Abstract
It has been found that the main causes of insufficient sales of different small and medium-sized enterprises (SMEs) is the low conversion rate of quotes into sales, which entails poor business performance and low economic impact. Therefore, a marketing methodology called inbound marketing is planned, which is modified and adapted to the case study. In contrast, tools such as ABC classification, workflow, and inbound marketing have been used as a structure of the proposed methodology to solve the problem. The implementation of this methodology resulted in an increased efficiency of quote development and an enhanced performance ratio thereof. In conclusion, it is possible to measure the financial impact of the methodology implementation which has been beneficial for the company under study. Business performance in the last month of implementation improved by 10%.
1 Introduction
The global economy is showing a clear trend toward business and market internationalization. SMEs play a key role in this process, because they are the organizations most capable of adapting to technological changes and generating employment. In the European community, SMEs account for more than 95% of all enterprises in the OECD countries, providing over two thirds of the total employment: approximately 60% in the industrial sector and over 75% in the service sector. In Peru, the SME sector is very important to the national industrial structure in terms of its contribution to national production (42%), according to the Small and Micro-Enterprise Promotion Commission (PROMPYME).
The SME sector is one of the most important economic sectors in Peru, because it accounts for 96.5% of the Peruvian enterprises employing over 8 million Peruvians. One of the challenges that most business-to-business (B2B) companies face is the time the sales department takes to respond to customer e-mails, given that today’s customers expect instant responses to the requested information. With respect to the millennial generation becoming more powerful in the market, 66% of millennial consumers expect real-time answers and interactions compared to the only 62% of baby boomers and traditionalists. The studies conducted in some Mexican hotels in 2018 revealed a 6.9% increase in the number of domestic tourists compared to the previous year and a 2.5% increase in the number of international tourists over the previous year and showed quotes of services presented. However, 67% of them did not send the quote and 73% did not qualify the prospect, this is precisely where the problem to be addressed in companies is found.
Given the importance of rapid response customer service in SMEs, research has focused on using tools and models that generate an efficient conversion of quotes to sales. This is due to the fact that 61% of buyers decide to change suppliers when they perceive a lack of interest on the part of the company that is serving them. Furthermore, if the new supplier is professional and responds promptly, they are quite likely to win over the customer (3 to 5 times out of 10 opportunities).
2 State of the Art
2.1 B2B Model in Marketing Companies
The B2B marketing model is considered a company strategy that allows companies to collect potential customer’s information. In summary, the authors agree on the benefits provided to customers, such as the implementation of messenger chatbots to effectively find information about the main product and make the purchase [1, 2].
2.2 ABC Classification in Companies with Recurring Demand
Therefore, the authors mentioned focus on demand for products, as well as on locating product batches since processes and items are requested according to the demand. Likewise, they agree on the importance of demand performance and knowing the right supplier for the product. It is also important to assess the waiting time and product collection by the company and make a good distribution and control thereof [3,4,5,6].
2.3 Inbound in Product Marketing Companies
The similarity between these articles lies in the fact that the authors conceptualize the methods to reach the customer and assess employee behavior. In addition, they focus on certain categories of advertising [7, 8].
2.4 Inbound Marketing Component and ABC Classification and Companies
Therefore, companies should focus on customers, starting from typologies and processes, in order to increase sales and customer portfolio. In addition, it is important to provide information when introducing the business to new subscribers, in terms of reception of products and services provided and advertising to present a price range with respect to consumer selection [9, 10].
3 Contribution
3.1 Rationale
On the one hand, the technique that will be implemented for the model is inbound marketing to ensure advertising and thus increase store sales [11].
Additionally, the ABC classification will be used, where companies strive to implement an effective purchasing strategy (improving inventory turnover). The results of this study are expected to help researchers improve their decision-making in order to better understand the impact of strategic purchasing advances on variance and complexity management. Secondly, the article “Un retraso de dos niveles en el contrato pagos para la coordinación cadena de suministros: el caso de la demanda de crédito dependiente” (A two-level delay in payments contract for supply chain coordination: The case of credit-dependent demand) shows the importance of this tool in the last phase of customer loyalty, since companies intend to delight customers with quick attention and obtain the stock needed for the offers strategically analyzed by the ABC classification [5].
On the other hand, in SMEs, the relationship between the company and the customer is also important, because sales managers and account executives in companies do not differ from the rest of the sales force in terms of their attitude toward relationship management. Thus, a tool was developed aimed at exploring the full scope of a service sector sales force through the different sales and relationship management roles [9].
3.2 Proposed Model
In accordance with the above, the B2B marketing model adapted to sales improvement is implemented through an ABC classification and inbound tool in an SME and is divided into levels as mentioned by the authors [2] and [12] in order to solve the issue of inadequate management of the quote-to-sale conversion, because it considerably impacts the company under study.
This model comprises the following components (Fig. 1):
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Research phase
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Attracting phase
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Conversion phase
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Closing phase
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Delight phase
3.3 Detailed View
B2B Model
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Purpose: To strategically attract the target customer, i.e., the companies in this case
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Represents: It is the model phase where related and anticipated content that contributes added value is generated
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Interprets: In this model, strategic activities such as publications, mailings, and technical sheets are used in accordance with the potential customer.
VBA Programming
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Purpose: To automatically generate customized reports and perform other data processing functions
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Represents: This component is found in the closing phase, i.e., the quote development.
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Interprets: It is one of the most essential model components, as it focuses on the improvement of the general problem of the case study.
ABC Classification
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Purpose: To segment warehouse product references according to their importance in three categories (A, B, C)
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Represents: This component is found in two phases, research and closing, in which the products most requested by customers are analyzed.
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Interprets: This technique will be used to publish strategic content in the sales channel. In addition, it will be supplemented by stock analysis activities for customer service.
Customer Follow-Up
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Purpose: To delight new customers so that they can be integrated into the customer portfolio
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Represents: This component is found in the last phase, delight, and will monitor if the customer is satisfied with the product and service provided.
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Interprets: Digital tools such as e-mail and apps will be used to have a closer relationship with the customer in addition to providing a personalized service.
4 Validation
The study was carried out at SEI PERU, a tool supply company.
Describe the Scenario.
The problem presented by the company under study is the low conversion rate of quotes into sales. One of the main reasons why the customer chooses not to send the purchase order is the ineffective quote development. This table shows the ranges of hours when the quotes were developed from July 2018 to July 2019.
Describe Initial Diagnostic Values
Indicators | Formula |
---|---|
Loyalty | \( \frac{45 - 40}{45} \times 100\% = 11\% \) |
Quote efficiency | \( \frac{12}{36} \times 100\% = 33.3\% \) |
Quote performance | \( \frac{5670.70}{20535.19} \times 100\% = 29\% \) |
Increased sales | \( \left( {\frac{28540 - 20535}{28540}} \right) \times 100\% = 28\% \) |
A-Product usefulness | 60% |
Conversion rate | \( \left( {\frac{204}{731}} \right) \times 100 = 28\% \) |
Development of the Proposed Model
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Market Research Phase
B2B model
Through the analysis of the company’s customer’s portfolio, we identified the customer’s profile. In addition, we presented key proposals for the type of customers, as follows:
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Sales channel selection according to the customer profile, Web page
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An active and continuous presence through the website
Channel structures
In addition, the website part is structured, updating publications, editing images, and adding descriptions among others.
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Conversion Phase
Strategic items:
At this stage, the decision is made to immediately send the product data sheets along with the requested quote. In addition, these sheets are expected to be automatically added in the publications on the same website. Next, a product characteristics sheet is presented.
E-mail reception:
We are implementing the practice of responding to emails immediately once the quote has been received. The virtual catalogues and the company’s presentation are shown in this welcome e-mail.
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Closing Phase
VBA programming
In this phase, VBA macro programming is used to speed up quote development. The codes used for this process are shown below.
ABC classification
In this phase, the ABC classification is used to inform the customer about the product delivery time. In addition, this analysis will be used to improve inventory turnover.
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Delight Phase
Follow-up
The strategic follow-up plan is being implemented in the sales department. The activities to be carried out to obtain an adequate customer follow-up are shown below.
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Send a customer satisfaction survey.
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Propose offers according to the volume required by the customer.
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Send clearance sale catalogues to arouse interest.
Method of payment
At the quote time, the credit corresponding to each customer is indicated. In addition, the seller specifies the method of payment to the customer. This added value, which is the credit offered, must be less than the credit the company has with its suppliers.
5 Results
Indicators | Formula |
---|---|
Loyalty | \( \frac{58 - 45}{58} \times 100\% = 22\% \) |
Quote efficiency | \( \frac{16}{43} \times 100\% = 37.2\% \) |
Quote performance | \( \frac{17997.37}{46217.21} \times 100\% = 39\% \) |
Increased sales | \( \left( {\frac{46217.21 - 28540}{46217.21}} \right) \times 100\% = 38\% \) |
A-Product usefulness | 60% |
Conversion rate | \( \left( {\frac{260}{850}} \right) \times 100 = 30.4\% \) |
6 Conclusions
The conclusions are as follows:
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The customer portfolio grew by 22% between September and October.
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Quote efficiency increased to 37.2%.
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Quotes in relation to sales went up by 39%.
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Sales grew by 38% in the last few months.
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The profit margin of the products will be diversified by 60%.
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Galvez-Torres, E., Cruz-Alfaro, M., Cespedes-Blanco, C., Raymundo, C., Mamani-Macedo, N., Dominguez, F. (2020). B2B Marketing Method Adapted to Sales Improvement Through the Implementation of ABC Classification Tool and Inbound Marketing in SMEs. In: Kantola, J., Nazir, S., Salminen, V. (eds) Advances in Human Factors, Business Management and Leadership. AHFE 2020. Advances in Intelligent Systems and Computing, vol 1209. Springer, Cham. https://doi.org/10.1007/978-3-030-50791-6_21
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