How B2B Product Marketing is Different from B2C
I read a great post from Gopal Shenoy this week about how B2C product marketing is different from B2B. I’m a B2B marketer so that got me thinking about writing a post in the reverse.
Here’s how I think B2B product marketing is different from B2C
1/ Channels are important (sometimes critical) – Most B2C companies sell direct. B2B is often through channels or a mix of channel and direct. The channels can be single or multi-tier and you will need to figure out how to price for these channels, enable and train them, incent them and ensure that there is as little channel conflict as possible. This is not easy.
2/ Long term customer relationships – Many B2C companies talk about “building customer relationships” like it’s a new thing and that’s because for many B2C companies it is (with the exception of SaaS-based B2C services where churn is a major metric). On the B2B side, there are fewer customers and often you will live or die by your long-term relationship with that customer. That means you will often have dedicated teams assigned to larger accounts.
3/ Tiered customer service – Because those long-term relationships are important, customer services becomes absolutely critical. Of course service is important on the B2C side as well, you don’t often see differences in the way you serve customers. On the B2B side there is quite often a massive difference in the way you service a very large account vs. a very small one.
4/ Purchasing teams – For larger-ticket items there will be a number of people and groups involved in a purchase decision including business leaders, IT, purchasing, legal, etc. Closing a deal often means working it across all of these different functions who often have very different requirements.
5/ Users vs. Buyers – This is a big one and in my opinion the reason why so much Enterprise software sucks as far as the user experience goes. Often users have little say the purchase process of enterprise systems. This is particularly true when the sale is IT-driven. As a result, factors such as how well a system integrates with the current IT environment are often much more important purchase drivers than how difficult a product is to use. Yeah, for some functions users are starting to bring consumer services into the environment without going through IT but that’s still more the exception than the rule today.
6/ Deals are almost always competitive – Most companies have rules around putting projects out for bid if they are larger than a certain size so for big deals you will almost always be in some sort of a bake-off against a competitor. Your ability to stack up against them on a feature by feature basis makes a difference and how well you can roll out and execute a proof of concept will be important too.
7/ Longer sales cycles with distinct stages – Nobody goes online and whips out their credit card to buy a million bucks worth of accounting software (not now anyway). The cycles are long and the sales and marketing support required at each step of the deal is distinct and needs to serve the function of getting the prospect over the hurdle to the next stage of the deal.
8/ Sales Costs are High – Big deals are great when you close them but they don’t close quickly. You are often going to have to invest a ton of time and energy getting a big deal to the final stages including some sort of proof of concept that you may or may not get paid for. If you close the deal, it was all worth it, if you don’t, well, you better hope you are working on more than one deal.
9/ Politics can be a major factor – Anyone who has sold large enterprise deals will have a set of horror stories about how a new CIO came in a replaced a bunch of perfectly good systems with new stuff because “he was an Oracle guy.” CIO’s are risk adverse (they tend to get fired pretty quickly if things don’t work) and they tend to work with the same vendors over and over again. Sometimes they are pals with the vendors or get rewarded by those vendors for being such a loyal customer. There’s a lot of golf being played for a reason.
There are probably 100 other things but you get the idea. Did I miss any big ones? What do you think?
Category: Product Marketing
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How B2B Product Marketing is Different from B2C http://bit.ly/jUFUN1
How B2B Product Marketing is Different from B2C http://bit.ly/jUFUN1
RT @Pitch_Doctor How B2B Product Marketing is Different from B2C http://bit.ly/jUFUN1
Two additions others have surely noted: 1) Complexity of the sale, with the need to take into account existing infrastructure, training, corporate culture, deployment and testing time, etc. and 2) long sales cycles, as companies work through and consider all the issues noted in 1). All of which makes the need for informative content that LOOKS AHEAD to the customer’s long-term experience and total cost of ownership all the more important.
Thanks Bob – great points.
April
RT @jchernov: How B2B Product Marketing is Different from B2C http://j.mp/ktxreg .
Blog post: How B2B Product Marketing is Different from B2C http://t.co/691p71Z #b2b #prodmgmt #prodmktg
How B2B Product Marketing is Different from B2C | Rocket Watcher … http://bit.ly/lNU5as
How B2B Product Marketing is Different from B2C | Rocket Watcher … http://bit.ly/kJPfiO
How B2B Product Marketing is Different from B2C @rocketwatcher http://ow.ly/56Jzf
RT @aprildunford: Blog post: How B2B Product Marketing is Different from B2C http://t.co/691p71Z #b2b #prodmgmt #prodmktg
How #B2B Product Marketing is Different from B2C http://t.co/691p71Z #prodmgmt #prodmktg RT @AIPMMmx @aprildunford
How #B2B Product Marketing is Different from B2C http://t.co/691p71Z #prodmgmt #prodmktg RT @AIPMMmx @aprildunford | RT @GlenGilmore
“Most B2C companies sell direct. B2B is often through channels or a mix of channel and direct.” Somehow my picture is different. When we talk B2C in software I think about Office and software for taxes…and they are sold through channels & retailers. Whilst large enterprise systems are sold directly in the country where the company is located, and either directly or through partnerships internationally. What is your picture, Bob?
Hi Samantha,
I didn’t mean to say that all B2C companies sell direct – there are many that don’t and those are good examples. Ditto for large enterprise – in general it’s a mix but some sell only direct. For example I ran marketing for a suite of database products for IBM and we sold mainly direct in but also through OEM, distributors and VAR’s in North America.
April
How B2B Product Marketing is Different from B2C http://ow.ly/5hUmp So true and so misunderstood esp in social media
How B2B Product Marketing is Different from B2C http://ow.ly/5hUmp So true and so misunderstood esp in social media
Great points. But don’t you think that Enterprise business getting into on-demand model many of the points talked in B2C world are somehow becoming relevant in Enterprise. Rather I can say with on-demand offering from Enterprise companies, the line of demarcation between B2B & B2C is getting thinner like channels,partnering is fading away. Also I was wondering how does Web analytic which is used heavily in B2C world become relevant in B2B rather on-demand Enterprise offering ?
Hi Suresh,
Very good point! For sure, an on-demand model changes some things in the model but not everything. For example, you will still have an outside sales force for larger deals and you might still need to do custom integration work and development which for larger deployments will usually involve a services partner. When we look at enterprise software for larger businesses, the vast majority of those looking at cloud are doing private cloud deployments. From a purchasing perspective that looks very much like a traditional deployment where you would have channel partners, long sales cycles, etc.
Then there are other facets that aren’t changing even when you have completely vanilla SaaS deployment – longer sales cycles, multiple purchasing groups, etc. It’s still a large commitment for a company so you aren’t typically going to have a single person buying with a credit card. Someday we will get there – but we are a way off from that yet.
April
How B2B Product Marketing is Different from B2C | Rocket Watcher: Product Marketing for Startups http://htl.li/5qxcr
On the flip side, post by @AprilDunford on "How B2B Product Marketing is Different from B2C" http://ow.ly/5BXQO
How B2B Product Marketing is Different from B2C #pmv
http://t.co/HUnXp94
How B2B Product Marketing is Different from B2C by @aprildunford http://t.co/Rv795ms #rocketwatcher
How B2B product marketing is different from B2C http://t.co/8K3WRST #learningMarketing
The B2B buyer is more likely to have a split personality.
If you reach someone on social media (or at a party) and talk to them about something B2C, let’s say running shoes, they can respond to you as themselves. “I hate those shoes because they pinch my feet and the colours are boring!”
If you then ask them about their enterprise software system, there will be an almost imperceptible moment of silence as they assess whether you’re in their circle of trust. If not, the answer you get will be through their corporate CxO alter-ego. And you have to develop the sense of when this is happening to you.
This might be a sub-case of your “Politics” bullet, and I think it’s one of the reasons why social media for B2B is easy to get wrong.
RT @aprildunford: How B2B Product Marketing is Different from B2C http://t.co/cbwvmBjo
Interesting article on B2B vs B2C. Nos 2,3,4 & 6 particularly resonated with me http://t.co/SnI6EDkH
How B2B Product Marketing is Different from B2C by @AprilDunford http://t.co/NzLLYKHO
How B2B Product Marketing is Different from B2C http://t.co/dLE3wgpS by @AprilDunford @NickWAllen … nice review of the topic.
How #B2B Product #Marketing is Different from #B2C http://t.co/5pXZPhll via @aprildunford ^EH
How #B2B Product #Marketing is Different from #B2C http://t.co/5pXZPhll via @aprildunford ^EH
RT @aprildunford: How B2B Product Marketing is Different from B2C http://t.co/ApPAtT8F
How #B2B Product Marketing is Different from #B2C http://t.co/NcgNpr7G via @aprildunford
Not just for startups – How B2B Product Marketing is Different from B2B|Rocket Watcher: Prod Mktg 4 Startups http://t.co/qiYY1EVv
How B2B Product Marketing is Different from B2C via Rocket Watcher: Product Marketing for Startups http://t.co/OwbOd6Vw
hahaha…"There’s a lot of golf being played for a reason." http://t.co/rp9NaE7M
RT @aprildunford: How B2B Product Marketing is Different from B2C http://t.co/XAETPCBP
Una cosa es armar el #marketing de un producto pa vender a Usuarios Finales y otra es pa vender a Gerentes de IT, OjO > http://t.co/xOPxwmR0