Industrial Marketing
Industrial marketing is the marketing of goods and services to industrial and institutional customer.
These include manufacturing firms, governments, public utilities, educational institutional, hospitals, wholesalers and retailers, and other formal organizations.
Consumer marketing, in contrast, is concerned with marketing to individual, families and households purchasing goods and services for their own consumption.
The distinguishing feature of industrial and institutional customers is that they use purchased goods and services in their own production of goods and services.
Purchased products, such as raw materials, components and subassemblies, may become part of the customer’s final product or may be added to physical facilities, in the form of construction and equipment.
In other cases the purchases may be supplies used in operations, repair and maintenance activities, including such products as fuel, office supplies and building materials.
Resellers, such as retailers, distributors and wholesalers purchase products for resale but add value to those products in the form of the services they provide, such as availability, credit and customer.
In real sense, industrial marketing keeps the economy functioning by providing the products and services required by factories, offices, government agencies, hospitals, universities and other providers of goods and services.
It has been estimated that industrial marketing transactions equal in dollar value at least twice the value of consumer purchases.
This can be understood by considering the long and complex chain of industrial market transactions preceding the manufacturing and sale of a consumer product, such as a shirt or a can of soup, chain that begins with raw materials from farm, forest, mine, or ocean and almost certainly crosses national border at several points.
Given that all manufacturers depend upon other manufacturers for goods and services, the chain is virtually endless.
Industrial Marketing
