All You Need to Know About B2B Ecommerce in 2023
The world does business differently today than it did a decade ago. While consumers flock to online retail, companies are leveraging the power of ecommerce to increase their profit margins and customer satisfaction.
A decade ago, people ran businesses through physical stores and outlets worldwide. However, in the past few years, we have seen the emergence of B2B ecommerce as an efficient way to conduct business transactions with enterprise customers located anywhere in the world.
Industry giants such as Amazon, IBM, Microsoft, and Oracle have already adopted B2B ecommerce platforms for their business needs. Take Amazon Business, for example. The platform lets business customers purchase products in bulk with discounts, access exclusive product catalogs, and receive invoices through the use of automated processes.
Thanks to the ability of B2B ecommerce to automate many of the processes and streamline certain business operations, it is projected to grow exponentially over the next few years. B2B ecommerce is expected to reach 1.8 trillion U.S. dollars in just the U.S. alone in 2023.
If you're ready to join the B2B ecommerce revolution and take your business to the next level, our guide will outline all you need to know about this potential game-changer.
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What is B2B Ecommerce?
Well, how do we define B2B ecommerce? B2B ecommerce, or business-to-business ecommerce (or business-to-business electronic commerce!), is an online trading platform where businesses can buy products and services. It differs from traditional B2C (business-to-consumer) platforms in that it focuses on providing the resources necessary for businesses to purchase goods and services directly from other companies.
Let's look at an example to give you a better idea of how B2B ecommerce works. Say you own a restaurant and need to purchase supplies from a local supplier. You can use the B2B ecommerce platform to find relevant suppliers in your area and place orders for the products you need. Perhaps it's a bulk order of ingredients or a supply of new cookware.
This process is much more efficient than having to contact each supplier manually and negotiate prices over the phone or through emails – something that would take up precious time and energy.
How did B2B Ecommerce come about?
Believe it or not, B2B ecommerce has existed for some time. In the early days, companies like AT&T and IBM were already leveraging the power of electronic data interchange (EDI) to conduct business transactions with other enterprises. The EDI technology allowed companies to securely exchange information in a standardized format without relying on paper documents. The technology was eventually adopted by other businesses as well, leading to the emergence of B2B ecommerce.
The first B2B ecommerce platforms were developed in the late 1990s, with pioneers such as Ariba and CommerceOne at the forefront. These companies created marketplaces that allowed businesses to purchase products from other businesses online. Since then, there has been a surge in the number of B2B ecommerce platforms on the market today – all offering various features and services tailored for specific industries or business needs.
Types of B2B Ecommerce
B2B electronic commerce platforms come in a variety of shapes and sizes. Here's a rundown of the different types of B2B ecommerce platforms available that offer various features and services:
Wholesale marketplaces allow businesses to purchase bulk products at discounted rates. These types of platforms are mainly used by retailers, but they can also be beneficial for companies that need to purchase large quantities of goods or services. Faire, for example, specializes in wholesale marketplaces for independent retailers and brands - think quirky items like candles, cocktail mixes, scrapbooking items, and more.
Manufacturer to Business (M2B)
M2B platforms are similar to wholesale marketplaces but specialize in providing businesses with direct access to manufacturers. Essentially, you're taking out the middleman and taking advantage of wholesale prices directly from the source. This is great for businesses that want to get their hands on exclusive products or services, as well as those that wish to work with a manufacturer on custom orders.
Business to Business to Consumer (B2B2C)
B2B2C platforms - quite the mouthful - are the talk of 2023 and are a bit of a novel concept. They allow businesses to connect with consumers directly, making it easier for them to provide personalized services and products that meet their customers' needs. If you’re a business that wants to expand your customer base by tapping into the consumer market - this format is for you.
Suppose a company sells natural skincare products. B2B2C platforms directly foster a connection between the company and customers and offer them tailored services such as personalized product recommendations and discounts.
Different Business Stages
Not all businesses are created equal - and neither are all B2B ecommerce platforms. Depending on your business's stage, different types of B2B ecommerce platforms will be better suited for your needs. Here's a quick overview of the four different stages and the types of B2B ecommerce solutions they would pair best with (it's like wine and cheese, but better):
Regarding B2B ecommerce, startups and small businesses need to prioritize scalability. Easy-to-use, cost-effective solutions should be at the forefront, ones that can grow with their business. Platforms such as Shopify or BigCommerce are great options here.
Businesses that are looking to proliferate will require more robust B2B ecommerce solutions. Platforms such as Magento or WooCommerce Enterprise offer greater flexibility and scalability, allowing businesses to scale up their operations quickly. The difference here is that these solutions are more expensive but offer greater customization and integration capabilities.
Businesses that are looking to expand their operations and break into new markets will need a more comprehensive approach. Platforms such as SAP Hybris or Oracle NetSuite provide businesses with advanced features and tools, allowing them to easily manage complex marketing campaigns, customer data, inventory management, and much more.
Ripe and ready, businesses at this stage need to focus on optimizing their operations and maximizing their profits. Solutions such as IBM Websphere or Microsoft Dynamics365 provide businesses with enterprise-level features and tools, allowing them to manage their operations more efficiently.
How to Utilize B2B Ecommerce for Your Business
And now we get to the fun part - how actually to use B2B ecommerce for your business. Businesses must first understand how their customers shop, what they want and expect, and the best way to meet those needs. Only then can companies quickly create custom marketplaces that cater to a specific audience.
The number one goal of any business should be to engage its customers and build strong relationships. B2B ecommerce allows businesses to craft personalized customer experiences and create effective targeted marketing campaigns.
Regardless of the campaign, businesses should remember to understand the customer journey, segment audiences, create personalized experiences, and provide targeted content. For businesses to be successful, they need a comprehensive marketing strategy that leverages the available channels, such as search engine optimization (SEO), content marketing, and email campaigns.
The selection of marketing tools out there is vast, as tools such as email campaigns, social media ads, AI-driven tools such as machine learning and predictive analytics, and even voice search have all become available. Businesses can use these tools to create custom-tailored customer experiences that cater to specific needs and interests.
Some marketing tactics to consider within business-to-business ecommerce include:
- Leverage content marketing to build customer relationships and increase customer loyalty.
- Use email campaigns to target specific segments with tailored messages and offers.
- Utilize targeted advertising and segmentation to reach customers who are more likely to purchase from you.
- Incorporate search engine optimization (SEO) into your B2B ecommerce strategy to rank higher on search engine results pages (SERPs).
- Invest in data-driven marketing to get the most out of your B2B ecommerce efforts.
ROI-driven targeted ads have become a part of the core of any successful B2B ecommerce strategy. Targeted ads effectively reach the right customers, as they allow businesses to personalize their message and tailor it to a specific audience.
They can be used in different ways, such as retargeting campaigns or display advertising. Business owners should use this technology to create compelling experiences for their customers that will help them build brand loyalty and increase conversions.
A clothing company could use targeted ads to promote its new line of winter coats, targeting customers in cold climates. If the company reaches out to potential customers in colder regions and provides them with relevant information about the product, it can result in an impressive ROI.
Buyer Loyalty Programs
Buyer loyalty programs are an effective way to keep customers coming back and spending more. These programs reward customers for their purchases, providing them with discounts, rewards points, or other incentives.
To create a program that will provide the best experience for your customer base, keep an eye on customer behaviors and preferences, and adjust accordingly. To do so, you might want to consider implementing an AI-driven loyalty program that dynamically adjusts rewards to meet customer needs.
These AI programs work by collecting customer data such as purchase history, demographics, and interests, then using algorithms to provide personalized rewards for customers. The result? An engaging loyalty program that keeps customers coming back for more.
Even outside the B2B space, partnerships can be a powerful way of gaining access to new markets and customer bases. As the saying goes - two heads are better than one. And the same is true with B2B ecommerce partnerships.
With ecommerce in B2B, businesses can partner up and share resources to gain access to new customers and markets. A business might partner with another related company and work on joint product launches, bundled products or services, and cross-promotion through each other’s channels. All in all, the benefit of partnerships is twofold.
No customer wants to wait weeks for their order to arrive, and in the B2B space, delivery speed is even more crucial. Businesses must ensure that they have access to reliable transportation methods such as air freight or courier services to quickly and efficiently fulfill orders. But what exactly is considered fast? 97% of consumers consider same-day delivery “fast,” while 95% consider next-day delivery to be “fast”.
It’s also crucial to consider using automated delivery tracking systems to inform customers of their real-time order status. You want that customer trust and loyalty to build, and the best way to do that is by giving the assurance their order is being taken care of.
Distributor Order Minimums
Although most customers expect to be able to order in bulk, businesses need to consider their own distributor order minimums so they can more easily manage inventory and ensure customer satisfaction. Businesses can ensure that their margins remain intact and that customers get the best possible deal when they require a minimum number of items that must be purchased or a specific dollar amount before an order is accepted.
Checkout Process Simplification
A streamlined, simplified B2B checkout process is essential for an efficient online business. Businesses should ensure that their website offers a seamless customer experience and that it allows customers to search for and select items they want to purchase quickly.
Seeing that the checkout process should be secure, fast, and simple, many businesses opt to use payment solutions such as PayPal or Stripe to refine their checkout process and make it easier for customers. Are you questioning the importance of one-click payment solutions? Don’t. Statistics show that a whopping 97% of consumers choose to abandon their purchase if the process isn’t convenient.
There are so many ways businesses can interact with customers, and B2B ecommerce allows them to do so across multiple channels. Omnichannel selling involves creating an integrated, seamless experience across the spectrum. This means that customers have access to the same products and services, whether they shop online, in-store, or via mobile devices.
A unified online and offline experience is essential for a successful B2B business. Companies must ensure that their website, mobile app, and physical store locations are in sync.
These particular strategies are beneficial for B2B ecommerce as they let businesses offer customers the convenience of ordering from anywhere, anytime – something that’s essential for busy business owners who want to remain competitive in today’s digital age.
Embracing the B2B omnichannel experience involves understanding the use of different sales channels at each stage of the buyer’s journey. For instance, you’ll want to use digital marketing strategies such as search engine optimization, content marketing, and social media to attract prospects, as well as use a combination of email marketing, customer segmentation, and targeted advertising to nurture those leads.
Myths about B2B Ecommerce
Misconceptions about B2B ecommerce are far too common and cause companies to miss out on huge business growth opportunities. Let's take a look at some of these myths and see how they can be debunked.
Myth 1: B2B customers prefer traditional purchasing methods
Commercial buying and selling have become obsolete in some way - digital buying behavior is now the norm for B2B and B2C customers. The rise of the COVID-19 pandemic truly accelerated the digital transformation of B2B ecommerce, with many companies being forced to move their buying and selling processes online. Along with this came the realization that digital marketplaces are far more efficient for buyers and sellers.
Straying away from the traditional sales model will continue well into the future. The Gartner Future of Sales 2025 report predicts that by 2025, 80% of B2B sales interactions between suppliers and buyers will happen through digital channels. Gone are the days of time-consuming paperwork, phone calls, or faxes. Instead, B2B customers can make purchases quickly and easily via digital marketplaces with just a few clicks of a mouse.
Myth 2: B2B Ecommerce is limited to large corporations
B2B ecommerce is no longer ruled by large corporations. In fact, SMEs (small and medium-sized enterprises) are continuing to turn to digital marketplaces because of the cost savings and convenience they offer. With so many niche B2B platforms coming out, it’s made it easier for small businesses to access a wide range of products and services. No more investing in expensive infrastructure!
A good example is Alibaba’s B2B marketplace, which allows smaller companies with limited budgets to access global markets.
Myth 3: It’s expensive to set up a B2B Ecommerce website
The cost of setting up a B2B ecommerce website has dropped significantly over the past few years. Why? Because there are now several open-source solutions available that make it easy for businesses to build their own websites, minus the need for expensive development costs.
Platforms like Shopify, WooCommerce, and Magento are becoming increasingly popular for small businesses that want to get started quickly without breaking the bank. Many of these platforms offer free trials and discounts, so you can quickly test them before committing to anything long-term.
Myth 4: You have to be tech-savvy to succeed in B2B Ecommerce
Owing to the rise of intuitive, user-friendly ecommerce platforms, it’s now easier than ever for small businesses to get started with ecommerce in B2B. All you need is basic knowledge of how to use the interface and a willingness to learn. Adding on the help of tutorials and customer support from your platform provider, you can be up and running in no time!
Many of the latest platforms offer instinctual user interfaces and advanced features, such as automated order processing, making it easier to manage orders, track shipments, and more.
Myth 5: B2B Ecommerce is only for product sales
While it’s true that B2B ecommerce is primarily used for product sales, there are also several services and digital products you can offer as well. The scope includes consulting services, software solutions, training programs, and more. Offering these types of services opens up a whole new realm of possibilities for companies that want to streamline their operations and increase efficiency in the process.
Pros of Using B2B Ecommerce
The trend toward digitization is only increasing, B2B ecommerce is becoming an essential part of doing business. Luckily, the reasons for using it are endless. Here are a few of the top benefits of using business-to-business ecommerce:
In the past, businesses had to go through multiple vendors to get what they needed. Cutting out the middleman, B2B ecommerce platforms make it easier for companies to find items and services quickly and efficiently. This reduces costs, improves customer service, and encourages repeat business.
If you haven’t caught on already, there’s a global marketplace at your fingertips, making it easy to reach new customers worldwide. Plus, with features like language translation and currency conversion, it’s easy to overcome the barriers associated with international trade.
Building an online presence is key to long-term success for any brand. Your ecommerce site can become a valuable asset that can help you reach new customers you would’ve never been able to reach without it.
Integrating the right marketing strategies results in B2B ecommerce platforms reaching a wider audience. For example, by creating targeted ads or using SEO tactics to improve your ranking in search engine results pages, you can increase awareness of your products and services.
There are also a wide variety of additional tools out there, like Ecommerce Keywords Analytics tools and those for specific platforms, such as Amazon. Semrush’s apps, such as Traffic Insights for Amazon and PPC Optimizer for Amazon, can help you scale your marketing strategy and set up profitable campaigns.
Having an online presence significantly reduces operational costs. With the help of B2B ecommerce, businesses can make processes seamless and reduce the amount of time spent on manual tasks like order processing. Voilà - resources can now be allocated to other areas of your business.
Improved Customer Experience
B2B ecommerce platforms offer buyers more control over their purchases. Buyers can browse and compare products, view detailed product information, and place orders when convenient for them. As well features like product reviews and ratings can also provide a more informative shopping experience and help you build trust with your customers.
At brick-and-mortar stores, customers can only sometimes find what they need, but when shopping online, they have access to a much larger selection and can make purchases quickly. The experience is also much more independent, with no need to interact with salespeople or wait in line. In fact, 67% of consumers in a survey commissioned by Nuance Enterprise preferred self-service over speaking to a company rep.
Better Collaboration Between Businesses
B2B ecommerce platforms can help businesses collaborate more effectively. By streamlining communication and providing easy access to product information, companies can communicate better with their suppliers and buyers. This helps reduce the costs associated with manual processes, allowing you to focus on what matters most: growing your business.
One of the great things about ecommerce is that it’s highly scalable. Whether you’re a small startup or a large enterprise, your business can benefit from an online presence.
You can easily add new products and services to the platform as your business expands in minutes. And you’ll even be able to expand and grow your customer base without worrying about additional overhead costs associated with physical stores. All of this makes it easier for companies to keep up with changing demands and remain relevant in their market.
With technology, naturally comes data. Leveraging insights from real-time data can allow companies to make more informed decisions to improve their performance and marketing efforts. Increased visibility into customer behavior helps brands understand what’s working, what’s not, and how they can optimize the customer experience.
To illustrate, a company might want to analyze customer data to determine which product categories are the most popular and then use that information to make informed decisions about pricing, promotions, or product selection.
By making it easier for customers to shop, B2B ecommerce platforms have the potential to drive more sales - the most critical metric of success. By implementing online payment options and automated shipping, customers can quickly check out, leading to higher conversion rates.
Examples of Successful B2B Ecommerce Businesses
B2B ecommerce is genuinely inclusive. Companies in all industries, from manufacturing to healthcare, are using business-to-business ecommerce solutions to redesign their operations and increase their bottom line. Below are a few examples of companies that have successfully implemented a B2B ecommerce strategy - they might even give you some inspiration for your own business.
Amazon Business is one of the leading B2B ecommerce companies, providing businesses with access to millions of products from suppliers around the world. With features like advanced search capabilities and bulk purchasing options, Amazon helps companies save time and money while they shop.
Reselling on Amazon is becoming a go-to way for businesses to expand their reach and gain new customers. With powerful tools like Fulfillment by Amazon, sellers can easily manage inventory, process orders, and ship products directly to customers.
Amazon Marketplace also lets business owners list their products on the platform, allowing them to get more visibility and reach a wider audience. Amazon’s advanced analytics capabilities can help businesses better understand their customer base, helping them make smarter decisions about product offerings and pricing. Throw seller feedback in the mix, and it becomes easier to identify customer needs.
We're even seeing Amazon Business expand into the healthcare industry, which is an exciting development for companies looking to source professional medical supplies - is there anything Amazon doesn’t do?
UPS Supply Chain Solutions
UPS Supply Chain Solutions offers a suite of solutions for businesses looking to tackle their supply chain operations. From logistics consulting services to distribution centers, UPS provides an array of tools to help businesses stay on top of their operations.
With UPS’s cloud-based platform, businesses can easily manage their inventory and orders while staying up-to-date on the latest industry trends.
IBM is a leader in the B2B ecommerce space, offering customers access to customized shopping experiences and advanced analytics. Their AI-powered solutions can help businesses find products quickly, automate order management and streamline customer service processes. They also offer inventory tracking capabilities that are important for the supply chain.
Products like IBM WebSphere Commerce and IBM Sterling Selling and Fulfillment Suite let companies create personalized customer journeys that fit their unique needs.
Volvo is a great example of a company that blends B2C and B2B ecommerce. Their online store allows businesses to purchase vehicles directly while also offering a comprehensive suite of services like financing and leasing options, parts and accessories, and even the ability to order custom-made cars.
Customers can now shop for and purchase their cars without leaving their homes' comfort. And offering features like virtual test drives, price comparison tools, and secure payment options, Volvo is leading the way in modern B2B ecommerce experiences.
Dermalogica Pro is a B2B ecommerce platform specifically designed for beauty professionals. It caters to professionals looking to purchase high-quality Dermalogica products at wholesale prices and provides educational resources and exclusive promotions.
Professionals can also take advantage of the platform’s loyalty program, which rewards them with points that can be used to save money on future orders. The platform also provides free shipping on orders over $100 and offers advanced order tracking capabilities so that professionals can keep track of their orders in real-time.
Chobani is a prime example of a B2B ecommerce business that has successfully leveraged digital solutions to grow its business. They're primarily known for their yogurt products, but they also offer a variety of other food and beverage items.
Chobani wholesalers can order products quickly and easily through their online store, with advanced search capabilities and detailed product descriptions. The platform also offers customizable order forms so customers can tailor their orders to fit their needs.
What’s Next for B2B Ecommerce?
The outlook of B2B ecommerce is changing rapidly, and it’s vital to outperform the competition. The rise of omnichannel commerce has made it easier than ever for businesses to reach customers wherever they are - whether they’re shopping online or in-store.
As customer expectations continue to evolve, businesses must take advantage of new tools and technologies to meet the needs of their customers. So, where is B2B ecommerce headed?
A change in how businesses shop for supplies
As the B2B ecommerce industry continues to grow, businesses expect a consumer-like shopping experience when they purchase products. Suppliers must offer intuitive user experiences and easy checkout processes - just like their B2C counterparts. 80% of B2B buyers look for the same buying experience as B2C customers.
AR and VR technology can also help businesses visualize products before they make a purchase, allowing for more informed buying decisions. The technology would help, for example, a construction company to determine if a particular product would fit the job site or a fashion retailer to determine if a particular fabric would be suitable for a garment.
The rise of digital marketplaces
Digital marketplaces are becoming more popular as businesses look for new ways to find products and suppliers. These marketplaces provide access to a large selection of items from multiple vendors, making it easier for buyers to compare prices and find the best deal.
Oddly enough, these marketplaces used to be less prevalent in the B2B space - but recently, they’ve been gaining traction. They’re now the fastest-growing channel in B2B ecommerce. According to Digital Commerce 360, there was a 5.3x increase in B2B marketplace sales from 2020 to 2022.
These marketplaces also offer a fantastic opportunity for small businesses looking to reach new customers - so if you want to expand your customer base, consider creating an online store on one of these platforms.
The emergence of AI-based solutions
Artificial Intelligence (AI) is one of the most promising trends in the B2B ecommerce space. AI-based solutions can help businesses automate their supply chain processes and optimize product search results based on customer data. AI can also be used to analyze customer behavior, allowing for more personalized shopping experiences - an increasingly important factor in the B2B world.
Reliance on analytics tools
Businesses are relying more heavily on analytics tools to gain insights into their operations. These tools can track customer behavior, analyze sales data and provide insights into marketing campaigns - all of which can help businesses make better decisions. As the importance of data-driven decision-making grows, so too will the need for robust analytics solutions.
More sophisticated tools and technologies
In this dog-eat-dog world, there’s no room for businesses to lag behind on technology. As mentioned, advanced analytics can help you better understand your customers’ buying habits to make more informed decisions about how to market and sell your products.
AI-driven chatbots are also taking over in the B2B space - they provide a quick and easy way for buyers to get answers to their queries without needing to contact customer service. Userlike found that 68% of respondents in their survey enjoyed the speed at which chatbots answer them, and if the chatbot isn’t able to assist, they can be redirected to an agent. So, chatbots might be the way to go if you’re looking for a way to improve the customer experience.
And finally, blockchain technology is starting to be adopted in the B2B ecommerce industry, allowing for improved trust and transparency between buyers and suppliers.
Mobile devices are slowly becoming the primary platform for online shopping, and B2B ecommerce is no exception. Data gathered from 100,000+ Shopify stores reported that 50% of all traffic came from mobile accounts.
Businesses must ensure that their websites provide a smooth user experience on mobile devices if they want to be an influential player in the market. Mobile-friendly features like responsive design, touch interfaces, and optimized images are essential to creating a seamless experience that customers will enjoy.
B2B mobile app ordering has increased by 250% since before the COVID-19 pandemic - making it more critical for businesses to capitalize on mobile-friendly ecommerce.
Conclusion: Looking Ahead – Future of B2B Ecommerce
As technology advances, so too will B2B ecommerce. In the coming years, we can expect to see more sophisticated analytics and AI-driven insights being used to put customer experiences in a different class and increase sales. Automation will also be a key factor in order processing and customer segmentation capabilities.
The future of B2B ecommerce looks bright—more businesses are embracing it, meaning that companies need to be ready for what’s ahead if they want to succeed. Overall, the B2B ecommerce space will only continue to grow and evolve in the years to come. So if you’re a business looking to stay ahead of the curve, now’s the time to prepare for what 2023 will bring!
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