B2B vs B2C: What's the Difference?

Whether I should do B2B or B2C is one of the main questions people ask while starting any business. To be an entrepreneur, you pursue degrees like a bachelor in business administration, bachelor in business management, master in business administration or take any specialisation in entrepreneurship, but that is not enough. To be a successful entrepreneur, you need to understand the key difference between B2B vs B2C. Once, you are well-versed in this concept, you would be able to make wise decisions for your business.

Under this blog, we’ll walk through the definition of B2B and B2C, which one is better, and what are the differences that one needs to consider. So, let’s move forward with the concept of B2B vs BC2.

What is B2B?

B2B means business to business - it is about focusing on personal relationships than transactional ones. B2B is a different route where you have to look for wholesalers or you deal directly with the company. It can be a medium-sized business, large business or small-sized business, but here, you do not sell directly to the customers. B2B is about selling products in bulk, and when they prepare the ad, they use the terms their client is familiar with.

B2B majorly focuses on generating leads, and while developing personal relationships, the repeat and referral business can make or break your business. In this type of business, you build relationships to avoid negative reviews, but 72% of users who read online reviews say, ‘negative reviews give depth and insightful analysis of the products and services.’

Pros and Cons of the B2B Business Model

Pros	Cons
Recurring Revenues	Creating product awareness can be difficult
Potential for larger sales	It takes a good investment in marketing
Customer lifetime value is increased	Sales process has major frictions
Competitive Advantages	Scaling is difficult
Flexible Terms	Buying process takes longer time
Higher Profit	Trust needs to be built

What is B2C?

B2C means business to customers - it is more focused on transactions and business coming from the customers. When you choose this type of business, you sell directly to the customers. Your branding is more focused on messaging, and the ad that you present is more emotional and playful. You do not use terms that are unrealistic and confusing. In B2C business, the targeted audience is funnel-focused.

It is said - time is money, and in B2C business, you need to spend minimal time getting to know your customer. Here, the business and the customer never get involved directly. Under this business, the priority is to sell high-quality products at a competitive price. Even giving personalised discount codes and offering deals can result in reviews from valuable customers. It also establishes trust in the people who can possibly turn into your customer.

Pros and Cons of the B2C Business Model

Pros	Cons
Unlimited Market Place	Product exposure limits
Shrinks Competition Gap	Security concern
Eliminating Third Party Client	Cut-throat Competition
Lower Cost of Business	Infrastructure
Inflexibility of the catalogue	Shipping Charges

B2B vs B2C: Which is Better?

Often the question arises - B2B vs B2C, which is better? Which route should we opt for while we are entering the world of entrepreneurship?

If you think that any of these business models is better, then no. Both B2B vs B2C business models have their own pros and cons. Not every business is suited for both models, some are better in B2B, and some are better in B2C. You need to check the infrastructure, the capital, the goals, and the industry to define your business model.

• If you are starting a business that will produce products in bulk and need warehousing, then choosing a B2B business model will be better.
• If you want to sell products with defined shelf-life and in small quantities, then opting B2C business model will be helpful.
• If you don’t want to invest in staffing salesmen and want to work with a small team, then choose B2B.
• If you have capital and you can invest in onboarding more staff, including salespersons, that can meet your goals, then choose the B2C path.

Critical Differences Between B2B vs B2C

Many people think that B2B and B2C are the same, but no, there are key B2B vs B2C differences that you need to know. These differences will let you understand the depth of the B2B vs B2C business model.

B2B	B2C
There are multiple pricing tiers according to the order value.	There is a single pricing mentioned for all the customers.
Here, an account manager can handle all the issues.	Whereas, here, you have a defined customer service team that helps the customer.
Website in B2B is mainly used as a dashboard for the business.	Here, the website is built to attract and convert the people who are opening the site.
In this, there are additional steps involved while checking out.	No additional steps are involved, and a streamlined process is there so that people don’t abandon the product in carts.
They sell to the business (in bulk) that resells the products.	They sell their products directly to the customers.
They focus on what the product can deliver to the business.	They are focused on consumer taste according to demographic, and sociographic groups.
Under this category, there is a higher acquisition cost.	Under this category, there is a lower acquisition cost.
You can see the detailed information mentioned on the product.	Here, a short but broad description is printed on the product.
You can experience a longer sales cycle in this business model.	Here, a shorter sales cycle is what you experience because the trend changes faster.

B2B vs B2C Buying Process

When we talk about B2B or B2C, we need to understand the customer's needs and requirements. Hence, under B2B vs B2C, there is a certain buying process that one needs to follow. Scroll ahead to see the chart showing the buying process of B2B and B2C.

There are 6 steps involved in the B2B buying process.

B2B Buying Process

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Awareness

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Commitment to Change

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Considering Options

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Commitment to Solutions

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Decision Time

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Final Selection

There are 5 steps involved in the B2C buying process.

B2C Buying Process

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Problem Recognition

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Information Search

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Alternative Evaluation

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Purchase Decision

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Post-Purchase Evaluation

Conclusion

Now that you know B2B vs B2C differences, it’ll be easy to choose the business path for you. Before getting into B2B vs B2C, it would be great if you pursue BBA in entrepreneurship, BBA in international business or a BBA business analytics from colleges powered by Sunstone. A BBA degree focuses on management and leadership roles and helps you in getting the core knowledge of the business. Apart from that, you’ll get 70+ sessions from industry experts and 70% job opportunities in top metro cities.