The rise in digitalization and advancements in e-commerce allows businesses to launch targeted campaigns to ensure maximum conversion and sales.
For an effective strategy, however, you need to understand your type of business. There are two types of companies you can own, B2B or B2C, depending on your target market.
In the blog, we’ll discuss what is meant by B2B and B2C businesses and the differences that contribute to diverse sales strategies. So, if you want to boost your sales and ROI, read on ahead:
What is B2B Business?
B2B stands for business-to-business transactions, primarily selling products or services to other companies. For example, Cubix is a software development firm, helping other businesses traverse the digital marketplace with a website, mobile app, or web app.
B2B transactions can vary from a company needing raw materials for its production processes or software to streamline operations. Additionally, a retailer reselling products or services of an agency is another example of a B2B business.
That said, B2B marketing targets business executives, procurement officials, and business representatives tasked with making a purchasing decision for companies. Unlike average consumers, these officials train to think logically and follow financial incentives like a boost in sales when making a decision.
B2B service providers need to devise a marketing strategy that not only attracts but educates these individuals. The aim is to help them understand why and how a product or service can help their company boost its growth, which will encourage them to take the desired action.
What is B2C Business?
B2C businesses, on the other hand, are the everyday transactions taking place between companies and consumers of various products. It is also the most explored section of e-commerce as many brick and mortar store owners take their business online in hopes of leveraging the power of digital media to boost their sales.
B2C transactions include retailers, restaurants, department stores, housekeeping service providers, and more. Going online not only allows companies to target a global market, but consumers can also find what they need more conveniently. They get a virtual inventory at their fingertips at all times.
Marketing strategies for B2C businesses target average citizens. They aim to attract, engage, and delight customers, guiding them through their buyer’s journey to taking the desired action.
B2B vs. B2C: The Difference
The target market is one of the many differences between B2B and B2C businesses. Between the marketing strategies and sales, there are many areas where the two business models contrast.
It is crucial to understand the difference and devise an on-target sales strategy that guarantees results. That said, here are some of the significant variations between B2C and B2B sales:
Where B2B businesses aim for a long-term partnerships with potential prospects, B2C companies are prone to short-term relations with their clientele. It’s because the choice of a B2B service provider can influence processes, operation, costs, productivity, and more for a company. Meaning the B2B environment has higher brand loyalty than a B2C setting.
Contrarily, with B2C businesses, the products or services do not have a lasting impact. Plus, not only do consumers have multiple choices to explore for their needs, but the costs are also minimal, which leads to low brand loyalty.
Additionally, where B2C buyers spend a few minutes to browse and make a purchase, for the B2B sales team, it can take months of effort and time to close a deal. They need to continue to tend to their requirements, provide sufficient information, conduct follow-ups, present to stakeholders, and more before securing a purchase.
The investment of time and efforts from both parties sets the foundation for a long-term relationship.
The sales teams for both B2B and B2C businesses need to have a profound understanding of the products and services they’re trying to sell. From features to design details, benefits, and drawbacks, even competitor knowledge is essential.
Buyers today are aware of what to look for in a product when making a purchase. They know details and ask questions before making an informed decision.
However, the depth of knowledge is where B2C and B2B markets differ. Both sales teams have a different set of information requirements to meet. For instance, a B2C buyer looking for a cereal brand may ask about its taste, price, calorie, and sugar count. Your B2C sales team can train to answer these questions in a matter of days.
Contrarily, for a B2B sales team, information requirements include specifications and technical details about the product. They need to understand how it will operate and fit into the buyer company’s existing processes and systems, be it hardware, software, or human-powered.
Furthermore, the information differs from company to company, meaning B2B sales teams need continuous training, experience in product presentations, and dealing with executive-level prospects.
The duration of the purchasing process differs significantly for B2B and B2C businesses. For B2C brands, it is quicker and more straightforward, even impulsive. People buy in-the-moment tempted by advertisements, word-of-mouth, habit, or craving.
For a B2B setting, the process can extend over a few months. It’s because there are several people involved in the decision-making process, and the sales team needs to convince each of them to conclude. From several phone calls to meetings, demos, and presentations, a lot happens before you can close a deal.
The lead pool is a significant difference that separates B2B and B2C sales strategies. For B2C businesses, the target market includes the entire population. You are targeting millions of people searching for your products or services, for example, fresh produce or home painting services.
For B2C, the audience demographics expand from kids to students, young adults, business owners, new homeowners, elderly, and more.
Contrarily, for B2B businesses, the lead pool is limited by the companies’ requirements. For example, if you’re selling software to streamline HR processes, your lead pool is limited to HR firms or companies with an HR department. You can’t target the elderly or students, homeowners or kids, and so on.
I hope the blog helped in understanding the difference between B2B and B2C service providers. The next step is to devise your marketing and sales strategy!
Get in touch with professional consulting firms listed on reviews and rating sites, and plan out your strategy to boost your sales and reach your ROI goals.
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- B2B Vs. B2C Sales – Concepts and Differences Revealed - June 16, 2020