Each online store has its own criteria for customers’ segmentation. Creating the segments, we can understand some distinctive features of a particular group of people and determine the specificity of communication with them.
In this article, we will review two segments – B2B and B2C clients, and we will try to analyze some important characteristics of these segments for the e-commerce market.
Understanding B2B Ecommerce Solution
The definitions of B2B and B2C are very simple. If the deal takes place between two companies or businesses, it is B2B. If a product is offered by a company to an individual client, it is “Business to Customers” relationship or B2C. The table below shows the main distinctive characteristics of these two segments.
Further, we will review some of the features in a more detailed way.
The principal difference between B2B and B2C is that for B2B client the decision-making processes can be long, complex and can involve several people. Moreover, the decision-making criteria for each of the participants may be different, and each of them can pursue their own goals. This fact makes the process poorly controlled. In order to be able to influence the situation, it is important to know the roles of all participants in the decision-making processes. They can be as follows:
- The initiator of the purchase who says that the product is needed
- The person who is responsible for finance and will approve the budget
- The researcher, the one who will collect information of possible proposals on the market and prepare a presentation
- Point of entry – the person who is responsible for communication between the company and the online store.
- The user who will use the product
- The person who can help and participate in the process of communication (secretary, courier, etc.)
All these roles are not necessarily present in the decision-making processes and are represented by different people. But it is important to organize the effective work with the person who is the “point of entry” and try to clarify all the information about roles and the number of people who are involved.
By the way, this approach will be useful for B2C customers. For example, in a family, the initiator of purchase can be a wife, but a husband should approve the budget. Very often customers can say that they need to ask somebody. In this case, you can offer your help, ask for contact information of a person who will also make a decision and send some additional information to convince them that your offer is good and beneficial.
The peculiarity of Buying Process in e-Commerce
Regardless whether B2B or B2C customer is buying something, the purchase in an online store is usually made by one person. For B2C it is ok. But for B2B it can be dangerous because the important information can be lost. To understand why it is a problem, we’d like to present a real example of one of our clients.
The online store specializes in the sale of office supplies, and there was one client who ordered more than other companies.
Of course, the online store always tried to satisfy this company and considered them as a VIP client. Suddenly, this company stopped buying and did not place orders for a few months. The managers of online store tried to find out what happened. It was determined that they always communicated with one person – a secretary, who made the purchase of office supplies in the online store.
The company changed the secretary and there were no other contacts for communication. The managers of this online store had to re-establish relationships with this company, and they discovered that all orders were formed by the Managing Director of the company, and the secretary bought what he said to buy, but she chose the online store and nobody cared what store she preferred. The main task was that everything should be delivered on time.
In real life, a lot of online stores that work on the B2B market, have a short and easy purchase process. If the product is not expensive and its necessity is obvious, the buying decisions are not so complex. Merchants communicate with customers very rarely, only in case of any problems.
This is absolutely fine.
But it is essential to remember that the clients’ database of the online store contains only a contact person who passes the registration process, creates an account and places an order in the online store. This person is only a buyer and may be a usual manager and not a decision-making person. So, it is necessary to identify the VIP customers, get more information about them and have several contact people with whom the relations have been established.
Communication with the Clients
Lack of information about the customer can lead to misunderstandings due to lack of clarity. Let’s review one more real-life example.
Electronics Online Store.
The sales manager of this online store was bothered by one young lady who called several times. At first, she asked about some features of Canon EOS 700D then she was interested in the discount for Apple MacBook. Once she asked if the iPad Apple A1567 was available and finally she wanted to find out the colors of Samsung Galaxy S6 which were in stock.
Of course, the manager decided that she was a crazy lady who did not know what to choose. But later he discovered that this lady was an HR manager of one company. She was responsible for a corporate event and had to prepare gifts for the staff. It was a task of a director of this company, and these gifts were to be given to valuable managers, so the process of selection was very thorough.
This example shows that at first, the manager considered this lady as B2C client, but when he got more information, he realized that it is a typical B2B client and could understand the strange behavior. For this online store, it was unexpected, because 95% of its clients are B2C customers.
Communication with clients gives a lot of useful information and it is important to collect and analyze it. A CRM system can help a lot. It allows organizing all contacts of each B2B client, keeps the history of communication and controls the process of cooperation.
In conclusion, we can say that a B2B client is like several B2C who are “combined” in one purchase. It can be considered as a complexity or a threat, but on the other hand, it is an opportunity to sell more.