The Key Differences Between B2B and B2C

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There are many phrases unique to the business world. Unless you are familiar with business practices, some of them may mean nothing to you. For example, you might have heard or read the terms “B2B” and “B2C.” These two terms are used especially in business marketing. We look at them both in more detail in this post.

It is worth remembering that the overall goal of business marketing is to make as many sales as possible. Both B2B and B2C are business marketing models where the end goal is to make sales, but they still differ from each other.

You will find more information about the differences between B2B and B2C, along with some examples, below. Let’s begin with B2B.

B2B Explained

B2B is a transaction that takes place between two businesses. This means it is a commercial transaction. The long form of the term “B2B” is business-to-business. Only companies take part in a B2B transaction. The consumer is not involved at any stage. A manufacturer could sell a product to a retailer and that would be classed as a B2B transaction. A transaction between a wholesaler and a retailer would also be a B2B transaction.

Examples of B2B

Microsoft is a good example of a company that conducts B2B transactions. The products they offer can be purchased by other businesses, to help their businesses in day-to-day activities. Software such as Word and Excel are examples of Microsoft products that other companies purchase. Microsoft also sells data platforms to businesses in addition to its other products.

A shoe is another example of how B2B works. The process begins with the sale of leather from one business to another. The buyer of the leather will use it to create the shoe. When the shoe is complete, the shoe manufacturer will sell it to a retailer in a second B2B transaction.

B2C Explained

The term B2C refers to the marketing and selling of products to consumers. The full title of this type of selling is business-to-consumer. The target of B2C is always the consumer. There is nothing in-between, so all the marketing for the product must be done by the business selling the product. In this case, the manufacturer would not be using a retailer. They would instead be using their own marketing skills to sell the product.

Examples of B2C

Amazon is a notable example of B2C marketing. Companies can list their products for sale on Amazon and sell them directly to the consumer. In fact, Amazon can be both a B2B and B2C company. However, many of their products are offered directly from the manufacturer to the consumer, which is B2C.

Your internet connection is another example of B2C. You are purchasing your internet connection directly from the internet service provider. Without the internet, you could not access online entertainment, such as Platincasino and Netflix. The same can be said for having a haircut at the local salon. You are buying the service directly from the person giving the haircut. That is a B2C transaction.

Comparing and Contrasting B2B and B2C

Comparing and contrasting B2B and B2C can help further to distinguish between the two terms.

In simple terms, the B2B model is a transaction between two companies, whereas the B2C model is between a company and a consumer. During B2B transactions, the emphasis is on a good relationship between the two companies. But for B2C transactions, the focus is mostly on the product.

The pricing of products can differ depending on the number ordered in a B2B transaction, whereas the price is fixed on a B2C transaction. Businesses selling via B2B will have an account-based website, with little detail and a basic layout. If a company runs into any issues when purchasing from another company, an account manager will be on hand to solve the problem. On the other hand, businesses selling via B2C need an attractive website that will convert browsers into buyers.

Whether a Transaction is B2B or B2C Depends on the Product

There are plenty of differences between B2B and B2C transactions. The type of marketing used for each transaction is one of the main differences between the two, where generating a desire to buy the product is more important during a B2C transaction.

Both models, if done well, can provide a business with a significant volume of sales, but it depends on the type of product being sold. For example, a company selling leather is going to struggle to sell anything to an individual consumer. The product in question ultimately determines the type of transaction that will take place. It is not usually a choice. It will be either B2B or B2C.