This document summarizes key differences between B2B and consumer markets. B2B markets have relatively fewer geographically concentrated buyers who purchase more technical, customized products that require greater service and involvement from multiple functional areas on both sides. Purchasing decisions are more performance and rationally based. In contrast, consumer markets have mass markets of dispersed buyers who purchase more standardized products with less technical expertise required and purchase decisions based more on social and psychological factors.

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3. Areas of Difference B2B Market Consumer Market
Market Characteristics Geographically Concentrated Consumer Disbursed
Relatively Fewer Buyer Mass Market
Product Characteristic Technical Complex Standardize
Customized
Service Characteristic Service, timely Availability Extremely
Important
Some what Important
Buying Behavior Involvement of Various Functional area
from both the ends
Involvement of family members
Technical Expertise Relatively less technical expertise is
required
Stable Interpersonal relationship Non- Personal relationship
Purchase Decision are performance
based and rational
Purchase decision are mostly based on
physiological/social/physiological

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5. High Cost to Serve Low Cost to Serve
Order Custom Products Order Standard Products
Order small Quantities Order Large Quantities
Unpredictable Order arrivals Predictable order arrivals
Customized delivery Standard Delivery
Frequent Changes in delivery
requirement
No changes in delivery requirement
Manual Processing Electronic Processing
Large amount of presales support Little to no presales support
Require company to hold inventory Replenish as produced
Longer credit periods Payment on time

6. Transactional Exchange Collaborative Exchange
Availability Alternative Many Alternative Few
Supply Market Dynamism Stable Volatile
Importance of Purchase Low High
Complexity of Purchase Low High
Information Exchange Low High
Operational Linkage Limited Extensive
Typical Characteristics of buyer seller relationship based on
Market condition and Purchase Behavior