The fight between business to consumer (B2C) brick and mortar stores and online retailers has been going on for a years. Now, however, it's time for business-to-business (B2B) sellers to pay attention.
Online retail giant Amazon recently overtook Walmart as the biggest retailer in the world, CNN reported. And, it's equally clear; Amazon is taking aim at business-to-business sales as well. “Going back to early 2012 or 2013, it was evident to us that the very fact Amazon was entering into this B2B segment would challenge traditional manufacturers, distributors and suppliers with a robust online experience,” Chris Dalton, CEO of CloudCraze told EBN in an interview.
At the same time, business buyers increasingly are looking for a consumer-like online buying experience with their B2B suppliers as well. To stay relevant and competitive, suppliers hoping to woo business buyers are going to have to take these key trends into account.
In the last few years, we've started to see particularly strong interest [in online commerce] coming out of B2B,” said Dalton. “One of the factors was that the inherent adoption of online commerce by consumers was putting pressure on B2B to have more robust systems, that is digitally enabled systems, than they've had in the past.”
Market research firm Frost & Sullivan anticipates that the B2B online retail market will reach double the size of the business-to-consumer (B2C) online market, generating revenues of 6.7 trillion USD by 2020. The company's report titled Future of B2B Online Retailing predicts that B2B online sales will account for close to 27% of total manufacturing trade, which is likely to hit 25 trillion USD by 2020.
Forrester Research is similarly optimistic. By 2020, the B2B e-commerce market in the United States will reach $1.13 trillion, or 12.1% of the total B2B marketplace, according to Forrester Research's report U.S. B2B eCommerce Forecast, 2015 to 2020. This year, B2B e-commerce in the U.S. will total $780 billion, or 9.3% of the total market, according to Forrester. The market research firm predicts that B2B e-commerce will grow at a compound annual growth rate of 7.7% between 2015 and 2020.
Increasingly, B2B buying organizations are positioning their approach as digitally enabled or online centric, signaling that a smart online strategy will continue to be increasingly important for any electronics seller who wants to survive and thrive.
Cloud-based e-commerce solutions provide a variety of benefits to organizations who want to bring their online B2B sales efforts to the next level. Order processing accuracy can go from an average of 97% to as high as 99.5%, a huge difference in terms of customer satisfaction and cost, said Dalton. In addition, these solutions can increase sales volumes by 10 to 30%, decrease the cost of each transaction dramatically, and also encourage customers to partake of upsell opportunities, he added.
“Those fundamental things are one factor but when you look at those performance and better serving customers with quality results and quality products, the whole business case is unique and different,” Dalton said.
How do you see the B2B sales landscape developing? Let us know in the comments section below.