Sales is a process where systematic approach makes difference and matters the most. The more systematic you are in terms of your sales strategy, the greater your success will be – that’s the rule tested by numerous people throughout decades. Different types of sales do have broad differences, though. It begins with different approaches to commercial relationships, different target audiences and ways to work with them, and ends with specific of sales funnel and sales cycle. So, what is the difference between four main areas of sales – B2B, B2C, B2G, and C2C, and what are the main things to know about all these sales types?
Each of these sales segments have different types of internal processes, different types of customers, different methodology and techniques used to close deals. Nonetheless, all of them are united with one single principle – you have to sell as much as you can, and that’s the only way to success.
B2B – “business to business”
As it follows from its acronym, B2B selling and B2B model at all refers to “business to business sales”, which means both seller and buyer are enterprises. This relates to all fields of doing business: not only selling goods and services, but also providing outsourcing services. There is also no limits in B2B sector for company size to do business with each other – both large enterprises can supply small family businesses, while those large enterprises can also purchase from small businesses, even though second option is rarer to meet with. In most cases, B2B businesses are aimed at resolving business problems for other companies: for instance, software development companies provide solutions for other businesses to optimize or automate their business operations. B2B market segmentation also means high competition.
In B2B companies, it is important to remember that:
- The main driver of a purchase in this industry is to resolve a specific business issue that requires either specific tool, or professional approach and assistance. Thus, marketing strategy in B2B is mostly focused on business problem solving and specific issues businesses suffer from;
- The industry is highly competitive, and the number of potential customers is limited, so it requires a tailored approach and individualized marketing strategy to convince potential customers to choose you as their partner. Also, B2B business has higher requirements to such things as quality of your product or service and their reliability;
- B2B business can be very profitable as it has some super-marginal niches, where one deal can cost more than a thousand of deals in B2C;
- B2B market segmentation is another thing to take into consideration, including wide range of specific niches it has;
- Key challenge in B2B business model is to build trustworthy relations between B2B counterparts and to succeed in B2B marketing, where B2B brands face tough competition for the customer.
B2C – “business to consumer”
B2C is an acronym for businesses that sell goods and services to customers for personal use. B2C customer segmentation is the widest for each B2C segment. It can be a large hypermarket, a small hairdresser, or a consulting center. The industry includes retail outlets, food outlets, consumer services (from car rental to beauty salons), and e-commerce (paid online services, online stores, etc.). B2C refers to businesses that sell products directly to consumers for personal use. Such businesses are everywhere: from a small grocery store right at that corner to a huge hypermarket that sells almost everything.
Specifics of selling B2C businesses:
- One of the most important things regarding B2C sales is that you can either sell goods that are must-haves for people (above-mentioned groceries, etc.), or sell some goods that are purchased impulsively, not by need – that’s why sometimes rationality doesn’t work here. Also, B2C transactions are faster than in the case of B2B transactions, and B2C has shorter sales cycles.
- You have to understand that B2C sales are more about universal needs, than someone highly individual wishes, as such businesses often sell generally needed products. It doesn’t eliminate the need to focus on customer service personalization though.
- To win the competition in such high competitive field as B2C industry, you have to invest in customer service and in quality of your goods – personal trust and regular customers will determine your success.
New types
B2G – “business to government”
B2G isn’t a new type of sales or business, it is as old as world, but it do differ significantly from other sales segments, at least because government supplies have high requirements to suppliers. To become successful in this field, you have to meet this requirements, but if you do, it is a great field to get stable contracts and grow your business.
Such commercial relations have a number of specific features:
- tender contracting system which doesn’t exist in public sectors;
- complicated decision-making process that can consume months or even years;
- very stable business relationships;
- administrative resources involvement – government agency, government entities, etc;
- difficult financial processes.
The interaction between the state and business occurs primarily through procurement, where the state takes the initiative. Public-private partnerships also play a significant role, addressing complex socially important tasks by involving businesses in various government projects.
A key strategy for success in this domain is to collaborate with a specialist well-versed in the intricacies of public procurement and experienced in organizing the interaction between business and the state. This involves activities such as gathering information on upcoming procurements, identifying tenders, and preparing accurate applications. The fulfillment of obligations in this context demands meticulous attention and a strong sense of responsibility.
Despite the challenges associated with B2G transactions, such as dependence on employee qualifications, bureaucratic processes, and reliance on uncontrolled structures, there are notable advantages, including:
Clear Algorithm: The ability to work according to a clear algorithm streamlines processes.
Long-Term Planning: The potential for long-term planning provides stability.
Large Orders: The opportunity to engage in significant projects with substantial orders.
Consumer-to-Consumer (C2C model)
The consumer-to-consumer relationship pertains to both online and offline sales where individuals, not officially recognized as entrepreneurs, act as sellers and buyers. C2C transactions involve a rapid interchange of roles between the buyer and the seller.
Similar to Business-to-Consumer (B2C), C2C shares certain characteristics:
Personal Use: Purchases are made for personal use.
Small Average Check: Transactions typically involve modest amounts.
Numerous Customers: A high volume of orders with a diverse customer base.
Targeted Advertising: Advertising efforts focus on specific consumer groups within the unlimited group itself.
Third-party intermediaries, such as online platforms, print and electronic media, and auctions, often facilitate these sales:
Online Platforms: Individuals use these resources for one-time or systematic selling, with platform-specific limitations.
Print and Electronic Media: Newspapers and classified magazines publish seller offers for direct buyer contact.
Auctions: Intermediaries not only facilitate sales but also provide additional services like goods appraisal, sales support, and security.