Your business model could be one of many and ensuring your digital strategy fits into this is crucial. Creating an aggressive e-commerce strategy for a relationship-based B2B business would not be a good fit. Likewise, leading with a pure content and social media strategy for a sales-focused retailer is highly unlikely to deliver the sales volumes you need to achieve. It is vital that you therefore fit your strategy to your business model. There are many different definitions of business model and within those there are many models. Below is a list of three common business models, some of their qualities and how they apply to your digital marketing strategy.
Mass market B2C
This model includes organizations that sell products that appeal to a broad range of consumers at an affordable price. An example of this type of business is fast-moving consumer goods (FMCG) companies. Selling a large number of products such as food, clothing or toys involves being able to attract a high volume of customers to your website and stores. This means creating awareness through above-the-line advertising, acquiring visitors and converting them into customers. This would also require a robust customer service process. Therefore all digital channels are relevant here.
This model is a direct-to-consumer business that has a highly targeted service. This could include products for people living with a specific disability or products to ultra-high-net-worth individuals. Whilst this model also appeals directly to consumers, it works with a specific niche such as those in a specialist trade or ultra-high-net-worth individuals. Using broadcast media is not relevant in most of these scenarios as the majority of the viewers will not be potential customers. Creating trust and advocacy is essential, however, so a deep content strategy and first-class experience are crucial to success.
The B2B model includes organizations such as wholesalers or technology resellers that are selling directly to other businesses. Here you are dealing with other business people rather than end consumers. These business people are of course still individuals and it is important not to forget that human psychology still applies. They do, however, have very different expectations. You may be seen less as a brand and more as a supplier, which creates a very different relationship. Your customers may be more cynical or aggressive than B2C customers as they have specific objectives and goals to achieve. You may find that traditional marketing messages and sales techniques are less well received. Therefore the focus should be more on relationships through CRM, content and direct value-added discussions rather than through advertising. It is still important, however, for these customers to be able to find your site and the information they need to get to.
Within these broader business models there are of course many specific models. A B2B IT company may be a hardware product provider or a service support provider. The service model would require more of a focus on screen sharing and CRM whilst the product model would require more of an acquisition and conversion focus. A B2C model may be simply to sell products at a significant margin or simply to gain traffic in order to make advertising revenue.
One interesting trend in business models in recent years is the freemium model. This model has grown in popularity and is essentially the method of attracting users by giving a percentage of your product or service for free and offering a more interesting, deeper experience for a price. A good example of this is the music-streaming industry with businesses such as Spotify and Deezer employing this technique. One other point here is that business models can shift and shape over time. There are many examples of this such as IBM, but there are also some more recent changes in the digital space.