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In 2020, the global business-to-business (B2B) market with a value of $14.9 trillion was over five times that of the business-to-consumer (B2C) market. In India, the B2B ecosystem is also showing similar trends with reports indicating that valuations in the sector doubled every quarter attracting investment of $100 million-plus.
A report by research and advisory firm Forrester says that the US will see 17 percent of all B2B sales on B2B e-commerce reaching $1.8 trillion by 2023. The e-commerce world is meeting the requirements of both consumers and businesses through a comprehensive system of working. Just as B2C e-commerce has consumers look out to it to meet their needs, businesses have begun to see the potential of having B2B e-commerce in meeting their end goals.
Understanding the B2B Model
B2B e-commerce completes the process of marketing and selling products between two businesses online. It is a service platform that lets businesses achieve their vision of expanding their customer reach and managing to reduce cost-to-serve. In turn, the B2B e-commerce model helps drive in more revenue for the business that uses it. On the pure strength of it being an online business model, B2B and B2C are different. The latter is a business model that sells products directly to customers. B2B on the other hand has a manufacturer and wholesaler, or a wholesaler and a retailer, who use an online sales portal to conduct their business.
E-commerce as a business is a subset of B2B commerce. So be it D2C, Omnichannel, or even quick and social commerce, they all have a B2B element to them. If we are to look at India, it is among the fastest-growing markets in the world today. The Indian B2B e-commerce business, with wider financing options and access to capital, is tipped to reach over $1 trillion by 2024. B2B commerce offers a huge potential to the Indian market, the glimpses of which can be seen in the expansion of players like Udaan, Jio Business, and the likes. But though India is yet to fully realize the potential of the vertical, the projected business in B2B e-commerce is expected to be achieved sooner than expected.
Driving the B2B e-commerce platforms have been – innovation and technology developments. Digital commerce has brought automation to the manual sales and marketing processes traditionally labor-heavy. Reduced cost of business and efficiency are two important benefits that businesses switching to B2B get. This has made possible the creation of a digital home where buyers and sellers meet, place, and manage orders. It also helps connect distributors and suppliers using their mobile phones.
With about 73 percent of millennials estimated to be involved in the B2B buying process, personalized sales portals, mobile ordering, AR tours, and self-service functionality have all grown in demand. The millennial businessmen and women expect convenience and relevance more than their baby boomer and Generation X counterparts. Cost-effective and accessible selling opportunities make it attractive. B2B e-commerce is their newfound interest for it allows them to reach a mass audience with fewer resources, the possibility to personalize relationships at scale, and it gives customers the power to serve themselves.
Choosing the Right Model
The advantages of using a B2B e-commerce platform are great. Though many still feel that it is just a platform that offers a tool to list products and accept payments, B2B e-commerce is all that and much more. It is actually designed to be a command center that lets you control the various aspects from sales to commerce operations for B2B, wholesale clients, or a D2C website. The benefits of an e-commerce site website are that it helps with personalized sales and marketing experiences across sales channels and devices. It helps customers find products with onsite search and customized navigation, integrates customer data from ERP or CRM using reliable APIs, and makes it possible for flexible payment options with different payment providers with manual invoicing. B2B e-commerce can also be optimized for great checkout promotions.
Likewise, a solution drive using B2B e-commerce for wholesale businesses would make creating custom pricing and discounts for specific customer segments easier. It also automates and reviews new buyer signups, allows customers to buy, track, and reorder products easily. Besides, it ensures that inventory, purchase orders, and customers are synchronized, with an existing e-commerce store or third-party software.
And it is for this purpose, that choosing the right B2B e-commerce platform is of great importance for its success. It all boils down to being supplier, buyer, or intermediary oriented. For B2B retailers where there are many buyers and few suppliers the supplier-oriented model is best suited. Suppliers using this model control pricing and the customer experience, which helps build long-term relationships with their B2B buyers.
Buyer-oriented marketplaces can be found where there are many buyers and fewer sellers. Suppliers and manufacturers show their products and accept bids from different sellers using these B2B marketplaces, which are a good way to advertise products to buyers and retailers with less marketing effort. The intermediary-oriented marketplace is a third-party platform that matches buyers and sellers. Amazon Business, Alibaba, AliExpress, Rakuten, and TradeKey are successful examples of such intermediary B2B sites.
Finally, as B2B e-commerce defines the capabilities of doing business online, it strategically reaches out to other businesses. A futuristic development in B2B business, its adaption in an e-commerce platform ensures better purchasing decisions and a B2B marketing plan that is precise, clear, and engaging to drive business.
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