B2B vs. B2C product management
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"Observations of a B2C PM who went to the dark side" Product management changes a lot whether or not you're in B2C or B2B. With B2C being the clear darling of the press and different books on the subject, I wanted to share my views on what makes B2B different for a Product Manager. Presentation made at La Product Conference in Paris on June 21st 2016
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B2B vs. B2C product management
- 1. B2C Observations of a B2C PM who went to the dark side B2B
- 2. Some background 11years of B2C product management
- 3. 1 year of B2B in Adtech
- 4. First shock: 5M vs. 5k
- 5. What is your business model? Mass market users (still) expect the service for free
- 6. Either you find a way to make them pay Or you find companies who pay for ads
- 7. Businesses are willing to pay (a lot more) for service
- 8. In summary 2 fundamental elements change how you approach product management 1. Number of users 2. How (much) you monetize them
- 10. In B2C, all users have the same value.
- 11. One roadmap, two goals: 1. Bring more users in 2. Transform your existing users into more engaged users
- 12. As you scale, you should prioritize based on the users you don’t have yet
- 13. In B2B, those 3% could mean 25% of revenue
- 14. In B2C YOU define your strategy In B2B it’s challenging to run YOUR strategy instead of just requests from big clients
- 15. MVP
- 16. How do you define “minimum”?
- 17. You can actually take risks more often, despite the threats of revolution
- 18. In B2B, a data-only approach is complicated
- 20. You are not the user, duh
- 21. Sales? Account strategists? “Build a product that delights users and they will come”
- 23. One key similarity once you are scaling What does “being agile” really mean?
Editor's Notes
- Press: big focus on B2C B2B seens as not glamourous
- Fell into B2C during the first photo sharing wave Going from wave to wave over 11 years of B2C MySpace and the social network wave content discovery and reco with StumbleUpon Sharing economy with BlaBlaCar IoT?
- Then decided to catch the biggest wave that was there all that time: adtech 1 year of B2B My very biased point of view
- If you look at the number of users, the change of scale is astounding If you look at the associated Revenue, the change of scale is astounding, but the other way around It’s the first of 2 things that impact a lot how your approach product management
- In B2C the massive scale is necessary to generate revenue B2c usually starts free
- Either you find a way to make them pay (dating, sharing eco, free to play, subscription) Your need a position of dominance to make it possible > can’t pull it off too early At Blablacar we had to reach critical market share to be able to switch from a free model > users will try their best to find alternatives Or you find companies who pay for ads In this case you need eyeballs > a lot of returning users Linked In, even Craigslist make the enterprise pay through job ads
- By contrast in B2B, securing the first client is the challenge, but businesses are willing to pay (a lot more) for service Dropbox moved to B2B looking for revenue, using its B2C product as a sales channel Thousands of clients is already a lot
- In B2C, all users have the same value. “What about the core, most active users? They’re worth more!” Counter intuitive, but in your roadmap you don’t cater to those much.
- Your roadmap has 2 goals: Bring more users in Transform your existing users into more engaged users
- You don’t cater to your most engaged users (While at MySpace “they’ll be the last to leave”) There are more users that you don’t have yet, than users you have.
- 3% of users can be discarded, except when they represent 25% of revenue You don’t want your future clients to be like the 3%, because they ask for a lot of custom work!
- In B2C YOU define your strategy In B2B it’s challenging to run YOUR strategy instead of just running requests from big clients
- “Minimum” doesn’t mean the same for a user who pays you big money. Espcially hard during migrations Change is very risky Experimentation is more complicated Unless you have close partners, and then they can help a lot.
- In B2C, change can be received by uproar, but numbers tell you if it’s legit or just the vocal minority, the 3% FB switching to the newsfeed Data is your best friend!
- With individual clients contributing significantly to your revenue, data-only appraoch is complicated Many clients with different needs Constant fight against custom work
- Easy to do in B2B! In B2C sometimes hard to realize, especially in the scaling phase. Common thing to miss by the founder. She created the service to answer her needs. In B2C, data tells the truth
- Can’t scale without the sales team Hard to make changes without the buy-in from the Account strategist. > You can get a lot more qualitatitve feedback about your product thanks to them. They know your user better than you ever will Sales and account managers have a huge impact on your roadmap and on your rollout A very useful tool, but a very important stakeholder Quick feedback loop
- Sometimes to cater to your users needs, you need to know what the competition is doing. I used to just create an account to see what the others are doing. Myspace, looking at FB and their “ad-free” one page experience Sharing economy and the “design by AirBNB” Much more complicated in B2B It also makes recruiting PMs with B2B experience slightly more challenging :)
- One bag of money, 2 bags of responsibilities