The question “is our product B2B or B2C ?” seems to be bewildering to anyone who has not actually been a field salesperson for B2B. The simple answer is that something is B2B or B2G (Business to Government) if that product or service is purchased by the organization not for personal use but for achieving the mission and goals of the organization.
What about the working lunch that an administrative office orders for the entire staff during an internal conference? That’s B2B because although individuals might be eating the lunch but the purpose is to have a good conference and ordering lunch perhaps saves some time, particularly if the group is large.
Just extend the above lunch example to a factory cafeteria contractor and it’s easy to understand B2B is and how it is different from B2C. A cafeteria contract is a long process for both the buying and selling parties from invitation to bid, tenders, proposals, negotiations and a contract- that is for a year or more.
A Cafeteria contractor once installed, is not easy to remove, no matter how bad the food is sometimes! Here are some reasons that goes to B2B marketing thinking:
- Cafeteria is inside: The cafeteria manager gets to hear about complaints sooner because he or she is right there (the cafeteria is inside the organization) as people eat. Responsiveness that can be in real time includes (a) fixing what is wrong (b) making sure that at least influential people are treated better (c) concerns are addressed right away.
- Contract and the “used to” factor: This one is from the point of view of a contractor who wants to displace the existing contractor because they believe that they have better equipment, more qualified chefs and a committed serving staff and most importantly better prices. The organization might be just “used to” the existing contractor and when it comes to decision time, buying center members will invariably favor renewal unless the performance of the existing contractor is awful and more than one member of the buying center believes so.
- So how does a “new” supplier get in ? The word “new” here is the challenge for a supplier trying to get in. The buying organization is set in its ways, people complain about the food sometimes, the present contractor makes some amends and life goes on.
- Innovation is the answer? For a new supplier, innovation is the answer because if you are similar in most ways, including price, to the existing supplier there is no incentive for the buying organization to shift suppliers. Something innovative like a “healthy weight loss menu” for a cafeteria supplier might give you a chance but here too the organization is very likely to ask the existing contractor to match your “healthy menu” proposal- and then make a decision.
Just understanding which parts of your market are B2B – can help your marketing and growth. About Stratoserve.