The B2B ecommerce space is growing fast and buyers have high expectations. Let's take a look at the different types of B2B ecommerce, as well as common misconceptions and some success stories.
B2B ecommerce, or business-to-business electronic commerce, describes online order transactions between businesses.
Because orders are processed digitally, buying efficiency is improved for wholesalers, manufacturers, distributors and other types of B2B sellers.
As of 2018, global B2B ecommerce had already surpassed $10.6 trillion in revenue.
While some B2B businesses are still reluctant to move online, B2B buyers are already there.
A 2018 survey found that 48% of companies now conduct 50–74% of all corporate purchases online. 23% of companies do 75% or more of their purchasing online.
Emerging ecommerce technologies are also reducing the barrier to entry for traditionally B2C businesses to add a B2B component (B2C2B) and, vice versa, for traditionally B2B companies selling direct-to-consumer (B2B2C).
Let's explore the different types of B2B ecommerce models.
B2B ecommerce comes in many forms. Here's an overview of five common types of B2B ecommerce.
Business-to-business-to-consumer (B2B2C) ecommerce takes out the middleman usually between the B2B organization and the B2C, putting the businesses directly in contact with the consumer. The B2B2C model can best be described by looking at how a wholesaler or manufacturer interacts with traditional B2B and B2C models.
In those cases, the wholesaler or manufacturer sends goods to the B2B, and those goods are then sold to the final consumer. In a B2B2C model, the wholesaler or manufacturer reaches the final consumer by either partnering with the B2B or directly selling to the consumer. With B2B2C ecommerce, these transitions happen online, often through virtual storefronts, an ecommerce website, or even apps.
In many B2B2C ecommerce models, the consumer knows they are getting products from a business that’s separate from where they purchased it. For example, the consumer may purchase a product from an affiliate blogger but the product is branded and sent by the manufacturer.
Businesses often buy goods in bulk for a lower price and turnaround to sell them at retail value. The goods are usually purchased directly from the manufacturer or distributors. This is wholesale, and it's a popular form of B2B. Wholesale could also be described as the sale of goods to other businesses.
Wholesale B2B models are present in many industries including retail, food service, construction, and medical, among many others. Traditionally, wholesale B2B transactions occurred over the phone, via email, or by way of spreadsheet order forms.
With wholesale ecommerce, everything is digital using a B2B ecommerce platform. The platform allows the wholesaler to display products easier and creates a seamless buying experience.
Manufacturers produce finished goods on a large scale by utilizing parts and raw materials in combination with manual labor and machines. In a B2B model, the finished goods are sold to other manufacturers or wholesalers.
The auto industry is a good example of manufacturers in a B2B arena. The manufacturer creates individual car parts, such as a fuel pump and an engine. Then, the manufacturer sells these parts to an automotive company that builds the entire car from the parts and sells it to the consumer.
In the same way that wholesalers are taking business online, manufacturers are, too. B2B buyers are looking for a buying experience similar to B2C and these businesses are taking note.
A distributor is a person who works closely with manufacturers in an effort to bring visibility to the goods they are producing, with the goal of increasing sales. In an ecommerce model, the logistics of the sale happen online, often through an ecommerce platform.
Many manufacturers work with distributors and taking things digital creates a greater opportunity for growth. Just as other B2B models, distributors are working to shorten the lead time from sale to delivery and create a customer experience that beats customer expectations.
One reason the B2B ecommerce market is expanding is a result of B2Cs making the switch. While it's possible to make the transition, there's a bit of a learning curve. B2B transactions tend to be larger than B2C purchases and B2B sales often rely on long-standing relationships with vendors.
There are a plethora of misconceptions around B2B ecommerce.
From a misunderstanding of the complex technology available to a naivety around automation best practices that save both time and money, let’s demystify this profitable industry.
The number one reason many brands say they aren’t selling B2B is because they don’t realize they are already doing it.
Selling B2B is a variety of things, including:
You do not have to be a supplier in order to sell B2B. Many online brands are both B2B and B2C.
You do not need a separate ecommerce site in order to sell B2B. Instead, you can build site engagement and SEO on a single URL and use customer groups to allow for personalized browsing experiences for your B2B segment.
As the new generation comes to managerial and purchasing power age, their preferred method of purchasing (ecommerce) will surpass older processes.
In general, B2B customers want to see their B2C conveniences transfer over.
A recent report found that millennial B2B buyers aren’t just coming –– they are here.
And, they shop differently than their generational peers. A Heinz and SnapApp study found:
These buying behaviors mimic B2C buying behaviors in which brands must educate, build trust and build community before a purchasing decision is made – or even considered.
If you want your brand to show up in those buying committees, you must have an online presence.
One last data point to drive this home:
An overwhelming majority (89%) of B2B researchers use the internet in their research process and they conduct 12 searches prior to engaging on a specific brand’s site.
With low margins and fierce competitors looking to underbid a B2B business, many brands don’t want their prices available to the public.
This safeguarding of the supply chain is understandable — and it’s why many ecommerce solutions offer price availability only after a customer logs in.
This means only your customers see the prices — and that prices can be presented exactly as negotiated for individual customers.
You can also use your site to enable product visibility, but require customers who are not logged in to their customer groups (likely a prospect) to call in to get prices.
One of the best ways to make sure a customer doesn’t go to a competitor is by building a long-term, personal relationship with them.
This is why so many B2B businesses are family-owned and operated. There’s a personal touch to being one of the family: phone calls, dinners, visits and trips.
An online store can seem cold in comparison, but it doesn’t have to be.
And, especially now that Millennials are at the forefront of many B2B buying decisions, buyers are looking for a streamlined digital purchasing experience.
In a Demand Gen Report, 55% said, when all other factors are equal (e.g., price, quality), “a digital buying experience is extremely important to selecting a vendor.”
With 24/7 chat technology that can turn an online chat on your store into a text on your phone, the new generation can communicate efficiently and effectively in their preferred communication channel: text, Facebook messenger or a variety of other options.
In fact, this type of customer service is not only easy to set up, it is highly desired by customers across the board.
A study by McKinsey & Company found that slow site response times are a B2B buyer’s biggest complaint with online ordering.
Increasing your speed to respond to a customer is today’s version of quality, face-to-face interactions. Ignore it, and you’ll lose business.
With B2B customers and wholesalers, the possibility for custom orders is much higher than for a B2C site.
And for many B2B businesses, they want to provide for the custom order (which helps with that personal relationship).
But custom orders aren’t often an ecommerce norm — or so many people think.
Thanks to custom quoting tools, unique variants and segmented customer groups, B2B businesses can allow customers to send in a PDF quote 24/7, then evaluate the quote and get back within regular business hours if the unique order can be filled.
Then, your B2B business can place that customer in their own unique customer group so the next time they order, the customer won’t have to go through the quote engine.
Instead, they can just click and checkout the item that is made specially for them.
There are many advantages to using a B2B ecommerce platform, and they are vital to business success. Here's a few reasons why using a B2B ecommerce platform is the direction to take:
A B2B ecommerce site with public-facing catalog pages is a powerful way to reach new B2B customers. By going online, you can utilize digital marketing strategies to increase your reach.
Your future buyers not only prefer to shop online but will demand it. B2B buyers are getting so used to making purchases online, they're starting to expect it. Buying online is efficient and it makes repeat purchases much easier.
The concept of B2B ecommerce offers better management of both the suppliers and customers. Going digital means you can utilize a business management software. This will show you data about how your customers shop.
You'll be able to use this information to create better, more personalized shopping experiences for your customers. Essentially, the whole initiative is a win-win for both parties.
Not only will you reach new customers, ecommerce also allows you to easily implement an automated cross-sell and up-sell recommendation program. This goes hand-in-hand with offering shoppers a personalized experience. You'll be able to help them find products they're looking for, without them having to ask — much like an in-person sales associate would do.
B2B ecommerce provides the perfect platform for an organization to launch a comprehensive analytics campaign. With analytics, B2Bs can make better business decisions.
This feature is available in every B2B ecommerce platform that provides in-depth analysis of sales effectiveness. You can generate various types of reports to understand how your business is progressing.
Analytics will help you to identify what's working and what's not for your business. You can find out what the customer is looking for on your site and accordingly take steps to boost site engagement. All in all, this feature will play a key role in the success of your organization.
No matter what your hesitation is to launching your B2B ecommerce store, know this: nothing needed for a B2B business to prosper online cannot be done.
Here’s how to market to your B2B customers to grow your online sales, streamline your business and focus on what you do best: getting products into the hands of your customers.
The concept of an online strategy interweaving content and commerce has a very practical application.
If a user is not presented with all of the information — from sizing charts, to ingredient lists, to how-to guides — they will seek it elsewhere.
That exploration often results in the consumer entering another purchasing funnel outside your organization’s digital commerce channel.
B2B user experiences have transformed from green screen-like portals with limited information into educational avenues that push product and promotions to your buyers.
Why? Because this is the way the online value ladder works.
Companies using a B2B business model have long done this with conversations over the phone or drinks. Now, you need to do it to drive traffic and close sales online.
The number of B2B customers that prefer to speak to a sales rep in person or using phone, fax, or even email will continue to decrease at a rapid pace as Millennial buyers gain more decision-making and purchasing power within their organizations.
In the B2B Millennial Buyer Survey Report, respondents were asked about the top three types of interactions they seek from sales teams. The top answer (69%) was outreach via social media and/or messenger apps.
If your team is implementing a new ecommerce channel, be sure to communicate early and often with your customers.
Simple web forms provide the option of connecting with sales and support as well as requesting samples and catalogs all online. The chat box persists throughout the site as well, as another option for customers to seek support.
Regardless of how you introduce the digital channel, anticipate questions and concerns, and, most importantly, highlight the benefits of migrating to the new platform.
To ensure customers can use the platform efficiently, create:
B2B fulfillment errors are typically exponentially greater than those associated with B2C or direct-to-consumer shopping, due to the nature of the type and quantities of product ordered.
Mistakes can result in truck or trainloads of product being impacted.
Your B2B brand needs to be able to consistently deliver the right products on time while meeting expectations.
Instead of dealing with customer service challenges, refunds, and apologies, your team must be able to develop new relationships and introduce ancillary services.
Most B2B brands use an ERP or OMS as a central source of truth – using powerful APIs to sync those systems with an ecommerce platform.
Beyond an ERP single source of truth, ecommerce platforms can also automate various ecommerce aspects to better the customer experience.
Let’s look at a couple of those B2B ecommerce automations.
Set up rules to alert customers to inventory counts and show out of stock without having to do a single thing.
A clear order dashboard is available for your fulfillment teams. You can also use APIs to send order information to an ERP for a real-time sync.
From this view, you can also clearly see the fulfillment process — what has been sent out, what is pending and why.
Further, beyond an orders dashboard, you can drill into each individual order to see fulfillment stage, order details, PO numbers and more.
After the platform has been deployed, look to other initiatives to continually turn the needle.
Likely, if you are a B2B organization, you supply products that are consumable or will need to be continually maintained and replaced.
Allowing for both subscription-based and traditional one-off purchases can lock in buyers, yield higher customer lifetime values, and simplify doing business.
Furthermore, the data can empower your sales team to present and offer complementary products, as well as understand when a customer might be ready to buy.
Industry behemoth Amazon has already begun to implement these programs. For instance, certain products, such as this air filter, can be purchased in regular (monthly) increments.
On your own ecommerce store, you can use integrations with partners like Rebilla to manage saved credit card information for individual customers, or PayWhirl for recurring billing.
Organizations often find themselves working inefficiently due to resources being in the wrong roles, or process silos that negatively impact momentum.
These obstacles occur either because the digital channel was built as an ‘add-on,’ and not cohesively structured within the organization, or because organic decisions over time have morphed into a structure (i.e. solely Marketing or IT “owning” the ecommerce software) that no longer has an effective foundation for cohesive cross-channel growth.
Here’s how to make sure your teams are aligned:
In addition, using a tool like B2B Edition can better mobilize your sales team to access buyer shopping lists, add products to cart, and complete order placement.
As commerce platforms become more robust in functionality beyond just a “shopping cart,” their reach and influence within a company’s existing technology landscape is widening.
Lines of traditional applications are blurring as large software companies are acquiring and integrating smaller, specialized software at a rapid pace.
When undergoing a digital commerce initiative, it is important to understand the selected commerce technology platform’s roadmap and what that signifies in terms of capabilities.
This knowledge could allow you to trim license and maintenance costs on overlapping technology and reduce technical bloat.
Internal channel conflict is a common pain point for B2B organizations.
With industry analysts predicting the demise of the B2B salesperson, the online channel is recognized as a legitimate threat.
Organizations that successfully overcome internal anxiety communicate early and often with the individuals that could be affected.
The digital teams, alongside sales leadership, should showcase the benefits of customers leveraging technology-based customer self-service and how it can actually help sales members retire and exceed quotas.
For example, in the telecommunication space, B2C-like ecommerce sites often exist for SMBs to order hardware, upgrade their plans or increase their services.
Only if and when that customer becomes complex does an actual sales representative take over the account. This approach allows the team to focus more on selling and less on order taking.
Usability is an essential element in creating value for customers.
This does not necessarily mean creating “consumer-like” ecommerce experiences centered on visual and interactive elements.
Instead, focus on factors like:
Usability also means empowering customers to take control and complete goals on their terms.
Including responsive design as part of the ecommerce software frees customers to research, complete transactions, and manage their accounts, regardless of device.
This cross-device enablement can also make sales representatives in the field far more productive and efficient.
No two customers are the same.
Customize the ecommerce channel to cater to the way they do business and become an indispensable business partner.
This starts by building one-to-one relationships.
Use segmentation to present customer-specific catalogs and pricing, as well as introduce incentive programs that reward customers for loyalty and the volume of business they transact.
Then, develop workflows that align the ecommerce ecosystem with the way your customers do business to remove any friction from the process.
For instance, if customers require a multi-step order approval process, the underlying ecommerce platform should be built to support this.
You can also do this with a Quoting tool.
The same goes for payments.
From enabling Purchase Orders, to checking credit availability and enforcing purchasing thresholds, ensure the ecommerce system conforms to customer needs.
For wholesale brands which need customer financing options, look for ecommerce platforms that integrate with Klarna and PayPal Credit.
Keep customers in the loop by being transparent with data.
Proactively notify customers of backordered items and low inventory counts for products they purchase to minimize any potential disruption to their business.
BigCommerce automatically emails customers their invoices when an item is ordered and a shipping update when it is shipped out.
Merchants can use the Orders channel on the BigCommerce backend to dive into any specific area, resend invoices, manage returns and refunds, etc.
And though it’s only applicable in a subset of B2B use cases, enabling punchout to allow catalog feeds and ordering directly through the customer’s procurement system can make the ecommerce channel a powerful tool for building lasting value.
That’s why BigCommerce integrates with hundreds of ERP systems, syncing information back and forth in real-time.
All kinds of different businesses have adopted B2B ecommerce. Here are a few examples of businesses that have used ecommerce to their advantage.
One such brand is Flexfire LEDs, which receives 80% of its revenue from B2B sales, but also sells direct to consumers.
Flexfire LEDs launched in 2010 and today, they drive more than $5M in annual sales. Their customer base is split 50/50 for homeowners (regular consumers) and businesses (B2B). And yet, only 20% of our revenue comes from the B2C segment.
The company started creating content in 2010 that answered common questions that would arise when researching LED strip lights and how to install them.
Flexfire LEDs didn’t focus on:
Instead, they focused on:
Each Google update in the subsequent years put Flexfire rankings above competitors'.
Organic traffic has always been their biggest source of traffic. Even their first sale came from an article explaining the technical difference between two types of LEDs.
Flexfire's educational content continues to build brand trust and traffic –– even among the industry’s most trusted brands themselves.
Assurant launched a business-to-employee ecommerce website with BigCommerce, saw incredible growth, and then used that same site to sell B2B and B2C.
Employee benefits at large organizations include first access to company deals and percentages off merchandise or company-required purchases from uniforms to equipment.
Now, through customer groups, the site is segmented for Assurant employees, wholesalers and regular retail customers.
Customer groups allow you to build personalized site experiences for groups or individuals once they log in.
Customer groups are useful for VIP segments for all merchants, but are essential for B2B sellers online. Assurant's MyWit portal is divided by audience and clearly outlines the benefits for each group.
Brands like Selini NY simply gate pricing until you login.
This means only your customers see the prices – and that prices can be presented exactly as negotiated for individual customers.
You can also use your site to enable product visibility, but require customers who are not logged in to their customer groups (likely a prospect) to call in to get prices.
Berlin Packaging uses chat to drive immediate conversion at the exact moment a potential new customer is ready to talk. Their Contact Us page also provides customers with a number of ways to reach out via digital channels.
As a fairly complex B2B operation, Berlin Packaging was on the hunt for a B2B ecommerce platform that offered:
Since switching to BigCommerce, Berlin Packagin has already seen a substantial lift in conversions—as much as a 27% increase. They've also seen an increase in orders and demand revenue as well.
ResMed takes initiative to educate their customers via continuing education courses, clinical research, and ResMed Academy Online.
Housing this type of information on their site keeps the consumer from leaving and then entering another purchasing funnel. Sure, they could come back, but is that a risk you're willing to take?
When you're the one educating the consumer, you have more control over their moves within the funnel. This also builds trust between the customer and the business, which often leads to a conversion.
The Knobs Co points B2B customers to a dedicated landing page from the homepage that clearly states the benefits of their online purchasing program.
Once you land on the Trade Professionals page, you get further information on why you might want to join.
The Knobs Co provides information here describing what those who fill out the form can expect from customer service to quality of the product. Then, they provide a dedicated form to drive leads so they can immediately contact anyone interested.
At the end of the page, there's additional resources so customers can browse other areas if they aren’t yet ready to buy.
BuySwings.com’s simplified checkout process enables various B2B checkout functionalities that are not usually seen on B2C sites.
They set clear shipping expectations by outlining the expected shipping date and shipping method. They also accept purchase orders in addition to PayPal and credit cards. Finally, there's an open space where customers can write custom instructions if needed.
BulkBookstore enabled a live chat pop up for their customers. This feature puts customer service front-and-center for shoppers, which is part of the experience they crave.
On the backend, you can enable customer service integration to provide customer service agents with a complete view of the ecommerce system.
This allows your team to resolve issues in real-time, and act consultatively to recommend cross-sells and upsells when appropriate.
It is a misconception that the ecommerce world cannot support the needs of B2B sellers and brands.
It is not a misconception, however, that your brand may not be ready.
Be sure to allocate the appropriate funds to your B2B site launch, including work with partners and agencies to build the unique tools you need.
Though you may need to make an investment, the increase in revenue you can expect vastly outweighs this initial expenditure.
An ecommerce platform like BigCommerce is more than extensible enough for what you need, and some basic SEO techniques for B2B sellers will set you on the path to success.
But like any good investment and growth opportunity, there will be a small capital investment upfront.
Don’t worry though. Average launch time is three months – and sales start pouring in immediately.
Here are some simple answers to frequently asked questions about B2B Ecommerce.
B2B commerce is the selling of goods to businesses. B2C commerce is the selling of goods to individual consumers. The main difference is one of professional versus personal use.
The global B2B market size was $1.2 trillion in 2018.
B2B purchasers today are looking to do as much self-education on the products as they can — and, in some cases, complete the purchase process — online. They also want to communicate with salespeople less than in the past. When they do, favorite channels include social media messaging and text.
No. Many retailers are already selling business-to-business in some capacity and just don’t recognize it as “traditional” B2B. Selling B2B can include wholesale, distribution to retail, selling to organizations like schools and nonprofits, or supplying to resellers.