What is B2B2C E-Commerce?
Get Individual Customers by Acquiring Them in Bulk
B2B e-commerce is short for business-to-business e-commerce, which involves businesses selling to other businesses online. B2C e-commerce is short for business-to-consumer e-commerce, which involves selling to individual customers.
While there are several B2B e-commerce giants, most people think of B2C businesses when they think of e-commerce. Of course, e-commerce businesses can be classified along many other dimensions, and there is no standard taxonomy for classifying the types of e-commerce businesses.
What Is B2B2C E-Commerce?
With the abbreviations laid out above, you might be able to guess that B2B2C expands e-commerce to business-to-business-to-consumer. To understand what this means, think of an online retailer who sells back-to-school supplies. But instead of approaching students (or their parents) directly, this retailer ties up with schools and then sells to the students of those schools.
So you could say that B2B2C e-commerce is effectively a B2C outfit that is facilitated by another business.
The Motivation for B2B2C Ecommerce
The B2B2C chain has three participants. Here is the justification for each one's presence in this chain:
- First B in B2B2C: This is the original business that gets into the B2B2C arrangement is hoping to acquire customers in bulk. Instead of focusing on acquiring one customer at a time, this online retailer wants to achieve economies of scale by tapping into the customer base of another business. In many cases, tying up with the intermediate business (the middle B) in the chain brings in a lot of credibility and trust.
- Middle B in B2B2C: The intermediate business might have several possible motivations. On the one hand, it could simply be commercial considerations, such as the middle B could be making a commission on sales that are routed through it. But often the middle B does not make any money in this chain. So there are other motivations—some of them include providing value to their customers by getting them better priced or more convenient purchase options. In some cases, such as in the case of purchase of school uniforms, the middle B probably wants to ensure that all their customers are purchasing a standardized product.
- The C in B2B2C: Being part of a buying group is an inevitable outcome of being the C in a B2B2C chain. This buying group might be formally defined, and bulk-buying benefits may accrue. Alternatively, one might choose to go the B2B2C route solely for the convenience, or the perceived reliability, in this purchase process.
B2B2C and Scaling Up
The B2B2C e-commerce format can be greatly facilitated with pre-existing relationships. These relationships can be harvested to lead to a bulk acquisition of customers. Given the formidable cost of customer acquisition, this one benefit alone can make B2B2C a valid e-commerce model.
B2B2C Still Takes Work
If you have set up a new e-commerce business, you are probably intimidated by the effort required in acquiring one customer at a time. Many new e-commerce business owners may consider bulk customer acquisition through the B2B2C route as an alternative to putting in the effort to acquiring individual retail customers, but they would be wrong. Not all e-commerce businesses adapt well to the B2B2C format. If your sole motivation is to avoid effort, then this might not be the best format for you.