HomeIndustriesB2B Business Model: The Definition and How It Differences with B2C

B2B Business Model: The Definition and How It Differences with B2C

Have you ever heard the terms B2B, B2C, or C2C? These terms are business models that all companies in the world implement. Regardless of industry or scale, every company must adopt one of the three business models. However, what do B2B, B2C, and C2C mean, and how do these business models differentiate companies?

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Table of Contents

Definition of B2B and B2C

B2B (business to business) is an acronym for Business to Business, which refers to a business conducted between companies, rather than between a company and an individual consumer. Usually, the company, which is the consumers in this business model, will resell the products they previously bought or use them to facilitate activities within the company.

While B2C stands for business to consumers, the company sells its products or services directly to final consumers in this business model. So, there is no intermediary between the company and the customer. Companies distribute their products or services directly to customers. There are several popular types of B2C, including direct sellers, online intermediaries, advertising-based, community-based, and fee-based.

Related article: Is It Necessary for a Business to Have a Brand Persona?

Differences Between B2B and B2C

Apart from the fact that the target consumers of B2B (business to business) and B2C are different, there are several other differences between the two. For example, on the price and quantity of sales. Companies with a B2C model need to sell many products to earn big profits. Meanwhile, companies with a business-to-business model can obtain several transactions with a very large nominal. Not only that, here we summarize some of the differences between B2B (business to business) and B2C, namely:

By business strategy

B2B (business to business) often uses marketing strategies to increase reputation. Companies with this business model usually use the media to present various content and portfolios to build a good image. This method will convince potential customers that the company has expertise. Not only that, but business-to-business model companies also use public relations to influence their target customers. You can use CRM to manage the interactions that occur between customers and your B2B (business to business) company.

The strategy is slightly different from B2C. Although both need to create a good image, B2C companies do it differently. Companies that target consumers directly use emotional marketing strategies. The company will make consumers feel the company’s content until they finally buy the advertised product. In addition, many B2C companies are actively promoting and discounting their products.

By company and decision making

Perhaps we don’t know much about B2B (business to business) companies because B2B companies are closer to the industrial sector. B2C is more focused on the individual end customer. Thus, the B2B and B2C digital marketing approaches will also be different, especially regarding the digital marketing channels used. For example, in B2C, it would be more suitable to use social media, such as Instagram, Facebook, and Youtube, to reach consumers. At the same time, B2B will be more suitable for doing digital marketing through a screening process for quality client prospects.

Not only that, clients from B2B (business to business) are usually logical business clients. Before buying a product, this client needs much consideration, especially regarding long-term benefits. Not infrequently for a transaction, the company will ask for references from the director, manager, financial, legal, and marketing departments. So the decision-making will usually take time. To overcome this, you can use ERP software to integrate the company’s system and make it more efficient.

As for B2C companies, because their products are for personal purposes, the scope is small to make decisions individually. The considerations are not as complex as B2B so that retail product buyers can make faster pre-purchase decisions.

C2C Business Model

The C2C or customer-to-customer business model is very similar to the B2C model. They both have in common their target market, which is consumers who buy in small quantities. His motivations and decision-making are also very personal and brief. The competition and the marketing strategies they both take are similar. C2C also often uses social media to upload the latest product promotions.

The C2C business model provides an opportunity for fellow consumers to sell goods. Usually, e-commerce is the place where many C2C business models practice. This is because e-commerce can make C2C transactions more secure. So, indirectly, e-commerce or marketplace becomes a third party to provide transaction facilities between sellers and buyers. This business model is very convenient because the seller and the buyer do not have to meet in person to make a transaction.

Related article: Effective Marketing Jobs that Develop Your Business

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Anak Agung Istri Karlita Aprilianti
Anak Agung Istri Karlita Aprilianti
Junior Creative Content Writer at Hashmicro.

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