Consumer vs Enterprise Product Management

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Whether you call it consumer or B2C¹, enterprise or B2B², being a product manager on one side or the other has long been a defining characteristic. You either know how to build products for enterprises or for consumers and job ads make a big deal about focusing on one or the other. But is there really a difference any more?

Consumer is conceptually pretty straightforward – you build a product for the end user and, if they like it, they’ll pay for it. Great user experience has quickly become fundamental as the competition is fierce and the treacherous one-click adage puts competitors just one click away.

But in the enterprise world the user and the purchaser are different people with different needs. This suggests that it requires a different product management approach and certainly until recently enterprise businesses focused almost exclusively on the purchaser. Their clients’ penchant for driving top-down adoption of software and products meant that the end user experience didn’t really matter – as long as whoever was paying for it was happy and hit their goals.

The rapid consumerisation of the enterprise means this approach has all but disappeared. Due to the revolution in user experience in consumer apps, end users simply gave up on crusty old systems internally and demanded better tools. And, if they don’t get them, they simply circumvent their IT department and use whatever they can to make their work more efficient. Companies have woken up and realised that installation isn’t the same as adoption and that to truly benefit from new products they have to be used.

I’ve worked on both sides throughout my career and I believe all products should be approached the same way, because at the heart of it they are simply products with different personas acting on them. Fundamentally, even most B2C products have the same problem as they’re advertising funded – so the end-user and the person paying for it are still different people.

This means knowing and understanding the requirements of all the different personas or stakeholders that engage with your product – whether they are an end-user, a corporate procurer or advertiser – and maximising the product’s usefulness for all of them. This doesn’t mean they have equal priority.  Ultimately, this prioritisation is now overwhelmingly in favour of the end-user – because if they’re not loving it and using it, the procurer or advertiser aren’t going to pay for it.

¹business-to-consumer
²business-to-business

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  • http://twitter.com/iris__k Iris van de Kieft

    “The rapid consumerisation of the enterprise means this approach has all but disappeared.”
    I’m always amazed at those horrible old systems. I can’t wait to really see them be replaced with products with good UX.

    • http://www.martineriksson.com/ Martin Eriksson

      I know. My favourite recently has been an enterprise software system we’ve had to use through a partner that is so complex to use that their professional services team have built incredibly complex excel forms for clients to fill out instead of subjecting them to the system itself. Talk about wasted effort…

  • http://twitter.com/niteshj11 Nitesh Jain

    Ultimately it boils down to what is MVP that you can make sell. Agree that doing a good UX is ideal, but everything comes at a cost. You may need to prioritize functionality vs UX at times, and see what really would be valued by your customers and users.

  • Dr Chris White

    Martin – I agree with your position. I have ~20 years experience ranging from military lasers, telecom optical systems, to now real time mobile phone billing systems (Prepaid) and understanding what drives the ultimate end customer has always been fundamental to my decision making process. It is so frustrating that recruiters and corporate managers still do see product management as a skill (like finance, development etc) that if the person is very well skilled can be applied to almost any product. In my current industry you see so many technically talented sofwtare people move to product management with no training with the end result the products are so “user unfriendly” it is untrue, and they miss to do a complete environmental analysis. – Martin keep up the good work

  • http://twitter.com/jtpedersen JT Pedersen

    .

    There are areas of similarity. There are also significant differences.

    Yes, the days of creating enterprise systems with clucky ugly interfaces are/have passed on. But that’s often because the competitive landscape has tightened. If yours is a commoditized environment, then the UX becomes a new area for competitiveness where it wasn’t previously.

    Many ‘consumer’ products are driven by a sense of desire, a want, and frequently ‘need’ doesn’t even enter the picture. Enterprise products flip that formula on its ear. If it isn’t needed, justification is hard to get, unless there’s an executive champion with enough clout to drive ‘want’ over need.

    The other key differences are interoperability and scale. One might argue that in the case of web/SaaS based offerings, scale is moot. Your ‘finance’ offering might need the same infrastructure to service 10,000 consumers of the fundamentally identical product you sell to 200 customers with 500 users each. However how you approach packaging, pricing, delivery, and value proposition for B2C and B2B are going to be different.

    And, therein lies the answer. While underlying product requirements may have strong similarities, how you deliver the to market can be completely different, requiring product managers with relevant expertise.

    • http://www.martineriksson.com/ Martin Eriksson

      Thanks for the reply JT – I completely agree with all your points, but to me what you’re describing are the differences in requirements, customer needs and ultimately the product marketing. The product management process in the middle by which you discover those inputs, prioritize them and build them is the same IMHO.

      • http://twitter.com/skychatter Praveen Krishnan

        Good article and worthy of deeper discussion. I second JT. From afar, yes, the process may seem the same but in each step of the process there are big differences, IMHO:

        - Discovery: In the B2B world, getting input from customers is a prolonged and laborious process.
        a) It is often not easy to reach the end user at the customers because they are several levels away from purchasers who are the points of contact. PMs often have to make judgement calls from limited input whereas with B2C, there are various ways in which you can get a lot of input directly from large numbers of users (e.g. A/B tests).
        b) In many cases, you need product elements that would appeal to the purchaser/decision-maker but not necessarily useful for the end user.

        - Prioritization: Again, B2B is different. PMs have to deal with competing demands from large ($$$) customers/prospects. A large customer or prospect can have a significant influence on the product roadmap in terms of resources.

        - Build: Here, B2B and B2C may be more similar than different.

  • http://twitter.com/jockbu Jock Busuttil

    I certainly agree that, in an ideal world, companies and recruiters should be able to see ‘a good product manager’ rather than ‘a good B2B or B2C product manager’. However, I would also contend that there still remain a few hurdles for product managers making the leap from one world to the other.

    In my view, the most significant difference is the presence of an in-house sales force in B2B companies. A competent, well-aligned sales team will be a force to be reckoned with; a dysfunctional sales team will kill any product stone-dead irrespective of how good the product and its manager are. In effect, a B2B sales team can add a level of indirection between the product manager and the market that would not be present to the same extent in a B2C company.

    This doesn’t prevent B2C product managers making the leap to B2C at all, but it’s important to be aware of this – look before you leap, so to speak!

    • michelle

      What does a good product discovery / user research process coordinated with a sales team look like?

      • http://twitter.com/jockbu Jock Busuttil

        Hi Michelle, thanks for the question.

        A good sales (or account management) team should be in frequent contact with the customers, so they can be a good source of secondary evidence about what’s good and bad with your product, as well as uncovering potential opportunities for new features or products.

        As with any secondary source of information, it’s advisable to corroborate their feedback with the market rather than taking it as the gospel truth. Again, if the sales team is good, they’ll be able to introduce you to the right people at customers to help you gather market feedback.

        Similarly, a good sales team will be an effective conduit for getting the word out to customers, say if you’ve got a product launch coming up or perhaps need some early adopters / beta testers.

  • James Kelly Mendaros

    Great! When will be your next post?

  • James Kelly Mendaros

    I learned a lot from this blog. Thank you.

  • Kael Montas

    Wow. This answers my questions. Really helped a lot. Thanks

  • Kael Montas

    Really helped a lot. This answers my questions in my business management course. Thanks a lot.

  • Kael Montas

    Who is the best product manager ever??? thanks.

  • Kael Montas

    Yeah. When will be your next post?

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