What are some of the best practices for segmenting B2B markets versus B2C markets? (2024)

FAQs

What are some of the best practices for segmenting B2B markets versus B2C markets? ›

For B2B markets, segmentation often focuses on industry, company size, and role of the contact. It's about understanding business needs, buying process, and decision-making hierarchy. In B2C markets, segmentation is usually based on demographics, psychographics, behavior, and geography.

The main difference is that B2B segmentation tends to focus more on organizational factors, such as industry, size, location, decision-making process, and budget. B2C segmentation, on the other hand, tends to focus more on personal factors, such as demographics, psychographics, lifestyle, and preferences.

1 Firmographic Segmentation. Firmographic segmentation is the most common and widely used method of B2B market segmentation. It involves grouping businesses based on their demographic and organizational attributes, such as industry, size, location, revenue, structure, and ownership.

The main differences between B2B and B2C

B2B companies prioritize tactics to capture qualified leads, provide continuous answers in the sales funnel, and offer dedicated support. For B2C, tactics emphasize capturing active consumers, encouraging quick purchases, and offering efficient customer service solutions.

That is, recognising that different groups of customers have different needs and therefore need to be targeted with a specific marketing plan. Therefore, segmentation is a vital component of any successful marketing strategy. Segmentation can be approached in three main ways: firmographic, behavioural and needs-based.

B2C segmentation is based on identifying and grouping consumers according to their demographics, psychographics, lifestyle, and buying behavior. The focus of Business-to-Business approach is different from that of Business-to-Clients. The expectation, target audience and model of operation is important to consider.

The 4Cs, however (Content, Connection, Communications, Conversion), illustrate the marketing mix for B2B.

Demographic segmentation is often the easiest because the information is the most readily available. You can send surveys directly to customers to determine their demographic data, or use readily available third party data such as government census data to gather further information.

Why is B2B better than B2C? ›

Most B2B markets have tens, hundreds, or thousands of potential buyers… not millions as is common in B2C markets. If your market is highly concentrated (just a few buyers), engage a large % of the market buying power in customer interviews. This “primes” these big customers to buy later.

B2C e-commerce targets personal consumers. A company that sells office furniture, software, or paper to other businesses would be an example of a B2B company. B2B ecommerce tends to be more complex than B2C ecommerce. It involves heavier research, more needs-based purchasing, and less marketing-driven buying.

Total Market Size

Market size is one of the biggest differences between B2B and B2C sales. Because B2C sales target the individual consumer, your market size can be massive, depending on your product. According to Presedence Research, the global B2B e-commerce market in 2023 was worth $9,74 trillion.

B2B marketing means business-to-business marketing. It's any marketing strategy or content used by one business to target and sell to another business. For instance, companies that sell services, products, or SaaS to other companies or organisations typically use B2B marketing.

Market segmentation is the process of dividing the market into subsets of customers who share common characteristics. The four pillars of segmentation marketers use to define their ideal customer profile (ICP) are demographic, psychographic, geographic and behavioral.

B2B and B2C are two acronyms that get thrown around regularly. B2B stands for business-to-business, referring to a type of transaction that takes place between one business and another. B2C stands for business-to-consumer, as in a transaction that takes place between a business and an individual as the end customer.

B2B customer segmentation helps businesses better tailor their sales tactics and marketing campaigns to different accounts. For instance, certain deals might have the potential for a bigger contract than others, requiring more time and bandwidth.

B2B stands for 'business to business' while B2C is 'business to consumer'. B2B ecommerce utilises online platforms to sell products or services to other businesses. B2C e-commerce targets personal consumers.

Types of B2C Data Segmentation Include Geographic, Demographic, Psychographic, and Behavioral: Each type offers a unique approach to understanding and engaging with target audiences, from regional marketing strategies to aligning with customers' values and behaviors.