7 Key Differences Between B2C and B2B Ecommerce Models

Much has been made in recent years of the digital business-to-business model (B2B) versus the digital business-to-consumer model (B2C), in terms of scope, customer acquisition and retention, pricing, product variety, and most importantly, profitability.

Many companies choose to focus their full efforts on one model or the other, while others attempt to hedge their bets by supporting a hybrid of both.

Here, we’ll dive into some of the main differences between the B2B and B2C ecommerce spaces, and the key concepts necessary to support a thriving digital business, regardless of your end user profile.

Customer Profile and Market Size

At its most basic level, a B2C company sells its wares directly to the customer, where a B2B company’s products are sold to another business, which often sells to customers of its own.

In the B2C space, the target audience is far broader, so although customer retention is vitally important, the greater focus is placed on customer acquisition, where attracting sheer numbers of interested prospects remains the main stepping stone in the buying cycle. And with a smaller average customer value ($147 per order, according to Shopify), casting as wide a net as possible maximizes awareness and demand for the company’s product – and ultimately revenue.

The B2B prospect is not only a business, but a specific kind of business, and booking new customers requires hitting a much narrower target. But when you do, it pays dividends.

A key B2B target may be a company with a certain volume of revenue ($1-5 million per year, for example), or a business that operates in a certain vertical (real estate, hospitality, medical, etc.). And though a potential lead is likely more difficult to identify and close – with a much longer sales cycle to boot – the average customer value is nearly triple that of B2C ($491 per order), and represents significantly higher value.

Where customer acquisition tends to be the greater focus for B2C, B2B’s bread and butter is customer retention. Because each B2B buyer represents a much greater revenue stream, and the business/customer relationship lasts months or even years, there’s far greater value in consistently reminding your B2B customer of your worth, through personalization, flexibility and various pricing options, which we’ll address.

B2B ecommerce is certainly on the rise, with Forbes valuing it at $6.7 trillion by as early as 2020.

The B2C Versus B2B Buying Decision and Supporting Content

B2C and B2B customers approach online buying differently, and each model should support its customers’ needs and preferences accordingly.

When a B2C customer takes to the web for product search, they’re the single decision maker in a fairly simple transaction. They need to know product functionality, price point and to get an overall sense that the product meets their personal – and yes, even emotional – needs. And because a B2C purchase requires a smaller upfront cost and the refund policy is likely simple, there’s much less risk involved and therefore a much shorter buying cycle.

The supporting web content that educates the B2C customer on the product – like landing pages, demos, FAQ’s and even the checkout page – should be exhaustive but not overwhelming. The consumer should feel educated enough to make a purchase decision in as few steps as possible to prevent them from leaving your site at any point during the buying cycle.

This, however, is where B2B gets significantly more complicated.

The B2B research and buying process is much more rigorous, the implementation process operates on a larger scale, and the initial purchase decision likely requires buy-in from more than one person.

For example, if an IT specialist is looking to subscribe to new software for their company, they’re going to have to convince any number of other people, like their supervisor, top executives, and even the finance department, among others.

Because this is a business decision instead of a personal one, the supporting material should be more detailed and exhaustive. In addition to the traditional FAQ’s and product demos, consider displaying a use case that guides each decision maker based on their particular concern. Educate the CEO on why it’s a great investment, the accounting department on why it makes financial sense, and the IT department about the ease of implementation.

Providing the necessary information to a prospect’s full slate of stakeholders can help make sure your company becomes its desired service provider. From there, you’ve on-boarded a profitable client that represents a potential long-term partnership.

Read more: Bring Consumerization to the B2B Buying Experience

Customization and Payment Flexibility

For a single B2C customer, signing up for enterprise software or a SaaS subscription remains fairly plug-and-play. After conducting research and making the purchase, they’ve decided the product meets their needs and presumably supports their device. Customization should be minimal.

On the B2B front, whether usage-based, seat-based or any other user model, dozens and maybe hundreds of employees in the end user’s business may be using the software on a day-to-day basis. It’s crucial to allow the end user to customize their experience based on functionality, usage, department, and other metrics that maximize usability.

And just as the product itself should be flexible, so should the payment options.

For B2C, there’s often a uniform price for all customers, and the standard credit card and PayPal-type payment options should suffice. But the B2B model should host a bevy of additional options, like purchase orders, payment on credit, budgeting workflows, etc. And for large clients buying a significant order, consider the Configure Price Quote (CPQ) model or volume-based discounts as incentives, both of which we’ll explore further in future blogs.

B2B Web Performance

Some 98 percent of B2B buyers say they do at least some research online, according to Forrester, and 62 percent said enhanced search functionality is essential to their research and purchase decisions.

As a digital business, your website remains one of the most important tools to appeal to your customers. And for obvious reasons, it should function in a way that suits the user.

A digital platform in the B2C place can populate adequate search results with a basic search function that delivers on common keywords and product SKUs. Amazon is a great example of this.

In B2B, because the slate of product offerings are more complex and niche, the search should be far more tailored to the B2B user profile and company need. A search function based on structured data and more complex algorithms can populate results based on what your customer has bought before, what they’ll likely buy next, and provide a forecast for purchases far in the future.

In fact, some B2B companies even build out separate microsites tailored specifically to the needs of their top clients, which may bring in the lion’s share of yearly revenue.

And for B2B buyers who are used to the company’s sales representative as their primary contact point, according to Shopify, streamlining the online search process doesn’t replace the sales role, but rather “empowers your sales reps to work in a more consultative, rather than transactional role,” supporting an even more optimized and personalized experience.

Keystone

Although B2B customers are fewer, they maintain a much higher value than their B2C counterparts, and can potentially deliver more revenue if your company implements the right structure and the platform to support it.

Whether your end user is a single customer or another company, cleverbridge can help manage, monetize and optimize your digital business as you continue to grow. We take responsiblity for recurring billing, global payment processing, compliance, customer service, and more.

Ready to discuss further? Contact our sales team today.

Kyle Shamorian is the content marketer for cleverbridge.