Abstract
This chapter discusses the possible effects of decentralized, digital supply chains on B2B marketing. Traditional buying and selling functions will change once large organizations decide to procure from digital platforms. Using the case study of medikabazaar.com, an Indian start-up, the chapter shows that while medical supply purchase will become decentralized, digital platforms will create a new centralization of suppliers and have a significant impact on industrial buying particularly for high value medical equipment purchase in small towns or small hospitals. Organizational buying process will be impacted and companies that choose to supply products directly to hospitals will have to change their marketing strategy suitably.
TopBackground
Industrial marketing refers to the sales and marketing of industrial goods to different organizations which then use such goods for further processing or re-sell them in the market. B2B marketing has a broader scope and covers commercial transaction between two organizations. For the purpose of this chapter, both terms have been used interchangeably.
The healthcare industry in India is poised for a major change in the post COVID world. Even before the pandemic, the Indian government’s medical insurance scheme for almost half of its 1.3 billion population, ‘Ayushman Bharat’, was seen as a boost for the hospital sector. The scheme would enable affordable healthcare for millions but also provide increased revenue outlook for the medical industry. Rising income of a young and growing population and burden of chronic diseases also meant demand for better healthcare and wellbeing related products and services. During COVID19, the Indian government has announced special procurement schemes for made-in-India ventilators and personal protective equipments for the first time in the country’s history. The country’s push and policy for self-reliance (Atma-nirbhar Bharat), ‘make-in India’, have created new impetus to the domestic medical equipment manufacturing and hospital supplies industry. However, the pandemic also created huge problems for purchasing managers in hospitals. Many small and medium enterprises were shut down during the nine week lockdown in the whole country and the partial lockdowns that went on till August, 2020, causing disruptions in hospital supplies. As caseloads started increasing, hospitals started switching to online procurements. At the time of writing this chapter, Medikabazaar.com (MBR) was India’s no. 1 B2B platform for hospitals and doctors. Taking advantage of the pandemic situation, the company pushed for digital procurement for doctors and hospitals. A large number of medical products were made available through the company’s website. In the process, the dynamics of buying and selling hospital and medical supplies changed.
Key Terms in this Chapter
New Buy: A product purchased by an organization for the first time.
Buying Centre: Group of individuals in an organization involved in its purchasing process.
Industrial Buying: Purchase of products by organizations for their own use or re-sell.
Platform: A digital platform providing goods and services to organizations.
Vendor: Individuals or organizations supplying products to another individual or organization.
Decentralized Supply Chain: A system of procuring goods and services required in an organization from multiple sources or vendors.