B2B Product Managers vs. B2C Product Managers

Regardless of whether you manage a consumer-oriented product (B2C product management) or one targeted at business users (B2B product management), product managers (PM) mostly have the same challenges and to-do lists. All product management is ultimately a balance between iteration and the audience.

Both PM roles use the same language, but each domain comes with slightly different dialects. Read on to learn where they overlap and what sets them apart.

Industry Knowledge for B2B Product Managers vs. B2C Product Managers

For effective B2B product management, product managers must attain a level of expertise regarding their target industry. It’s hard to know what a medical administrator, banker, or construction manager really cares about without digging a little deeper and doing research.

Occasionally product managers will already possess real-world experience in the field they’re targeting. But, typically, most come to the table with little-to-no background. To build credibility and properly prioritize things, product managers have to do their homework.

In order to get a handle on how your product could make things better, faster, or cheaper for customers, B2B product management requires PMs to conduct in-depth customer interviews, site visits, and following the industry news. It’s a learning curve journey from novice to thought leader in this space. If successful though, the B2B pm will gain the trust of their sales teams and developers as they grow confident in your ability to truly understand what the market wants.

PMs on the B2C side typically rely more on experimentation, data analysis, and their instincts to see what’s worth testing (and what eventually might stick) rather than learning up on industry knowledge. As such, usability testing and behavioral science play a far larger role for these PMs, as their hypotheses don’t have the same solid foundation as their counterparts in B2B product management.

Population Management for B2B PMs vs. B2C PMs

B2C product managers typically have a user population (or total addressable market) that dwarfs their B2B brethren (unless they work at Microsoft, for example). That’s no knock on B2B products, but even the most successful business-oriented solutions will be used by a fraction of people compared to a typical consumer app.

But that larger and more diverse user base of consumers comes with its own set of challenges. The product manager for a logistics solution will probably have a pretty good sense of who’s using it, but consumer products have a user population that can include almost anyone for B2C PM’s to keep in mind.

B2C product vs. B2B product metrics

B2C metrics reside on an exponentially larger scale. For instance, B2C companies don’t get excited about tens of thousands of users, but that would be considered a massive victory for many B2B companies. So, as a product manager, what changes when you’re talking about millions of users?

Both B2B and B2C product managers have to worry about customer churn, but it’s a far more pressing issue on the B2C side. It’s fairly atypical for consumer apps to have multi-year contracts. Users can flee at any time over the littlest things. Therefore, customer retention and loyalty metrics are a higher priority.

Customer acquisition cost (CAC) and lifetime value (LTV) are other key B2C metrics that don’t play such a large role in B2B product management. When growth is dependent on adding more users and maximizing revenue opportunities, B2C product managers must be sure the LTV remains significantly bigger than the CAC or the whole company ends up with an upside-down business model.

And while B2B product managers may care about how much time users spend using their product or how many features they’re using, these metrics are way more important for advertising-driven consumer apps. More time spent, more sessions, and more page views all mean more money.

B2B vs B2C Personas

Figuring out what kind of person uses your app is essential to understanding their motivations, preferences, and concerns. It’s integral to effective and efficient marketing. But when your potential users could literally be anyone, it’s much harder to boil that down to a handful of personas.

In B2C, you must “focus on who that person is as an individual: age range, gender, race, income, hobbies, interests, location (urban vs suburban vs rural,) and how they spend their free time and money,” says Danielle Bilbruck of Kapost. Whereas B2B, “focuses on that person as a professional: job title, department, company size, department size, number of people on a team, and budget size.”

This requires B2C product managers to build out many personas based on analytics data and surveys to try and isolate which personas are most common since there will always be outliers for a consumer app. They can then try to keep all of them in mind when planning their roadmaps and honing their UX for that diverse audience.

Another key difference between B2B and B2C products is that, for B2B products, the person buying the product isn’t typically the one who uses it. What that means is, it changes both how you market and sell and how hard you work to keep the user engaged.

B2B vs B2C Feature Requests

The relationship with customers significantly differs between B2B and B2C products. B2B products have clients and clients have expectations and demands. B2C products have users that have wishes and wants. Either can walk away when they don’t get what they’re asking for, but a B2B customer’s unhappiness is far more impactful.

Thanks to a long sales cycle, onboarding, account management, and customer success contacts— B2B customers have formed personal relationships with team members. They’ve usually committed a sizable sum of money as part of their engagement. There’s an expectation—often contractual—of support, service, and attention that simply doesn’t exist in the B2C realm.

The sales models also impact product management because they distribute B2C products without a concerted sales effort. They rely solely on marketing and advertising. Whereas B2B products typically require salespeople. And if there’s one thing salespeople love to do, it’s to vocalize what the product shortcomings are that are costing them deals. This input from salespeople, while valuable, must always be taken with a grain of salt and appropriately vetted with customer references. Hearing a request from a sales team member also creates an urgency that a B2C user’s complaint never does.

Since B2B products have relatively fewer customers at much higher price points, product managers can’t afford to ignore them. Instead, they must take the time to support and understand them, not only to protect that account but because there are likely others out there with similar issues and concerns too.

Features and Usability

Functionality and ease of use are important for everyone. While B2B users will put up with a clunky UX if it gets the job done, consumers will head for the hills if an app is difficult to use. This is primarily because business users really need the product’s main functionality, while consumers can typically take it or leave it.

Customers make requests, market requirements evolve, and competitors continue to innovate. The focus on features is what fuels B2B product development. It’s about what your product can do and less about how to do it. Although investments in additional functionality should align with the overall corporate strategy, there will always be a push to expand what’s capable.

B2C products don’t have the same pressure to continue adding on new features. It’s far more important to do a limited set of things really well and easily enough to appeal to a broad audience with varying technical chops and tastes. UX and style are just as important as core functionality since there are likely alternatives competing at the same price point with similar features.

That’s not to say B2C products never add new features, but they typically introduce them far less frequently and they guide with strategic objectives versus a specific customer request.

Price and Volume

How people pay for their products dictates their expectations. A B2B purchase often involves a contract, which comes with all kinds of terms and conditions that give the customer far more leverage in the relationship.

Not only can they threaten to not renew or expand their number of seats, but they could also demand refunds or bring up legal action if a product impacts their regular course of business. On the flip side, if a customer wants something that’s not currently in the roadmap, they may pay an additional fee to get it done. This changes the dynamics of the affair, giving far more power to the customer in dictating priorities and making demands.

Meanwhile, B2C users usually pay little to nothing for digital consumer products. Although if in-app purchases are enabled, then their “virtual” purchases could eventually add up to some meaningful dollars.

Regardless of whether a B2C customer is spending pennies or tens of dollars if any single customer cancels or quits there’s no real impact on the company.

This dynamic shifts the emphasis from satisfying the individual customer to focusing on the “greater good” and making sure large swaths of users are happy. It’s optimal to keep as many users as delighted and engaged as possible. In reality, it’s neither practical nor possible to elate them all.

With this in mind, B2C product managers can make bolder moves aimed at achieving business goals and objectives even if it underwhelms a portion of their user base. This level of confidence would be far more precarious in a B2B product management setting.

Release Frequency for B2C vs. B2B Product Managers

New, exciting, and different is great when you’re looking to be entertained. But less welcome when you’re trying to get your job done. This reality shapes the velocity and scope of introducing changes to the products that reside in these two categories.

Releases for B2B products

B2B customers typically have a running list of tweaks and new features they want to see in the product. But beyond their pet projects, they really aren’t interested in a whole lot of changes to the product. Because changes interrupt routines and might mess with currently functional workflows and integrations. Changes may also require additional training of staff, which can be difficult to carve out time for.

These B2B clients may welcome improvements. However, they might view anything “extra” as “extraneous.” They understand that things will periodically change. But they’re less okay with coming in on a Tuesday morning and finding the UI changed so much that they can’t complete a task they had no trouble with on Monday afternoon.

To mitigate disruptions, B2B product managers bundle up major new releases. When they add new changes, they strive to make them optional and settings-driven versus universally changing everyone’s experience.

Releases for B2C products

Consumers are generally quite receptive to changes. They’re happy to get new functionality, more content, extra game levels… whatever gives them an even better, more engaging experience.

As they become familiar with UX elements on other apps, they’ll expect similar behavior in your products and generally don’t mind an incremental learning curve as long as there are some user-friendly prompts and the reward of a superior experience. As long as there are no new performance problems or lost user data, they’re generally game for the new experience.

Not every change is welcome, however. If something they love goes away, they might, too. When it’s a really big UX change, consumer products need to be prepared to restore the old functionality, like Instagram did after they swapped scrolling for tapping in their feed last December.

Conclusion

The responsibilities of B2B and B2C product managers have plenty of overlap and draw from the same well of skills and tools. But their strategies, goals, and execution will vary tremendously.

Some product managers may be able to switch between the two approaches easily. Others may have a strong preference for one over the other. The lack of certainty and a wide range of users may frustrate those that manage a B2C product, while others may cringe at a situation where one or two customers make up 50% of the company’s revenue and have a ton of influence.

Luckily, there are plenty of products to go around. You do not need to settle for one when you believe the other is a better fit. But regardless of the product, we’re all ultimately trying to do the same thing, even if we do it a little differently.