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C2B (Consumer to Business) - Meaning, Importance & Components

Published by MBA Skool Team in Marketing and Strategy Terms Last Updated: July 01, 2023Read time:

What is C2B (Consumer to Business)?

C2B (Consumer to Business) is a business model where the end consumers create products/services ideas and value which are directly consumed by businesses to create more value and improvements. It is diametrically opposite to the popular concept of B2C (Business to Consumer) where the companies make goods and services available to the end consumers.

In C2B, the companies typically pay for the product or service. However, it can assume different forms like an idea generated by an individual (like an innovative business practice) which may be used and implemented by an organization. Another possible form of C2B is where a consumer specifies a need and the various businesses compete or bid to fulfil that need.


Importance of C2B (Consumer to Business) Model

C2B model though an inverted business type has become very important since the rise of internet and smartphones. large group of customers can interact with each other and the business directly through social media and customer service pages. The value from customer feedback, comment, suggestion can directly be consumed by business which can be converted to an actionable insight. This is one of the advantages of the C2B. Many a times, business ask for direct feedback and even ask for issues with the product. The information collected is directly used for product development and improvement.

But it is very important to manage the C2B model well. Sometimes it can become very difficult to handle the feedback and comments which can lead to less research and development and more reliance on the customer comments. This can be an issue in long term when the consumer behavior changes.

Feedback analysis and C2B should be not be very heavily coupled because not all consumers might be expressing their concern or ideas online. It is important to properly understand the customer through research and proper channels to take and ask for ideas. 


Components of C2B (Consumer to Business)

There are 3 main components

Product or Service

This is the main component which drives the business or on which the entire business is based. This produced by the end customer and taken to the business in C2B.

In case of Consumer to business model, the product may undergo more value addition and changes once it goes further in the process.

Consumer

Consumer is the one who consumes the product or the service produced by a business or a company. In C2B, Consumer creates a product or an idea and takes it beyond personal usage and act as catalyst for future growth of business

Business

The business is the producer or manufacturer of the product or service consumed by the end customer generally but in c2b, the business buys or consumes the product created by the customer to create more value and updates on top of it.


C2B


C2B (Consumer to Business) examples

1. One of the good example is where an instant noodle brand asked for suggestions to improve the noodles and add more flavors. After the suggestions, they selected the top entries and created actual products and launched in market.

2. Another example is where smartphone companies take direct feedbacks from customers and influencers before launch on the performance of the product.

Hence, this concludes the definition of C2B (Consumer to Business) along with its overview.

This article has been researched & authored by the Business Concepts Team which comprises of MBA students, management professionals, and industry experts. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

Browse the definition and meaning of more similar terms. The Management Dictionary covers over 1800 business concepts from 5 categories.

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