In the simplest of terms, the differences in B2B versus B2C eCommerce are the customer relationships. eCommerce being an online business model facilitating sales transactions; a B2B model is a transaction from one business to another business (or B2B), whereas when an individual purchases from a website, it’s a business-to-consumer model (B2C).
Creating a quality online experience for customers is vital to business’ success in 2021. Just like B2C platforms have improved the way we as consumers experience retail shopping, so too must businesses be consistently improving the purchasing experience for their business customer. With the advancements in B2B technology and impacts of COVID, B2B buyers are now rapidly moving to digital first approach to engaging with the suppliers. A recent study from Forrester suggested that up to 74% of B2B buyers said they’d prefer to reorder from a website rather than directly from a sales rep. This has now been accelerated even further by the pandemic.
The preference for transacting online is clear, however, unfortunately setting up a B2B eCommerce business operation is not like B2C retail. Sure, there are many similarities, however there are some distinct differences that make B2B eCommerce more complex. Let’s take a look!
1. B2B Buying is More Complex and Customised
Unlike B2C where the consumer is a single person shopping among many products much in the same way as any purchaser, the B2B purchasing experience varies greatly by industry, product, company size and more.
The B2B buyer is often not really the buyer at all, not in the traditional sense at least. Typically, the buyer is a procurement expert hired to purchase according to a previously negotiated contract. Those contracts contain specific pricing and promotion agreements for each individual customer. The relationship is many to many; many people, many channels, many products, and many different contractual agreements.
Building an eCommerce site to fit a B2B business operation requires expensive customisations. For example, imagine you’re an employee or a procurement specialist for a business and it’s your role to manage stock on behalf of a branch or worksite. Going onto a website to search through hundreds or thousands of items or searching and filtering through results when you know exactly the one item you need would be tedious and time consuming. Instead, you’d want a site where you could enter a product identifier (either a UPC code, a specific product number, etc) and find exactly what you need. You’d submit your quantities for multiple items and your contract pricing or discounts are automatically applied.
Creating this type of site is understandably more complicated than your average online shopping experience as a consumer.
2. Admin & Fulfillment Rules More Complex
A B2B eCommerce platform must often factor in the complexities of multiple billing accounts, multiple shipping locations and more.
Unlike your B2C system where you get one buyer, one seller, one transaction, and common payment types, B2B can and often does include more complicated aspects such as multiple billing accounts, different shipping locations per order or product, and even complex rules around collections from distribution centres or warehouses.
Furthermore, many B2B transactions are rarely transacted on credit cards, but rather via a line of credit or purchase orders. The majority of transactions are also invoice-based, rather than point-of-sale purchase.
3. Varying Job Roles & Customer Profiles
B2B purchases aren’t always a simple one customer, one purchase transaction. Any given order can have several points of contact. And these several points of contact have a wide range of job roles and needs.
You might have an accounting department who needs to access invoices or make payments or a job foreman who needs to check on delivery statuses, a procurement manager might need access to a proof-of-delivery in order to close an order.
Having multiple stakeholders interact with one account means you’re not just providing a service to one customer per order, it could be several.
4. Decision Processes & Approval Workflows
With more people involved in purchasing decisions, products and services are often heavily vetted and thoroughly researched. Recent research by Trust Radius indicates more people involved in the decision-making and that 95% of decisions were made by a committee or group of two or more people. With a longer approval process, the research also indicated that the decision making time could sometimes take up to one business quarter for 46% of buyers.
5. Different Buyer Behaviours
In a typical B2C online retail experience, buyers are lured by discounts and sales or driven to make impulse buys to add to businesses revenue, much the same way they would in a brick-and-mortar shop. It’s the fundamentals of consumer retail; add-on purchases, flash promotions and other enticements to sell more.
B2B buyers, buy, in some ways similarly, but in many ways, quite differently and failure to meet the changing preferences can be costly.
It’s not likely a B2B buyer will purchase on impulse or respond in the same way a typical consumer might. They’re there to fulfill a business need, items that have been predetermined, approved and budgeted for. B2B buyers rarely work outside of a predetermined procurement workflow that cannot incorporate impulse buying or add-on merchandise outside of what they came for.
However, it’s important to note that B2B commerce experiences do benefit from other merchandising experiences such as kitting, bundling, customisable products, and the like. Often specific parts or items may need additional components for installation, depending on the application. With kitting or bundling, suppliers can offer all that’s needed in one single ‘add-to-cart’ mechanism, with or without a pricing incentive.
Buyers also purchase the exact same items frequently, such as restocking consumable products. In these types of scenarios, different merchandising mechanisms that can be beneficial for B2B sellers like quick order pads, reorders by ‘remembering’ past orders, and/or subscription-style purchases.
While the first two are self-explanatory, subscription ordering is becoming a more common option as it offers multiple benefits to a B2B buyer. No re-ordering is necessary and the risk of them ‘running out’ of a product and waiting on a new delivery is less likely, allowing for a more seamless workflow.
For the seller, it provides an automated repeat order and increased customer loyalty.
6. Relationships Are Essential
For your average consumer buying a one-off item from a website, building a relationship with that person takes a different approach when compered to B2B. Most consumers are looking for a great price on the item they need, they buy and move on
B2B purchases are investments in an ongoing supplier relationship and as such, a brand’s reputation and customer management are vital for survival. A buyer must be able to trust that a vendor will offer reliable delivery times, can honour agreed rates and be available to them for post-sales support. Ticking these boxes and giving buyers that confidence is ultimately the deciding factor on their purchase decision.
Bain & Company estimates that it costs 6–7 times more to acquire a new customer than retain an existing one. So, building loyalty is critical, particularly in B2B where you sell to a smaller set of companies over and over again.
So what do these differences mean?
Knowing how these two vary, means it’s important to take a different approach when creating a B2B eCommerce system. If your business is selling to other businesses, you must consider these key differences when you’re developing your B2B eCommerce platform.
- It must create value. B2C is all about getting a product in front of as many buyers as possible, while B2B is about increasing the value of purchase and building customer loyalty. Unlike consumers, businesses aren’t just looking to purchase a product based solely on the lowest cost. They’re about maximising the return on investment (ROI) of a purchase. A more expensive price tag won’t necessarily put them off if the ROI outweighs the purchase price. This is where case studies, extensive product information and review are essential. Business customers want to see evidence that the purchase they’re considering has paid off for other companies in their industry.
- It must adapt to the changing landscape. More businesses than ever sell products and services online and customers are making those purchases from all types of digital devices. Your eCommerce solution must offer the functionality and customisation that your buyers need for you to stay competitive. Accenture research shows that more than 70 percent of B2B buyers revealed they would switch their suppliers to one providing a better overall digital experience.
Examples of B2B eCommerce Functionality
B2B eCommerce platforms should offer functionality features designed specifically with the business buyer in mind such as functionalities for quick re-ordering, requisition lists and punchout support, all assist with hassle-free ordering.
Including functionalities such as submissions requests and quote management tools allow you to quickly and efficiently respond to quote requests, building confidence and loyalty. The same applies for order tracking, access to purchase history and the like both empower your customers to quickly access information they need, when they need it.
Examples of Successful B2B eCommerce Sites
The best way to understand what a success B2B eCommerce website needs to offer is by looking at ones that are doing it well.
Companies like Swedish merchant Swedol AB required eight different brands to be hosted on a single platform. With customers over 100 stores in four countries, they required a platform capable of supporting multiple brands in all four countries with scope for future growth. Read how they did exactly that by clicking here.
Likewise, BMN Bouwmaterialen were able to boost B2B revenue by creating a flexible platform that allowed their customers to find exactly what they needed, quickly and easily. Read a case study on how it was done using Magento Commerce by clicking here.
Lastly, air conditioning experts, Carrier Enterprise were able to streamline their business, with more than 200 stores and in industry migrating to online shopping. Read about how they did it here.