In this article, we’ll talk about the differences and similarities between B2B and B2C product management. Mainly, you will learn about the job responsibilities of B2B and B2C product managers and understand why B2B can be more beneficial. However, this is our honest opinion only – it’s always up to you to decide. 

Who Are Product Managers?

Product managers are like the glue that binds many product-related functions – engineering, design, customer success, sales, marketing,email marketing, operations, finance, legal, and more. Not only do they make decisions about what will be built but they also influence every aspect of how it is designed and launched.

B2B and B2C product managers are responsible for promoting their products throughout their lifecycle. However, their day-to-day responsibilities can vary depending on the nature of the business.

With that said, let’s briefly define product management between Business-to-Business and Business-to-Consumer.

What is B2B Product Management?

Generally speaking, a B2B product manager focuses on customers and their needs. In B2B, companies have a longer-term relationship with their customers. You’re transferring ownership of the customer’s software rather than keeping it to yourself. It’s also worth noting that when you’re working with large B2B contracts, you may suddenly have 10,000 users on your platform. That’s why the way you measure and compare usage is a little different.

As a B2B product manager, you spend most of your time in meetings/calls with customers and working closely with the sales team.

What is B2C Product Management?

In B2C, product managers focus on the end-user without knowing their customers. Product managers can conduct focus groups, surveys, interviews, and user research to get any data about customers and their preferences. However, they don’t need to maintain an ongoing relationship with customers. 

B2C product managers work daily with product analytics, studying user behavior patterns to see what works best and what should be improved. They are constantly looking for new ways to optimize product UX.

Similarities Between B2C and B2B

Despite differences in project management, sales processes and release cycles, B2B and B2C have one thing in common: anticipating customer needs and solving them. At the end of the day, no matter what you think of a particular idea or product feature, what matters is what your customers need. In both cases, customers want:

  • User-friendly and outstanding adaptation experience;
  • A mobile-centric solution that makes it easy to interact with the product on the go;
  • Customized solutions. With so much digital “noise” in the marketplace, companies need to make the most of every opportunity they have to connect with customers. The priority? Addressing individual needs and preferences. The focus is on the quality of the customer experience;
  • Low effort, no matter where they are in the customer journey;
  • Brands that deliver on their promises and values because most customers buy from companies they trust;
  • Support channels with multiple options, including calling or talking to customer service or reading FAQs.CallHippo is very handy call center software if you are looking a virtual number. 

Don’t forget that any free project management app will streamline the tedious processes both B2B and B2C teams struggle. 

B2B vs B2C Product Manager

Back to product managers. 

A product manager is not just a fancy job – it’s a truly essential position in almost any company. To put it simply, a product manager is an employee who is responsible for the product as a whole – he/she does everything possible to make sure the product sells well and its users are fully satisfied. There actually can be a product manager for any product, starting from Uber or Boeing 747, ending with your smartphone or yogurt.

  • Product Manager in B2C makes products for individuals, for example, smartphones, bikes, food apps, etc. 
  • Product Manager in B2B creates products for companies, e.g. IP phone systems, dump trucks, CRM systems, etc. 

At first glance, the difference seems minimal, but in fact, these are two different occupations.

B2B usually implies expensive solutions. The profit from each solution is considerable. Thus, for a product to be successful, it is sometimes enough to find 5-10 corporate clients. In B2B, sales are usually slow, with meetings, demonstrations, and customizations. Purchase decisions are made for six months or longer. However, at one time, you can execute a sales plan three years in advance.

B2C products are usually very cheap, so you have to sell a lot (from 10,000 units). To sell that much, you need to find a good source of users and make a very steep sales funnel. Building such a funnel is, however, quite difficult – the competition for consumers’ money is very high.

There are, of course, intermediate options – cheap B2B products (like CRM for sole proprietors) and expensive products in the B2C segment (like luxury real estate).

With that said, many entrepreneurs prefer B2B Product Management to B2C. 

Now, let’s look at the top 7 arguments why B2B is more profitable than B2C.

1. B2B has a meaningful way of working

To put it very simply, the Product Manager’s job is to make the product make more money. And sooner or later, you will have to figure out how to make the customer pay more.

In B2B it’s simple. If you don’t save or make money for your customers, they won’t pay. If you want more sales – you must create more value. If you’re, say, mining ore and coal for your clients. you have to make it efficient. This means giving more resources to the country and the Planet, making miners’ lives easier, and, no matter how pompous it sounds, make the world a better place.

In B2C, sooner or later, it all goes down to how to manipulate the users, so that they once again used the product. For example, make them “take an extra cab,” “order an extra pizza,” “spend a couple of hours in the social network,” etc. At the same time, extra usage of a product can be (like all excessive) harmful for the user. But who cares? After all, “money doesn’t smell”…

2. In B2B product has better chances of success

When a product manager is asked to create a new product, the task usually sounds like this: “Here is a rough description of the product, here’s the team, here’s the budget. The product must go on sale in a year, and pay for itself in two”.

In B2B, a new product has a much better chance because:

The employer already has a customer base and MVP (a prototype with minimal features, which main task is to get feedback). If there’s no customer base and MVP, you don’t want to go that way. In B2C, when creating a new product there’s usually neither of these, there’s only some kind of marketing ideas about a potential target audience and its needs.

In B2B, if you know how to bring $100k value to a client, you’ll definitely sell the solution for $10-20k. B2B clients understand that you have to pay for a good product, especially if its purchase and use will result in significant savings or income in a different form. At the same time, the user-friendliness of the product and its understandable interface is not the most important features. These can be sacrificed for the sake of the benefits the product brings to the client.

In B2C, if you know how to save the user $10, it’s not the fact that he/she will use the product even for free. Modern customers are spoiled by a huge number of free or conditionally free demo products, especially in all things IT. Thus, they are only willing to pay if absolutely necessary.

3. More freedom and diversity 

In B2B, there are many small, yet quite expensive, successful stand-alone products. This can be video surveillance of a mining excavator, for example. You can do almost anything within that, as long as the product benefits the customers and the client company. You can do webinars, showcases, reviews, etc.

In B2C, successful products are usually huge (like food delivery services, cab services, etc.), with a dozen product managers working on them. Thus, most likely your responsibility will be a small piece of that product. For example, the “search bar” or “cab driver selection screen”. You can’t really think of much variety here. Are you ready to spend two years trying to figure out how to improve the search bar?

4. More about working with people

Many entrepreneurs love working with people – communicating, selling, speaking. There’s a lot of that in B2B. If you’re an outgoing person who likes to exchange opinions with lots of people, you’ll have some fun in B2B. Real production, real people, real communication!

In B2C, there’s almost no need to communicate and sell. Sit back, look at the stats, increase conversion rate, and decrease churn rate. You don’t even need to communicate with customers that much: people’s behavior is better seen in stats than from conversations.

5. Intuition matters

In B2C, most decisions are made based on statistics. There are a lot of users – a lot of statistics. Almost every decision can (and should) be checked through A/B testing (for safety). The product manager’s function is reduced to working according to the instructions, the main goal is that everything is reliable and statistically justified.

In B2B, there is no such luxury as large amounts of statistical data. All you have is intuition, communication with clients and experts, and experience. You have to take responsibility for your decisions and take risks.

6. Less competition 


Various online courses have given birth to thousands of product managers lately, and the vast majority of them are going into B2C (we think, for nothing) because B2C is more in sight. It would seem, here they are hundreds of millions of consumers – sell and make money. Accordingly, this results in more competition.

The second problem with B2C is that product managers are easily replaceable. There’s no big link to the industry: a product manager in a food delivery service does roughly the same thing as in a cab service – improves conversions. So in B2C, you will be competing with a very large number of people.

In B2B, there’s always specialization. Say, if you’ve learned how to make cool CT scanners (AKA tomographic scanners), you’re unique. You only have to compete with people who are also very good at CTs. And there aren’t many people like that.

7. Better for entrepreneurs

Someone who has breathed in the “air of freedom” often finds it very difficult to go “for hire” afterward. You want more freedom and opportunities, you want to make decisions and be responsible for them yourself, without any instructions.

The work of a B2B product manager is very similar to that of an entrepreneur. Only the chances of success are much higher, as you already have a team of professionals, a well-established image of the company, and experience gained over decades. You don’t start from scratch, and you don’t risk your own money. Epic win!

So if you are a former entrepreneur but just can’t do it alone yet – B2B product management is for you!

Conclusions

In the B2B sector, you’re not just a manager, you’re a potential business partner for your clients. If an organization decides to buy from you, you essentially become part of its business model, as well as its pricing structure and customer business techniques. That’s why it’s critical that you fulfill your prescribed obligations. 

You have to manage strategic and logical parameters, and use charts, graphs, profitability projections, and reports of potential revenue increases in your presentations. Industry terminology and technical concepts are welcome, as well. You’ll be meeting a lot of people involved in the decision-making process, so you’ll have to build effective relationships with those in the company. 

The key to success in B2B sales is a profit-oriented mindset and value to the potential customer.

In B2C sales, the situation is almost the opposite. Not being a business partner, you act as a brand representative for the people you are selling to. Your actions and behavior will be, in their eyes, a reflection of the company’s actions. 

This is where friendliness, responsiveness, and cheerfulness come into play. You will want to share emotions with customers and establish trust when making a sale. Instead of charts and graphs, B2C sales executives use third-party stories and real-life examples. Instead of applying technical concepts, you’ll want to speak in a clear language that focuses on positive thinking. 

The key in B2C sales is to establish a friendly relationship with the customer you’re talking to and demonstrate that a particular product is right for him/her emotionally.

To summarize, the differences can be briefly outlined as follows:

  • Organizations don’t buy for emotional reasons – they buy based on logical aspects;
  • People don’t buy for logical reasons – they buy based on emotional factors.

Please follow & like us!

Please follow and like us: