B2B2C

Businesses are forever exploring new models that expand their reach and better serve customers.

One such model is B2B2C (Business-to-Business-to-Consumer.) This strategy bridges traditional B2B and B2C, enabling businesses to extend their products and services directly to end consumers through partners.

Implementing this model can unlock immense opportunities for growth. But without the right technology, it poses complexity in managing partnerships, pricing, and customer experience.

This is where systems like configure, price, quote software (CPQ) come in.

CPQ technology helps optimize the B2B2C workflow by automating quoting, configuration, and billing. It does all the hard work, so your company and your partners’, don’t have to. This means greater speed, accuracy, and, ultimately, higher revenue.

As companies pursue B2B2C models, integrating a CPQ system is essential to linking business processes across a wider network of channel partners and customers.

But before we get into the weeds, let’s explain what B2B2C is and how it works.

Understanding the B2B2C Model

The B2B2C model is a progressive business strategy that blends elements of B2B (Business-to-Business) and B2C (Business-to-Consumer) models.

It's structured to create a mutually beneficial partnership between two businesses that ultimately serves the end consumer.

How B2B2C Works

1. Initial Business Relationship (B2B Element): In B2B2C, the first business (referred to as B1) forms a partnership with another business (referred to as B2). This relationship is based on B1 using B2's established channels to reach consumers.
2. Reaching the End Customer (B2C Element): B1, through the partnership with B2, gains direct access to the end consumers. However, the key distinction here is that while B2 facilitates this access, the end consumers are clearly aware that they are purchasing a product or service owned by B1. The direct interaction with the consumer under B1's branding is a key aspect of the B2B2C model.
3. Data and Customer Ownership: B1 often retains the transaction data, which is instrumental for future marketing, product development, and customer relationship management.
4. Strategic Alliance for Mutual Benefit: For a B2B2C relationship to be successful, there must be a strategic alignment between B1 and B2. B1 should find B2B2C more advantageous than going direct-to-consumer, while B2 should benefit from partnering with B1 without compromising its sales.

So, what are the benefits of this setup for businesses and their customers?

The Wide-Ranging Benefits of B2B2C

In the B2B2C framework, manufacturers (B1), who may have been traditionally distanced from their end users, are now driven to engage more directly.

Simultaneously, B2 can sell B1’s products, often for incentive or commission, to fuel sales and interactions without innovating or manufacturing products.

B2B2C is more common than you think, with marketplaces from Amazon Business to Alibaba adopting this model. They enable manufacturers to strike B2C sales, offering both presence through their platforms and the infrastructure to support activities like transactions and marketing.

Let’s turn our attention to the benefits of B2B2C for both players in the chain:

Benefits of B2B2C for Business 1 (B1)

1. Access to Larger Customer Base: B1 can reach a larger customer base through B2's established network without the cost of building their own direct-to-consumer channel.
2. Economies of Scale: By selling higher volumes through B2, B1 benefits from economies of scale. This reduces costs per unit, enhances profitability, and allows B1 to price its products more competitively.
3. Brand Leverage and Trust: Collaborating with a reputable B2 enables B1 to leverage B2's brand strength and trust. For example, customers are more likely to buy a product from Amazon than directly from an unknown Chinese manufacturer.
4. Reduced Customer Acquisition Costs: B1 enjoys lower customer acquisition costs. It can tap into B2's existing customer base rather than building its own from scratch.

Benefits of B2B2C for Business 2 (B2)

1. New Revenue Streams: B2 earns additional revenue through commissions or profits by supporting B1's sales. This enriches B2’s business model without the complexities of product development.
2. Enhanced Customer Attraction: By offering a broader range of products or services from B1, B2 can attract more customers to its physical location or online platform, increasing its core business sales.
3. Diversified Product Portfolio: B2 benefits from B1's diversified product range, which enhances its customers' shopping experience and strengthens its market position.
4. Co-ownership of Customer Relationships: Depending on the partnership terms, B2 may co-own customer data and relationships, which is valuable for building business strategies or developing customer insights.
5. Collaborative Business Ecosystems: This model fosters collaborative relationships between businesses, creating an interconnected, resilient business ecosystem.

Avantages pour les clients

1. Convenience and Choice: Customers enjoy the convenience of accessing a wider range of products from B1 through B2's platform. This one-stop-shop experience simplifies the buying process and offers more choices.
2. Confidence in Purchases: The partnership between B1 and B2 gives customers confidence in their purchases, as they benefit from the credibility and support of both businesses.
3. Enhanced Support and Service: Thanks to B2's consolidated customer service infrastructure and expertise, customers often receive better support and assistance in a B2B2C setup. Amazon is a strong example of this, offering first-class customer service across its entire catalog.
4. Consumer-Centric Approach: B2B2C drives a consumer-focused approach. It aligns business strategies with consumer needs and preferences. This enhances customer satisfaction across sectors.

Challenges of B2B2C

While offering numerous benefits, the B2B2C model also presents several challenges relating to the close, complex relationships involved.

Let's delve into these challenges in detail:

1. Complex Partnerships

In a B2B2C model, companies need to balance the needs of business partners and end consumers. This requires active coordination.

Misalignments or misunderstandings between B1 and B2 can lead to poor product quality and inconsistent brand messaging.

Establishing clear communication channels and mutually agreed-upon goals leads to cohesive partnerships.

2. Customer Experience

Ensuring a consistent and high-quality customer experience is a significant challenge in the B2B2C model. B1 depends on B2 to maintain service standards and vice versa.

Any lapse in service quality, delivery, or customer support from either party can adversely affect the customer's perception of both businesses.

This requires stringent quality control measures and a shared commitment to customer satisfaction across the partnership.

3. Customer Ownership

Navigating customer relationship control in B2B2C is complex. B1 owns the product or service, but B2 often controls the customer interaction.

This can lead to issues in customer loyalty and retention. B1 may feel a lack of direct engagement with its end-users.

Crafting a balanced agreement that clearly delineates the responsibilities and rights of each party in customer interactions is essential.

4. Compliance and Security

Maintaining compliance and security standards across B1 and B2 operations is tricky, particularly when dealing with data privacy, regulatory requirements, and cybersecurity.

Both parties must ensure their collaborative operations adhere to industry standards and legal regulations.

This often requires integrated compliance frameworks and robust security protocols to protect customer data and business operations.

5. Differentiation and Competition

Establishing unique value propositions in the market is crucial in a B2B2C setup.

If B1 and B2 do not clearly define and communicate their unique offerings, there’s a risk of product or brand dilution.

Differentiation is critical to avoiding direct competition between B1 and B2. It ensures the partnership is mutually beneficial rather than cannibalistic

6. Technological Integration

Aligning systems and processes for seamless operations is one of the most significant technical challenges in B2B2C models.

Integrating IT systems, databases, eCommerce platforms, and CRM tools between B1 and B2 must be efficient and secure. Robust integration facilitates smooth operations, real-time data exchange, and consistent customer experiences.

However, without the right technology (discussed later,) achieving this level of integration requires technical expertise and significant resources.

7. Demand For Customization

The demand for custom, complex products is rising. According to McKinsey & Co.,71% of consumers expect personalized brand interactions, and 76% feel frustrated when this is not delivered. Enabling one-to-one experiences through B2B2C, however, is inherently complex.

For example, B1 might possess the manufacturing competency to create in-demand custom products but lack the sales channels to market them effectively. B2 might have those channels but lacks the ability to manufacture custom products.

How can this process be coordinated in a B2B2C model? The answer lies in CPQ, which we explore in the next section.

Deploying CPQ To Support B2B2C

Let’s start by quickly outlining what CPQ systems actually do.

In short, they streamline sales and manufacturing by managing complex product configurations, pricing, and quoting activities.

Here’s how CPQ works in three simple steps:

• Configuration: Customers interact with a visual product configurator to select specific features and customize products to their needs.
• Prix: The system dynamically calculates the price based on the configuration, considering variables like discounts, custom features, and quantities.
• Citer: It then generates accurate and detailed customer quotes reflecting the selected configuration and pricing.
• CAO et automatisation de la conception: It also generates engineering and production documents like CAD files and BOMs.

And here’s how CPQ slots into the B2B2C model in practice:

B2 (retailer/distributor) wants to directly sell B1's (manufacturer) highly configurable products to end consumers across both eCommerce and brick-and-mortar retail channels. Visual CPQ software provides the capabilities to make this seamless.

B1 embeds a no-code CPQ configurator (in the case of Epicor CPQ into B2's eCommerce platform, allowing consumers to access and interact with B1's product configurators.

As the consumer navigates the CPQ configurator, the selections update pricing, 3D renderings, etc.

Once the consumer finalizes their customized configuration, the CPQ tool automatically generates a comprehensive quote, bill of materials (BOMs), spec sheet, CAD files, and other supporting documents.

The comprehensive quote data is seamlessly transmitted to B1 for manufacturing and order fulfillment based on the custom specifications.

B2 makes B1's CPQ applications available on in-store tablets or kiosks for sales reps and customers to use.

Sales reps can guide customers through visually configuring the product via the tablet, or customers can self-serve and configure the product themselves. Real-time feedback shows whether selections are valid.

When the customer finalizes their product configuration, the CPQ tool instantly generates quotes, pricing, CAD files, etc. This enables sales reps to close sales more easily or empowers customers to complete the order independently.

The CPQ app transmits full quote details to B1 to fulfill the custom order.

This streamlines the ordering process and bridges the gap between B1 and the end consumer while maintaining B1's brand presence and supporting orders for custom products.

We’ll next explore the benefits of implementing this innovative sales model.

The Benefits of CPQ-Enabled B2B2C Sales Models

CPQ streamlines the creation of quotes and complex product configurations, empowering sales teams to provide customized purchasing experiences across channels–including in B2B2C.

Let’s explore the benefits in more detail:

1. Streamlining Sales Processes

In the B2B2C model, managing product configurations and pricing can be incredibly complex.

The retailer, B2, might lack deep technical expertise in customizable design and manufacturing constraints, particularly when it comes to complex big-ticket items.

B2’s online and in-store sales staff also lack the specialized knowledge to guide customers through customizing technically complex products. They find it difficult to answer configuration questions, validate selections, provide accurate pricing, and generate comprehensive quotes.

B1, equipped with CPQ technology, steps in to resolve these challenges for B2. The configurator simplifies both self-guided customization online and assisted retail selling in stores via easy-to-use guided interfaces.

Now, B2’s customers and sales personnel can customize items to their exact needs quickly without becoming technical experts. This boosts conversion and sales for customizable products online and in-store, mutually benefitting both businesses.

2. Enhancing Customer Experience

Transparency and speed are crucial in maintaining customer satisfaction and trust, especially in the B2B2C model, where the end consumer’s perception can directly impact B1 and B2.

CPQ tools improve the customer experience by offering a visually appealing configurator interface with 2D, 3D, and AR capabilities. In addition, accurate, real-time quotes mean buyers know exactly what they’re getting and how much it will cost.

Combined, CPQ systems help manage customer expectations, resulting in a smoother purchasing journey that strengthens the connection between B1 and the customer.

3. Supporting Operational Agility

CPQ systems enhance operational agility by automating the quote-to-cash process.

For example, by generating accurate quotes and technical files like CAD files and BOMs, CPQ enables businesses to sell custom products without extensive manual input for each unique order.

Additionally, the visual Solution CPQ provides B1 centralized control over product configurations across all their distribution channels. When B1 needs to update pricing catalogs, change what customization options are offered, or modify configuration rules, they can do it once in their CPQ software.

The changes automatically propagate out to the CPQ interfaces embedded with channel partners like B2. This saves B1 time compared to managing customizations, pricing, and settings for each distributor individually.

Ultimately, this allows businesses to focus on serving customers rather than getting bogged down in constant back-and-forth between sales and manufacturing teams.

4. Data Management and Analysis

CPQ systems collect data on customer and product interactions.

In a B2B2C context, having access to detailed data about customer preferences, buying habits, and sales trends is crucial for both B1 and B2 to make informed business decisions.

This also ensures that B1 can collect data from their B2B2C channel without the need to transfer it from B2, which could pose technical or compliance challenges.

5. Technology Integration

Integrating CPQ systems with existing CRM (Customer Relationship Management) and ERP (Enterprise Resource Planning) systems is vital for unified business operations in the B2B2C model.

This integration ensures that data flows seamlessly between B1 and B2, facilitating better communication, coordination, and overall process efficiency.

It also provides a consistent and unified approach to sales, inventory management, and customer service.

6. Supporting Omnichannel Sales Strategies

Today’s buyers want convenience and flexibility in purchasing and customizing complex products to fit their needs.

Some may prefer self-service configurators online that they can tweak themselves on their own time. Others want to discuss options with a salesperson, whether in person at a store or chatting with an expert online. CPQ empowers organizations to meet these diverse omnichannel needs.

For manufacturer B1, the B2B2C model integrated with CPQ allows them to provide an optimized experience across online and direct sales and distribution through partners like B2.

As long as B1 controls the CPQ system, it has a single centralized interface to manage all these channels while enabling customized products wherever customers and partners engage.

This omnichannel approach, combined with CPQ, gives customers added convenience and accessibility while saving B1 significant cost and complexity in managing setups for each individual sales channel.

En conclusion

The B2B2C model demonstrates the evolving nature of business relationships and market strategies in the digital age.

It’s become vital for businesses to demonstrate adaptability, strike strategic partnerships, and adopt customer-centric approaches.

While this model presents several challenges, including managing complex partnerships and ensuring a consistent customer experience, Épicor CPQ offers a solution.

Visual configurators support sales on the front end, enabling customers to access the personalized products they demand with accurate quotes and invoices. On the back end, Epicor CPQ supplies manufacturers with the technical information they need to fulfill those orders with minimal hindrance or delay.

The result? A tightly orchestrated B2B2C model that enables manufacturers to massively expand their reach without a total remodel of their production workflows.

To learn more, book a demo with Epicor CPQ today

B2B2C FAQs

How does a B2B2C business model differ from traditional B2B ecommerce and B2C marketing?

The B2B2C business model is a hybrid that combines elements of both B2B ecommerce and B2C marketing. In this model, a B2B company partners with a B2C company to sell products or services directly to the end consumer.

In terms of B2C marketing, the B2B partner, B1, gains direct exposure to consumers, and B2 is primarily responsible for marketing. The order goes straight through to the manufacturer (B1). The other company (B2) is just a conduit that captures the customer to take a commission.

What are the critical components of a B2B2C marketing strategy in the B2B2C business model?

In a B2B2C marketing strategy, the emphasis is on creating campaigns that effectively communicate with B2B buyers et B2C customers. This involves understanding the distinct needs and decision-making processes of both groups.

B2B2C marketing may include tactics like co-branded messaging, leveraging the B2C company's customer insights for targeted promotions, and employing digital platforms that cater to both B2B and B2C dynamics.

How can B2B eCommerce platforms be optimized for B2B2C marketing?

Optimizing B2B eCommerce platforms for B2B2C marketing involves integrating features that cater to both business clients and individual consumers.

A B2B2C eCommerce model might include customizable product pages, pricing models that accommodate B2B buyers and B2C customers, configure, price, quote (CPQ), and marketing tools that allow for segment-specific messaging. The goal is to create a seamless user experience that addresses all customer types' buying patterns and preferences.

What challenges can arise for a B2B company transitioning to a B2B2C business model, and how can they be addressed?

A B2B company moving to a B2B2C business model may face challenges like adapting its marketing strategy to resonate with B2C customers, managing a more complex supply chain, and integrating its systems with B2C company platforms.

To address the challenges of B2B2C partnerships, it’s crucial to develop a comprehensive understanding of the B2C customer journey, invest in technology that supports seamless integration, and collaborate closely with the B2C partner to ensure alignment of goals and operations. In B2B2C, company collaboration between both parties is essential.

How can a B2B2C platform enhance the customer experience for both B2B customers and B2C customers?

A well-designed B2B2C platform can significantly enhance the customer experience by providing tailored solutions and personalized interactions for both B2B customers and B2C customers.

For B2B buyers, this might mean offering bulk ordering options, volume discounts, and customized products. For B2C customers, the focus would be on user-friendly interfaces, personalized recommendations, and efficient checkout processes.

How important is technology integration in a B2B2C business model, especially for B2B commerce?

Technology integration is crucial in a B2B2C business model, particularly for B2B commerce.

Integrating systems like CRM, ERP, and CPQ ensures that data flows smoothly between the B2B company and the B2C company, facilitating effective communication and streamlined operations.

This integration is essential for maintaining consistent quality of service, accurate data analysis, and efficient management of the supply chain.