January 6, 2017
5 Key Differences Between B2B and B2C Marketing
Recently, we surveyed more than 500 marketing decision makers to find out where marketers were investing, winning, and failing. Along the way, we discovered 5 intriguing ways B2B and B2C marketers differ.
How do B2B and B2C marketing differ?
1. Their Priorities and Tactics
One way B2B and B2C marketers differ is their priorities. According to our research, B2B marketers prioritize brand awareness (43%), while B2C marketers prioritize customer satisfaction and retention (46%). These priorities have a significant influence on the preferred tactics of B2B and B2C marketers. While B2B marketers first invest in producing brand assets, B2C marketers are focused on welcoming and onboarding new consumers. What drives these differences? Building strong customer relationships is key to success in the B2B market. That’s why communicating a strong brand identity is essential for B2B marketers: Because it helps customers form a bond with the brand. By investing in brand assets, B2B marketers are able to generate and nurture leads while successfully differentiating their brands from the competition. Consumer-facing brands have thinner margins, making every customer critical to profitability. That’s why B2C marketers prioritize customer satisfaction and retention. By focusing their energy on welcoming and onboarding new consumers, B2C marketers provide a first class customer experience that helps keep consumers engaged.
2. Their Challenges
B2B and B2C marketers also face different challenges. While both B2B and B2C marketers struggle with budget constraints, B2C marketers (41%) list it as their top challenge. In contrast, B2B marketers primarily struggle to convert leads into sales (60%). What drives this difference? Because B2C companies have thin margins, decision makers may be reluctant to approve budget increases—forcing B2C marketers to work within constrained budgets. B2B marketers, in contrast, are under pressure to supply their sales team with a steady stream of leads. Why? Because B2B companies sell higher ticket items than their B2C counterparts—resulting in fewer, more lucrative clients as well as a longer and more complex sales cycle.
3. The Channels They Use
Another way B2B and B2C marketers differ is the channels they use. While both B2B and B2C marketers cite email as their primary channel, B2C marketers (30%) are nearly twice as likely as B2B marketers (18%) to use direct mail. What drives this difference? Direct mail campaigns are known to outperform digital campaigns, in part because so little mail is sent, making it easier to capture the attention of the recipient. So why are B2C marketers more likely to to use direct mail than their B2B counterparts? B2C marketers may have an easier time targeting their desired audience. Whereas B2C marketers often target specific individuals or households, B2B marketers target everyone who influences and/or makes decisions on behalf of a business—a group that’s not always easy to identify.
4. Their Use of Customer Data
When it comes to customer data, B2B and B2C marketers take different approaches. According to our research, B2B marketers (80%) are nearly twice as likely as B2C marketers (41%) to leverage predictive intelligence to create a personalized customer experience. What drives this difference? B2C marketers often target several unique, but large, customer segments, such as “Millennial Moms” or “Retired Boomer Dads”. In contrast, the importance of maintaining strong, long-term 1:1 customer relationships in B2B makes hyper-personalized communications a must for B2B marketers. This is one reason why B2B marketers are investing in predictive analytics, because it allows them to build detailed customer profiles based on their demographic, engagement, CRM, and event data that can be leveraged to customize offers for each individual client. Autopilot helps marketers (like you) automate the process of personalizing communications by accessing these customer profiles on your behalf. The result? Highly targeted, personalized messaging that runs “on autopilot”, allowing you to spend your time elsewhere.
5. Their Impact on Revenue Growth
How much impact can a marketer have on revenue growth? Apparently, it depends on their target market. Overall, B2B marketers have a bigger impact on the bottom line than B2C marketers. That is, B2B marketers (35%) grow year-over-year revenue by 250% more than B2C marketers (10%). B2B high performers also have a bigger impact than their high performing B2C peers. In fact, B2B high performers (55%) grow year-over-year revenue by 62% more than B2C high performers (34%). Having said that, B2C high performers stand out from the crowd more—growing year-over-year revenue by 240% more than their B2B peers. What drives these differences? One simple explanation is that B2B purchases are simply worth more than B2C purchases, resulting in higher revenue growth—even when an equal number of new customers is acquired. But why do B2C high performers find it easier to stand out amongst their peers in comparison with B2B high performers? Perhaps because it’s more rare for B2C marketers to innovate on a day-to-day basis. B2C companies are often larger than B2B firms. Because smaller firms tend to have less bureaucracy, B2B marketers may find it easier to take risks. Thus, when a B2C marketer is successful in adopting innovative tactics, it may make a bigger difference. Why do you think these differences exist? Share your thoughts in the comments.