loading site..
Skip to main content
Znode

The Ultimate B2B Ecommerce Guide

98% of businesses have an ecommerce channel already in place or plan on adding one. B2B sellers must invest in B2B ecommerce strategies to manage complex, changing processes that attract and maintain engagement from buyers.

Definition

Business-to-business electronic commerce, online order processing between businesses.

Digital transformation is at the forefront of B2B operations. Manufacturers, distributors, wholesalers and other sellers are seeking to optimize the selling of goods. B2B ecommerce is modernizing the sale of goods across the globe.

Jump ahead:

  1. Types of B2B Ecommerce
  2. B2B Ecommerce Verticals
  3. B2B Ecommerce Goals
  4. Benefits of B2B Ecommerce
  5. B2B Ecommerce Misconceptions
  6. B2B Ecommerce Requirements
  7. B2B Ecommerce Stakeholders
  8. B2B Ecommerce Examples
  9. The Future of B2B Ecommerce
  10. B2B Ecommerce FAQs

Types

There are many different types of digital commerce. Below are descriptions of the most common types.

  1. B2C

    As the original type of ecommerce, B2C ecommerce is business-to-consumer electronic commerce. Since the debut of digital B2C commerce the technology constraints of an ecommerce platform to fulfill this type of digital commerce has not changed much. Typically the requirements include a single catalog of products for a single customer type, consumers. The level of integration demands of a B2C commerce ecosystem are typically far less than that of the next type of ecommerce.

  2. B2B

    Since B2B ecommerce involves businesses transaction with one another, the intricacies of transactions are drastically different then B2C ecommerce. Even prior to transactions the user experience of a business-to-business ecommerce environments focus on streamlining the consumption of pricing, availability and product information data. The capability of managing unique account pricing is not easily achieved in a B2C ecommerce platform. Additional complexity comes from configured products to fit buyers specific use case needs as well as the accessibility of inventory to buyers. To be successful in B2B ecommerce friction from traditional commerce must be reduced and value must be added for customers.

  3. B2B2X

    B2B2X ecommerce models are emerging as more manufacturers and wholesalers attempt to empower channels. These models can be B2B2B or B2B2C, whereby the brand creates an ecommerce store on behalf of a channel or a customer-specific ecommerce store. These business models are very common in the uniform and promotional products industry and are growing in popularity in industries that have dealer networks and franchises. B2B2X business models can be very complex to manage in an ecommerce environment.

  4. D2C (C = Customer)

    The direct-to-customer (D2C) ecommerce model allows consumers and business customers to find products and buy directly from a supplier. D2C is often used by manufacturers if an existing distributor relationship does not exist or in geographies where distribution and service are limited. This model can also be used to capture a higher product margin.

    Distributors have also taken this approach, attempting to move existing customers to buy products and services online as well as attempting to attract new customers (within the geographic constraints of distributor agreements) via ecommerce. These approaches to ecommerce attempt to use best practices of traditional B2C ecommerce, such as a great user experience and tools that make the shopping journey easy (i.e., site search).

    Some of the complexities of the B2X approach include pricing and segmentation. A D2C site may show MSRP pricing; however, certain buyers may have negotiated pricing based upon existing contracts. Segmentation and showing the correct catalog(s) by segment also add complexity.

Depending on the vertical that a business classifies itself will often determine the type of ecommerce pursued.

Verticals

The location of a business in the supply chain can affect priorities when executing digital transformations to sales efforts. Manufacturers, distributors, wholesalers and consumer brands will all have different stakeholder and market demands.

  1. Manufacturer

    Over ⅓ of manufacturers project growth of at least 25% in B2B ecommerce sales over the next two years. Customer and channel expectations of manufacturers are rapidly changing. Internet searches and brand loyalty drive purchasing behavior. The impacts of the COVID-19 pandemic are only accelerating this trend as the work from home (WFH) trend becomes permanent.

    Wholesalers, distributors, channel partners and dealers also have higher expectations of manufacturer’s ecommerce offerings. At a minimum, businesses expect to be able to buy online, view negotiated pricing, check order status and invoices and self-serve.

    As manufacturers move towards digital transformation, evaluations of go-to-market strategies are needed. Reducing friction and being closer to the end customer are necessities, not luxuries, regardless of channels.

    See The Manufacturer Ecommerce Playbook.

  2. Distributors

    The business of distribution is rapidly evolving. Marketplaces like Amazon Business continue to achieve unprecedented growth. National distributors like Grainger, Ferguson and others have invested heavily in ecommerce and are capturing market share in respective industries.

    From 2019 to 2020, the rate of ecommerce adoption in distribution increased by 26.3%, and more than 10% of all revenue came from ecommerce for half of the distribution companies. As customer bases increasingly include younger individuals expecting Amazon-like buying experiences, distributors are incorporating more automated, collaborative and analytics-based technologies to maintain buyer interest and investment.

    See The Distributor Ecommerce Playbook.

  3. Wholesalers

    Products are purchased in bulk at a lower price from distributors, occasionally the manufacturer. Products then are sold in bulk to the retailers. That is wholesale. In general terms, it is the sale of products to other businesses.

    The wholesale model is based upon a markup between wholesale price, assigned by manufacturers and distributors, and retail price. Bulk orders are the name of the game in wholesale.

    With wholesale ecommerce, the efficiency in processing complex orders can be addressed through bulk ordering capabilities. Wholesalers also benefit from the consumerization of B2B ecommerce with the ability to showcase products and deliver the ideal buyer experience.

  4. Consumer Brands

    Consumer brands are experiencing dramatic changes in consumer behavior which have only accelerated with the COVID-19 pandemic. While demand for products has remained consistent and in some cases increased, the decline in foot traffic to retail stores has accelerated. With traditional foot traffic significantly down, brands must reprioritize opportunities to engage consumers and convert sales. Digital experiences are being prioritized by C-suites as the quickest route to grow and maintain market share and margins. The desire for physical interaction with a product is not gone, however, the combination of offline and online could lead to more unique promotions, pop-up stores and brand experiences in place of traditional retail experiences.

    Digital native vertical brands (DNVBs) also pose a threat. DNVBs often have optimized digital consumer channels and unique brand stories which allow them to quickly gain market share with less overhead.

    Consumer brands are seeking more digital functionality. This includes the ability to serve multiple customer segments and channels and even manage multiple brands online. Limitations from legacy technology investments in ecommerce platforms further complicate matters.

    Check out The B2C Ecommerce Playbook.

Setting appropriate goals for the business vertical and supply chain location a business serves will determine success and optimization efforts as investments proceed.

Goals

The primary goals of B2B ecommerce combine the interests of both sellers and buyers, ultimately producing better businesses interactions. Sellers seek to increase profit, reduce loss and keep processes efficient.

  • Increase Revenue
    An ecommerce strategy needs to positively impact revenue, whether that impact is direct or indirect. As the trend is to move away from inflexible ecommerce solutions, it is vital that a business considers new solutions that scale with new market developments. Efficient systems and increased customer satisfaction are two ways that ecommerce can contribute to an increase in revenue.
  • Increase New Customers
    A primary way businesses grow is by expanding the customer base. A well planned and implemented ecommerce strategy can draw in new buyers for a business. Every ecommerce strategy needs a plan for increasing reach and new customer acquisition. The marketing and sales aspects of a business need to maximize ecommerce features in order to attract and convince interested parties to become customers.
  • Increase Customer Adoption
    A company must not neglect current customers when it comes to ecommerce strategizing. Customer adoption is a primary key performance indicator (KPI) for a new ecommerce platform implementation. There is no benefit from updating features or front-end capabilities if no customers utilize the tool. Effective marketing and content management can go a long way in improving customer adoption of a new ecommerce platform.
  • Increase Wallet Share of Existing Customers
    It is critical that the opportunity to gain revenue from established buyers is not overlooked. B2B ecommerce should enable analytic opportunities to allow for cross-selling and up-selling. B2B sellers must maximize other merchandising capabilities, such as offering personalized recommendations to increase wallet share of current customers.
  • Improve Customer Experience (CX)
    Speed, aesthetic, simplicity and personalization are key customer experience categories that play major roles in the positive or negative outcome of a buyer/seller interaction. B2B sellers ensure customer satisfaction by ensuring website speed, clarity and the ability to showcase different content for different segments of the customer base.
  • Reduce Costs
    B2B ecommerce is all about opportunity cost. The initial investment in ecommerce transformation may be costly, but not investing can be even more costly. Working with legacy or monolithic ecommerce solutions is inefficient and can do more harm than good for a business. API-first ecommerce platforms reduce costs through efficiency, scalability, and overall improved customer experience.

Prioritizing B2B ecommerce goals positions a business to experience internal and external gains. Those gains are typically referred to as benefits.

Benefits of B2B Ecommerce

B2B ecommerce benefits sellers and buyers by scaling, personalizing, reducing inefficiencies, increasing customer satisfaction and centralizing data.

  • Convert Customers through Personalization
    Business-to-business ecommerce allows companies to tailor the buying experience to be highly profitable while providing customers with an efficient process that adds value.
  • Save Time and Effort
    An ecommerce platform takes processes that were previously time consuming and labor-intensive and automates them—such as creating new catalogs or promotions. This allows individuals who were responsible for those processes to focus on more productive tasks.
  • Reduce Errors and Maintain Customer Satisfaction
    Major mishaps become less frequent when an order management system (OMS) is responsible for tasks that could have human-error. Customers will have higher overall satisfaction as a result.
  • Business Model Flexibility
    A multi-store ecommerce platform can enable management of more than one business model depending on what a company needs. Perhaps a wholesaler sees an opportunity in the D2C market. With a good ecommerce strategy, the wholesaler can set up another website that markets and sells to consumers.
  • Centralize Data
    B2B ecommerce platforms can take over responsibility for managing data by syncing with existing legacy platforms such as ERP, PIM and CRM systems. The data centralization enabled by ecommerce platforms makes it easier for data (e.g., which products are viewed consecutively) to be easily accessed and acted upon by all relevant departments.
  • Deliver Better Internal and External Experience
    B2B ecommerce provides an opportunity for companies to create the best experience internally and externally. Composable commerce makes this achievable. This architecture contrasts with legacy and monolithic ecommerce which aren’t scalable, don’t meet ideal CX or testing demands, depend on constant IT care and attention, and require frequent re-platforming.

The advantages of B2B ecommerce transformation are clear, but there are significant misconceptions about the route to achieving those benefits.

Misconceptions

Some businesses resist shifting ecommerce strategy because of preconceived notions about what it means or how it will affect operations. A few common misconceptions are listed below, along with explanations of the inaccuracy.

  1. It’s better to have many requirements rather than few requirements.
    Starting off an ecommerce development process with scores of specific requirements may make the transition process more arduous than necessary. Instead, start with the business model and intended business outcomes. Then work to prioritize other features secondarily. This will help create feature alignment as an RFP is developed.
  2. A cloud-based implementation means no maintenance.
    Even though many ecommerce solutions can manage numerous maintenance tasks, resources are still needed to enable those platform maintenance capabilities.
  3. One team can create the requirements list.
    A shift in ecommerce strategy impacts an entire organization. Accordingly, it is important for all departments to have some weigh-in on the planning and requirements list. That way, the decided solution aligns to each team’s processes.
  4. Implementation partners do not provide more resources than an internal team.
    Although an IT team has a strong grasp of its company’s processes and systems, the IT team is not experienced in multiple instances of ecommerce platform implementation. Implementation partners do have that experience and can knowledgeably blend complex business models with ecommerce platforms.

Since many misconceptions about ecommerce come as a result of poor planning, it’s essential to have a purposeful requirement development process for ecommerce investments.

Requirements

92% of B2B companies plan to increase ecommerce technology spending this year [2021], and half of those companies say that spending will increase by at least 15% compared to last year. More money is being invested into ecommerce, meaning it is increasingly important to maximize value. The first step towards cultivating a vibrant ecommerce ecosystem is to determine the requirements.

  1. Decide B2B Ecommerce Goals
    Common goals are to:
    • Increase revenue
    • Increase new customers
    • Increase customer adoption
    • Increase wallet share of existing customers
    • Improve customer experience
    • Reduce costs
    • Reallocate resources to add more value
    • Improve order efficiency
  2. Identify Customer Requirements
    Instead of immediately focusing on the needs of the company, it is vital to identify what B2B buyers are looking for. Customers want to feel that they are prioritized. When buyers encounter a seller who puts customer needs first, the likelihood that a purchase and a lasting relationship will result is greater. An ecommerce platform that provides flexibility to future proof business and customer needs will ensure on-going success.
  3. Account for Business Complexity
    The digital shift should allow for improved functioning in a variety of departments. Consider the requirements of primary internal stakeholders and note areas of alignment as well as deviation. Look for a platform that meets the most business needs, thus requiring limited customization.
  4. Evaluate Platform Sustainability
    Businesses looking to initiate an ecommerce solution must consider the sustainability of the platform. Does the chosen platform support multiple web stores, user/account personalization, D2C or B2B2B? Will the solution continue to be profitable in the future, or will upgrading and/or re-platforming be necessary?
  5. Choose the Right Partner
    When customizing a B2B ecommerce platform to business or industry specific requirements, it is important to select an implementation and support partner with experience. Partner’s should understand the nuances of the particular industry(s) the business serves, as well as have experience customizing the ecommerce platform. Validating that a partner has staff certified on the platform available for a project is key.

When crafting a requirements list, take into account the various stakeholders who will be impacted by ecommerce transformation and identify the motivating factors in order to guarantee organization-wide success internally and externally.

Stakeholders

B2B ecommerce stakeholders generally fall into either an internal or external category. When a company makes an ecommerce platform investment, internal stakeholders have a special role in the new system implementation and adoption. Ecommerce transformation signals the evolution of business interactions and external businesses are impacted by the changes made to enable that transformation.

  1. Internal Stakeholders
    • CIO, CTO and Information Technology Department
      Generally, IT teams are among the first to realize the need for an ecommerce transformation. Legacy and monolithic platforms depend heavily on IT resources and are notoriously difficult to scale. Moving to headless commerce and composable platforms significantly reduces the burden on IT.
    • Marketing Leadership
      Marketing teams are always thinking about how the customer can be drawn to the product. With an ecommerce strategy, marketing leadership has the opportunity to expand capabilities and offer a more customer-friendly experience. The marketing department should not be solely responsible for ecommerce development since the integration of other business systems may be overlooked.
    • Sales VP
      Often, a switch to ecommerce business will majorly impact the sales department. Typically, the impact is a good one, as ecommerce enables self-service for customers and frees up sales reps to expand reach. A company should include the Sales VP and other relevant sales associates in the ecommerce planning and management since these individuals can verify that websites accurately reflect customer needs.
    • Ecommerce Manager
      This role is responsible for overseeing the whole digital commercial initiative. Ecommerce managers retrieve input from the various departments and submit projects to these teams in order to successfully run the system. They may also work closely with implementation partners to make a transition from an outdated ecommerce platform to a better solution.
    • Operations
      B2B ecommerce can dramatically change business processes, so it is vital to have an operations team member involved in the planning and incorporating phases of the transition. These individuals will be able to identify what processes will need to shift and how those processes can best be altered for efficiency.
  2. External Stakeholders
    • Distributors and Dealers
      A common customer type in the B2B arena is the distributor. Distributors sell products from manufacturers. Typically, a dealer is the individual responsible for making sales on behalf of the distributor. B2B sellers can cater to distributors and dealers by shifting the transaction digitally. Manufacturers are typically those selling to distributors, and they can set up a better inventory management system through ecommerce. This allows distributors to find products more readily and purchase with ease.
    • Wholesalers
      Wholesalers can greatly benefit from suppliers switching to digital transaction systems. Wholesalers purchase products from other producers and then sell those products either to retailers or direct to consumers. When suppliers have an ecommerce solution for business transactions, wholesalers can efficiently purchase products and devote more energy towards reselling.
    • End-Customers
      Companies, organizations and governments are also impacted when the outlets they purchase from allow for ecommerce transactions. These buyers are looking for easy processes and sustainable partnerships. Suppliers can meet that expectation through ecommerce solutions. When buyers can set up custom accounts or easily utilize e-procurement applications with a supplier, it makes business run smoothly and increases overall satisfaction.

 

Businesses that have begun successful digital transformations have carefully considered stakeholder needs to determine which new approach would best serve the business and its customers.

 

B2B Ecommerce Examples

 

Many enterprise-level businesses have embarked on a journey of B2B ecommerce transformation. Companies that have benefited from a shift in ecommerce approach are highlighted below.

 

Global Schoolwear - School Uniforms by Tommy Hilfiger

 

Global Schoolwear (GSW), School Uniforms by Tommy Hilfiger, provides schools with uniform options in different colors, sizes and styles. GSW’s complex data model was difficult to manage on its existing Magento ecommerce platform. To create new catalogs, data had to be replicated and new schools took months to onboard.

 

GSW transitioned to Znode which allows for painless management of catalog data. Administrators can now create hundreds of online stores and catalogs for schools with ease. Additionally, site speed has improved and school onboarding takes only a matter of days. GSW’s ecommerce transformation has contributed to the company’s self-sustainability and improved customer experience.

 

National Marker Company

 

As a safety identification manufacturer and supplier, National Marker Company (NMC) prioritizes public welfare by making and selling high-quality safety sign products. NMC used a home-grown ecommerce system but needed to better serve distribution channels and end customers. NMC needed to customize the user experience and payment options for multiple user types (retail, anonymous and B2B users). NMC also required the ability to manage complex products through showcasing multiple SKUs on one product display page.

 

Znode was NMC’s chosen platform to enable these changes. As a result, customer experience improved with faster site and page load time and better product and marketing pages. Overall, the comprehensive platform eliminated many outdated processes, allowing for easier updates and upkeep.

 

These forward-thinking enterprises are pioneering B2B advancement by stepping out of legacy platforms, into headless commerce, and towards more composable solutions.

 

The Future of B2B Ecommerce

 

Monolithic and legacy platforms are things of the past; headless ecommerce dominates the present; and composable commerce signals the future for B2B ecommerce.

 

  • What is composable commerce?
    Composable commerce is an approach that incorporates applications and services from multiple vendors for an optimized digital strategy. One vendor may provide the platform to manage different plug-ins. Other vendors may provide tax, fulfilment, customer data, payment gateway and further systems.
  • Why composable commerce?
    The motivation behind composable commerce is a best-of-both-worlds goal. B2B sellers come in all shapes and sizes and so do buyers. This means the ecommerce strategy that works best for one company may be widely different from another. A single platform cannot realistically provide B2B sellers with every imaginable feature or capability. However, with a headless structure that still retains a central source of truth, B2B companies can realistically incorporate composability into ecommerce solutions.
  • Composable Commerce Benefits
    Composable commerce reduces the burden on IT and development to provide innovative solutions while working with legacy tech stacks that can’t scale. The speed-to-market and customer experience is vastly improved with composable commerce since it enables agile scaling and implementation.

 

Companies that have embraced composable commerce by 2023 will have an 80% lead in new feature implementation compared to competitors. The future of B2B ecommerce is composable since the strategy provides businesses with the best tools to adapt to a changing market.

 

Major ecommerce change means complexity, and that’s why it’s important to have the basics straight.

 

FAQs

 

B2B ecommerce is still in its infancy. Undoubtingly, there are questions. Find answers to the most commonly asked questions below.

 

  • What is B2B ecommerce?
    B2B ecommerce involves transactions between business buyers and business sellers through online processes.
  • What is the difference between B2B and B2C ecommerce?
    Both the buyer and the seller in a B2B ecommerce transaction is a business. In B2C ecommerce, the seller is a business, but the buyer is an individual.
  • How can B2B ecommerce incorporate successful B2C ecommerce tactics?
    B2C ecommerce offers self-service capabilities to buyers. This is successful since consumers prefer having power over the purchasing process.
    B2B sellers should enable as much self-service as possible to allow customers to manage the purchasing experience. Browsing, searching, creating carts, ordering and tracking capabilities should all be available to buyers. In addition, quoting should be offered as an additional self-service feature.
  • What is the B2B ecommerce market size?
    The U.S. B2B ecommerce market is projected to reach a value of $1.8 trillion by 2023, which will account for 17% of all US sales.
  • What are the B2B ecommerce must-haves?
    • Self-service capabilities for buyers.
    • Quoting and promotional capabilities.
    • User/shopper personalization, including varying approval levels.
    • System integration: the ability to pull all data to a centralized place to manage and run all commerce operations.
  • Does a business have to be a supplier to sell through B2B ecommerce?
    No. Although supplying resellers is a popular form of B2B ecommerce, there are a few different types of buyer/seller transactions that qualify as B2B. Suppliers, businesses who sell to organizations, businesses who distribute to other businesses and wholesalers are all examples of B2B businesses.
  • How can B2B ecommerce be personalized?
    Segmenting customers allows for specialized marketing, user experience and sales approaches. Some examples of personalization could include hiding product catalogs from website visitors not logged in, or specific customer types; creating catalogs to share with specific buyer profiles; providing customer specific pricing; and saving transaction information in order to repeat purchases.

 

Get Serious About B2B Ecommerce and Request a Demo.

 

Interested in Znode?
Let's Talk.

Get ready to get more out of an ecommerce platform.

request a demo