By Aaron Schwartz of the Young Entrepreneur Council
There are two well-defined sales channels that most people use. Selling directly to individuals, more formally known as business-to-consumer (B2C), and selling products or services to other organisations, known as business-to-business (B2B).
These terms are so ubiquitous that when you talk about your business, investors, reporters, prospective employees and others will ask point-blank if you’re a B2C or a B2B company. There’s typically no other option — you have to choose one of those two.
However, the biggest potential sales channel for many consumer brands doesn’t yet have a name. There’s another target market for your product, somewhere between the black-and-white view of B2B and B2C.
Like many other brands, at my company Modify Watches we have a few obvious sales channels. We’re first-and-foremost a B2C company, selling product through our website. We’re also a B2B company, with two distinct approaches.
We sell our official MLB, NHL, NBA and MLS gear in arenas and stadiums around the U.S., as well as through online partners like Fanatics.com. We also sell custom watches as employee gifts for large companies like Nike and Google through distribution partners like BrandVia.
Moving beyond B2B or B2C
But we also discovered another channel. We’ve created custom products for wedding parties, professional cycling teams, the Greek system, nonprofits and more.
Although these sales initially took us by surprise, after a few years of people coming to us and asking for products, we finally decided to formalise this channel.
We call this third channel business-to-group, or B2G. Here are a few example cases to better define this target market:
- Affinity group: softball team, fraternity or sorority, fans of an Instagram celebrity
- Event: nonprofit gala, quarterly sales meeting, championship games
- Occasion: wedding, family reunion
We’ve always admired CustomInk and thought of them as a leader not only in the custom products business, but in this B2G space. One message from their homepage says it all, “Custom t-shirts have the power to turn your group into a team, elevate your gathering to an event, or make your special moment more… well, momentous.”
Incorporating a B2G model
But winning in this marketplace requires a few changes from your normal course of business.
- Offer more custom options. If you’re just going to have a few options, you might as well put your product into retail locations. Success in the B2G space relies on crafting a single product for a group of people that then represents everyone perfectly, giving them a unique and more cherishable experience.
- Build new marketing channels. B2G is challenging because there’s not always a trade show targeting these groups. But the beauty is that once you figure out where these groups buy their products, you can target them all. For example, if you want to reach brides-to-be, the best marketing approach might be partnering with a company like Loverly that covers all things weddings. Each group is different. Another example: If you want to get in front of Little League Teams, you might have to call each city’s Little League commissioner and grow via word-of-mouth.
- Be generous with revenue sharing. There are often gatekeepers who can introduce you to groups, e.g. the Little League Commissioner. When appropriate, offer them an incentive to open doors for you. While they may not be the buyer, they can serve as the tastemaker who lets everyone know that you have a great product.
- Re-examine who you think is a buyer. Finding B2G leads is about servicing customers with products that support their passions. Consider reviewingMeetup.com for hundreds of ideas; someone who has created a Designers-and-Geeks organization or has joined a micro-brewery club is telling you, point blank, “This is me.” Help them show their passion and you will win.
The added benefit about B2G is that when you do a great job, you’re building a customer relationship with someone who can use your product or service elsewhere. Maybe they buy your stuff as an individual or recommend it to their group.
More importantly, someone who is a member of one group (such as a softball team) is often a member of other groups that celebrates other, different occasions.
The pitcher on that softball team might also volunteer with a religious group, sit on the board of a non-profit, ride with an amateur cycling team, serve as a member of the PTA, or even be the head of a fan club for a social media celebrity. Deliver an incredible experience, and they can bring your product to all of their other organisations as well.
This article, entitled “Beyond B2B and B2C: The sales channel your business is overlooking” originally appeared in e27.
Aaron Schwartz is Founder and CEO of Modify, which partners with influencers, nonprofits, brands and more to create custom merchandise shops. The Young Entrepreneur Council (YEC) is an invite-only organisation comprising the world’s most promising young entrepreneurs.