The Top 3 Barriers to B2B eCommerce Growth

B2B eCommerce is growing at an explosive rate. In 2019, B2B digital sales rose to $9 trillion, a 10.9% increase from the year before. The market continues to expand rapidly, which begs the question: Is your business doing everything it can to take advantage of this booming market?

Another trend to watch is the ongoing digitization of B2B companies. Combined sales of B2B eCommerce sites, login portals, and marketplaces increased by 18.2% between 2018 and 2019, jumping from $1.1 trillion in 2018 to $1.3 trillion last year. In fact, in 2019, all forms of B2B digital commerce grew 10 times faster than total manufacturing and distributor sales.  

Kensium has years of experience in developing and implementing eCommerce websites and ERP software for B2B companies. During this time, we've identified three main barriers to B2B eCommerce growth. We believe integrating eCommerce platforms and digital sales channels can help you hurdle these barriers and earn the growth you deserve.

1. Supply Chain Communication Gaps

Supply chain management is complex, particularly for B2B businesses that don't own their entire supply chain. It's a real challenge to get multiple companies to utilize consistent data throughout the process. One miscommunication in the supply chain slows the entire process. Communication gaps make it difficult to alert suppliers of changes in inventory and demand, leading to poor supply visibility and weak collaboration. For more effective supply chain management, consider emphasizing the following: 
•    More transparency in supplier relationships.
•    Cross-department collaboration.
•    Integrating information sharing technology across departments. 

Effective supply chain management systems that promote communication prepare you for unforeseen problems. Consider how a lack of connection between your back office and front office affects your business. Are you having challenges projecting how much inventory you'll sell next month? Are you entering data manually, resulting in system errors or redundancy? Do your customers want to track their orders? 

Customers need alerts on their shipments and any inventory availability issues. If you're only utilizing basic information, you're not receiving enough data to optimize your supply chain to the fullest. 

Kensium seamlessly integrates cutting edge eCommerce platforms and cloud ERPs, meaning that the front office and back office become just… the office. No more uploading order info by hand and no more supply chain communication snafus. Gain full visibility into your supply chain, all from one dashboard. Predict order quantities, track orders with increased precision, and identify productivity gaps. 

B2B Payment Processing

One sticking point for B2B companies arrives at the very end of the chain – payment processing. Compared to B2C transactions, B2B payments have plenty of factors which complicate how payments are processed.

Businesses need a steady flow of supplies to continue operations, so B2B purchases are generally bigger and more frequent than B2C transactions. This means instant payment isn’t always possible. Direct debits, wire transfers, and even paper checks are still common since they involve no authorization in real time. Therefore, checks may bounce and cause delays.

The basic process is this: B2B customers choose the products they want, place the order, and schedule the delivery through an agreed shipping channel. Customers do not pay at the time of the order but receive an invoice which gets settled through agreed payment terms. A B2B payment processing system must accept orders in multiple formats including email, paper, or through customer portals. It must integrate order capture with your other administrative systems such as invoicing, customer records, and accounting.

It is vital to be able to offer an array of suitable payment methods that appeal to B2B customers. Web portals that offer credit, debit, and ACH payments allow customers to enjoy the convenience of paying with their preferred method of payment. Meanwhile, B2B vendors enjoy the benefit of faster cash flow and reduced effort.

2. Marketing To New Customers Is An Afterthought

Unfortunately, most people see B2B eCommerce as a channel for existing customers. They disregard the power of the internet to find new B2B buyers, focusing solely on maintaining client relationships they already have. While preserving customer relationships is critical to any company, a business cannot grow without acquiring new clients. 

A couple decades ago, B2B customer acquisition involved a lot of cold-calling, trade fairs, and offline marketing such as flyers or street advertising. But times have changed. Half of all B2B buyers are millennials, and millennials hate cold calling with a passion. Trade fairs have been put on hold due to COVID-19, and offline marketing simply doesn’t make sense in the B2B eCommerce sector. 

You can find and acquire new customers by taking advantage of automated marketing tools to attract and nurture new leads. Take time to study the marketing behaviors of your prospects and automate drip campaigns designed to appeal to their actions and interests. Most automation platforms come with pre-built templates that make it easy to personalize messages without needing to hire a designer. Providing leads with timely, educational, and visually appealing content is the perfect way to convert them into customers. 

Above all, B2B customers want to be educated. They have a lot more at stake than B2C buyers, since it’s company money they’re using, as well as a much longer chain of command to deal with. While a B2C customer often makes decisions based on impulse, a B2B customer must do a lot of research and determine if the purchase will have a significant ROI for the company. 

Personalization Is Key 

As B2C merchants can attest, personalizing sales messages is a must for boosting eCommerce sales. The first step is collecting the right data. Identify which data types are useful for analyzing buyer journeys and behaviors. Then identify where to find that data. You may find it siloed across departments, platforms, or even captured by your vendors.
 
Once you've mapped out your data sources, think about consolidating the information for more straightforward analysis. Though you could accomplish this by managing dozens of spreadsheets by hand, the better option is to automate and integrate through ERP software such as Acumatica Commerce Edition. 

B2C companies often use customer data to create personalized recommendations based on past purchases. The idea is to present a product designed to appeal to that specific customer, in the hopes that they will make an impulse purchase.  

On the other hand, personalization for B2B customers means presenting them with as much relevant data as possible. The customer experience and product recommendations derive from the customer's job title, the specific company they work for, and the device they use. You can offer your customers a storefront, product catalogs, promotions, and articles that are most suited to their preferences.

Without cohesion between your eCommerce store and other backend platforms, you're left with broad assumptions of customer behaviors, ultimately leading to broad sales messages. Personalization should be your goal. 

3. Outdated Legacy Platforms

Legacy platforms simply can't handle the evolving omnichannel needs of today's B2B buyers. Consumers expect B2B merchants to be every bit as agile and easy to buy from as their B2C counterparts, but old technology can't satisfy these expectations. Relying on antiquated systems for decades means you're not just missing out on increased automation and efficiency: You're missing out on sales. 

Interoperability (the ability to exchange and make use of information across systems) is another challenge that B2B eCommerce companies face. Businesses on legacy platforms have trouble exchanging information with their partners and suppliers because the different systems are incompatible. Implementing a modern, cloud-based ERP makes it easier to share critical data between you and your supply chain.  

Deploy Modern Platforms

B2B merchants that take advantage of modern platforms deliver improved levels of customer experience, multi-tier distribution selling, advanced pricing, and order workflows. Not only will you provide better experiences for your clients, but your in-house team will also enjoy more productivity, efficiency, and job satisfaction. Look for ways to step away from older technology and ditch the extra costs of keeping legacy platforms running. Many new SaaS environments allow your organization to focus on what is essential to growth in the B2B eCommerce space – product and service sales.

We understand your loyalty to your current systems. You've already got the pieces in place, your employees know how to use them, and a platform migration seems daunting. However, the cost of upgrading and repairing a legacy system often exceeds the cost of migrating to a new platform (Statista). Start by calculating your legacy systems' annual damages arising from errors, maintenance, and upgrades.

If you have any questions about platform integration or implementation, please contact us at info@kensiumsolutions.com.