What Is B2B And B2B Marketing?
I’m sure you’ve heard of B2B and B2C, but do you know what the specific definitions of these two are? The difference between the two and what kind of business is suitable for B2B and what kind of business is suitable for B2C? An in-depth understanding can effectively help you choose the direction of business development and improve your competitiveness. If you want to know more, then read on and you’ll get what you want.
What is B2B and B2C Marketing?
B2B marketing is an acronym for business-to-business marketing. B2B is a direct “business-to-business” operating model that refers to one business providing services or products to another. The main customer of a business is another business, not the business of everyday consumers. They will provide product marketing plans, services, or marketing solutions to other companies.
B2C marketing is an acronym for business-to-consumer marketing. B2C refers to the “business-to-consumer” operation mode in which enterprises sell directly to individual consumers. Their target customers are individual consumers, selling products or services to consumers.
What Is B2B And B2C With Examples?
Next, I will give you a more intuitive understanding of the difference between the two through a few examples.
Let’s say you’re a farmer who grows apples yourself. Your crops have a bumper harvest this year, yielding 10,000 watermelons to sell. You need to decide whether to choose the B2B or B2C route.
If you choose the B2B route, then you need to find a retailer to buy your watermelon wholesale, whether it is a supermarket or a fruit store, a grocery store, or a restaurant. You will negotiate to sell each other in bulk at a mutually satisfactory discounted price, and then the other party will somehow sell the watermelons to consumers.
1. Here are other examples of B2B:
- Fabric manufacturers sell fabrics directly to garment processing factories
- Snack manufacturers sell snacks to supermarkets or grocery stores
- Electronic component manufacturers sell parts to mobile phone manufacturers
If you choose the B2C route, you’ll set up your own stall, perhaps at the wet market or find an empty spot to sell it yourself. At this booth, you, as the seller, sell watermelons directly to consumers. This requires you to spend more time selling watermelons, but you can sell them at your own price, either at a lower price or at a higher price.
2. Here are other examples of B2C:
- Specialty counters in cosmetics companies sell lipstick directly to female customers
- Real estate agents sell houses to residents
- Car dealers sell cars directly to customers
B2B vs B2C Marketing: Which Is Better?
In fact, it cannot be simply said which of the two business models is better, B2B or B2C, although they are similar, they have their own advantages and disadvantages.
Which model is more suitable for most enterprises also needs to be determined by your business model, your business development goals, infrastructure, and industry.
Here’s how to determine which strategy model is better for your business as B2B vs B2C:
- If your business is mass-producing and your products need to take up warehousing, B2B may be the right choice. B2B allows you to transfer and sell large quantities of products without backlogs but also saves storage costs. However, this requires you to be involved in bulk shipping.
- If your product is not produced in large quantities, but in smaller quantities, or sells goods with a short shelf life, then B2C may be the best business model for you. This type of business relies more on inventory turnover. Individual items are more profitable, but selling as many products as possible requires more work. B2C may need to spend more labor costs and money in order to achieve sales targets, make profits, and need dynamically focus on inventory, or adopt more effective inventory management techniques.
How B2B Marketing Is Different From B2C Marketing?
Learn about the 5 main differences between B2B and B2C marketing.
1. The customer audience is different
When it comes to target customers, the difference between B2C and B2B marketing becomes very obvious.
B2B is the direct sale of products or services to other businesses.
B2C is a business model in which a company sells products or provides services directly to consumers, rather than to retailers or any other business in the supply chain.
2. Marketing methods are different
B2B marketing is all about emotions and the meaning and story behind the brand. Marketers need to tell decision-makers where the competitiveness of their products or services and functions is, and even pay more attention to the brand effect owned by the company, which is one of the important factors to motivate customers to make decisions.
However, for B2C marketing, consumers are most likely to be interested in the functionality of the product itself. B2C marketers should use plain language to explain to consumers the benefits and value that a service or product brings to them. Instead of telling a long, boring story.
3. The return on investment is different
B2B customers want to know if their future return on investment is promising. They want to know the expertise your business provides, whether your products or services can optimize your company’s efficiency, or whether returns can skyrocket in the long run.
For B2C marketing targets, their consumers may be more concerned about whether they can get discounts, whether they can bring emotional value or use value to the products and entertainment activities being traded.
4. Marketing costs
B2B marketing is often a lengthy process that involves a lengthy chain of command. After all, decision-makers are usually not alone, which means B2B marketers have to spend more money.
B2C customers often make quick one-person decisions. This can save marketers a lot of time and money.
5. Purchasing decisions are made differently
The B2B buying process can be a tedious and careful process with many procedures. Decisions need to be made before purchasing through the relevant responsible persons of the accounting department, purchasing department, and other important departments. Since B2B is a business dealing, the purchase decision process can take longer and be relatively more complex.
Also for B2C, the entire decision-making process is a straight line, very simple and straightforward, consumers may only need to ask family and friends for advice, or more often the consumer alone to make a purchase decision, it only takes a few minutes.
There are actually many similarities between B2B and B2C marketing, but there are also many subtle differences between the two.
When it comes to the choice of B2B and B2C marketing models, you need to consider more of the current situation of your company. Choosing the right marketing model will help you follow a customer-first marketing approach that helps generate more revenue and profits for your business. If there are other things you don’t understand between these two models and other businesses you want to consult, you can contact us, and we will help you answer any questions you may have warmly and patiently.
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