To establish itself in the online market, every e-commerce business, whether B2B or B2C, needs to build an impressive website/app, create a powerful marketing strategy and offer great customer experience in addition to other attributes.
However, what differentiates these two is their diverse approach towards each of these business elements. The difference in audience significantly changes the way B2C and B2B operate. This article talks about the varied outlook that B2C and B2B businesses need to adopt in order to grow and scale online.
Key Differences Between B2B and B2C
| Business 2 Business (B2B) | Business to Customer (B2C) |
| Sells to companies | Sells to consumers |
| Focuses on building interpersonal relationships | The relationships are more transactional |
| Sales cycles are relatively long | Sale cycles are short |
| Target audience is niche and more specific | Can have a broader set of audience |
| Driven by logic and functionalities | Driven by emotions and convenience |
| Marketing centred around emails and gated content | Social media channels are leveraged for marketing |
| Prices can be negotiable | Prices are usually non-negotiable |
How do B2B and B2B Approaches Differ?
Here’s how each type of business differs in its approach towards its audience.
1. Content and communication
Content and communication play a crucial role in an e-commerce business. An effective content strategy builds a strong perspective about the products and as well as the business with the help of multiple mediums.
Communication in B2B usually has content that is more research-oriented with in-depth articles, e-books, white papers, case studies, etc. The communication is data-oriented with industry facts and figures along with the current market trends.
The objective of content in B2B is to offer readers reliable pieces of information that eventually convince them to invest in the product.
Content in B2C is less complex and focuses on being relatable and appealing to individuals.
It is trendy, engaging and emphasises the necessity of owning a particular product. Social media is an important medium in B2C content where most of its users interact and reach out.
The objective of B2C content is to create a lasting impression and need for the product in the buyer’s mind.
2. Customer relationships
Customer support is fundamental to e-commerce businesses and there are many ways to reach out to a customer and vice versa.
B2B customer relationship is much more personal considering it is a long-term partnership and demands continuous engagement and attention. Moreover, it tends to require active support during the sales journey including the checkout process and post sales to manage any queries on the product and integrations.
B2C customer support is more passive unless there is any urgent concern. Customer support is offered through chatbots and resolutions are often almost immediate. Customers are redirected to a call with an executive only if the queries remain unresolved. Customer relationship in B2C is brief yet extremely impactful.
3. Product prices
Irrespective of the type of business, price is an important factor when investing in a product. There are different ways in which B2B and B2B manage costs because of the customers they cater to.
Product prices in B2B often vary for different consumers and are also negotiable. If the order volume is considerably large or if they are frequent, the prices are considerably revised. Additionally, the payment terms are also complex and settlements might happen over an extended period.
Product prices in B2C are the same for every buyer and are non-negotiable. However, businesses often introduce coupon codes and discounts for better sales. The transactions also are quick and hassle-free and so are refunds in case the purchases are returned.
4. Sale cycles
A sales cycle consists of the process that the sales team follows to convert a potential lead into a customer. It includes finding a lead, qualifying it, nurturing, negotiating and finally closing the deal.
Sales cycles in B2B can be long, extending for weeks and even months before a lead is finally closed. There are various factors involved such as negotiations, customisations, terms and policies, etc that demand time. Usually a sales executive is assigned a lead to qualify, nurture and close it and develop a strong business relationship with the client.
Sales cycles in B2C are fairly short and extremely quick at times. They can convert right at the first touchpoint mostly when they are impulsive purchases. Oftentimes, users may buy a product by reading its reviews or watching an advertisement. In most cases, they do not require assistance from the sales team.
5. Acquisition costs
Most e-commerce companies invest heavily in acquiring new customers leveraging multiple mediums and partnerships to get more traffic and new users.
Acquisition costs in B2B are evidently higher owing to factors such as the long sales cycles and extensive marketing campaigns. The promotions have to be consistent for results to show. Short-term hype or advertising does not yield results in B2C.
Acquisition costs in B2C are lower because they can manage to start getting new users even with a single campaign or two when targeted to the right audience. However, retaining the acquired customers is a challenge for most businesses.
Conclusion
Both B2C and B2B need a thorough knowledge of their respective audience to be able to reach them effectively. Along with offering seamless customer experiences, they also need a robust payment gateway for hassle-free transactions on their website/app.
Partnering with a reliable payment solution such as Paytm Payment Gateway can ensure secure and quick transactions with 100+ payment options. Its advanced features and functionalities make it the most preferred payment solution among startups as well as enterprises of all sizes and scales.
FAQs
Is B2C business relatively easier than B2B?
Particularly with sales, B2B purchases involve several decision-makers and departments which can significantly extend the sales process. Whereas, a B2C sale is faster, simpler and quicker with less stakeholders involved.
Which business model offers higher chances of profitability?
For B2C one can sell the same product to multiple individuals without making any changes/customisations in it leading to chances of quicker growth and profitability. On the contrary B2B may modify the product according to the customers demand which can consume time but yield significant profits in the long run.
Is industry experience essential for B2B?
To be successful in B2B businesses, industry experience is considered useful because initially you might have to acquire customers and build a business based on your industry knowledge and network. Without any prior knowledge of the industry and its people, it can get very difficult to operate a B2B model.
