B2B vs B2C Product Management

It has been over 4 years since I have been into product management and over these years, I have led teams across both B2B and B2C products. I have observed that although the core overall goal of the product manager’s job and day to day activities remains the same in both these ecosystems which is problem-solving around the core pain-points of the user, the approach to problem solving varies. 

I would like to deep-dive and share my experiences on how these vary across the product lifecycle.

1. Getting Requirements

To start off, the first step in building any product is gathering requirements, understanding user’s problem, identifying customer pain-points - whatever you may choose to call it. In this very first step the approach is generally to conduct customer interviews, identify the problems faced, and nail down on exact problem the product is going to solve.

In both B2B and B2C, this is done via customer interviews. However, it is more easy to find the target persona and interview with them in a B2C landscape unless there are existing B2B clients and the problem statement has been defined by them apriori. Else, a specific set of users (companies in B2B) are prioritised and the requirements are gathered explicitly from them which needs to be delivered then.

2. Prioritising roadmaps

Once the problem has been identified, the next step is to get the Product Requirements Document (PRD) in place, write user stories and prioritise the roadmap.

The approach in B2B landscape is mostly to get the requirements from a couple of companies, and then make sure that the requirements are met. In the B2C space, the roadmaps are more open to be prioritised and re-visited as the approach is to deliver to the masses and not a handful of customers.

3. Introducing features into existing roadmap       

Introduction of new features in the existing roadmap basis competitive analysis, or problem discovered from a new customer not in the existing pool or via the first round of usability testing is very difficult to incorporate in the B2B roadmap since product scope and timelines have been communicated to the client and is difficult to be compromised on. Also, a B2B product needs to be released with full suite of capabilities, stability and security in place even in the beta phase .

On the other hand, it is fairly easy to incorporate product changes, introducing new features/functionalities just on the basis of product usage data and releasing a iterated product. If done right, this goes to the extent of delighting your users and reducing your Customer Acquisition Cost (CAC) & improving customer Lifetime Value (LTV). 

4. Go-To-Market (GTM) Strategy

In the B2B space, the go-to-market strategy is more tailored towards demos and sales calls leading to purchases. There has been a shift in the trend wherein some B2B products do allow the users to use the product for a trial period to explore all the features and functionalities before signing up a contract. But, this needs to go a long way to become the norm as it is in a B2C product.

On the other hand, B2C products are driven more by marketing efforts which are classified into various buckers like digital, organic, SEM, SEO, etc.

5. Product Launch and Adoption

The launch for a B2B product is driven by more of sales efforts vs that for a B2C product. Also, the number of checks on the features incorporated is given more weightage as compared to ease of use that a product brings. There are several examples of B2B products being adopted on the sole reason of the ticks that they pass on the checklist being used by the decision maker. Since the user of the product is very different from the person making the buying decision, most of the metrics on usability is not given proper weightage and priority. By the time the organisation realises that the product is not increasing workplace productivity, it is too late to switch.

The case is very different for a consumer product where not only the switching costs are very low but also network effects matter a lot in adoption. Consumers are always on the lookout for better products at a lower cost and thus it becomes essential to focus on user experience, network effects and ease of use for survival.

6. Product Pricing

It is difficult to raise the prices of a B2B product without any additional functionalities and the most common industry standard is a tiered pricing. Once new functionalities are introduced later, they are tied to a new product line or suite.

On the other hand, it is very difficult to get users to pay in a consumer market especially in an economy like India if the barrier to entry for competitors in the space is low or the value being provided is not significant as compared to other free alternatives.

7. Conducting experiments and using data to iterate on product

It is a norm to conduct A/B testing or multivariate experiments for B2C products to gather user behaviour data and iterate on product improvements. However, I have seen it happening very infrequently in the B2B space wherein most of the product improvements are driven by client requests.

8. Streamlining customer support

B2B customers have a tendency to rely on customer support and training documents or videos to get to know how to use the product. B2C on the other hand relies on product experience, ease of use and intuition to guide adoption. B2C products cannot afford to have users figuring out how to use the product or wait to contact support to get their queries solved about product usage.