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B2B and B2C eCommerce difference

Lázár Gábor

B2B and B2C eCommerce difference

Digital transformation, the integration of digital technology into every area of business, has changed the landscape for all, including companies dealing in sales

With the expansion of the Internet, eCommerce has become a major player – as a matter of fact, it now accounts for 13,7% of all retail sales, expected to climb up to 17,5% by 2021. This quickly growing industry consists of two branches: B2B - business to business, and B2C - business to customer. Let’s shed light on their differences and similarities.

According to Google, eCommerce means “commercial transactions conducted electronically on the Internet”, which refers to the activity of buying or selling of products or services over the Internet. This goes for both B2B and B2C; however, thanks to their distinct goals, the way this activity is conducted can be quite specific. Let’s see the most significant differences.

The audience:

The first, and the most obvious, distinction is that while B2C targets individual consumers, a.k.a. customers, B2B transactions are completed between two companies. A manufacturer sells to a wholesaler, a wholesaler sells to a retailer, or a retailer sells to an independent company – they all participate in B2B sales. Another big difference in this area is that “B2C brands often strive to reach a broadly defined group of people - sports fans, fitness-minded moms, millennials who are into music”, while B2B eCommerce audiences can be a lot more narrow, like ad agency owners or hairdressers. This, however, doesn’t limit the potential of B2B – quite the opposite. The gross merchandise volume in B2B in 2017 was $7,66 trillion, while B2C reported merely $2,14 trillion – less than a third of B2B.

The average price point and buyer lifecycle:

Hardly coming as a surprise, the average order value is in B2B is much, exactly 3,34 times higher than B2C: B2C averages $147 per order while B2B averages $491. There are exceptions, of course, but in general, a B2C eCommerce brand needs to reach and sell to a lot more people to crack their first million in sales, while a B2B brand with a few hundred customers still generates millions in revenue. B2B buyers also usually buy from the same brand for a very long time, unless new advancements come into play or a competitor undercuts you. As a result, the customer acquisition process takes longer; however, the lifetime value of B2B buyers are way higher than those in B2C. Another difference worth noting is that in B2B markets prices are often hidden until a user creates an account, as well as more negotiable and dependent on future purchase agreements, past buying history, to name a few. Needless to say, this practice is not a characteristic of B2C companies.

The decision-making process:

In B2C eCommerce, consumers make individual decisions, based on emotions and potential benefits of the product or service they intend to buy. These choices are one-on-one customer decisions that usually happen much faster than a B2B sale. On the other hand, B2B decisions are planned for, based on logic and fulfill specific company needs; accordingly, orders are generally placed or, at least, approved by a team. As a matter of fact, in 2015, an average of 5,4 decision-makers were involved in the B2B buying process with a dramatic 26% drop in the purchase likelihood when a second decision-maker was present. This finding also means that at least five people within the organization will see your content: your home page, about us page, product pages, videos – everything. The point in case is that you simply cannot turn a blind eye to investing as much time and energy into creating a painless user experience as B2C brands do.

It is clear that a B2B eCommerce company needs to pay just as much attention to an effortless purchasing process, personalized offers, omnichannel marketing experiences, and many more, as a B2C business does. Liferay Commerce offers a unique solution to handle all your eCommerce needs on a single platform that was built from the ground up to leverage the capabilities of Liferay DXP. From site and content management, pricing and discounts, sales rep support to data integration tools, checkout, shipping, and catalog browsing, you can do everything at one place. Liferay is able to handle the complexity of your business in the background so that your customers can enjoy the simplicity of your unified eCommerce efforts. Request the online demo and try Liferay Commerce for 30 days!