11.6 Competitive Bidding
Learning Objectives
- Describe the competitive bidding process
- Describe the role of pricing in the competitive bid
- Explain the use of competitive bidding for B2B pricing
Generally in business-to-consumer sales there is a standard price structure for all customers. That doesn’t necessarily mean that every customer will pay exactly the same price. The company may provide discounts—such as “loyalty” discounts, for instance—to a particular group of customers, but overall, the pricing is fairly uniform.
This is not at all the case in business-to-business marketing. In B2B marketing, most vendors will expect to give deep discounts to large customers who generate significant revenue. They also expect to tailor the solution to the customer to a much greater extent. This may include making adjustments to the levels of service, response time for issues, payment terms, and other aspects of the solution. The B2B marketing requires solutions that are more customized to the individual buyer, and the pricing is no exception.
Learning Activities
- Reading: Competitive Bidding
- Reading: Price in the Competitive Bid
- Self Check: Competitive Bidding