As the famous businessman, Michael Scott, once said, “People will never be replaced by machines. In the end, life and business are about human connections.”

 

 

Okay, sure it’s a quote from The Office, but it still holds true. Particularly in the world of B2C marketing. Consumers aren’t buying your products or services simply because it exists, they’re buying the messaging and values behind it too. 

 

 

That’s why brands like Beats by Dre still have a diehard following, even though it’s well-known that the sound quality leaves something to be desired. Even most audiophiles have said their product is hardly worth the high ticket precise. 

 

 

B2C sales are driven by human connection, far more than B2B—and brands who forget that will find out the hard way. While B2B targets only businesses, B2C sells to individual people. And because of that, they have exceedingly different marketing strategies at times.

 

 

However, it’s easier said than done.

 

 

There is much more to understand behind the scenes if you want to learn how the B2B and B2C models work to increase your sales seamlessly. If you invest more time learning the sales model than the money in your marketing gimmicks, the ROI will maximize in no time.

 

 

Understanding B2B and B2C Sales 

 

With the ever-emerging eCommerce trends, the line between B2C and B2B sales is slowly blurring. First, however, marketers must put the two apart. By understanding B2B and B2C marketing, businesses can better analyze and implement effective marketing strategies for consumers or other businesses. 

 

 

B2C sales are more inclined towards appealing to consumers to generate interest and amplify sales. For B2B, more efforts are put into engaging the other businesses, especially since the average B2B sales cycle length is 102 days.

 

 

Before we dig deeper into the sale-sy chaos, let us quickly overview the most important part of your sales—the consumer.

 

 

What is a consumer?

 

The consumer is the person that keeps your business running. They are the individual buyers or customers that purchase a product or service from you. Because of this, there are different types of consumers, and they want different things. 

 

 

For instance, you can’t sell a car to a person who wants a motorcycle. Similarly, you cannot sell a SaaS product to a business that wants new phone system.

 

 

B2B Sales

 

B2B, or business-to-business, is exactly what the name means. One business sells its products and services to another business and not to individual consumers. For example, a windscreen manufacturer selling to an automobile company is a B2B sale. 

 

 

B2C Sales

 

B2C or business-to-consumer sales are defined as when businesses sell to individual consumers.

 

 

When you are into B2C sales, you may collaborate to work with huge brands like Amazon or Apple to sell different kinds of goods to a diversified clientele. Alternatively, you can sell a single product in a single category to the same clientele, like the cosmetics in Sephora, or online subscriptions like Netflix.

 

 

When it comes to market size, B2C tends to be bigger in some industries but not always. In fact, reports published by Statista, retail B2C e-commerce sales by 2025 are expected to surpass a net worth of $1.3 trillion. That being said, the B2B is nothing to scoff at, either. According to Digital Commerce, B2B eCommerce marketplaces will reach $1.63 trillion in 2021.

 

 

B2B vs. B2C Sales

 

Now that we’ve covered B2B and B2C sales concepts, let’s discuss their differences. B2B and B2C sales processes have some universal strategies, but they are also unique at times from each other. Let’s see how that plays out with precise examples.

 

 

1. Customer Lifetime Value 

 

B2C sales are often just single-time, quick purchases. Therefore, the prices of B2C services and products are lower than B2B products. Unfortunately, this means B2C customers are less loyal, and you’ll see a lower CLV in your marketing. 

 

 

Moreover, the business often needs to make long-term relationships in B2B sales and maintain the clientele, making the entire model more expensive. For B2C sales, you may never hear from the consumer again. 

 

 

2. Purchase Risk

 

There is always risk associated with sales and marketing. If you buy the wrong ketchup brand, there might be an uproar at the dinner table, but you can always return it. However, if you invest in a multi-million dollar stock market and anything goes wrong…

 

 

Well—your entire career can come crashing down. 

 

 

In B2C sales, there is a lower perceived purchase risk because it is more likely to return or exchange the product. Whereas, with B2B sales, the consumer base is long-term, so they need insights on the return on investment and the lifetime value to analyze the purchase risk. A long sales and marketing cycle involves customer service and operations, so the risk is high. 

 

 

The B2B sales have a bigger sales cycle and more people on board, like decision-makers, policy experts, and subject matter experts. In B2C, the seller can alone navigate the entire sales journey of the buyer and directly coordinate with them.

 

 

3. Types of Marketing Campaigns 

 

We all know B2C consumers read reviews and check for ratings for the online store before they make a purchase. Therefore, the B2C salesperson may rely on social channels and affiliate marketing—by putting up ads. This way, the salesperson can directly impact the consumer’s decision-making, keeping the sales cycle short.

 

 

When it comes to B2B sales, there are a lot of product testing, demos, promotional lunches, pitches, and much more involved with a post-purchase consumer follow-up. And this, of course, increases the tremendously.

 

 

4. Differences in Number of Decision-Makers

 

For B2B sales, consumers tend to be involved in long-term relationships. Therefore, they do a lot of research before making a purchase. In contrast, B2C consumers are impulsive buyers, mostly after quick solutions for their needs (immediate gratification). 

 

 

Let us take Professional Services Automation or the PSA tool as an example. As a B2B consumer, you will investigate the specifications, cost, integration level, and reputation of ten software’s long-term benefits. And you make the buying decision once you are satisfied. Simply, a B2B buyer will not mind waiting for a lengthy process even because their decisions are less emotional and more strategic. 

 

 

In addition, to reach a strategic decision and industrial purchase, B2B mostly contains a DMU (decision-making unit). This unit includes a team of professionals with different expertise to advise and decide on the purchase, making the process lengthier.  

 

 

One alluring advertisement that resonates emotionally with a B2C buyer will make them buy the product. However, the B2B DMUs will take more than one advertisement. They will have to put in more effort, time, and money to influence the consumer’s decisions. 

 

 

And let’s not forget, the B2B buyers care for the post-purchase services—yet another reason they will take time to reach a decision. In contrast, B2C consumers are less likely to approach the brand again after the purchase. 

Therefore, their decisions are faster.

 

 

5. Cost vs. Value

 

A B2C buyer is often influenced by discounts because they need the product instantly. Alternatively, B2B buyers spend more time deciding on long-term investments with little interest in discounts. This plays out in the different types of SaaS products especially. 

 

 

A B2B SaaS company sells its services and products to other companies. Adobe, Slack, and Shopify are examples of  B2B SaaS companies. Long-term Saas products can reduce the cost and increase the value of B2B consumers. The main purpose is to reduce HR costs, optimize sales, upgrade marketing, and enhance customer service.

 

 

Google Docs, Uber, and HyreCar are perfect B2C SaaS examples where many people can use a sharing service in a marketplace. Providing instant value at reasonable prices for the consumers. 

 

 

Sure B2C and B2B Saas products have things in common such as churn rate, subscription offers, lifetime value, and customer acquisition cost. However, there are differences in the number of customers, sales cycles, and budgets.

 

 

6. Customer Acquisition Cost 

 

The CAC or Customer Acquisition Cost measures the entire cost of acquiring a new customer, and it is one of the crucial factors in determining the revenue and profitability of a business or salesperson. 

 

 

It can help the companies or the sellers to determine customer value and use efficient marketing channels, automation tools, Saas products, and the customer base. 

 

 

For B2B, the customer acquisition cost is often high because of the lower leads and higher price points. As a result, higher investments are made to provide customers with high-end marketing channels and lifetime value. However, for B2C, the major acquisition cost is also for marketing, such as travelling or educating consumers. 

 

 

7. Sales Cycle Length

 

For B2B, you have a lot of support from other people in your team, and the seniors make the decisions for you. You have to show the art of selling. In addition, the B2B sales rep has a backup that can influence the sales experience. The sales cycle for B2B is lengthy because it involves:

 

• Strategies to generate prospect leads
• Reach out to potential customers via advertisements and other marketing channels
• Keep the customers in the loop
• Present the product
• Take care of the customer objections
• Close sales
• Provide after-purchase customer service
• Generate referrals

 

Beyond that, each step in the B2B sales cycle needs approval for a senior. 

 

 

In comparison, the B2C sales cycle is much shorter than the B2B sales. The customer is encouraged and convinced to buy the product or service instantly. And unlike in the B2B sales cycle, usually, only one person is involved in the decision-making process.  

 

 

The Final Word: Are B2B and B2C Sales Different?

 

In the last few years, brands have witnessed a boost in eCommerce sales. This, in turn, has somewhat blurred the differentiation between B2B and B2C marketing. Still, there are key differences like the ones we listed already.

 

 

And if you’re looking for help with your marketing, we’re happy to help. Our agency has helped hundreds of clients in the B2B and B2C space—and we’re happy to share that experience with you. 

 

 

Contact us today to get started.