The Emerald Research Register for this journal is available at www.emeraldinsight.

com/researchregister

The current issue and full text archive of this journal is available at www.emeraldinsight.com/0263-4503.htm

Business-to-business marketing
What is important to the practitioner?
Gary Reed, Vicky Story and Jim Saker
Business School, Loughborough University, Loughborough, UK
Keywords Business-to-business marketing, Marketing intelligence, Private sector organizations, Public sector organizations Abstract The paper reports on research sponsored by the Chartered Institute of Marketing as part of its Canon of Knowledge initiative. The paper addresses the issue of what areas currently being taught as part of the discipline of marketing are considered important by business-to-business marketing practitioners. It also examines how these differ between the private and public sectors and identies the tools and techniques felt to be most useful to practitioners.

Business-tobusiness marketing 501

1. Introduction The paper reports on research sponsored by The Chartered Institute of Marketing (CIM) and undertaken as part of its Canon of Knowledge initiative. The Canon aims to bring together the best in marketing principles, best practices and case studies on the CIM web site as an up to date information source for marketing professionals in order to improve knowledge transfer between academics and practitioners. The research aims to establish the extent of the divide between academics and practitioners in terms of relevance of teaching content and the vehicles for disseminating academic research. It examines the use of marketing tools, techniques and research within the business-to-business (B2B) marketing context and identies sector differences in the application of marketing knowledge disseminated by academics. Specically, the paper addresses three key questions: (1) What areas and techniques within the discipline of marketing are considered important by practitioners operating in organisational buyer markets? (2) How do these differ for practitioners in the public as opposed to the private sector? (3) What are the implications for those involved in the development of marketing education? 2. Background The differences between consumer and B2B marketing are well documented (Simkin, 2000). Traditionally, the contrasts revolve around: . market structure and demand; . the nature of the buying unit; and . the types of decisions and the decision process involved (Kotler et al., 2001). B2B organisations are typied as having a large number of customers that have to be kansson et al., 1976), and also require relationship handled individually (Ha development, frequently long term, between the selling and the buying organisations (Ford, 2003). These areas have been highlighted in the work of the
Marketing Intelligence & Planning Vol. 22 No. 5, 2004 pp. 501-510 q Emerald Group Publishing Limited 0263-4503 DOI 10.1108/02634500410551888

MIP 22,5

502

Industrial Marketing and Purchasing Group (IMP) and epitomised in their writing over kansson the last two decades and represented more recently in Turnbull et al. (1996), Ha and Snehota (2000) and Ford (2002). In contrast, much consumer marketing is based around a large number of individual customers with mass communication and brand development being key pillars of this activity. Fletcher and Hart (1990) also identied that B2B organisations have a tendency not to employ marketing directors, nor have people in senior positions with a responsibility for marketing. In contrast, consumer market organisations have a high level of marketing, and senior managers with a responsibility for marketing are heavily involved in strategic planning procedures. Their suggestion is that the B2B sector has not embraced the concept of marketing in the same way as the fast moving consumer goods (fmcg) sector with a lower level of priority given to marketing within the organisational power structure. Marketing education has compounded this problem by being consumer market focussed, implying that somehow machinery and components are less sexy than hair sprays, cars or stereos. The CIMs initiative is driven by a desire to counter this and provide a reference source for B2B marketing practitioners. From textbooks published in the area it is clear what is being taught within marketing courses but it is apparent that no work had been done to identify what current B2B marketing practitioners believe are the most useful elements of this body of knowledge. This gap provided the motivation for this piece of research. Much of marketing practice is based around common principles. In B2B marketing theory, organisational buyer behaviour concepts are also undifferentiated between industrial sectors. In public and private sector organisations, nal organisational objectives may well vary, which could lead to different aspects being emphasised as important. Therefore, the difference between these sectors is also explored in this research. 3. Research design and methodology To address the three research questions there was a need to obtain an informed response from senior marketing practitioners from both the public and private sector. All the respondents were to have had some formalised marketing training and were regarded from a career perspective as being marketing professionals, as opposed to simply undertaking a marketing role as part of a broader career development. To enable a good response rate from senior executives the data was collected using telephone interviews. This method provided the means of obtaining responses from a broad sample of marketing practitioners, and was predicted to yield higher response rates than postal questionnaires (Oppenheim, 1992). Telephone interviews also gave the advantage of enabling the interviewer the opportunity to explain and clarify any difcult questions, and allow the probing of responses to open-ended questions (Malhotra and Birks, 2003). This was felt to be important if there was ambiguity in the use of marketing terms. 3.1 Questionnaire development A questionnaire was developed using an expert panel of academics and senior industrial company personnel involved in the B2B sector. The panel consisted of

representatives from Corus, AMEC, BAE Systems, Rolls-Royce, Loughborough University, the CIM and two independent marketing consultants involved with both the public and private sector. The aim was to identify the most signicant topics usually encountered by the business community and to backll these with reference to areas covered by standard texts recommended by the CIM. These were then incorporated into the questionnaire, which ended up addressing nine key thematic areas: (1) Customers and relationships. (2) Competitors and the nature of competition. (3) The promotional mix. (4) Winning B2B business. (5) Resource allocation. (6) Sales campaigns. (7) Sales force management. (8) Supply chain management. (9) E-business. The questionnaire framework was used in three stages. First, interviewees were asked to score the importance of a marketing subject area using a Likert scale. A four-point scale was chosen to avoid interviewees choosing the middle ground (Malhotra and Birks, 2003), the assumption being that you could expect marketers to consider the subjects either to be important to their role or not. Second, in those subject areas where interviewees scored the subject as high importance, they were asked for the key topics that were particularly relevant, either because it reected excellent practice or was a cause for concern in its application. Third, at the end of the questionnaire, in order to conrm that all appropriate issues had been discussed, interviewees were asked for information on other topics they considered important. They were also asked for recommendations on sources of information/knowledge, such as articles, reports or books. 3.2 Pre-test The questionnaire was then pre-tested with six of the potential interviewees to ensure that the subject areas were appropriate, that there was no ambiguity in the terminology used, and ensure it was in practitioner speak rather than academic terminology. The questionnaire was then reviewed and minor amendments, in terms of terminology, were made by the panel. 3.3 Data collection Potential interviewees were sourced from the CIM membership database and the four contributing organisations and were all conrmed to be senior B2B marketers. Respondents were rst sent a letter advising them of the survey and seeking their support. The letter was followed up with a telephone call seeking a suitable time for a telephone interview. Prior to the interview the questionnaire was faxed/emailed to the interviewee to aid question understanding and allow participants time to think about their responses prior to the interview. In order to reduce interviewer bias, only one

Business-tobusiness marketing 503

MIP 22,5

504

telephone interviewer was employed who was clearly briefed on the terminology to avoid ambiguity in the interviews, and to be able to offer clarication to interviewees (Oppenheim, 1992). While the authors acknowledge there are limitations with using the CIM database for such a large proportion of interviewees, it can be justied for this study in that all included had received some formal marketing education and they would include representation from both the public and private sectors. The inclusion of a random sample of additional interviewees from the four industrial partners, and the fact that all interviewees were contacted systematically from the database and, if available, asked to participate, makes the researchers condent that minimal selection bias has been introduced at the data collection stage. In total, 75 interviews were conducted, 31 from the public sector and 44 from the private sector, all respondents had a senior role within their marketing operation. 4. Findings 4.1 Responses common to both sectors Interviewees identied the following subject areas as the most important. 4.1.1 Customers and relationships. The predominant area of discussion in this section was concerned with managing relationships with customers, especially key accounts. In particular, there was an emphasis on building long standing relationships in order to retain customers, which reects Ford et al. (2003) position. A concern reported in this section was the lack of cross-organisational understanding of the importance of customer relationships, consequently, a major challenge for interviewees was trying to encourage their businesses to be client-facing and market-led. Although marketing courses touched on this area the respondents felt that there was a need for a greater emphasis and a need for the development of relevant materials. The concept of market orientation was understood but it was felt that there were insufcient tools and guidance on how the concept could be practically implemented. 4.1.2 Market research: customers, products, services, competitors. In this section interviewees discussed the types of research they carried out, this was frequently quoted as qualitative and quantitative, without explaining further the actual research undertaken. The main concentration of research effort was on customers, the state of play in the market place i.e. competition, and identifying market segments. Networking was also emphasised as an important tool for gleaning information about competition or developments in the market place. Two of the challenges facing respondents in the area of research were the availability of resources to nd relevant and timely information, and the short time scales in which to collect, process and develop actions to win new business or maintain an existing customer. The view was that conventional marketing education emphasised structured research but failed to cover areas such as market intelligence networks. 4.1.3 Planning the marketing and selling activities. This was identied by interviewees as critical to the success of any business. Respondents considered this to be more important over the last few years due to the increased focus on customer relationships and retention. Challenges reported in this section included allocation of resources where planning and prioritising can be difcult . . . especially over the longer term, and getting everyone in the organisation on side supporting the activities. The respondents felt that there was a greater need to concentrate on the

principles of implementing marketing, which was felt to be weak in traditional marketing education programmes. 4.1.4 Allocation of resources to the business winning process. The majority of respondents discussed the types of resources (usually money, time and personnel), how they were allocated, and in particular getting the right resources in the right place, at the right time. Prioritising, budgeting and justication of resource allocation were identied as key skills. The respondents highlighted the need for internal marketing to market marketing as a key activity within the organisation. The role of internal marketing has become more of a feature of marketing programmes in recent years (Ahmed and Raq, 2002), but for many people currently in senior positions the subject was not covered when they underwent their formal marketing training. 4.1.5 Finance, accounting and protability. Many interviewees stressed the importance of understanding nance and accounting, predominantly in terms making a prot and understanding the workings of the balance sheet to ensure prot opportunities are maximised. Only isolated marketing texts integrate nance within the subject (Wilson, 1999) but many fail to cover this subject at all. In many courses marketing is taught in isolation, almost as a separate discipline, the need to take a more integrated approach highlighting the impact on other aspects of the organisational performance came through as a major factor for the respondents. In summary, the questionnaire interviewees reiterated the importance of relationships, people skills, networking and internal marketing, which supported Ford (2002) view on the key marketing activities in business markets. 4.2 Differences between public and private sector responses Signicant differences were identied between the ratings given by the public and private sector interviewees on a number of subject areas. These differences are listed in Table I and will now be discussed. The t-test identied a statistically signicant difference between the public and private sector interviewees on the scores for Customers and relationships, with the private sector scoring higher. However, the mean scores show that both sectors actually identify this area as being of high importance (public sector 3.48, private sector 3.83). Competitors and nature of competition also showed a signicant difference, with private organisations having a higher focus on competition, which would be expected. It is, however, surprising to note that the actual mean importance rating given by the private organisation interviewees was only just above the scale mid-point (mean 2.80), which shows that they do not rate it of high importance. This rating was supported by a number of additional comments that highlight the lack of competitor analysis undertaken, such as: theres no formal process of identifying competitors just know they are around, more aware of this recently, . . .perform some kind of SWOT analysis, difcult to take advantage of weaknesses in this industry quite a friendly environment. However, there were a few more positive statements made by interviewees showing an understanding of the importance of assessing competitors, for example, marketing research, networking and data sources are all crucial in supplying information about competition. Other differences of interest included the lack of importance rated by the public sector interviewees for winning B2B business. The comments from one interviewee give an indication of why this might be the case local authorities just assumed that

Business-tobusiness marketing 505

MIP 22,5

Variable Customers and relationships Competitors and nature of competition 1 2 1 2 1 2

Mean scorea 3.48 3.83 1.96 2.80 3.29 2.36 2.34 3.16 2.72 3.15 1.72 2.43 2.10 3.28 2.31 2.91 2.90 2.37

df Sig. (two-tailed) 0.012 0.000 0.000 0.001 0.046 0.001

2 2.630 73 2 4.039 72 4.800 71 2 3.442 72 2 2.030 73 2 3.582 73

506

Advertising, promotion, events, market communications Identifying the major activities in winning B2B business

1 2 Allocating resources to the business winning process 1 2 Build and manage sales campaigns or sales projects 1 2 Manage the sales process and the sales force; Strategic selling, managing key accounts and customer relationships 1 2 Manage the supply chain for customer value 1 2 Apply e-business 1 2 Table I.

2 5.677 73 2 2.676 73 2.598 73

0.000 0.009 0.011

Note: aBased on a Likert scale 1 to 4, where 1 = low importance, 4 = high importance, 1 = public sector, 2 = private sector

they will always get the business. The situation is similar in allocating resources to the business winning process. A public sector interviewee said . . .. it (the allocation of resources) reects the local government approach to marketing, i.e. they only have one person involved in marketing and the process of winning and retaining business is not matched by the resource allocation, which equals a constant battle. By comparison, a private sector opinion was sound marketing principles equals budgeting effectively suggesting that the resource allocation mirrors the attitude to marketing and its status in the organisation. While there was a signicant difference in the mean scores for Building and managing a sales campaign or project, with the score being higher for private sector, it was not rated of high importance. The mean scores for both groups were below the scale mid-point, the private sector just below (private 2.43), and the public sector showing very low importance (mean 1.72). It is interesting to note that only ten interviewees offered any comment on this area. A common theme comment was that sales planning is simplistic, supporting the low score that was given. The biggest difference in importance was in the area of managing the sales process and the sales force; strategic selling, managing key accounts and customer relationships. The private sector, perhaps unsurprisingly, considered this to be important (mean 3.28), unlike the public sector who score this as unimportant (mean 2.10). The main theme of the comments in this area was developing relationships, showing what they feel this area is all about. There were also a few references to marketing tools, as one interviewee said, few policies are in place about key account management of

customer relationship management just personal contact. Interpreting the qualitative comments, it appears that although respondents identify this as a key area, knowledge of appropriate frameworks and approaches is poor. The private sector interviewees also identied Managing the supply chain for customer value as more important than their public sector counterparts. The private sectors challenges were to develop relationships with suppliers and subcontractors and set-up partnership agreements but it is also important for these relationships to produce value, customers actually want a demonstration of the supply chain in full working order eliminating waste. One of the issues in overcoming these challenges is that departments in the company arent customer facing the challenge is to get them to understand one another to help prevent duplication and become cross functional. In terms of the public sector, their focus was also on showing value for money and justifying that every part of the chain is effective. However, these comments do seem to contradict the relatively low importance score given by public sector as a whole on managing the supply chain (mean 2.31). Two areas were scored of signicantly higher importance to the public sector than the private. First advertising, promotion, events and market communications, where the private sector responses considered this standard practice, necessary for supporting the brand, although there were some issues regarding corporate versus regional responsibility, where major conicts of interest exist. The comments from the public sector explain their higher importance score based on the fact that they have more limited resources, therefore the challenge is in getting people to come up with ideas in house and being creative and innovative to get the most out of the budget. Another interviewee reported that this (advertising) is what the local government views marketing as: solely promotional and nothing else. The other area of higher importance to the public sector interviewees was applying e-business. This may be the direct result of government policy, as shown by the following comment several government targets set for improving e-business. In the private sector opinions varied from all in all, it has tremendous potential and we need to capture that to just another method of communication. Views also varied in terms of use, as shown by the fact that some saw the challenge to be to use it to effectively complement face to face selling and customer management, whereas others see its use in supporting increasingly remote teams. Many of the highlighted differences between the sectors were to be expected. The role of marketing in the public sector has been an area of research and writing for a number of years (Aaker, 1980; Coffman, 1986; Lovelock and Weinberg, 1989; Fine, 1992; Titman, 1994; Chapman and Cowdell, 1998). The key issue for this paper was to examine the areas that would normally be associated with B2B marketing in both the public and private sector. From this particular perspective the low scores in areas such as building and managing a project and managing key accounts and customer relationships would suggest that there is a need for marketing educators to look at ways in which these basic B2B concepts can be introduced in wider contexts. 5. Discussion 5.1 General issues The general consensus from both sectors reected the lack of understanding of the wider organisational implications for the implementation of marketing demonstrating

Business-tobusiness marketing 507

MIP 22,5

508

a lack of organisational marketing orientation. This lack of marketing orientation leads to very little cross-departmental collaboration, a practise often found in the consumer market companies. It appears from the responses that the concept of market orientation and holistic relationship management across organisations is problematic. It is difcult to see how the marketing community can formally inuence people in senior management who come from other disciplines unless it is done through effective internal marketing. The issue of internal marketing is also relevant when considering one of the other areas of contention; that of gaining appropriate resources to deliver B2B marketing activity. The requirement to market marketing in B2B organisations came out as one of the key ndings of this study. Another area of concern was the issue of market intelligence. Many conventional courses teach a formalised market research approach with questionnaire design followed by data analysis. Informal networks and market intelligence gathering are areas not found in many mainstream market research modules. When examining the public/private comparison, the public sector interviewees varied from having little concept of marketings role in their organisation, through to having a good grasp on marketing theory and practice, and the ability to apply it. However, regardless of level of knowledge most public sector interviewees felt that little marketing material was specic to their situation or really suitable for their needs. Interviewees from private organisations generally had a more consistent grasp on the marketing role, but less in terms of using or referring to marketing theory or practice. One interviewees response was marketing publications are not that much help, I just go on experience and information from contacts in the industry. Another had absorbed the theory ages ago, but it still comes into play today not a direct link, i.e. I dont go and read books and try to directly apply these ideas. One considered that there was no real use for marketing theory resourcing is a top priority. Others just felt that their industry sector was an odd case and overlooked, with the focus being on fmcg, hence, they felt that marketing theory was of no or little use to them. One interviewee found it frustrating that theoretical marketing models dont lend themselves to [my] industry. Evidently, both the public and private B2B sectors feel that much of the discipline of marketing is inaccessible (i.e. do not/cannot nd) and/or inappropriate. 6. Conclusions In order to identify the extent of the academic-practitioner divide, this paper attempted to address three questions, what areas within marketing are considered important by practitioners, how do these differ between the public and private sectors and what are the implications for the development of marketing education? The ndings identify a clear divide between academics and practitioners in terms of the use of standard marketing teaching subjects and research in the workplace due to issues of access and relevance. Also identied is the importance of the role of marketing education and educators to teach B2B marketing as well as consumer marketing. 6.1 What areas are considered important to practitioners? It is apparent that the B2B sector views mainstream marketing as being too consumer focussed. The respondents struggled to see the application of principles based on the

fmcg market to the B2B environment. If the education community is to address the needs of the B2B sector there is a need to focus on areas such as: . in-depth coverage of internal marketing; . market intelligence gathering and network development; . a greater integration of the nancial aspects of marketing and its balance sheet implications; and . practical emphasis on interpersonal skill development in a B2B context. Differences between the public and private sector? The respondents from the public sector reinforced the view that too much marketing education and training is based on principles from the consumer marketing arena and where the emphasis is on B2B there is a lack of emphasis and application on the issues facing the not for prot sector. Interestingly, the interviewees from the public sector, tended to be better qualied in marketing and have a better understanding of the tools and concepts. However, they found that their education was of even less relevance to their role in the public sector, shown by the lower importance scores. Again, this highlights the need for marketing educators to teach B2B and more specically, B2B marketing in the public sector. This teaching needs to be underpinned by relevant research, which could present an opportunity for academics, as only limited marketing research has been done within the public sector. The other key issue for this group of interviewees was the difculties they faced working in an organisation that places less value on the role of marketing. Therefore, public sector marketers will only adopt the results of any research in this area if they are disseminated in such a way that senior managers within public sector organisations are also apprised of the benets. 6.2 Implications The ndings of the study identify that while there is research work being done by academics in B2B marketing, this research does not seem to be identied or used by practitioners. The conclusion must be that the research is not being published in journals or other media that are easily accessible to the interviewees and/or the format is not practical for application in the eld. The research supports Piercys (2000, p. 30) contention that the way in which University academics are assessed by research output results in publishing in scholarly outlets read only by other academics. Consequently, academic institutions do not direct effort into wider dissemination of research ndings into journals/publications that managers read. This, along with the need for a more proactive inclusion of B2B marketing practise in mainstream marketing courses will go at least some way to address the criticisms expressed by practitioners in this sector.
References Aaker, D.A. (1980), Marketing Research Private and Public Sector Decisions, Wiley Series in Marketing, John Wiley and Sons Inc., New York, NY. Ahmed, P.K. and Raq, M. (2002), Internal Marketing: Tools and Concepts for Customer-focused Management, Butterworth-Heinemann, Oxford.

Business-tobusiness marketing 509

MIP 22,5

510

Chapman, D. and Cowdell, T. (1998), New Public Sector Marketing, FT Prentice Hall, Englewood Cliffs, NJ. Coffman, L. (1986), Public Sector Marketing: A Guide for Practitioners, Wiley Series on Business Strategy, John Wiley and Sons Inc, New York, NY. Fine, S.H. (1992), Marketing the Public Sector: Promoting the Causes of Public and Nonprot Organizations, Transaction Publishers, New Brunswick, NJ. Fletcher, K. and Hart, S.J. (1990), Marketing strategy and planning in the UK pharmaceutical industry: some preliminary ndings, European Journal of Marketing, Vol. 24 No. 2, pp. 55-68. Ford, D. (2002), Understanding Business Marketing and Purchasing, 3rd ed., Thomson Learning, London. kansson, H. and Snehota, I. (2003), Managing Business Relationships, Ford, D., Gadde, L., Ha 2nd ed., John Wiley & Sons Limited, Chichester. kansson, H. and Snehota, I. (2000), The IMP perspective, assets and liabilities of Ha relationships, in Sheth, J. (Ed.), Handbook of Relationship Marketing, Sage Publications, Thousand Oaks, CA. kansson, H., Johanson, J. and Wootz, B. (1976), Inuence tactics in buyer-seller processes, Ha Industrial Marketing Management, Vol. 5, December, pp. 319-32. Kotler, P., Armstrong, G., Saunders, S. and Wong, V. (2001), Principles of Marketing, 3rd ed., McGraw Hill, New York, NY. Lovelock, C.H. and Weinberg, C.B. (1989), Public and Non Prot Marketing, Scientic Press, San Francisco, CA. Malhotra, N.K. and Birks, D.F. (2003), Marketing Research: An Applied Approach, 2nd European ed., Financial Times Prentice Hall, Harlow. Oppenheim, A.N. (1992), Questionnaire Design, Interviewing and Attitude Measurement, Pinter Publishers, London. Piercy, N. (2000), Commentary: why it is fundamentally stupid for a business school to try to improve its research assessment exercise score, European Journal of Marketing, Vol. 34 No. 1/2, pp. 27-35. Simkin, L. (2000), Marketing is marketing maybe!, Marketing Intelligence & Planning, Vol. 18 No. 3, pp. 154-8. Titman, L. (1994), Marketing and the Public Sector: Managing the Public Sector, Longman Information and Reference, Harlow. Turnbull, P., Ford, D. and Cunningham, M. (1996), Interaction, relationships and networks in business markets: an evolving perspective, Journal of Business and Industrial Marketing, Vol. 11 No. 3/4, pp. 44-62. Wilson, R.M.S. (1999), Accounting for Marketing, Advanced Management and Accounting Series, International Thomson Business Press, Boston, MA. Further reading Churchill, G.A. (1995), Marketing Research: Methodological Foundations, Dryden Press, New York, NY. Dibb, S., Simkin, L.P., Pride, W.M. and Ferrell, F. (2000), Marketing Concepts and Strategies, 4th ed., Houghton Mifin, Boston, MA.