Why should your company be a Business to Experience company?
The B2B and B2C vision, while useful, represents less and less the current business ecosystem, which is more digital and driven by experiences. Find out everything you need to make your business thrive in the era of Business to Experience.
Over the past decade, UX designers and researchers have dedicated themselves to enhancing each touch point of interaction with customers. Years later, this user-dedicated style had been established with new parameters, inaugurating a new moment in business.
Now is the time for experiences.
In this context, Business to Experience (B2E) represents a transition, which follows the flow of other trends that have been consolidated in society and business. It is another change in the logic of consumption that we have recently seen.
“So can we forget about that user-centric business?”
Of course! This is because, instead of a simple exchange, Business to Experience means another evolution of thought, which will have as prerequisites a symbiosis between focus on the user and obsession with the customers.
Do you want to understand more about this trend? Keep reading the article and understand everything you need to know about B2E!
The value of experience
One of the consequences of digitalization is the valorization of experiences.
As a result, we saw the boom of startups that were able to uniquely link up with their consumers. Netflix and Amazon paved the way. To speak of the Brazilian unicorns (startups that are worth US $1 billion), NuBank and QuintoAndar are very successful examples in 2 great pillars of the experience: convenience and customization.
In our closest reality, we can take as an example the phenomenon of fintechs, who understood the digital context very quickly, encompassing some concepts of the trends we just discussed.
These companies caused an unprecedented movement in the banking sector by elevating the consumer to the role of protagonist in the process of developing new digital products and services. And consequently, the business model.
All of this built with a lot of Design Thinking and UX research (user experience). We talk more about this both in this blog post on innovation in the financial sector, and in our Meaningful Banking e-book. They are worth checking out.
Meaningful Banking: Banks bet on technology to focus on user experience
With an obstinate focus on understanding users’ needs, startups (essentially) inaugurated a new modus operandi in the market, offering simple, intuitive and easy problem solving experiences.
The obsession with the customer has borne fruit.
On the part of consumers, convenience and time savings, given the possibility of solving complex problems with 2 or 3 interactions on the smartphone, guaranteed immediate adhesion. The model paid off and today, it quickly scales across the business world.
What is Business to Experience?
The pandemic has intensified the Digital Transformation process, adding a new component to this equation – remote work. But it was not just the way we work that changed: the period changed the way people consume, generating unprecedented demand on digital channels.
Digitalization has become the only option to keep businesses running. In this respect, discussions about omnichannel (multichannel) strategies have grown. And, of course, the subject of the experiments became a stamped figure in the departments.
Business to Experience consists of the idea of growth guided by the construction of memorable experiences, with purpose and that makes sense to consumers. According to this idea, more than products or services, people buy experiences.
And why is this distinction important? For B2E, it is through experiences that companies will be able to retain customer loyalty and turn brand discourse into action.
The model appears to put companies in sync with the pace of changes in their customers’ consumption habits and needs – and even to foresee opportunities.
Therefore, B2E is a vision of consumer experiences that covers the entire area of operations and represents a fundamental change in the way a company interacts with its customers, whether in digital, in person or in analog media.
This concept of “experience as a business model” considers an important factor: interactions with your brand are being evaluated based on the best experiences in the market. It doesn’t matter whether or not your company is in a market that is used to offering good experiences.
For the new consumer, this is an intersectoral relationship. You are no longer in just your given industry sector. You are in a digital environment. Did you understand the logic?
A model under construction
Some chains within the corporate world consider Business to Experience the evolution of Customer Experience (CX). There is some literature on the web that even makes a direct parallel, calling the term Business of Experience (BX).
Other articles associate the acronym B2E with the Business-to-Business (B2B) and Business-to-Client (B2C) business models. But there are inaccuracies in both directions. Because there is no competition between the terms.
Business to Experience is a new holistic and broader way of looking at business.
How does B2E work?
Still on B2B and B2C, it is interesting to comment on a few things. But first, analyze the sentence below:
“100% of your customers are people. 100% of employees are people. If you don’t understand people, you don’t understand business. ”
The above sentence was said by Simon Sinek, speaker and best-selling author of works like “Start with the Why” (or “O Jogo Infinito” in Portuguese) about leadership, learning and business purpose.
Do you agree that the phrase is for both B2B and B2C models? It speaks more about purpose than about a business model. The logic is similar to Business to Experience.
The B2B / B2C / B2E comparison is a false symmetry: being B2B or B2C is not an impediment to being B2E. We need to break that barrier.
That said, we must point out that the model goes through an appreciation of commercial relations from people to people. He sees companies more as abstractions and falls within the scope of individual experience.
They are not companies that solve problems, they are people. They are not companies that have difficulties in usability of applications, they are people. In B2E, the discussion is always about CPFs and not CNPJs.
In Business to Experience, the understanding that a healthy level of abstraction about business models is needed will make the experience more personalized and will generate greater links between individual and brand.
Important: when we talk about changing the focus of the customer to the experience, it is not about stopping being customer-centric – but understanding that the construction of a memorable experience must be at the center of the evolution of this look for the consumer.
There is no way to be B2E without being user-centric.
What are the benefits of implementing B2E?
This allows us to return to the example of fintechs and digital banks. We can make the benefits tangible with 3 phrases, which tell a story:
- According to the PhD in economics Philip Kotler, there is a well-accepted truth in the market that gaining new customers costs 5 to 7 times more than retaining them.
- Studies indicate that about 90% of consumers look to experience as the main decision factor in a purchase
- The phenomenon of fintechs frightened the market with such a strong adhesion on the part of consumers and an “emotional bond” never before seen between banks and customers.
Facing these two statements, we can assume that the solutions offered by these companies can be at least 5 times more adherent. Experience is a key factor in building customer loyalty.
Can you imagine the size of the competitive advantage that a movement of this magnitude creates for your company?
The ROI of the experiment
There is evidence that inserting UX practices into the development process as soon as possible, such as research and usability testing, eliminates rework, reduces development costs and continues to generate long-term savings.
Thinking on an industrial scale in Fortune 500 companies, for example, we are talking about an economy in the tens of billions.
Some scholars go further: they claim that allocating 15-20% of a project’s total budget to UX, whether in research or prototyping, can guarantee better ROI.
Yes, investing in UX research is likely to result in a higher initial cost. However, the long-term benefits can be much greater. In our blog post about the ROI of UX, we showed that companies that consider the user experience as one of the pillars of the business perform 228% better than average.
Why Business to Experience?
The experience boom follows a natural cycle of adopting new trends. Originally, it dealt with the cycle of adoption of new products by consumers – but it can be overflowed to the behavioral issue, for example.
Enthusiasts are innovators. Visionaries are the ones who see the long-term value of innovation. After this adoption, there is a hiatus before the trust and attention of the pragmatists, who will form the initial majority, is won.
Conservatives, in turn, represent the late majority. And finally, skeptics represent laggards.
That said, can you see the competitive advantage of being in these first groups? The number of opportunities that only pioneers will have? That’s why you should pay attention to Business to Experience.
The way of looking at the competition has changed. And being restricted to the playpen of the sector itself can mean losing a good opportunity that could have been given to 2 or 3 people instead of 1.
For Netflix, its market is that of attention. This means that the company considers any form of entertainment to be competition. From this point of view, any activity that limits the time a user is watching Netflix, is hindering the platform’s growth.
To conclude the examples from the banking sector, it is a consensus, both for experts in UX, CX and the banking sector, that fintechs have remodeled the way of “doing banking”. Only this is not restricted to that sector.
Today, when we think of a good experience, we have fintech as a reference – and we want any and all aspects, from the telephone sector to real estate, to offer us good performance in experiences.
If a tree falls in a forest, but there is no one to hear, does it make a noise?
One of the elements that helps most in the consolidation of good experiences is the construction of a recommendation system based on the evaluation of customers and their experiences.
When the experience is good, people naturally feel the need to share it. And in that case, gamified apps and platforms – and even forums built on personal opinions, are great requests. It’s digital word-of-mouth.
But it is important to know that this dynamic can also be cruel with poorly designed experiences: it is necessary to be very sure of the quality of the experience that is being offered. After all, we tend to be more detractors than complementors.
Therefore, you can’t stay on a tightrope: define your goal and invest heavily in transforming your business safely. Only then will your company be able to take advantage of the opportunities that arise in the gap between visionaries and the initial majority.
B3E is about saying “yes”
There is no magic: you really have to solve the customer’s problem. But functionality alone is also not enough – it is necessary to incorporate the economy of convenience, giving the customer more options to solve that problem.
After all, Business to Experience is about saying more “yes” to consumers. It’s about empowering them to make quick decisions, providing great experiences and offering the right way to solve the problem at the right time.