B2B or B2C: Which Is The Best eCommerce Opportunity?
If you are looking at the many opportunities in eCommerce, you will have noticed a division in the eCommerce space. Some businesses market services to businesses (B2B), and some sell products directly to consumers (B2C). Both of these business models have their advantages and disadvantages.
Before you begin to build your eCommerce business, you need to understand the differences between each and decide which is the best for you. Here is a quick and simple guide to business-to-business and business-to-consumer eCommerce, and how to choose between them before you start up your new company.
Business Or Brand?
When you are offering Business-to-Business (B2B) services, you are entering relationships with other businesses that are not looking for a brand. Consumers are much more likely to look for a brand to identify with and engage with. This is one of the biggest differences between the two business models, and this will impact every area of your eCommerce company.
Business-to-Consumer (B2C) websites will be selling a brand as well as products and services, a B2B website should have a professional look and feel. The content on the site should demonstrate you understand the market, their business, and their expectations.
Whichever business model you choose, the appearance of your website and its performance will be key to your success. It needs to reassure your customer base and give them lots of reasons to keep coming back. This should include a smooth and reliable user experience. The UK’s Shopify Agency Charle can help you build a site that your customers will enjoy engaging with and give your business a lasting first impression.
Many eCommerce businesses think they can get by on website templates and learning some coding part-time. This often leads to failure. Companies like Charle can not only help you create a unique site that gives your customers value, but they can also support you as you grow.
Targeted Markets Or Mass Appeal?
B2B commerce focuses on a specific market. The service you offer businesses should be targeted at a market within the business world. This can be a blessing and a curse. There is a much smaller market for you to promote your eCommerce business to, limiting your options and opportunities. When marketing to consumers you are selling your products or service to a much larger market, increasing your chances of sales. There is a greater amount of competition in this arena, though. It can be harder to have an impact early on.
In business-to-business, it is likely that your services only suit a small cadre of other businesses. This could be marketing companies or tech start-ups, for example. Though this keeps the pool of potential clients small, it does enable you to target your marketing efforts to the demands of these businesses and sometimes to a specific business.
When selling to consumers you are marketing to the masses. Though you will be one fish in a big pond, your advertisements can be much broader and follow trends. This can make marketing much simpler. You will be competing with more eCommerce businesses for consumers, but there is plenty to go around. Business-to-consumer eCommerce sites get more engagement, which leads to sales.
The differences between the two are a little like fishing with a net or fishing with a hook. B2C businesses cast a wide net and try to bring in consumers. B2B businesses need to bait a hook and wait patiently. Once they reel in a big fish, they will have lots of repeat business from them, as long as they provide a valuable service.
Quality Or Quantity?
When you are operating a business-to-consumer company, you will have a lot of customers making small-scale purchases. The opposite is true in B2B, you will be selling your services to a small group of regular customers that buy at a large scale. You can slowly build up your customer numbers from there. There are advantages and disadvantages to both of these kinds of customer bases.
B2B comes with a few risks that B2C does not. If you lose a customer, for whatever reason, it can devastate your bottom line and cause problems across your business. B2C is more flexible, and losing a single customer has less of an impact on your turnover. If you add the wrong product or follow the wrong trend, it can have a big negative impact on your business though. Bear these facts in mind when planning your eCommerce business.
The foundations of each type of eCommerce business are fundamentally the same, but how they operate is different. Choose the one that appeals to you the most, or suits the eCommerce idea you have. It is possible to operate a hybrid model and try to offer products and services to both businesses and consumers. It is best to start with one, however, and make the hybrid model a part of your expansion plans once you get your business running.