The Difference between B2B versus B2C Marketing

Fire Alarm Marketing, which augments a firm’s marketing and business development organizations, is focused on B2B  companies. I often hear “marketing is marketing”. Granted the functions of marketing (the process of determining what product/service to develop, how to promote it, how to communicate it and how to sell it) are the same for both Business to Consumer (B2C) and Business to Business (B2B) the “ingredients” are different. The chart below illustrates the major differences.

                                                Comparison for B2C vs. B2B Marketing

Marketing Function B2C B2B
Audience End User Enterprises
SampleSegmentation/Profile Age 16-21, modest income, hard rock music, New England region $1B or > revenues, Healthcare, BankingSIC codes, HQ+30 branch locations
Examples of Products/Services Toothpaste, iPod Data Center Solutions, Sales Force Automaton Software
Service for the buyer Return the product Service/Consulting organizations
Price $2-$100 $250K and >
Promotion TV ads, Radio, Newspaper,Word of mouth Web Site, Tradeshows, Sales person
Internet Banners, Ads Blogs, Articles, Testimonials, Groups
Distribution Channels Retail stores, catalogs, on-line Direct Sales, VARs
Value Proposition Hype, branding Enterprise Needs, Why Us
Message Hype Branding, Who we are
Relationship building Little loyalty Critical
Decision Maker One/two Many/Committee
Sales Cycle Short Months/years

 

A few comments about some of the specific marketing functions.

1- Your audience: Note in B2C the marketing is done “directly” to the end user. In B2B the marketer is often focused on the enterprise who sells to the end user. Therefore the marketer must be aware of two audiences.

2-Distribution channels: while both types of marketing are complex for this function; the B2B has one additional challenge, that of relationship building with the reseller/VAR/etc.. This relationship is needed so one can address items like total life cycle or joint marketing.

3- Sales cycle: In B2C the end user may do some research, but typically one has a need (not necessarily), shops and buys in the same cycle. B2B involves many steps and individuals, thus the marketer must be aware of this and “market” to each phase.

4-In both the B2C and B2B markets, there is a need to “push” and “pull” a product through the distribution channel(s). In the B2B environment, there is generally less “pull”, i.e. end user promotion, due to the technical nature of the product or service and the relatively long selling cycle.

 In summary, as I have said many times, the first and foremost requirement is to have a strategy. Do not proceed to “GO” until you have an overall strategy. Once this is done, there are two critical next steps.  One, understand and analyze what I call the business surrounds; what impacts or influences the business or government buyer that you are marketing to. Examples would be the economy, their suppliers, the market, and any potential technology disruptions. Second and very, very important, look at the derived demand, i.e. what are your targeted businesses end user needs; circumstances like an increase in  the price of gas, which reduces travel, which reduces calls to a call center, that might impact your marketing functions.

Have you reviewed your strategy today?  Does it still relate to the 2010 environment?

RHL 3/23/10

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