When you think of a Customer Relationship Management system (CRM), what do you imagine?
Most people immediately think of a CRM solution like Salesforce — the original CRM that defined the category. A CRM is the one place where all of your customer data lives, creating a single source of truth on which to base business decisions and manage customer engagement.
However, most traditional CRM systems were built specifically to serve B2B businesses — and you can tell.
B2B CRMs clearly aim to help salespeople manage long, relatively predictable sales cycles and one-to-one communications, and they often pair with marketing tools to nurture leads across the course of a lengthy sales funnel.
Despite this, many B2C marketers still try to force B2B CRMs to serve their very different business needs. But a product tailor-made for B2B sales clearly wasn’t doing the job, and B2C CRMs emerged to fill the need for retail businesses that sell to individual consumers, rather than massive corporations.
The two types of CRM are distinct, however, there’s still some confusion in the market today — perhaps because the acronyms are so similar. We’re here to help clear up some of the confusion for anyone looking to buy a CRM today. In fact, B2B CRMs are very different than B2C CRMs in:
- Serving sales vs. marketing
- Managing accounts vs. people
- Tackling predictable vs. unpredictable sales cycles
- …and much more.
Learn the specific differences in the capabilities and functionality of a B2B CRM vs. a B2C CRM so you can decide exactly what’s right for your own business.
Sales-focused vs. Marketing-focused
In the world of B2B, the CRM is a tool for the sales team. The sales team uses the CRM daily to track the progress of prospects as they move through various sales stages. In contrast, the B2C CRM is built for marketers. In B2C, marketers drive the sale directly since most ecommerce sales are self-service. Because of this, B2C marketers need actionable data in order to segment customers and offer targeted, personalized marketing across channels. A B2C CRM helps marketers keep track of exactly where customers are in their buying journey, based on granular behavioral data — something B2B CRMs cannot effectively do.
Account-driven vs. people-driven
In B2B, you’re selling specifically to a large organization: an account. Because of this, B2B CRMs are set up to manage accounts, with a list of individual contacts within each account. This structure doesn’t align very well to the high volume, people-driven nature of B2C. In B2C, there are no accounts because it’s a person who buys a product from your business directly. B2C marketers don’t care about measuring accounts at all — it only matters how you can nurture and market to that person to encourage a second purchase. Because of this, B2C CRMs are built to measure the individual, not the account.
Predictable vs. unpredictable sales cycles
B2B sales tend to be more complex, involve buy-in from more stakeholders, and require a longer process of vetting and technical integration. Because of this consistent process, most B2B businesses understand their usual sales cycle length and expect the process to take a certain amount of time. In contrast, a B2C sales cycle can be a short as a minute or as long as a few years. A buyer might see an ad for a new pair of shoes and make an immediate impulse purchase; a different B2C customer may have a very long consideration period before deciding to finally buy. The varied nature of the purchase cycles in B2C makes it tough for a B2B CRM to serve the needs of a B2C business.
Thousands vs. millions of transactions
The sheer number of contacts and accounts touched on a daily basis is hugely different in B2B vs. B2C. In B2B, your business is generally dealing with a list of thousands of companies in your target market this quarter; whereas in B2C, a large retail brand could be selling to millions of individual customers per day. A traditional B2B CRM may not be equipped to handle the extremely high volume of transactions common in B2C. A B2C CRM must be able to both ingest massive amounts of data and accurately assign that data to specific customers in order to effectively measure results over time.
Higher vs. lower ASP
B2B products not only take longer to buy, they also tend to be much more expensive. In a B2B deal, you may be talking about a multi-million dollar contract that spans a massive, multinational corporation. In comparison, B2C transactions could be as simple as buying a $45 pair of shoes. The two types of businesses also look at customer lifetime value in a very different way because of the cost to acquire customers is so much higher in B2B, while the importance of repeat purchases is much higher in B2C. With such a different Average Sales Price, it becomes very difficult to measure the two types of transactions using the same system.
Because of all of these differences, a B2C CRM actually must be far more powerful than your traditional B2B CRM. In B2B, sales reps can actually go in and manually clean up or alter data as things change. But since B2C transactions happen at a faster pace, in far larger numbers, in less predictable ways, maintaining a database manually is unrealistic. A B2C CRM must be able to quickly and accurately identify customers, resolve those identities across devices and channels, and update records automatically – and in real-time.
The divergence between the two types of CRM is clear. And now that you understand all the differences between a B2B CRM and a B2C CRM, why would you try to force your business to use a product that wasn’t built for your market? It’s clear that B2B marketers have their software, and B2C marketers need their very own CRM — a B2C CRM that is built to serve their specific needs.