Business To Business (B2B)

Joran Hofman
April 3, 2021

What is B2B? (Business-to-Business)

B2B is an acronym for Business-to-Business that defines a business model in which companies buy or sell a product or service only to other companies. Usually, this type of transaction is used in supply chains, for example, when a company sells raw materials to another company to be used in a manufacturing process.

When planning and defining marketing strategies for the B2B business model, it is important to keep in mind that marketing to consumers is very different from marketing to companies.  To learn more about this, you can see here our blog on how to create a B2B Marketing strategy.

What is The Difference between B2B and B2C?

Buying process.

In the case of B2C (Business-to-Consumer) transactions, the buying process is faster and smoother and involves fewer actors. Usually, the buyer sees the product, is attracted to it, evaluates the cost and availability of resources, and makes the purchase.

On the other hand, when it comes to B2B (Business-to-Business) transactions, the buying process is usually longer and more complicated. There are various B2B sales techniques and organizations can implement, but it is important that they implement the right one for their industry.

A summary of the steps to follow can be: detection of a need, analysis, preparation and approval of the budget, search and selection of suppliers, analysis of offers, negotiation, preparation of the purchase order, award, delivery of the product or service, after-sales. 

Demand and target the public.

The market for the B2C business model is broader than that of B2C because the number of people is greater than the number of companies that exist. Consequently, the demand is different.

In the case of companies that carry out B2B transactions, they depend on fluctuating demand, which is nothing more than consumer demand variation. In other words, if consumers do not buy, production does not take place, and therefore, supplies are not purchased because the companies do not require them.

However, in the B2C case, demand is generally not so variable, it is more stable, and consumers can be captured relatively easily if there is a significant decrease.

Points of sale and distribution channels.

Between B2B and B2C business models, there are differences in how they sell and distribute their products or services.

B2B businesses have physical and online stores and points of sale for consumers to make purchases. On the contrary, in the case of B2C, the distribution and sales channels are much more complex, structured, and sectorized due to the higher volume of sales and the higher financial risk involved.

Marketing.

When marketing, all companies that commercialize products or services have these questions: Who are our customers? Where are they? How can we reach them?

In the case of B2C businesses, marketing focuses on the needs and interests of individuals who conduct business transactions on behalf of themselves or the organization they represent and is conveyed through large advertising campaigns, conventional advertisements, and even individual experiences.

On the other hand, in B2B business models, marketing focuses on the needs and interests of the individuals making the purchase, i.e., directly on the end buyer, and communication ranges from generating detailed content to sending personalized mailings.

Buying cycle and repeat purchase.

For a B2B company, the product or service is purchased in the long term.The possibility of making another purchase may also be long term, so business relationships will tend to be more solid. 

In the case of B2C businesses, the purchase cycle is faster and more frequent. Usually, consumers purchase to satisfy an immediate need, and they may repeat the transaction according to different factors such as quality, price, loyalty, experience, among others.

What is an Example of Business-to-Business?

The B2B? (Business-to-Business) is widely used in manufacturing companies that need to transact with different companies to produce the goods and/or services they offer.

An example of this can be seen in Samsung, which is one of Apple's major suppliers for the production of the iPhone mobile device. Apple also has B2B operations with companies such as Panasonic, Intel, and Micron Technology.

Another recent case where a commercial relationship is established between 2 companies can be seen in the case of Huawei, which, with a market in more than 170 countries in the world, has established an alliance in Europe with the company DHL for the logistics of the delivery of the equipment it markets.

For automotive production, this business model is fundamental because different independent companies produce a large number of components such as horses, tires, batteries, locks, and others. 

The B2B model is not only used for the purchase and sale of goods. It is also used in the case of services. An example is seen in real estate management or industrial cleaning companies that carry out commercial transactions with other companies.

Best Marketing Strategies for B2B.

B2B marketing is a practice that occurs between companies or organizations to promote the sale of a product or service.

In this sense, several strategies can be implemented to reach a specific business audience:

Email Marketing.

The method of doing B2B marketing by email has a high probability of success. Due to its level of effectiveness, it is estimated that today it is used in more than 85% of B2B marketing campaigns.

Among the best email marketing practices are:

  • Optimize the subject line of emails by writing sentences that are eye-catching to readers.
  • It is more effective to make only one call to attention (CTA) to not confuse users.
  • It is recommended to segment emails by type of needs or by stages in which users are.
  • Last but not least, it is important to adapt the design of emails so that they can be seen correctly on mobile devices.

Digital marketing.

With the rise of internet use in the world, all companies must be present on digital platforms through the use of different marketing strategies; here are some of them:

  • Define which audience the campaign will be directed to by analyzing demographic and psychographic location information.
  • Create an informative and eye-catching website for users.
  • Optimize all digital content through SEO tactics to make the company's presence visible to users.
  • Perform PPC (pay-per-click) campaigns that help showcase content and engage new audiences on both search engines and other digital platforms.

Content marketing.

A good B2B content marketing strategy adds valuable information to users, anticipates what they need, helps them find your website, and provides them with a solution that leads them to become customers.

B2B social media marketing.

Nowadays, you can't talk about digital marketing without talking about social networks; this is because currently, more than 53% of people around the world are connected to them.

Social media marketing allows to create awareness of the company's image or brand and to give it a more human aspect; this helps to carry out more effective marketing campaigns and to create a connection with potential or future customers.

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