What is B2C?
Business-to-Consumer (B2C) is a business model where products and services are marketed and sold directly to the end user.
The B2C business model stands in contrast to the business-to-business (B2B) model, in which a company sells its products and services to another company or business entity.
In the Software-as-a-Service (SaaS) world, some applications are developed to solve a particular business problem while others are made to provide entertainment or facilitate social connections. Applications that solve problems for businesses will be marketed B2B, while those that satisfy human needs like socialization and entertainment will be marketed B2C.
B2C vs B2B - Comparing Business Models
Suppose you invent a widget that solves some problem for your target customer. After an initial production run, you have an inventory of 10,000 widgets and you’re ready to go to market.
Now that it’s time to market and sell your products, you’ll have the possibility of choosing between a B2C or B2B business model.
If you choose a B2C approach, you’ll want to set up an eCommerce storefront where you can make sales, accept payments, and coordinate fulfillment. You could hire a paid media agency to run PPC advertisements on Google or launch a content marketing campaign to generate traffic to your website. You can run conversion rate optimization (CRO) experiments like a/b testing to identify high-performing landing page designs that drive on-page conversions.
You might even open a bricks-and-mortar store (“Widget Mart”) where your target market can physically purchase your product.
If you choose a B2B approach, you’ll be acting as a wholesaler and selling your widgets in bulk to one or more retail partners, who will sell them on to the end user. You’ll need to identify, contact, and initiate partnerships with retailers who might be interested in selling your widgets.
Although your product is the same in either case, your choice of B2C vs. B2B determines who your target customers will be, which has a huge impact on your overall go-to market strategy.
It’s also true that businesses and consumers tend to follow different decision-making processes and have different motivations when it comes to making a purchase. The task of marketers is to understand the purchasing habits and needs of their target customers, and to build customer journeys that cater to those needs.
B2C vs. B2B - Key Differences
Marketing professionals face different challenges when marketing products and services in a B2C vs. B2B business model. These challenges are shaped by the characteristic differences between B2C and B2B outlined here.