus and auditing of customer needs will B2B marketing reach the levels of performance in B2C markets (Leek, Christodoulides, 2012). There are also many limitations of this study, including the lack of an empirically sounds research methodology, more effective sampling frame, and the inclusion of more diverse respondents to better represent the markets of interest. The model has also created a model of causality based on limited data and the transformation of brand value to relationships strength, initially proven with the sample, is tenuous when evaluated from the context of am empirical study. Due to these factors the research needs to be considered anecdotal at best, and an interesting data point in an overall view of this area of brand value transitioning to relationship strength.

Assessment of the Study, Does Salesperson’s Customer Orientation Create Value in B2B relationships? Empirical Evidence from India

The nature of customer selling in B2B relationships has often been analyzed empirically from the standpoint of how effective tools, techniques and strategies are. Little research has been done on how the extent of a sales person’s customer-centricity and relationship skills impact customer trust (Singh, Koshy, 2011). Intuitively this seems obvious yet the current body of research hasn’t defined, In India, the extent to which a salesperson’s customer orientation leads value creation is often exacerbated by the cultural dimensions that lead to high levels of collectivism and risk aversion. This can slow down innovation in B2B markets if relied on alone as the basis of customer relationships. The study shows how sales professionals with strong customer orientations can create more effective, trusting relationships with B2B customers over the long-term.

The methodology for this study includes 249 small and medium-sized Indian firms that engage in a variety of banking and financial services, in addition to consumer electronics retailing and distribution. The entire study was completed in Ahmedabad, India using a convenience sampling technique across local businesses chosen randomly.

The demographics of respondents are evenly distributed across the age groups of 17 to 65 years of age, with the median age being 30.43 years (Singh, Koshy, 2011). A total of 91.5% of the sample were male, with the majority of companies represented being in consumer and high tech electronics retailing. A small percentage of the overall sample was from the banking and financial services industry.

The study’s findings indicate that in Indian small and medium businesses, the greater the sales person’s customer orientation the higher the level of value creation attained (Singh, Koshy, 2011). The researchers use several scenarios to underscore this finding, showing how effective the use of kept commitments and confidences create an effective foundation of trust between B2B sales people and their customers. The reliance on B2B sales people for the latest product information and how to sell against competitors also is instrumental in strengthening trust over time as well (Singh, Koshy, 2011). These findings also indicate how critically important it is for a salesperson in this Indian city to think of time not just as a limited resource but as an asset to be invested in relationships (Singh, Koshy, 2011). This orientation on value over just thinking about transactions has been found in many other comparable studies, and is supported by this study as well. The limitations of this study are its lack of research design specifically aligned to the needs of businesses throughout the region, as it is just focused on Ahmedabad, India. This study also fails to take into account the women business owners in the area as it is highly skewed toward male respondents (91.5%) of the sample. Finally the study lacks a clear set of prioritized actions and recommendations for businesses to achieve a greater customer-centric mindset. It assumes that this quality is either present or it isn’t and doesn’t actually provide any guidance of how to develop it.

Discussion

The progression of B2B marketing away from the abstract and clinical to a more relationship-based mindset is rapidly changing how businesses purchase from each other. The series of four studies shown in this analysis have evaluated several different facets of how B2B marketing and selling is changing to embrace a more trust-based approach to developing and continually improving customer relationships., The fact that non-utilitarian approaches are being replaced with more personal and focused communication and selling strategies to make trust an effective catalyst (Bellizzi, 2009) is reflected in every study included in this analysis.

Where these studies vary is how they manage the continuum of trust with key customers and the strategies they rely on for keeping connected with customers over the long-term. From the reliance on more relevant, strategic content as shown by studies of non-utilitarian approaches (Bellizzi, 2009) to the approach of using brand value as a means to create a greater emotional connection with customers (Leek, Christodoulides, 2012) the studies range in the versatility of approaches and frameworks to accomplish a common overall goal. That goal or vision is the attainment and continual improvement of trust. In conclusion, while each of the four studies have taken a different path to the goal of creating and sustaining trust with customers, they each have a unique framework and methodology for defining how B2B marketers and salespeople can attain this challenging goal over the long-term.

Recommendations

The following are the recommendations that emerge from this analysis:

The greater the use of consistent, highly emotionally-defined branding and intensive use of symbolism to connect with customers, the higher the probability of success with B2B marketing initiative (Bellizzi, 2009).

Sales people selling in B2B environments need to be coached to not immediately push for a transaction to close but rather listen and seek to become a trusted advisor. The greater the ability of a salesperson to earn trust through authenticity and transparency, the higher the probability of long-term sales (Chang, Wang, Chih, Tsai, 2012).

Studies showing the interaction of the functional and emotional components of branding indicate that when sales takes on a given problem for a customer and seeks to “own” it for them, trust is earned in addition to significantly higher long-term sales (Leek, Christodoulides, 2012). Enterprise sales teams need to be trained to manage this aspect of development of relationships with greater focus, getting beyond just the selling aspects of their professions and seeking to be a trusted advisor as well.

The customer centricity and willingness of a salesperson selling to small and medium businesses to share product and market information, and seek to assist them with their own selling is a strong catalyst of long-term trust. Customer centricity of B2B selling professionals in India can create long-term value (Singh, Koshy, 2011).

Conclusion

B2B marketing and selling has traditionally been very long-term in focus, highly regimented and controlled by the flow of information between buyers and sellers. It has also has lost much of what made B2C marketing so effectively, and that was the voice of the customer and their specific needs and preferences.

The past of B2B marketing and selling is quickly being replaced with a very focused present and future in this area, centered on building trust and shared information across entire value chains. The greater the focus of B2B markets and sellers on these dimensions the more effective and profitable they will be today. This shift in orientation towards the emotional elements of branding continue to change every aspect of B2B selling today, making it imperative the sales professional become a trusted advisor to their clients first.

References

Bellizzi, J. (2009). Using non-utilitarian factors to encourage business-to-business purchases. Journal of Global Business Issues, 3(1), 121-127.

Chang, S., Wang, K., Chih, W., & Tsai, W. (2012). Building customer commitment in business-to-business markets. Industrial Marketing Management, 41(6), 940.

Leek, S., & Christodoulides, G. (2012). A framework of brand value in B2B markets: The contributing role of functional and emotional components. Industrial Marketing Management, 41(1), 106.

Singh, R., & Koshy, A. (2011). Does salesperson’s customer orientation create value in B2B relationships? empirical evidence from India. Industrial Marketing Management, 40(1), 78.


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