Buoyed by pandemic lockdowns, B2B e-commerce is following in the footsteps of online retail as one of the fastest-growing market trends. But it is not simply a copy of its B2C counterpart; rather, it is a complex and evolving field that requires businesses to adopt innovative strategies and technologies to meet customer expectations and stay ahead of the competition. In this article, we will explore five B2B e-commerce trends that will shape the market in 2023 and beyond.
The state of B2B e-commerce
It is understandable that customer expectations in the B2B e-commerce space in 2023 include an experience very similar to what new customers in particular are used to in a regular online store. However, B2B e-commerce has its own unique challenges and requirements, such as:
- more complex pricing structures,
- complex purchasing procedures (tenders, bids, etc.),
- supply chain complexity,
- multiple decision-makers (transactions may require approval from managers, accounting, etc.),
- long-term contracts,
- greater need for customized, non-standard solutions resulting from specific requirements.
Therefore, B2B e-commerce sellers need to adopt a digital channel strategy that caters to the specific needs and preferences of both new and existing customers, while also leveraging the advantages of B2B e-commerce, such as lower costs, higher efficiency, and wider reach.
Despite these problems, e-commerce has become, according to a recent report by McKinsey & Company, the most effective sales channel for B2B companies in 2022, surpassing in-person sales, video conferencing, email, and telephone. The report states that 35% of B2B companies rate e-commerce as their top sales channel, followed by 26% for in-person sales, 12% for video conferencing, 10% for email, and 8% for telephone.
Even though the importance of online sales channels for B2B is growing, there are still many myths surrounding B2B e-commerce trends. According to a blog post by McKinsey & Company, there are five prevailing myths about B2B eCommerce that need to be debunked:
- E-commerce is not offered by most B2B companies. In fact, according to McKinsey & Company, nearly two-thirds (65%) of such companies, across all industries, now have B2B e-commerce capabilities, fully executing online sales transactions.
- B2B buyers prefer face-to-face interactions. In reality, a Gartner sales survey has found that 83% of B2B buyers prefer ordering or paying through digital commerce, while a survey by McKinsey & Company indicates that 66% of B2B buyers actually prefer remote human interactions or digital self-service to one-to-one purchases. As a result, two-thirds of corporate customers intentionally reach for digital or remote in-person engagement when given a choice.
- Just a basic e-commerce site can suffice. This is neither factually correct (as mentioned before, B2B e-commerce platforms have numerous special requirements) nor a belief widely held in the B2B sector. In fact, the majority of companies in this market treat e-commerce as a full-service channel and are adjusting their business model, investment, marketing, and sales strategy accordingly.
- E-commerce is an immature space for businesses like ours. This is said primarily in relation to large companies that make high-value sales and purchases and, indeed, whose procurement managers are skeptical about conducting large-scale business through e-commerce, as it often requires negotiations, approvals, etc. However, a McKinsey & Company study found that as early as 2021, most buyers were willing to spend upward of $50,000 through e-commerce channels, with a third of corporate decision-makers comfortable with making online purchases of up to $500,000 and 15% of $1 million and more.
- Business customers are not ready for B2B e-commerce yet. This is patently untrue. As shown by numerous studies (some of which were mentioned above), corporate buyers are not only open to B2B e-commerce, but two-thirds of them actually prefer digital and remote channels throughout their (increasingly personalized) shopping experiences.
Read more on e-commerce development:
B2B e-commerce trends—omnichannel
One of the major e-commerce trends of recent years has been omnichannel. This is a retail strategy that integrates different sales platforms and various traditional and digital channels, such as desktop and mobile e-commerce technology, third-party online marketplaces, mobile apps, email, social commerce, and brick-and-mortar stores, to create a unified customer experience. The aim is to make it easy for customers to interact with a brand by meeting them wherever they are and however they shop.
Significantly, most e-commerce customers already use multiple channels (mobile apps, mobile and traditional sales platforms, social commerce through social media platforms, third-party online marketplaces, physical stores) to make purchases. A customer might even start a purchase on a mobile e-commerce site (perhaps brought there by digital marketing on a social media platform) but conclude the purchase on a traditional e-commerce site and then pick the order up in a brick-and-mortar store.
B2B buyers could be expected to want the same flexibility in their professional dealings, especially since B2B purchases are often a more extended process, meaning that business customers might prefer to use different sales channels—for example, face-to-face, videoconferencing, online chat, or online marketplaces—at different stages of their buying journey. In fact, McKinsey and Company research indicates that by 2021, B2B decision-makers were using 10 distinct channels to interact with suppliers.
While procurement managers point out that mobile devices are less important in B2B e-commerce, as purchases are most often handled from the office, and mobile wallets are not a suitable means for large businesses to handle their payments, the growing importance of mobile in B2C e-commerce leads one to expect that more and more B2B buyers will want to use mobile devices, especially in smaller organizations with less-formalized procurement procedures. It has also been noted that mobile devices play a crucial role in the work of sales reps, who are often on the move, always on the phone, and may cherish the possibility of handling their side of online sales through a mobile device.
The significance of omnichannel e-commerce is highlighted by the fact that around 9 out of 10 prospective customers prefer having an omnichannel experience. This trend seems to have accelerated as digital transformation sped up during the pandemic, when more buyers (and sales reps) would conduct transactions (even with business customers) at home, on their sofa, rather than in front of a computer at the office, and the aforementioned McKinsey report shows that over 90% of companies believe their pandemic-adjusted sales strategies are more effective.
Sana goes further with this trend, proposing a concept of unified commerce as a way to create a seamless customer experience across different channels. In practice, unified commerce entails connecting backend systems to sales platforms that customers frequently view and shop from. A key concept here is a single source of truth—i.e., all of the sales channels (be it an e-commerce store, third-party fulfillment or e-commerce platform, customer self-service portal, brick-and-mortar store, or sales rep) rely on the same database for information about current customers, stocks and pricing, inventory management, supply chain management, etc. Unified commerce is built on three pillars:
- Tech stack: software solutions integrating frontend and backend systems
- Product offering
- Different channels
B2B e-commerce trends—hybrid teams
Speaking of B2B e-commerce trends relating to salespeople, an extension of the unified commerce idea is the hybrid sales team. Hybrid sales teams are an innovative approach to sales that combines traditional in-person sales with online sales and self-service platforms. Customers can choose to interact with the sales team in person, online, or through self-service platforms, depending on their preferences and needs. This flexibility allows businesses to meet customers where they are and provide a personalized experience. In fact, a report by McKinsey & Company indicates that hybrid sales produce up to 50 percent more revenue than more traditional models by taking advantage of a more diverse talent pool and enabling deeper customer engagement.
One of the key benefits of hybrid sales teams is the ability to provide a consistent and cohesive customer experience across different channels. Whether a customer interacts with the sales team in person or online, they should receive the same level of service and have access to the same information. This consistency helps build trust and loyalty among customers, which can lead to repeat business, customer retention, and positive word-of-mouth referrals.
Another advantage of hybrid sales teams is the ability to gather valuable data about customer preferences and behaviors. By tracking customer interactions across different channels, businesses can gain insights into what products or services are most popular, which marketing strategies are most effective, and how customers prefer to engage with the sales team. This data can inform future business decisions and help optimize the sales process.
As we can see, the benefits of this approach largely overlap with the omnichannel or unified commerce trends. The added benefit here is that all the sales channels are handled by a single team, providing better communication between different channels, but most importantly between sales representatives and customers. This helps solve problems, such as supply chain issues, improves customer retention, and helps boost customer loyalty by giving buyers the best of both worlds: the versatility of omnichannel plus a trusted sales rep.
B2B e-commerce platform—own store or third-party marketplace?
An omnichannel strategy also includes the use of third-party sales platforms. Generally, when it comes to online sales, businesses have two options: building their own store or using a third-party marketplace. Building a company-owned online storefront allows businesses to have complete control over the platform and tailor it to their specific needs, which is particularly important in the complex area of B2B sales. It provides the opportunity to create a unique brand experience and maintain quality control. However, building a platform from scratch requires significant investment in terms of development, maintenance, and marketing.
On the other hand, using a third-party marketplace, like Amazon Business, offers immediate access to a large customer base and existing infrastructure. It allows businesses to leverage the marketplace’s brand reputation and benefit from its marketing efforts. Additionally, third-party marketplaces provide a convenient way for businesses to reach global markets and a wider audience, reduce supply chain complexity, and perhaps also take advantage of the platform’s efficient fulfillment processes. By utilizing an established marketplace, businesses can focus on their core competencies while leveraging the marketplace’s resources and customer base. There is also no reason for a company not to use both a proprietary e-shop and a third-party marketplace, especially if it can stick to the “one source of truth” principle.
No wonder then, that a Digital Commerce 360 report on B2B e-commerce trends stipulated that as of 2022, B2B marketplaces were growing 7.2 times faster than all of B2B e-commerce and would reach $130 bln in sales in the US alone.
B2B e-commerce trends—D2C
The trend in e-commerce that allows manufacturers to sell their products directly to customers, bypassing intermediaries and salespeople, is known as D2C—direct-to-consumer sales. And D2C approach targets both B2B and B2C customers offering many benefits such as:
- Reaching new customers: D2C enables manufacturers to sell to customers who would normally be too small or too far away to serve in a traditional way. By creating an online store, manufacturers can expand their market reach and attract customers who prefer online shopping.
- Building customer relationships: D2C allows manufacturers to communicate directly with their customers without relying on third parties. This can help them create a stronger brand identity, increase customer loyalty, and collect valuable feedback.
- Increasing profit margins: D2C eliminates the costs and commissions associated with intermediaries and salespeople. This can help manufacturers increase their profit margins and have more control over their pricing and promotions.
- Innovating faster: D2C enables manufacturers to test new products and features with their customers without waiting for approval from distributors or retailers. This can help them innovate faster and respond to changing customer needs and preferences.
Even more importantly, according to a report by Omnia Retail, D2C sales increased by more than 36% from 2020 to 2022 in the United States and are predicted to reach $182.6 billion in 2023. This shows that D2C is definitely a trend to watch in 2023 and beyond.
B2B e-commerce strategy—personalized service
Another trend to watch for in B2B is that existing customers will be increasingly replaced or joined by younger Internet users. They are used to the full experience of an online store, including buying through many different channels, using self-service tools, and a high degree of personalization. Furthermore, unlike B2C customers, who often make impulse purchases based on emotions, B2B buyers are more rational and pragmatic. They have specific needs, preferences, and expectations that vary depending on their industry, role, and company size. Therefore, B2B e-commerce platforms have an even greater need to offer personalized experiences that cater to each buyer’s unique requirements and goals. This means that if a B2B company wants to remain competitive, personalization is a key factor.
Personalization can help B2B e-commerce platforms achieve several benefits, such as:
- Increasing customer loyalty and retention by providing relevant and tailored content, offers, and recommendations that match the buyer’s interests and needs.
- Boosting conversion rates and average order values by simplifying the buying process, reducing friction, and increasing trust and confidence.
- Enhancing customer satisfaction and advocacy by delivering consistent and seamless experiences across multiple channels and touchpoints. Here we come back to omnichannel yet again.
- Gaining a competitive edge and differentiation by offering value-added services and solutions that address the buyer’s pain points and challenges.
No wonder, therefore, that according to Adobe’s “2023 B2B Commerce Growth Strategies Survey,” B2B organizations are already using their data for personalization: 72% are collecting behavioral and transactional data and 68% are using it to personalize the customer experience to some extent. However, fewer B2B companies are taking advantage of this data with systems such as marketing, merchandising, and email.
Thus, expanding the use of personalization is another one of e-commerce trends to look out for in the future.
The future of B2B e-commerce will be shaped by:
- hybrid teams,
- third-party marketplaces,
- personalized services.
These trends offer opportunities for businesses to create a better customer experience, increase sales efficiency, and differentiate themselves from their competitors. By embracing these trends, businesses can leverage the power of e-commerce to grow their business and achieve their goals.