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From small local businesses to large multinational enterprises, there are two broad groups of companies. Some businesses primarily sell to other businesses (B2B), while another group sells directly to consumers (B2C). And some do a bit of both.
B2C dominates the eCommerce industry and brick-and-mortar stores. Think restaurants, Amazon, or a local plumber.
In this complete guide, we'll cover everything you need to know about the business-to-consumer model (B2C), including the ins and outs of B2C sales, key benefits, and the difference to B2B.
Learn about:
- What is B2C Marketing?
- Understanding B2C Sales
- B2C Sales Models
- Benefits of a Business-to-Consumer (B2C) Model
- B2B vs. B2C: What's the Difference?
- 5 B2C Sales Tips
What is B2C Marketing?
B2C, or Business-to-Consumer, refers to all commerce where businesses sell products or services directly to consumers. For the majority of people, it covers their main interaction with companies. Historically, it formed the backbone of the economy, covering restaurants, pubs, shops, and much more.
Consumers are any individual who purchases goods or services for their private use. That could include cars, food, clothing, video games, streaming subscriptions, or even holidays.
Common examples of B2C businesses include:
- Online retailers
- Fast food chains
- Supermarkets and grocery stores
- Electronics and appliance stores
- Clothing and apparel stores
- Movie theatres
- Streaming service providers
- Airlines
- Hotels and resorts
- Cosmetic and beauty stores
However, since eCommerce and internet shopping evolved following the dotcom boom, B2C primarily referred to online retailers selling products or services to consumers through the internet. Think Amazon, eBay, or even streaming services like Netflix.
B2C marketing involves the strategies and tactics used by companies to promote their products and services to individual consumers.
Because consumers are much more emotional than bottom-line-focused businesses, B2C marketing tactics tend to build customer relationships or tell a story – for example, TV commercials, social media campaigns, influencer collaborations, or email newsletters.
Moreover, consumers are rarely experts in a particular field, nor do they have budgets comparable to businesses. That means shorter sales cycles, more products and discounts, and more basic, product-focused content.
In eCommerce, B2C is by far the most popular method of business – becoming a competitive presence for traditional B2C brick-and-mortar retail stores (a trend further accelerated by the pandemic). Consumers, favouring convenience and cheaper prices, turn to online retailers primarily for non-perishable items.
Understanding B2C Sales
If a marketing campaign is successful, it leads to a sale. B2C sales are marked by the individual transactions of a consumer with a business. Unlike B2B sales, consumer transactions are small volumes compared to the former, where bulk sales might be more common.
The lower value of each transaction usually means a shorter sales cycle. Consumers are more willing to part with their cash after a handful of interactions with a brand. Nonetheless, brand loyalty is highly important, as significant customer churn (as experienced by the Software-as-a-Service (SaaS) industry) can impede expansion and growth.
Because of the large number of individual transactions, pricing is usually fixed – although sales, discounts, and promotions can occur to spark a desire or impulse to purchase a product or service, emphasising the emotional nature of the relationship.
Finally, customer service revolves around post-sale support, e.g., product returns, warranties, or user guidance, to ensure customer satisfaction.
One exception is in the SaaS industry, where because of the high level of customer churn, the concept of customer success was created – a proactive approach that works to guarantee a customer receives a tangible benefit from a product. However, SaaS sits at the cross-section of B2C and B2B sales.
Examples of B2C Sales
B2C sales is a highly diverse sector, covering any transaction an individual can make. Consider these examples:
- Buying groceries at supermarkets means choosing food and household items from varied options
- Shoppers try on and buy seasonal or trendy clothes at a retail store
- Subscribing to streaming platforms offers on-demand movies, series, or music
- Ordering from restaurants allows for convenient, tasty, or dine-in meals
- People get haircuts or special beauty treatments at a salon or hairdresser
- Purchasing concert or movie tickets gives access to live or filmed entertainment
- Buying a car from a dealership means choosing based on design, efficiency, or brand
B2C Sales Models
In online sales, there are five broad B2C sales models:
1. Direct Sellers
Like the shops you'd see on the high street, direct sellers are online retail stores where consumers buy products directly from the manufacturer, e.g., Next, Fat Face, IKEA, Amazon, or Adidas. Often, these online stores have brick-and-mortar shops alongside their online presence.
2. Online Intermediaries
Remember when you went to your local travel agent to book a holiday – they acted as the middleman in the transaction. Online, this business model has rapidly expanded, connecting almost any kind of service or product maker with consumers. Common examples include eBay, Airbnb, Etsy, Fiverr, Upwork, and Expedia.
3. Advertising-Based
Some sites provide free content, making their money from businesses buying ads. Technically, this B2B and B2C model has no significant real-world counterpart. It covers the biggest online businesses, such as tech giants like Google, YouTube, Instagram, Spotify (free version), and Reddit or new sites like BuzzFeed and Huffington Post.
4. Community-Based
Creating and monetising a community is a genius way to earn a steady income. Platforms like Facebook allow advertisers to reach users through shared interests or demographics. Other examples include Quora, Clubhouse, Twitch, Goodreads, and Discord.
5. Fee-Based
Charging a subscription for a premium service is a common B2C sales model. It's largely taken over the media landscape. Think Netflix, Disney+, Audible, Spotify (Premium), MasterClass, The Wall Street Journal, or The Telegraph.
Benefits of a Business-to-Consumer (B2C) Model
Compared to B2B sales, the B2C model removes a lot of complexity associated with catering to fellow businesses. Some key benefits include:
- Direct Engagement. B2C businesses interact directly with their end-users. That means they get immediate feedback on their B2C marketing tactics, allowing rapid adjustment to their offerings. Moreover, the deeper brand connection fosters strong brand loyalty – especially given the interaction's more emotional, relationship-oriented nature. In fact, it's not uncommon for a brand to become a part of a person's identity, e.g., a particular supermarket, smartphone brand, or clothing supplier. Certain demographics even associate themselves with brands, e.g., polo players and Ralph Lauren or the Scottish and Irn-Bru.
- Dynamic B2C Marketing. Shorter sales cycles reduce marketing costs and allow businesses the flexibility to alter their pricing based on real-time demand, seasonal trends, and special promotions. Direct consumer transactions, especially in eCommerce, are completed swiftly without the wrangling and negotiations businesses expect.
- 24/7 Model. No matter the time or geographic location, eCommerce stores are always open. Post a product or service to your website, and you'll continue to make sales around the clock. And, with new shipping options, even small-scale companies can have a global reach, tapping into new markets and demographics.
- Less Reliant on a Single Customer. Customers may be fickle, but there are a lot more of them. For smaller B2B companies, the loss of a big client can threaten the entire enterprise. Not so under the B2C model. Plus, eCommerce stores can reorient their business to other markets to compensate for a shortfall elsewhere.
B2B vs. B2C: What's the Difference?
Even if they involve the same people, B2B and B2C sales and marketing couldn't be more different.
Take a buyer for a major corporation: Sarah. In her day job, she negotiates fiercely to secure the best deal for her company.
She reads a business's reports and white papers; she liaises and discusses with the business's sales reps; she conducts internal meetings arguing the pros and cons of the deal; and she performs projections and analyses based on the product or service.
Finally, after months (or even over a year) of toing and froing, her company decided to go with a different vendor. All the effort made to secure the deal was for nothing.
Then, sitting at home that night, she sees an advert for a new delicious double-bacon cheeseburger and buys it instantly. She spends that evening looking for a new dress for an upcoming wedding and picks the one she likes after half an hour of browsing.
That's the difference, in a nutshell.
Let's tease out the distinctions in these interactions:
5 B2C Sales Tips
B2C sales come with some serious challenges. Unlike businesses, consumers tend to be fickle in their spending habits. Brand loyalty can create rock-solid relationships that last a lifetime. However, if the economy weakens, consumers are among the first to cut back on their spending habits. That means B2C companies based around non-essential items struggle.
Targeting the right consumer demographic is a key part of the battle. Previously, mass media meant companies advertising through TV, radio, or newspapers marketed to everyone. B2B marketing and sales nowadays are more precise and personalised.
Consider the B2C sales tips for your next campaign:
1. Know Your Customer
Being primarily emotional, impulsive, and want-driven, B2C companies should develop a deep understanding of their customer's lifestyles, preferences, and needs.
Use customer feedback, surveys, and purchasing histories to create comprehensive profiles, segmenting customers into B2C marketing groups based on demographic or buying factors. For example, if you're a sports brand, learning which customers prefer which sports ensures you don't waste time and money selling golf equipment to an avid runner.
2. Data-Driven Personalisation
Data analytics is a major trend in modern B2C sales. Build a personal relationship with your customers using the information you collect. That could include personalised emails, advertisements, and product recommendations.
According to Campaign Monitor, emails with a personalised subject line have a 26% higher open rate. Indeed, at Trumpet, we take B2C personalisation to the next level, creating an entire microsite auto-personalised to an individual. In this collaborative and trackable space, companies funnel a buyer toward a final sale, educating them about their service, developing a mutual action plan, and even signing an agreement.
3. Rich Content Strategy
Your content strategy will be less in-depth than in the B2B sector. However, videos, blog posts, and interactive demonstrations can educate and attract customers at every stage of the buyer's journey.
Showcase your products and services and deliver informative, compelling content. Not only does this inform and entertain, but it also fosters a stronger emotional connection with a brand.
4. Exceptional Customer Service
You sell two things: your product or service and customer service. Forget the latter, and you'll earn a lot of disgruntled customers. Prioritise an effortless sales journey, including easy returns, loyalty rewards, and responsive support. It can transform one-time buyers into loyal customers.
5. Flexible Payment Options
Bundle complementary products together at a discount to increase perceived value or introduce tiered pricing structures to cater to different customer segments.
Moreover, provide multiple payment methods to remove potential sales barriers, including instalment plans or financing options.
Closing Thoughts
Understanding B2C sales is essential for any business connecting directly with consumers. It's all about adapting to the consumer's ever-evolving preferences and delivering value. In today's digital age, having the right tools and strategies is key to stand out in the crowded market.
Ready to revolutionise your B2C sales? Book a demo with Trumpet today and experience the transformative power of personalised marketing!
