B2c Vs B2b

Marketing Differences with B2B vs B2C

Courtney Spencer

March 19, 2007

eBusiness/ MGT 448

Keith Hopkins

Introduction

The array of eCommerce tools that are being introduced daily are evolving at a dizzying pace and are having a profound effect on the way organizations create value (Retooling).

The benefit of interactive technologies like the Internet and the Web has been immediately recognizable in the consumer space, where business-to-business (B2C) enterprises have always had to use strategies of relationship building, gathering and analyzing feedback and customizing products to fit consumer needs. What is becoming just as clear, however is that account management in the business-to-business (B2B) space, like consumer portfolio management in the B2C space is equally essential. Companies that provide products/services to other companies cannot afford not to engage and utilize this resource (Peppers,D.).

What is B2B?

Business-to-business eCommerce covers everything from Bob setting up a web site to advertising his auto body shop to General Motors using Web technology that permits customers to purchase an automobile tailored to a customer's taste to Ford employing an enterprise-wide resource tool to acquire the direct goods (components used to produce a finished goods such as engine blocks, axels and A/C units) and indirect goods, items such as office supplies, PCs, paper, pens and spare parts (Retooling).

One of the fastest growing sectors of eCommerce is business-to-business transactions. B2B eCommerce tools enable new kinds of relationships and provide new incentives and business models for what were once strictly buying and selling relationships. With B2B, business partnerships are strengthened and the relationship of partners is literally transformed from supplier/customer to true business partnerships where they collaborate at the same level on the value chain (Retooling).

For example, Nike does not manufacture a single pair of shoes, but rather engages manufactures as production partners so that Nike can focus on its core competence of marketing and distribution. Production partners invest in research and development to deliver new shoes based on the market insights Nike shares with them. It is B2B eCommerce that provides the platform for exchanging this kind of data.

B2B revolves around businesses working together with vendors, distributors, and other businesses using Web technologies and Internet sites (Retooling).

What is B2C?

Business-to-consumer eCommerce has enabled businesses to change their marketing and selling techniques in a number of ways. Much of this is being done through new marketing techniques that include customizing a mass produced product to meet the needs of a customer's individual needs; conducting market research to understand what the customer is really looking for; and obtaining a targeted audience through customer information (Retooling).

The most elementary form of business-to-consumer is the eCommerce grocery cart type model. At these types of sites the online buying is done by filling up a "virtual cart" and taking it to the check out. Amazon.com is the most recognizable example of a private sector site using the shopping cart model. Beginning as an online book retailer, it now sells videos and many other goods (Retooling).

The next level of B2C eCommerce is the "value-added" site, which provides more than just the opportunity to purchase goods or services. Even if the user cannot directly purchase goods from the site, these companies offer the opportunity for some added value to be obtained from their websites. An effective strategy for many of the larger established brick-and-mortar firms who are using B2C eCommerce is to allow their customers to tailor a product to their specific needs and receive special services. For instances, Federal Express's customers can track their packages through the FedEx site or determine the location of the nearest drop-off point and then obtain driving directions to that location. Another example is Gateway Computers'