B2B and B2C are two acronyms that get thrown around regularly. B2B stands for business to business, referring to transactions that take place between one business and another. B2C stands for business to consumer and pertains to transactions that take place between a business and an individual as the end customer.
While B2B and B2C follow essentially the same equation — a customer is buying something from a company — there are key differences in these two approaches that are worth understanding.
B2B vs. B2C lifetime value differences
Lifetime value, or customer lifetime value (CLV), represents the total revenue a customer generates over the span of their relationship with a company. This metric helps you optimize your marketing, but the figures often differ dramatically between consumer and B2B brands.
CLV in B2B relationships tends to be long term and strategic. B2B companies often offer complex products or services that require ongoing support and maintenance. As a result, B2B customers usually have a higher LTV because they make repeat purchases over time, often involving larger transaction values.
In contrast, B2C transactions are typically more transactional and shorter in duration, so consumers may not return frequently for repeat purchases. However, investing in B2C customer loyalty programs may help retain customers and boost overall LTV.
The path to purchase
The customer journey or path to purchase — e.g., the series of decisions a company or customer takes before completing a transaction — varies between B2B and B2C businesses. Understanding what the customer needs before they can buy from your brand is fundamental to planning your sales, marketing, and customer service.
[Read more: 10 Business-to-Business (B2B) Startup Ideas You Can Start Today]
B2B businesses target other companies. For example, Salesforce, Microsoft, and IBM sell software to other enterprises whose employees use their tools to perform their daily work. Every purchasing decision involves multiple stakeholders: finance, accounting, procurement, and other teams are often involved.
Typically, the B2B customer journey involves the following steps, with consensus-building occurring along the way:
- Identify a problem or need.
- Explore different solutions and do market research.
- Create a list of requirements.
- Select a supplier (e.g., the B2B business).
B2C businesses market directly to individuals, which means the path to purchase can be relatively linear: The consumer considers a particular set of products or services, they shop around to evaluate their options, and they make a decision.
The B2B sales cycle focuses primarily on building trust, authority, and price leadership, while B2C marketing is all about becoming memorable.
The path to purchase
The customer journey or path to purchase — e.g., the series of decisions a company or customer takes before completing a transaction — varies between B2B and B2C businesses. Understanding what the customer needs before they can buy from your brand is fundamental to planning your sales, marketing, and customer service.
[Read more: 10 Business-to-Business (B2B) Startup Ideas You Can Start Today]
B2B businesses target other companies. For example, Salesforce, Microsoft, and IBM sell software to other enterprises whose employees use their tools to perform their daily work. Every purchasing decision involves multiple stakeholders: finance, accounting, procurement, and other teams are often involved.
Typically, the B2B customer journey involves the following steps, with consensus-building occurring along the way:
- Identify a problem or need.
- Explore different solutions and do market research.
- Create a list of requirements.
- Select a supplier (e.g., the B2B business).
B2C businesses market directly to individuals, which means the path to purchase can be relatively linear: The consumer considers a particular set of products or services, they shop around to evaluate their options, and they make a decision.
The purchasing decision
Companies consider different factors when making a purchasing decision than individual customers. They care about price, efficiency, productivity, and return on investment.
For B2C customers, there's more of an opportunity to make an emotional connection. Brands like Nike, Whole Foods, and Petco attempt to connect with each customer's wants, creating a story in their marketing and sales campaigns that's entertaining and educational.
"B2C content is more fun, entertaining, and easy to digest, while B2B content is more technical, in-depth, and effort-intensive," wrote HubSpot.
The B2B sales cycle focuses primarily on building trust, authority, and price leadership, while B2C marketing is all about becoming memorable.
Customer engagement
B2B and B2C differ in how they engage potential customers — although, in recent years, this difference has shrunk. Historically, companies that sell to other businesses have relied on traditional B2B marketing and engagement methods: sales calls, conferences, trade shows, and networking.
"If you plan to sell B2B, ensure you are prepared to invest time in cultivating a relationship with your potential buyer. For instance, you may need to formally present your proposal or make multiple telephone calls to more than one person within the company," wrote Forbes.
Recently, however, the dynamics in B2B customer engagement have shifted and look very similar to B2C. Like B2C consumers, B2B customers are looking for an omnichannel experience. “The top three most frequently used touchpoints are a company’s website, in-person sales, and interactions via video conference. Other interactions include email, mobile apps, e-procurement portals, and online chat,” wrote McKinsey.
[Read more: How to Create a Hybrid Sales Model]
Technology
B2B and B2C companies may use similar software, tools, and platforms, but the ways in which they use technology differ. For B2B companies, technology enables sales professionals to develop deep, long-term, personal relationships with buyers. Tech is also used to identify opportunities for growth, personalize pitches, improve pricing, and automate tasks for sales force efficiency and productivity.
In B2C marketing, technology often plays a more tactical role. Generative artificial intelligence tools help create engaging social media campaigns; automation platforms schedule and send emails, social media posts, and SMS messages; and data analytics extract customer insights to help with personalized campaigns and targeting. Technology in B2C commerce is all about making things more efficient, maximizing engagement, and converting sales.
Customer service
B2C and B2B require different approaches to customer service.
Today's consumers appreciate an independent, self-service approach to customer service. In the B2C space, individuals want to quickly and efficiently resolve an issue, ask a question, or connect with a live agent without having to navigate a long phone menu or hunt through dozens of web pages. The bottom line for B2C companies: Help customers help themselves.
In B2B, some self-service options are certainly appreciated. However, B2B transactions are usually complex, expensive, and long-lasting. As a result, B2B businesses often need a dedicated support team to manage client expectations. This arrangement helps mitigate the frustration and stress caused by multiple teams using the same account. It can also promote continuity by managing all requests in one customer relationship management dashboard, for instance. Design your customer service to be personalized and dependable, no matter who calls for help.
Content marketing
The type of content that features in a B2B marketing campaign aligns with building these long-term relationships. Content should target multiple decision-makers: the person who will use the product, the manager who will approve it, and the finance representative who will allocate funding for it. Your content needs to address a range of concerns from different stakeholders across the organization.
Likewise, the tone of your content for B2B will be more professional and educational than typical B2C content marketing. “A B2B content strategy should focus on two key goals: attracting more qualified leads and showing your expertise. For lead generation, you might create helpful long-form blog posts, e-books, or webinars. To show expertise, you’d share things like case studies and whitepapers brimming with facts and stats,” wrote Mailchimp.
B2B uses channels like LinkedIn, direct outreach (email), and industry-specific publications to reach potential customers. Comparatively, B2C content will focus on engaging one individual with emotional storytelling and urgency. The mediums and messaging are completely different.
“Brands leverage platforms like Instagram, TikTok, and Facebook to engage consumers with compelling visuals, videos, and storytelling. The goal is to create an emotional connection that drives immediate action, such as purchasing or sharing content with others,” wrote Socialinsider.
Focus B2C marketing efforts on attention-grabbing videos and images, and create a sense of urgency to keep potential customers moving along the path to purchase.
Sales cycle length and lead nurturing differences
Data shows that the average sales cycle for B2B companies is about two months. These deals typically require alignment from multiple stakeholders and more complex negotiations; they also involve more money. Lead nurturing is all about building relationships.
B2C nurturing focuses on quick, emotional engagement via segmented promotions, video storytelling, social media, and real-time behavioral triggers to drive impulse conversions. Since these types of purchases tend to be more transactional, they happen over shorter time spans.
Although the sales cycle is shorter, B2C brands need to capitalize on every moment of contact with a consumer. “A brand only takes one-tenth of a second to make a first impression; it takes 5 to 7 impressions for consumers to remember a brand,” wrote Capital One Shopping Research.
Nurturing a B2C lead is about telling a brand story consistently, keeping messaging relevant, and targeting customers who are most likely to buy your product.
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
CO—is committed to helping you start, run and grow your small business. Learn more about the benefits of small business membership in the U.S. Chamber of Commerce, here.
