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When it comes to launching your SaaS business, you need to first decide which type of business you would get into. There are basically two categories in which your business would fit – B2B and B2C. B2B is the category of business where your product is made for other businesses to use. While
When it comes to launching your SaaS business, you need to first decide which type of business you would get into. There are basically two categories in which your business would fit – B2B and B2C. B2B is the category of business where your product is made for other businesses to use. While in the B2C category, you would want to target your product to direct consumers. In both the categories you need to ensure that you retain your customers. Hence, customer success has a key role to play in both kinds of businesses. But, B2B customer success is much different from B2C and we are going to see exactly that in this article.
Before we get into the customer success function for both the categories, let us understand a few basic differences in these two categories. When you are building a B2B product, your target audience is not just businesses but the decision-makers in those businesses. You need to think of their jobs, their pain points and the challenges they face in their daily work. Then your product would be specifically providing solutions in their business context.
It can either add business value by reducing the cost of their operations or maximize their profit margins. To build a B2B product, you must have a good understanding of the business context where it will fit in. Most of the founders of B2B product companies would have commonly spent some time in other companies where they identified a need to launch a new product that will solve their problems in those companies. So, they have prior industry experience before launching their product and later on, they extrapolate their solution to fit into other businesses too.
For a B2C company, the product can be very straightforward and handy and hence, different from B2B. It is targeted towards a large chunk of audience so that everyone can use it commonly. You don’t have to be an industry expert to launch your product. If you are solving a common daily life problem for any customer, then your product fits into the B2C category. The complexity of the product is usually much lower here because it is targeted towards providing a solution to common people’s problems and their pain points. To reach a larger target audience, the product should be as simple and handy as any other common chores.
Having understood the primary differences between B2B and B2C above, let us look at how customer success for each of them differs. Customer success by the definition goes as ensuring that your customer is able to achieve their goals and expectations with your product. So, naturally, these goals are way different for customers from B2B and B2C categories. But there are few areas which may significantly differ for both kinds.
The size of the customer base in both kinds are quite different from each other. B2C usually has a significantly higher number of customers than B2B. And on the other hand, the recurring revenues from the B2C customers are much lower than B2B customers. Hence, in B2C customer success, you cannot appoint a CSM to give personalized service to the customers.
You need to leverage technology to keep in touch with your customers through tech-touch engagement models. Whereas in B2B customer success, the Annual recurring revenue (ARR) is much higher than that in B2C. Hence, it makes more sense to give individual attention to your customers in B2B. You can appoint each CSM to a set of business customers to whom they can give personalized service.
B2C customer success has a relatively higher pace of moving from one stage to another in a customer journey. The sales process along with onboarding and product adoption would all be automated, simple and fast. In B2C, you need to keep track of the number of customers going in and going out on a daily, weekly or monthly basis. It is always in a state of flux. Hence, for higher retention, you need to make all your automated processes agile and simple to follow and the results will show immediately.
In B2B, this is not the case. The sales approval goes through multiple stakeholders and then the onboarding and training is given to other users. It is a more time-consuming process and needs a lot of manual intervention in taking things forward. You need to continuously monitor the customer usage to enable product adoption. When they are lagging behind in their customer journey to reach milestones then you need to intervene through calls or meetups to help them move forward. All this slows down your customer journey. But on the other hand, the revenue generated in B2B justifies all the cost spent on these processes.
In B2B, you have a lot of scope of growing your business through relationship management. You need to nurture the relationship with clients on a monthly to yearly basis to retain them for long-term. You are more closely integrated to your client’s business and hence you need to take care of their customer experience. These experiences can vary from the usage of the product to having interactions with your customer support team.
While in B2C, there is hardly any need of maintaining close relationships with your customers. Customers are mostly seen as just numbers in the CRM systems and they would hardly know faces behind the brand. It is also not needed because the value of the product means everything to them. They would stick to your brand as long as your product is good enough to serve them.
So by looking at all the differences in customer success in both the business categories we have some common findings. B2C is a number’s game whereas B2B is a quality game. That doesn’t mean you cannot give quality in a B2C business. But the depth of customer success you can get into in B2B cannot be achieved in B2C because of two reasons – Lower revenues and higher customer count.
Hence, one thing becomes clear by all this. In B2C, you need to make extensive use of technology and you cannot simply depend on manual efforts. Because the revenue per customer is much lower here, your business growth can only be possible through scaling. But all the experience you are giving digitally to your customers must be ahead of the curve for you to retain them. A small move in your business strategy would result in a large group of customers to either churn or become loyal to your brand.13
B2B customer success has always been about depth and the quality of relationship you nurture with customers. And these things take time to build. There are few aspects of B2C that are still applicable to B2B customers like automation for serving SMEs. But for the large enterprise, it takes patience and quality of service to retain them for long-term while continuously adding value through your product.
Shoeb lives and breathes Customer Success and SaaS. He has a passion to research on the latest innovations happening in SaaS and Customer Success. Shoeb hails from a Software Architecture background where he worked for many years with Indian Tech Giants like Wipro and ITC building software solutions for their MNC clients in the UK and Denmark.
Published 21 Jul 2020, Updated 6 Jan 2021
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