When dealing with the sale of a good or service, it is often quite important to take note of which form of transaction you are completing. Businesses operate in three main transaction types: business-to-consumer (B2C), business-to-business (B2B), and business-to-government (B2G). The two most prominent of these transactions are B2C and B2B.

In a B2C transaction, products are sold directly to the consumer, or the end user of the product. In this scenario, the individuals making the purchasing decision will likely be personally using the product they are buying. In a B2B transaction, a business as an entity is making the purchasing decision. In this case, it is likely that the ultimate decision maker will not be using the product or service, but the company as a whole (or its employees) will.

The Difference in “Wants and Needs”

Businesses and consumers have vastly different qualities that they look for in a product. When deciding on a product, each party has a list of wants or needs that the product must meet in order for a purchase to be made. While many of these factors may be the same between B2C and B2B, they vary in importance and order of appearance.

One of the most easily noticeable differences is the consumer’s devotion to specific brands. In many consumer-driven purchases, brands play an immense role in the purchasing decision. Consumers have been trained by savvy marketers to place inherent value on a product solely because of the brand that sells it. This is starkly contrasted when a business is making the purchasing decision. I believe that a business does not (for the most part) care about brand. If running a business, I would want the best product to fit my needs. This may not necessarily mean using the brand I’m more familiar with. While a consumer may be willing to sacrifice some of its other wants or needs simply to fulfill their wish for a particular brand, a business is not. Businesses rely more on the specifications necessary to their operation. A business will be quick to jump ship and select a new product if it aligns more uniformly to their goals.

Another significant need that must be considered is where the product falls in the purchaser’s price requirement. Every purchaser, be they consumer or business, have guidelines to follow when it comes to the product cost. In the case of the modern consumer, the cost of products is often subjective and can vary between products. This also falls in line with the consumer’s value placed on brands. Consumers will pay the price for a product that they deem acceptable. If a product’s price is not acceptable, they will move on to a different product. With a business making the purchasing decision, price is marginally more critical to deal with. In many instances, the price requirements are not subjective, but objective. The business has set a budget that must be met, with little room for movement. Unlike in the B2C world, pricing negotiations are commonplace in the B2B world. A business may put out a request to gather proposals from other businesses to find the right fit. This is something we do not see in the consumer sector in America.

The last major want that I believe should be looked at is variety. I’ve observed that consumers love variety. It would not be unreasonable to witness a consumer purchase three of the same sweater in three different colors or to have four pairs of sneakers. In both instances, the sweaters and sneakers all have a single purpose, but the consumer wanted variety in the fulfillment of that purpose. Businesses do not have this desire for variety. If a business wants three sweaters, it does not want green, blue, and red. They want three green sweaters. If they need four pairs of sneakers, they want four of the same pair.

Conclusion

When running your business, it is very important to identify who exactly you are conducting business with. Dealing with a business-to-consumer transaction, you want to make sure to focus on emotion, simplicity, and benefits. Selling the brand is paramount with consumers and will lead to lifelong customers. When dealing with businesses, always make sure you are being logical and cost-conscious, focusing on the business’s needs. Your strategy, design, social media, printing, and promotions should be carefully evaluated to ensure you are communicating to the proper target market. In developing a marketing plan, it is important to present yourself to your customers and clients in the most effective way possible.

References:

Ian Linton: Differences Between B2C & B2B in Business Systems

Laura Lake: Understanding Differences Between B2B and B2C Marketing

 

About the Author

Clay Ridings

Clay is a Marketing Assistant, eager to learn everything he can about the industry. When he isn’t working, he enjoys working on and riding his motorcycle or playing a relaxing round of terrible golf.

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