If you’ve been working mainly in B2B or B2G businesses up to now and have wondered how product management differs when working in a B2C company, then this post is for you.

In this post, I’ll cover the main differences based on my deep personal experience with both, while focusing on the reality in a B2C business.

But as always, let’s start from the basics…

What does it mean to be a B2C business?

B2C is a shorthand for ‘business-to-consumer’.

If the company you work for is a B2C business it means that it produces and sells its products to the end-users.

There is a subset of B2C which is called ‘D2C’, a shorthand for ‘direct-to-consumers’. D2C means that there is no mediator between your business and the end users. Practically it means that the end users can purchase/download your product directly from your website, rather than… let’s say… the Amazon website.

If your company sells its products to the end users via a retail store, such as Walmart, for example, then it’s a B2C and not a D2C.

Personally, I don’t care much about this distinction, so it’s up to you whether you’d like to be very precise with the definition of your business or not. Throughout this post I’ll solely use the term B2C for brevity.

Being a B2C company requires a very specific state of mind, one that we will discuss in depth quite shortly. 

In most B2C companies, you won’t find the classic sales team and you will rely heavily on marketing, or other viral/network mechanics for growth.

You will need to be much more data driven, as you will have much less opportunities to gather feedback via ‘customer interviews’ or questionnaires.

If you are going B2C, you expect to have millions of users, and hopefully, most of them (or at least a meaningful portion of them, depending on the business) will be customers as well. If you are unsure about the difference between the two I recommend you read my post about this here.

Examples of well known B2C companies:

Apple, Spotify, Nike, Walmart, Netflix, Tesla, Zara, Disney and plenty more…

Mixed Divisions: B2C and B2B

Now, if a company is a giant one – it can have divisions which are B2C and some which are B2B. Classic examples are Microsoft and Google. The search engine of Google is a B2C product, while its Google Workspace suite is B2B. Both Microsoft and Google offer cloud storage and infrastructure, which is classic B2B, but Microsoft also has its Windows software which is B2C.

B2B2C Businesses

One other type of business which is relevant to this context is B2B2C. Such businesses sell a service to business which faces the end users and serve these users on behalf of the business. Known examples are Shopify and Stripe. Shopify helps e-commerce business owners set up their online store very easily. This store, which was built using Shopify, is designated to serve the end users. Similarly, Stripe helps online stores with everything related to online payments (accepting payments, sending payments, etc..). The end user, when paying for an online product, is using Stripe solution, often without even knowing it.

Hence, the customer in both cases is the online store, but the end-user (the consumer) is the actual user.

Like their name implies, B2B2C businesses have characteristics which are a combination of B2B and B2C, and they deserve a post of their own. Hence, I’m not going to cover B2B2C businesses in this post.

Transitioning from B2B to B2C

For product managers and entrepreneurs transitioning from a B2B type of business to a B2C one, this can sometimes be quite overwhelming.

Let’s drill down to the differences.

Users and customers acquisition

In B2B businesses, it’s very common to acquire new customers using an in-house sales team. Some of the B2B businesses can be designed to leverage a PLG approach (if you are not what it is read this post), and then they might do just fine without any sales team. However, as long as they sell to enterprises they will most likely need a sales team this way or the other.

But the sales meeting is usually the second part of the funnel; to get prospects to the top of the funnel a B2B business will put some energy on lead generation. Could be SDRs (a function that focuses exactly on that) or via targeted advertising (or both).

So, we have the ‘prospecting’ stage and then the ‘sales call’ stage’. If the sales call went well – then sometimes there will be some kind of pilot or, if the customer knows what to expect (such as in AWS, for example) they will get an immediate access to the product once they paid the bill.

In B2C it works quite differently for most of the time. Most B2C tech products will have an online service, a mobile app or both. B2C businesses face a similar challenge to B2B in the sense they need to let you know they exist.

Targeted ads is one approach, but it’s sustainable as long as the LTV (lifetime value) is much bigger than the CAC (cost of acquisition).

If your business is new and you still haven’t figured out the business model, your GTM (go-to-market approach) is PLG or your business model is advertising – then targeted ads is probably not the way to go, as you will just burn money (it is still legit for generating a ‘seed’ of users, but it’s unsustainable long term).

In that case your product will need a very strong virality element built in, or, even better – a network effect built in (if you’re unsure what it is – read here).

Businesses who have established a very strong brand (such as Nike or Apple) can generate sales without any of those. Yes, they still have huge advertising budgets, but those are not for targeted ads. Rather, they are mainly aimed to raise brand awareness. Sadly, this option is unavailable for new businesses.

Hence, to summarize – if you’re starting a new B2C business – I am aware of only two ways you can use for acquiring new users:

1. Pay for targeted advertising 
2. Have a very strong virality/network effect built in

And the first option is only viable if you know how to generate much more money from each user from their cost of acquisition.

UX & UI

As I see it, there should be a fundamental difference in your approach to user interface, depending on whether your business is B2B or B2C.

Now, I’m pretty sure many UX and UI experts are not going to agree with what I’m about to write. I’m fine with it, and I do stand by what I’m about to write because this is based on my personal experience:

In B2B – the UI is much less important (the colors, the shapes, the fonts, etc..). It’s mainly important from a marketing perspective (your product needs to look good in the marketing materials) and from a brand perspective (the colors & fonts you choose must be aligned with your brand). Most of the users won’t care, and even if they care, and don’t like the UI – it doesn’t matter. Your customer bought your product because it brings its business a value, and the users within your customer’s company are forced to use it whether they like the colors or not. It’s hardly ever what makes a purchasing decision.

As for the UX (flows, interactions and screens layout) – this is more important, but most of it is not critical. It doesn’t even have to be intuitive. There are two things that are critical in B2B UX:

1. The flows are effective (don’t require a lot of interactions to perform key actions)
2. The flows lead to the desired outcome

I’ve seen B2B products with terrible UI & UX, that were very far from being intuitive. Still, once the user figures out where the functionality they wanted is hidden and how to operate it, and as long as it was 2-clicks to get a result – they were happy.

However, if your UX is not productive, and the user needs to click on 5 buttons each time, just to get the results they need – they will eventually reject your product.

Again, I know what I’ve written above may raise some disagreements with some people – and it’s ok.

Now, when it comes to B2C – everything is different.

In B2C both the UX and the UI are critical. Everyone is trying to shove their products in front of the users and they have a lot of variety to choose from. Additionally, the attention span nowadays is ridiculously low.

Hence, not only is it expensive to convince a user to download your app, once they launch it for the first time – you probably have about 30 seconds to convince this user that they have made a good choice by trying your app.

Because of that, the path to value must be super clear, intuitive and full of joy.

It puts a lot of responsibility on the user interface. The UI is the first thing the user sees, even before downloading the app. It must look sexy and you need to invest wisely in eye-candy.

Once the user interacts with it – the UX kicks in – and everything must make sense.

This is why in B2C businesses I’d never settle on anything less than an A+ designer, because there is too much at stake which belongs in this department.

Understanding users and gathering feedback

In B2B when you wish to gather qualitative feedback you usually set up a product call with the customer. From time to time – it also makes sense to gather quantitative feedback via a questionnaire that is sent to all or segments of your customers.

Yes, most likely you will also embed analytical events in your product so you can later review how the key metrics perform. Still – your main tool for understanding why your users and customers behave the way they do – is simply to ask them.

When it comes to B2C, However, it’s much less likely that you’ll have a chance to engage directly with your users in a conversation. True, if you are determined you can invite users to engage with you via social channels, and maybe meet a few of them. However this would probably be much less statistically representative because in B2C you plan on having millions of users and/or customers.

Assuming you made the effort and met with 10 of them – what will it teach you? Very little.

Therefore, if your business is B2C you have no choice but to become highly data driven. You need to put an extra effort on embedding the right analytical events in your product, because this would be your best chance to understand why your users and customers behave the way they do.

Another useful tool that you should be using is A/B testing, because understanding users behavior purely based on analytics can sometimes be challenging. Therefore, you would like to test screens, flows and UI elements.

It means that your team and your infrastructure need to be different from a B2B team. Your team must be quite analytical and your infrastructure should be designed in a way which makes it easy to run tests.

Don’t we need all of this in B2B as well?

Well, of course I always recommend designing the team and infrastructure to be data driven. So it definitely applies to B2B as well. However, in B2B, as noted, you have more effective methods for gathering direct feedback, so sometimes it’s hard to prioritize putting such a costly effort in the infrastructure and people. A B2B organization may decide to prioritize a strong sales team instead of a data driven team. And sometimes it’d be the right call.

Functions within the company

So far we discussed how your efforts towards the external stakeholders are going to differ between B2B and B2C. But the fact is that you should expect some dramatic changes with your internal interactions as well.

If you came from B2B, then most likely you are used to interacting with sales, customer success and support.

Those are all different in B2C:

• Sales are practically non-existent
• Customer success will probably be merged with the support function and it will work completely differently by handling mass feedback.
• AI chatbots sometimes replace the support function, or at least reduce the size of this team.

The notion of ‘strategic customers’ doesn’t exist in B2C. The days of building features tailored to one big customer who threaten to leave are gone. Instead, you will be in a reality where users are simply not retained and your energy will be focused on figuring out why that is, because you have no one to talk to. 

Unlike B2B, where you are constantly receiving Slacks from customer success or Sales about ETAs for features and weird requests from customers, in a B2C business you’ll be much more on your own, digging through piles of data and figuring out what you should do next. Users and customers will provide you their opinion either by rating your app and/or service, writing you a feedback via a feedback form, through their usage of your service or by simply churning. It’s much more quiet, in terms of ‘fires to put off’, but still – a lot is going on behind the scenes and if you won’t take action at the right time – users will churn.

And who knows… maybe you’ll miss the days of the loud and complaining customers…

Other differences

There are other differences between B2B and B2C in terms of product management, such as:

• Pricing considerations and structure
• Compliance and regulations 
• Monetization efforts
• More

However, I believe the main ones are the ones I covered above.

Summary

Being a product manager in a B2B business is quite different than being in a B2C one. Your priorities and considerations are very different.

It starts with the fact that in B2C you expect to serve a massive user base with no individual touch, while in B2B you will be familiar at least with your top customers if not with many more. This fact pretty much affects everything else – how you gather feedback, how you understand what should be next on your roadmap, how important it is to be data driven, your GTM and the internal stakeholders you’ll be interacting with.

I hope this overview helped you in better understanding the dynamics of each reality. As always – feel free to reach out if you have comments, would like to share your own experience or simply have some follow up questions.