The business approach can be categorized into 4 main models, and the two most popular are business-to-business (B2B) and business-to-customers (B2C). This is also applied to e-commerce. The model a business base on will affect the entire operation and management. This article will cover the critical B2B and B2C differences since it’s likely to follow either of these models if you’re running an online business.
B2B And B2C – Definitions
The Business-to-business (B2B) model describes a company whose clients are businesses. In other words, they are commercial transactions between two or more commercial organizations, such as suppliers and manufacturers, manufacturers and wholesalers, wholesalers and retailers.
B2C stands for business to consumer. In this form of commercial transaction, goods and services are sold to individual consumers. B2C stores sell products directly to end consumers.
B2B And B2C Similarities
The similarities of B2B and B2C include:
- They follow a customer-centric sales approach
- Both require excellent customer support
- Sellers need to build credibility and trust to attract and persuade clients to buy from them
So, in general, the similarities lie in B2B and B2C sales and marketing approaches. Building customer loyalty is the ultimate goal.
Whether you’re a B2B or a B2C marketer, identifying and defining a customer’s buyer persona (individual customers or companies) is critical to successful marketing.
B2B And B2C Differences
1. Target customers
This is the key and most apparent difference between B2B and B2C. The target group of B2C is individual consumers who purchase products and services for personal use. Businesses often divide these customers into different segments based on their characteristics. Also, these buyers are end-customers; there’s no production following for sale purposes.
The B2B target group is narrower and more critical than B2C’s. Businesses of all sizes, including SMEs or organizations, purchase products that may be later used for production or sale purposes.
2. Decision-making process
The second difference is the decision-making process. This process for B2C is generally shorter than for B2B.
In B2B, marketers have to deal with different target groups/roles within a client company. The buying process with a company involves many people, making the process more complex than B2C.
Depending on the nature of the purchase, the final purchase is influenced by a decision-making group that may include members of several departments.
In B2C, the decision-making process is much simpler. This is an individual purchase and is mainly dependent on the buyer’s sentiment. They make quicker decisions, and the transaction is just as straightforward.
3. Marketing strategies
While marketing in B2B and B2C may be similar in the advertising, publicity, promotions, and marketing channels, there are differences in strategies and how information is presented to clients.
With B2C, it is sufficient to advertise on general media such as TV, radio, or online magazines. However, this may not be enough to sell to businesses.
B2B customers are more rational, planned, and logical than B2C. Before purchasing, they carefully consider many factors such as prices, quality, expected ROI, delivery time, etc. Therefore, marketing for business clients follows a long-term strategy to build trust, deliver reliable information, and even develop particular policies.
Emotional factors often influence B2C customers’ purchasing decisions. Therefore, their message should be more expressive, and the content should be interesting. The messages conveyed to customers can also be more flexible and change regularly depending on each campaign.
4. Sales speed
B2C transactions are usually faster than B2B since B2C sells directly to customers. In B2C, sellers want transactions as fast as possible. This is because the order value is small.
In B2B, transactions take longer. Multiple people influence the B2B decision-making process, and the final purchase goes through many stages. Therefore, for B2B companies, selling merchandise can sometimes be challenging and time-consuming.
5. Relationships with customers
B2B has a deeper relationship with customers than B2C in most cases. The B2B market and the scale of potential clients are smaller than B2C. Because of this, B2B companies need to build strong relationships with their clients. Once a company builds trust with clients and benefits them, they have customer loyalty.
In B2C, relationships with customers tend to be shorter, and customers are less loyal than in B2B. Customers can buy from one brand today and from another the next day.
6. Return on investment
Unlike B2C, B2B buyers do not buy for their needs or entertainment. They believe in technology, software, and services to optimize their operations and manufacturing. It reduces costs, improves customer experience, and ultimately increases sales. Therefore, it can be said that B2B transactions are an investment in future profitability and productivity.
B2B And B2C Differences In E-commerce
1. Pricing models
B2C companies offer a single pricing tier for all customers that are only affected by a sale or discount.
B2B companies often offer multiple levels of deals based on order volume and frequency. B2B payments are more diverse than B2C, often exceeding 30 net terms.
2. Customer service vs account management
B2C e-commerce companies have customer support staff to respond to issues.
B2B companies need account managers to acquire new wholesale customers and contact them regularly to increase and support e-commerce sales.
3. Website structure
A B2C website needs an eye-catching landing page to attract and convert customers. This requires investment and dedicated staff to build and keep the site up-to-date.
B2B websites are mainly used as dashboards for companies to easily access products they want to buy or access account information. These differences are the same when companies use B2B online marketplaces.
4. Checkout structure
Even the checkout process differs between B2C and B2B e-commerce platforms.
In B2C, the checkout process is simplified to avoid customers abandoning their carts. In the B2B world, checkout often involves additional steps such as inserting human interaction options, adding multiple shipping addresses, or setting up automatic reorder points.
Whether you’re in the B2B or B2C business, your goal is to provide customers with the best service and merchandise. For e-commerce, a company should have a stable website with decent performance to increase trust and persuade clients to buy from them.
If this is your case, then you can cut down the time of looking for a web development solution by contacting Tigren. Our team has years of experience in this field and can satisfy the requirements of e-businesses from various fields. Be it a B2B or B2C website, we will do our best to deliver you a powerful website. Drop us a message at [email protected] today!
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