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5 Ways in Which B2B E-commerce is Different from B2C

B2B e-commerce is growing at an astounding pace; it is set to outpace B2C e-commerce and reach $6.7 trillion by 2020. The entire landscape has changed, thanks to advances in technology, the evolution of market, customer demands, and the increase in competition. Today, B2B customers expect the same digital experience as B2C buyers, and although both the models might seem similar superficially, there are several crucial differences that need special attention. When developing your B2B strategy, it is important you understand the differences and drive your efforts towards creating an experience to remember.

Here are 5 ways in which B2B e-commerce is different from B2C:

1: Type of audience

One of the primary differences between B2C and B2B is the scale and type of audience. While B2C companies often strive to reach a broader audience consisting of a large combination of demographic groups, each with a common customer journey map, B2B companies cater to specific businesses, each with different needs, and each serving their own set of end customers. Unlike B2C transactions where shoppers directly purchase products from a merchant, in B2B buying situations, a purchase involves a team of people researching products that fits their need, placing orders for products they are asked to purchase, and deciding when shipments need to arrive, among others.

Since each B2B buyer has a distinct need, your e-commerce site should make it easy for them to search, purchase, and manage the account on the same site. Also, while B2C merchants focus more on customer acquisition, the main driver for B2B companies needs to be on providing information and on customer retention. Since each B2B buyer represents a much larger revenue stream, and the relationship lasts months or even years, there’s far greater value in consistently driving value to B2B buyers through education, personalization, flexibility, and multiple pricing options.

2: Volume and type of sales

In a B2C environment, companies might need to sell products to hundreds of thousands of people before they can reach a million sales, mainly because the volume of sales for each customer is low. However, for B2B companies, it’s common to have fewer than a couple of hundred customers but still generate millions (even billions) of dollars in revenue. According to a report, B2C businesses average $147 per order while B2B companies average $491 – which is three times that of B2C. That’s more than triple the value.

Also, unlike B2C buyers who usually buy only a single product, most often, B2B purchases have larger order sizes, sometimes to the tune of thousands of units. Because B2B products are often used to build another product or system, it is important your content is updated and comprehensive. You need to list every minute detail including dimensions, specifications, warranty information, service manuals, spare parts, and more. Also, make sure to provide multiple product images – using appropriate angles, as well as in-depth options such as 360° views and videos. This will help the buyers make more informed decisions.

One more difference to be factored in the impact of the sales channel. Often B2B-focused organizations (like manufacturing companies for instance) will sell directly as well as through distributors. These distributors may form a substantial component of the buyers who come to the site. They would usually know exactly what to buy and all they need is a fast, simple, painless way to do that. They need access to specific pieces of information about the product and the ability to get in and get out of the buying cycle fast to get on their job of making more money by selling products to end-customers. This is something to factor into the eCommerce strategy.

3: The decision-making process

The decision-making process for B2C buyers is pretty straightforward- they realize a need and purchase a product that fits their needs. And because a B2C purchase entails a smaller upfront cost, and the refund policy is simple, there’s much less risk involved and therefore, a much shorter buying cycle. However, for a B2B buyer, the decision-making process is much more complex with multiple stakeholders, each with their own issues and motivations. The buying process involves the collaboration of the purchase team with members of the leadership, who then pull in the users, the operations, and the finance and legal teams. Do you know? An average of 6.8 decision-makers are involved in a B2B buying process, all of whom walk through product content, PDFs, demo videos, pitch decks, catalogs, and more – before they make the buying decision.

Since B2C and B2B buyers approach online buying differently, each model should support its customers’ needs and preferences accordingly. In order to cater to B2B buyers, you need to invest in creating an optimal user experience and clearly communicating your story. If you give them reasons to trust your brand, they will believe what you have to say about your offering and how it will solve their business problem. They will be more inclined to believe that you’re the best solution for their problem. It is only when you provide all the necessary information to each of the stakeholders, that you can have a profitable customer onboard and start a long-term partnership.

4: Payment flexibility

For B2C buyers, the flexibility offered for payment is fairly limited; since there’s often a uniform price for all customers, and most choose to pay using their credit cards, the checkout process is quick and seamless. However, a B2B merchant needs to provide the option for purchase orders, order approval options, budgeting workflows, payment on credit, and even the ability to check available credit. Because B2B customer relationships tend to be longer-term, special pricing arrangements may have to be offered. Merchants need to be able to handle customer-specific pricing scenarios, no matter how complex or how unique the pricing constructs are.

Make sure to offer flexibility for pricing adjustments – which may change based on varying bill-to and ship-to information. Present all pricing-related information to customers as quickly and accurately as possible. Also, ensure integration with various payment management solutions and providers to serve customers with credit limits, invoice history, and payment options.

5: Recurring orders

Because B2C buyers have more or less similar needs, most B2C e-commerce websites typically have a single catalog view. However, a B2B site needs to offer multiple views, depending on the customer segment or customer type. This is where content becomes critically important. Every time a customer from a specific segment logs in, he/she will see the catalog that has been applied to his/her specific account – with different product categories, and different prices. Also, the very nature of B2B transactions is that orders are repeated, sometimes even at regular intervals.

If your reordering process is difficult or cumbersome, you stand the risk of losing revenue. Hence, make sure your reordering facilities are exceptionally good. Enable your B2B customers to log in and easily repeat, view or edit their previous orders. Because the slate of product offerings is more complex and niche, the product information should be regularly updated, the search functionality should be able to populate results based on what your customers have bought before, and what they are likely to buy next – along with a forecast for purchases in the future.

Drive higher sales and profitability

In recent years, a lot has been said about B2B and B2C e-commerce models in terms of scope, customer acquisition and retention, pricing, and product assortment. While B2C buyers are more in number, their order sizes are much smaller and order values also lower. On the other hand, although B2B buyers are few, their order sizes are bigger. Considering the importance of forming and retaining B2B relationships, merchants have to ensure their back-end operations flow seamlessly and customers get the same level of quality and service as they get on a B2C site. With B2B e-commerce in the US expected to hit $1.2 trillion by 2021,  it’s time for you to transform your B2B strategies and digitize a key part of your sales strategy.