The whole area of sales of all kinds of goods and servicesdivided into two large segments. The first is B2C, the second is B2B. Quite often, after meeting these abbreviations, many are asking: B2C - what is it? Or what is B2B? So, let's figure it out.
B2B market description
If you translate verbatim verbatim, you will get"business for business", from English business to business. The term B2B means any business oriented to the sale of goods or services for other businesses. As an example, we can cite wholesale bases that sell their goods in large batches, trade organizations representing large producers and acting only as sellers, etc. So, the B2C market - what is it, what is B2B and what are their differences?
B2B market characteristics
For sales in this segment of the market is characterized by a number of features. Among them we can distinguish:
- Scope. B2C is focused on sales for business,therefore, companies operating in this segment are more interested in wholesale sales than retail. At a small cost of the goods (in comparison with that offered to the end user), these companies make large monetary turnover due to the volume of all kinds of products. A vivid example - wholesale bases and companies-dealers.
- Limited market. If we compare the number of customers at retailmarket with the number of potential consumers in the market oriented to business, we can conclude that the latter is many times inferior in quantitative terms to the first. Naturally, this fact increases the competition in the B2B segment and requires completely different approaches to customers than the B2C market.
- Weighted solutions. Unlike a typical buyer, virtuallyevery businessman approaches to any purchases for his business very strictly. First of all, this is due to greater risks. Suppose you can buy a batch of new goods, and it will not be in demand among consumers. Or, for example, buy a production line, and she will issue a marriage. In fact, there are a lot of such risks. And the businessman should take them into account, especially since the financial and time costs for purchasing goods on the retail market vary considerably.
B2C - what is it?
With a market oriented to business, moreless understood, move on to the consumer-oriented segment. So, B2C - what is it? In English - business to customer, and in translation to our native - "business for the buyer." If you compare it with a segment of the business focused on sales for sellers, you can see that these concepts are radically different.
Key business features for customers
- Range. Typically, retailers working in retailtrade, try to cover as much of the market as possible. This is done by maximizing the range of goods sold and services provided. Perhaps the most striking example of B2C is supermarkets. In such stores the consumer can buy almost everything he needs. Plus, get additional services, such as delivery, configuration and installation of household appliances.
- The value of the client. In retail, the value of one customer is notis very large, since the main money supply is done at the expense of sales volumes for different consumers. Therefore, the B2C segment is focused on the needs of the market as a whole, and in rare cases takes into account the needs of a single person. As an illustrative example, you can take any consumer goods, for example, bread. This product has all the characteristics that can attract the maximum number of customers. And if one person wants to buy bread with peppermint flavor, it is unlikely that it will be done. And no plant will not make one loaf only in order to satisfy the need of one client instead of thousands. And on the contrary: for example, the owner of a supermarket for some reason decided that the bread with mint flavor will disperse to cheers. He negotiates with the suppliers - and they make him a trial lot of such bread. Naturally, for such experiments, the volume should be large. The situation, of course, is rather unnatural, but, nevertheless, it is possible to understand by it how different the methods of promoting goods in markets with an orientation towards business and the consumer.
B2C: courier delivery
Like the goods market, the services market for B2Cis different from B2B. This applies to any business. For example, B2C - courier delivery. Orientation to the consumer market obliges the carrier company to have a very wide warehouse network, as well as transport. This is necessary, since the company needs to reach the maximum audience and create the best conditions for customers.
The combination of markets
If you look closely at manybusiness, especially large ones, it can be understood that in a certain place a clear line between two types of promotion of goods is erased. The natural desire of the owner of any enterprise is getting more profit, and if you get an opportunity to get an additional portion of customers, no one will refuse. A good illustration will be all kinds of building materials. Either dealer firms that distribute products to retail outlets.
Example of a company working with different markets
Let's consider an example: there is a small organization engaged in the production of metal products. In its work this enterprise uses paint and varnish products. The owner buys it in building stores or at construction bases, since it has small volumes for the purchase of goods directly from the manufacturer. Alternatively, this owner can find an organization that has a dealership agreement with the factories and which distributes their goods to the same construction stores. Given that such companies have a so-called minimum order, for example $ 100, ordinary consumers are automatically eliminated. But for the owner of a small business this amount is quite acceptable, given that in the production process he uses these goods. Working with a dealer company, he receives significant savings, since in this case the price he pays for the goods is almost equal to the purchase price of any store.
In this case, the owner of a small businessacts as a small consumer, since the volume of his purchases is much less than that of shops, and, nevertheless, he is able to take advantage of better conditions than other consumers.
Difference in approaches
What is the difference between B2B and B2C? Between these two markets there are quite significant differences, although at first glance they are very similar. These differences are concluded both in marketing approaches, and for the purposes of end users.
The main differences of the market for consumers from the market for sellers:
- Weighed and rational decision-making about purchases. B2C is characterized by emotionality, the need to meet desires.
- Volumes. If an ordinary consumer makes a purchase to satisfy their needs, then the businessman buys to provide his business. Therefore, the volume of purchases can be huge.
- The price of the product. For the average consumer, the value of the goods playsa great role, but very often not decisive. But in the case of the B2B market, the difference of 1 dollar per unit can result in tens of thousands on the whole lot, so the cost of the product is given great attention.
- Methods of sales. If for sale B2C much attention is paid to mass advertising, then in the B2B market, personal contacts with customers and work with databases come to the fore.
Thus, we can conclude that corporate sales are significantly different from sales in the B2C market, that this is a division that requires completely different approaches and methods.