B2B is the business model in which commercial exchange occurs between companies. Find out now what it consists of and what its benefits are.
Surely, this is not the first time you have come across the term B2B , even more so if you run a business dedicated to providing products and solutions to other companies.
It is true that, in the business world, when we look for innovative alternatives to optimize our sales , we usually come across terminologies that, at first glance, may seem complicated.
However, the logic behind B2B is not only quite easy to understand, but it can also bring important advantages to your company, especially if you are thinking of betting on electronic commerce or B2B ecommerce.
What is Business-to-Business (B2B)
B2B means “business to business” and, as its name indicates, it refers to a business model in which the exchange of goods or services occurs between two companies.
For this reason, it is very common to associate the term B2B with the trade that occurs between producers and distributors of a product. However, it can also be solutions that a company designs for others to optimize their sales.
In a nutshell, in B2B business the actions are focused on the commercial relationships between companies.
B2B vs B2C: What’s the Difference?
The other side of the B2B business coin is the B2C or consumer business model.
From the name we can already guess that the main differences between B2B and B2C channels lies in the type of client each one is aimed at, but there are also other aspects to consider:
1. Types of Customer
As we have said before, B2B is a model of trade between companies , that is, the end customer is another company. In this case, what is sought to highlight is how the goods and services offered are useful to generate new sales.
In contrast, in the B2C business model, the strategies are aimed directly at an end consumer. Here, the idea is to highlight the immediate benefits that a product or solution will have on people.
2. Market size
Being aimed at other companies, the number of potential customers of B2B businesses is smaller than that of B2C businesses, although the sales volume is greater.
This means that the market for B2B companies is easier to identify.
In contrast, the B2C business market is more massive and generalized, which is why audience segmentation is used as the main strategy.
3. Purchase process
In the first model, businesses or B2B buyers evaluate their purchase with much more time, carrying out a rational and detailed analysis of their budgets and true needs.
On the other hand, in B2C companies, the purchase process is much more agile since the consumer bases his purchase decision , mainly, on his emotions. Therefore, many of these businesses aim to generate brand loyalty.
4. Sales process
B2B companies should not only aim to sell solutions, but they should also instill confidence in their future customers. In addition, since confidential information from other businesses must be handled, the initial sales cycle is longer.
B2C sales, on the other hand, are much faster because, as has already been said, the consumer acts more impulsively . The strategy here is to convince that the product or service offered is the one he or she needs.
5. Brand value
When working with other companies, B2B businesses must manage a higher brand profile, because here there is a higher investment cost and the purchase decision implies evaluating many factors and constant consultations.
Meanwhile, in the B2C case, the valuation of the brand is not so decisive, since individual consumers seek an immediate solution to their needs and tend not to repeat the same purchase, unless they are loyal.
Although these are some of the characteristics that distinguish B2B and B2C channels , we must not forget that in both cases the products and services offered will at some point reach the hands of a particular consumer.
Benefits of Selling on a B2B Marketplace
The first thing you should keep in mind is that B2B ecommerce already represents a benefit, since it is a new sales channel for your company and, therefore, an additional source of income.
1. Large Spectrum Market
The online selling provides great area that covers all the aspects of business and delivers opportunities to uplift the sale graph. It has a well-managed audience that trusts b2b online marketplace hence; there is not even slightest communication gap between the buyers and sellers.
The ecommerce marketplace is a big pool that holds target customers waiting for the best offer and service. It is the wide lens that shows you bigger audience. By giving the best product and facilities the brand’s history can be established, and once that happens that means your company has already got dedicated buyers
2. Ecommerce marketplace comes with great profits
The b2b buyers have to go through the huge buying cycle which means consulting with different departments before purchasing the goods. In the case of online selling, it is convenient that process of purchase gets fit into quick way of selling, and purchasing the specific product.
The more sales in the span of less time means good growth and revenue. Once the buyers are aware about the brand providing quality, they develop trust with the company which helps rise in conversion.
3. The safe zone
In the business to business model the most concerning thing is safety with deals as it has high amount of contracts mostly. The ecommerce marketplace takes responsibility of safe dealing.
It assures from both buyers and the seller side that specific brand has this reputation and the client’s funds will be transferred into the firm’s account guaranteed.
It is also the reason why most of customers and wholesalers use marketplace.
4. Ease the marketing cost
In the business to business selling, the advertising cost is massive as it has activities that cause lots of engagement with the buyers and decision makers. The product or services are promoted in offline seminars, meetings. Etc.
But the online marketplace, benefits the sellers as most of the process gets done including the communication between two corporations. It happens through the software. It saves the finance and time. The marketplace has its own shipping team that manages the delivery.
5. Brand’s history and awareness
The most influential thing about selling b2b services through online marketplace is that it records your brand’s history and once your enterprise has become successful providing the excellent material to the buyers. It will create the company’s status.
The other people will recognize your brand’s worth by the ratings. The higher ranking means making your place worthy. The newcomers and devoted customers buy the services by checking the marks and reviews of previous buyers.
