What is B2B – Understanding B2B Companies?
Business-to-business (B2B), also called B-to-B, involves business conducted between companies rather than between a company and individual consumers.
The most straightforward short term measurement is to look at conversion rates – sales generated as a direct result of a particular campaign. For example, how many units did I sell, at what profit, after deducting the cost of the campaign?
Estimated reading time: 4 minutes
What is the Difference Between B2B and B2C Companies?
The main difference between B2B and B2C businesses is their intended customers. B2B sells to businesses that resell the products while B2C sells directly to the end consumer.
Which Industries Cover B2B Companies?
B2B companies operate in many industries, such as:
- Professional Services
Five Questions to Ask at a B2B Company
- What do they need?
- Who are the decision-makers?
- Can they afford your product or service?
- What other solutions are they considering?
- Are they ready to take the next step, such as having another meeting, attending a product demo, signing up for a trial, etc.?
Seven Latest Developments in B2B Companies
B2B business development is all about probing your business operations and identifying areas of improvement. As a result, you can leverage what is working great while improving the under-performing areas of your b2b business.
Here are the seven latest developments;
Security and privacy
Real time customer service
Sales and marketing alignment
Data-driven decision making
B2B Companies and ROI – Return on Investment is King
Think about these five criteria:
- Number of pieces you are mailing or emailing
- Total programme costs
- Response Rate: % of responses expected
- Conversion Rate: % of responders expected to make purchases
- Average profit per sale
From this you can calculate:
- Number of respondees
- Cost of campaign per response
- Number of buyers
- Cost of campaign per buyer
- Cost of campaign per mailing/emailing piece
- Total profit from the campaign in monetary terms
- ROI percentage
Ask us for details and we can help you calculate these numbers from your initial business data.
Measuring response rates as well as conversion rates.
Response rates are important to factor in as part of your judgement on the success of a campaign, as they show you the level of engagement and interest in your campaign, even if a sale (on this occasion…) didn’t occur.
Response rates are something you can build on with future campaigns, perhaps tweaking and varying your offer. Responses can be creating more long term benefits than the immediate kick of a sale:
- Awareness of your business/brand/services
- Initial interest which may lead to a sale on the second or third email/mail: most people don’t buy on first contact.
- Click-throughs to find out much more about your products/services, beyond those perhaps mentioned in the b2b agency campaign.
- Depending on your campaign message, there could be the opportunity to send someone a sample product/free gift/business report/more info etc. They have engaged with you!
- The acquisition of someone’s full contact data to allow you to follow them up by phone.
With the correct approach to the follow-up, ‘responses’ can lead to a high percentage of conversions. More about follow-up in a future blog, in the meantime you can follow Twitter BDPs