B2B2.. wait, there’s more?
While traditionally businesses may have fallen into either B2B or B2C models, there is another business model that has taken more dominance in our digital-first age: B2B2C.
What is B2B2C?
B2B2C (business to business to consumer) is an e-commerce model where businesses access customers through another business but are able to interact directly with customers under their own brand.
B2B2C differs from a channel partnership in that customers are fully aware that they are buying from the business. However, this does not mean that the middle man is entirely cut out. Rather, both parties work together to serve the end customer, a win-win situation.
What are Some Examples of B2B2C Business Models?
- Instacart is a startup that allows customers to mimic a grocery shopping experience, directly from their website. Grocery stores don’t typically offer this service, since it requires significant technology and staffing investments. But now grocery stores are able to partner with instacart to reach more customers.
With this business model, Instacart is able to leverage the brand recognition, existing customer base, and inventory of existing grocery stores, and the grocery stores get to take advantage of Instacart’s technology and resources. But ultimately, customers are able to easily purchase the groceries they need, without needing to even step into a store.
- Pladur, the leading drywall provider in Spain, wanted to differentiate itself from the increasing competition in its sector. So they created a B2B2C e-commerce platform where employees, distributors, and customers were all on the same solution. Not only are customers able to purchase easily online, but since everything is connected, logistics and warehouse management is simplified, significantly reducing lead times in order fulfillment processes.
- Tuff Shed, a manufacturer of storage sheds and garages, has stores across the US but is also in national retailers, such as Home Depot. Customers can access Tuff Shed’s online product builder through devices located in Home Depot stores. Even though customers are shopping through Home Depot, Tuff Shed retains its branding through the devices and is able to directly collect customer information.
Why Are Businesses Shifting to B2B2C?
Trying to scale operations and handle increasing orders alone is becoming more challenging. That’s why many B2B companies are choosing to partner with other businesses through a B2B2C model.
Benefits of a B2B2C Business Model
Have a 360-Degree View of Customers
Businesses are now able to gain access to customer data and information where previously impossible since traditional B2B companies had no visibility to the end customers.
They can then use this information to fuel more personalized offers and solutions, ultimately providing customers with a better digital experience that will keep them coming back.
Reduce Operational Costs
One of the main benefits of B2B2C includes being able to decrease overhead by eliminating costs associated with logistics. Additionally, entering a new industry or delivering a new solution requires a large amount of capital, but B2B2C partnerships can help reduce these costs by sharing it across multiple businesses.
Grow Revenue Opportunities
Alongside cutting costs, many businesses that pursue a B2B2C business model can expand their potential for economic growth. Partnering with other businesses provides opportunities to enter into new markets and reach more customers, without needing to shoulder all the burden.
Retain Control Over Their Branding and Pricing
Often with a B2B model, businesses have less control over how their solutions and products are positioned and sold. Most times even losing their brand identity in the process so that end customers aren’t even aware who they are buying from. But through a B2B2C model, businesses are more directly involved with the end customer and are able to have more of a say in both the price and presentation of their products.
What's the Challenge with B2B2C?
With all these benefits, why isn’t every business pursuing a B2B2C business model?
The main challenge holding businesses back is balancing the demands of both customers and business intermediaries. If it’s difficult for businesses to deliver excellent experiences to their partners, it’s only exacerbated once end customers are added into the mix.
On top of customers wanting personalized and seamless purchasing experiences, businesses will also need to balance partners’ needs and requirements for effective selling.
For businesses that want to move to a B2B2C model, they’ll need to invest in a robust ecommerce platform that is not only able to sell directly to customers, but also able to integrate with business solutions to empower intermediaries with the information and tools they need to be a key player within the ecosystem.
Start Delivering Excellent Ecommerce Experiences
Ready to start delivering better online buying experiences? Then you’ll need to make sure your solution excels in:
- Self-Service Account Management
- Order Management
- Buying Experience
- Product Content Experience
Learn more about each of these capabilities by downloading this ebook.