In this super high-level, trivia-laden guide, you’ll learn the ins and outs of the bucket term “B2B” and the entire section of transactions and interactions it covers.
What is the definition of B2B?
A transaction between a company and another company.
That’s the simplest definition of B2B or business to business. It’s when a car manufacturer buys the glass and tires for making the car.
What isn’t B2B?
B2C or business-to-consumer transactions. This is like when you choose to buy Oreos at the grocery store. A company sells a consumer a product. Anything that has this dynamic is B2C.
What is sold in B2B?
Here are the types of products bought and sold in B2B transactions:
- Services
- Software
- Tools/Equipment
- Data
- Raw Materials
B2B covers a wide scope. Purchases in the supply chain that support or enable a business to make and sell its offering are B2B. The tools, services, software, and equipment needed to run a manufacturing plant or office are B2B transactions.
When should I write out business-to-business instead of using B2B?
Write out business-to-business if:
- Your audience is unfamiliar with the term.
- It’s part of an acronym-heavy line of copy.
- It’s the first reference in a high-level piece of content.
Most of the time, B2B is fine. Those that work in B2B likely know what it is. Just imagine your least informed lead. Do they know what B2B means? Then use the abbreviation.
Is B2B an acronym or an abbreviation?
An abbreviation is a shortened form of words to represent a whole. An acronym is a set of initial letters that usually form another word.
Faced with these definitions, I’ll call B2B an abbreviation.
Are there other abbreviations for business-to-business?
Supposedly, outside of the United States, there are two variants to abbreviating B2B. They are B-to-B or BtoB.
I’m going to be honest, maybe that used to be the case, but there is absolutely no evidence that either of those abbreviations is used outside one article on Investopedia and another on Wikipedia.
BtoB is a K-pop artist though, so I would avoid adopting this abbreviation and stick with B2B.
Can the abbreviation B2B mean anything else?
Yes!
If you search “B2B” on Twitter, you see a little bit about the duality of what the acronym of B2B can mean.
It’s used in the music world, particularly in electronic music to describe when two artists play “back-to-back.”
According to Urban Dictionary, these are the definitions of B2B.
Just in case you were wondering, in this case, it seems the DJs are both literally back-to-back and figuratively.
Should I hyphenate business-to-business (B2B) when I write it out?
Yes. When you are using it to modify nouns.
The purpose of hyphens is to group modifiers together for clarity. It makes sense to hyphenate business-to-business when it is used as a modifier e.g. business-to-business marketing is much clearer than business to business.
The trick to use when you’re trying to decide whether or not to use a hyphen to group modifiers for clarity, ask if the words can individually modify the noun.
For example:
Business to business marketing
Would break into:
Business marketing – x2
To marketing
Whereas:
Business-to-business marketing
Can’t be broken down further. Hubspot and Grammarly both correct to business-to-business.
Hyphenate business-to-business when you spell it out and use it as a modifier. Speaking of which, when should you spell it out?
What is the relationship between buyer and seller in B2B?
In B2B transactions, both buyer and seller are representing a company in their transaction. That means there is typically a businessman (or few) on each end of the transaction.
That means both have a similar amount of negotiation power. The only time that isn’t the case is when a large organization and a small one complete a transaction. The larger organization usually has the upper hand in this case.
How much time is spent on the average B2B deal?
According to the experts at Marketing Charts, 75% of B2B sales to new customers take at least 4 months to close, with nearly half (46.4%) taking 7 or more months.
That lifecycle is undoubtedly even longer, as many buyers don’t come forward until they’re well into the research process.
For returning customers, the sales cycle for B2B is much shorter, with 60% of all deals closed in 3 months or less.
How much money is spent on the average B2B deal?
There is no easy way to answer that question. The deals closed between two businesses can range anywhere from a few dollars to millions of dollars.
How old are B2B decision-makers?
The answer to this is changing.
More and more millennials are becoming decision-makers at B2B organizations as the eldest in that generation reach their early 40s.
As of mid-2020, it was reported that 73% of those involved in research and decision making for B2B purchases are millennials.
How does the B2B customer operate?
The average B2B customer does a lot of research before ever talking to a sales rep. Then they may talk to the other stakeholders after maybe filling out a form to get more information from your company and others.
Then the initial push towards the purchase is done in a group setting, with the final word going through a manager, director, or executive.
How is payment handled in B2B?
Payment is less likely to be handled in a swipe a card sort of fashion. It is more likely to be a series of invoices, contracts, and documents processed by the finance departments of the two organizations.
What are some of the biggest/well-known B2B companies?
B2B companies are a large part of the American economy. They also tend to be some of the largest organizations. There were 19,464 in 2015 that had more than 500 employees. Of that almost 20,000, an estimated 72% were businesses that primarily served other businesses.
Here is a list of top-performing B2B companies from 2017. It’ll be interesting to see an updated version of this list:
- Google/Alphabet
- General Electric
- Intel
- AECOM
- Apple
- Boeing
- Cisco
- IBM
- FedEx
Not shockingly, most of these top performers are in the defense, tech, logistics, and transport industries. Another not-too-surprising part of this list is that almost all these companies work in both B2B and B2C.
These are the companies that serve both businesses and consumers, which means they’re in necessary, profitable industries.
What is the biggest selling product in B2B?
Data. The answer is always data. It’s the largest world commodity.
What will impact the B2B marketplace in the future?
There will be a number of factors impacting B2B transactions in the future. They are:
- Changing definitions of work and workplaces
- The availability of data and rules put into place around data (from both organizations and government
- The impact of remote work/business
Talk to us! We are listening:
- What do you think of this list?
- Do you have any more questions about B2B?
- Did we miss something important?
