According to Gartner, by 2024, 15 percent of B2B organizations will use digital commerce platforms to support both their customers and sales reps in all sales activities. In this guide, we’ll discuss why this transition is happening and what the consequences are for B2B branded producers.
The tendency is explained by Millennials replacing Baby Boomer as the key buyers in many B2B businesses. Needless to say, this won’t happen immediately, but the change is inevitable. The importance of this change comes in the fact that both of these generations have quite different buying habits regarding applications solutions. Millennials have a tendency to rely on relational stations — with their social networks of friends and business contacts. Baby Boomers are more likely to rely on customer reviews and third party input.
- Nearly 60 percent of Millennials are more inclined to participate with sales long after doing preliminary study and defining a set of solutions to evaluate. Meanwhile, Baby Boomers are more likely to engage a salesperson early in the procedure.
- 44 percent of Millennials favor no sales rep interaction when interacting with the vendor.
- 80 percent of Millennial buyers say that they expect personalized involvement from the vendors they buy from.
- Boomers are 17 percent more likely than Millennials to favor RFP stations and are less likely to select digital stations and eProcurement systems.
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In addition to the changes in buyer personas, the worldwide pandemic has had a substantial effect. It has dramatically reduced if not removed facial interaction from the purchasing procedure. B2B purchasing process is rapidly digitizing and getting omnichannel:
- 61 percent of all B2B transactions start online
- 73 percent of buyers generally use digital stations.
- Multi-channel clients are 25 percent more profitable than human-only interactions.
What does it imply for B2B manufacturers?
To achieve sustainable business growth in this environment, B2B producers need to change their company to address the requirements of their new audience in the new circumstances:
- Single commerce engine to support both online station and area sales
- Allow buyers to jump between multiple digital and conventional touchpoints during the complex buying process as part of a continuous journey.
- Provide buyers with end-to-end purchase visibility from purchase to shipping to make certain they have a clear view of the buying process, particularly for mission-critical services and products.
- Deliver personalized experiences across large complex organizations, including customized products, services, and pricing.
- Support new electronic touchpoints such as chatbots and augmented reality to deal with digitally savvy Millennial audience requirements.
For many B2B makers, these business requirements are out of reach. With the majority of sales historically going through sales agents, their trade capabilities are non-existent or rudimentary at best. Even in situations when they exist, often they’re completely disconnected from the resources the area sales usage, such as CPQ, making the omnichannel journey impossible.
B2B manufacturers must change to modernize their electronic commerce solution or implement a new one from scratch to conquer these challenges.
Digital commerce requirements
Most conventional B2C commerce solutions aren’t a great fit to support the intricate B2B buying process. The B2B manufacturers should look for a solution that addresses the following requirements:
CPQ Integration or CPQ Capabilities. Revenue personnel typically use CPQ to make orders, and the experience is extremely different from the web site experience. Because of this, a trade solution needs to integrate with a CPQ application and supply all essential CPQ capacities that an arrangement capture UI can be built on top of it. For the former, the trade platform should have a thorough integration framework, while for the latter, it ought to get APIs using that an order capture UI can be constructed.
Sophisticated Account Structure. Selling to large organizations often requires selling to buyers in numerous sections across different affiliates. This needs a trade solution allowing to configure and manage complex enterprise accounts with multiple users.
Personalized pricing. In the B2B world, prices are usually unique with customized offerings, pricing, and discounts. To deal with this need, trade solution must support individualized pricing and product variety on a per-account foundation and deal-specific discounts.
API-first approach. With the greater complexity of a B2B purchasing process, customers will probably move back and forth between different touchpoints. This necessitates commerce solution to possess well-defined and well-documented APIs.
Reference Applications. A B2B manufacturer often has no expertise with new digital touchpoints like Augmented Reality and chatbot. A library of ready-to-go applications allows to simplify development and accelerate speed to market for new touchpoints.
How adding solutions to your goods can propel your organization growth?
Convenience has been a key driver of their success for many brands which have survived throughout the COVID-19 pandemic. And though it can feel like we’re slowly coming to the conclusion of the unprecedented times, consumer purchasing behaviour is permanently altered, and will in turn, influence the success of many companies for many years to come.
As Gartner intends to prepare application leaders to the accelerated shift towards electronic, they forecast that,”By 2024, major trade organizations will generate 10 percent of online revenue from services connected to physical goods .”
By providing the convenience and Additional consumer experience, of coupling analog products with brands, services will become more appealing to the biggest generation with the highest spending power: the millennials
The millennials are on peak of the food chain when it comes to trade, and they’re craving personalized, cost efficient, and time saving ways to progressively consume products and services on the internet. While it is widely considered that price is the dominating factor behind many purchases, it has been discovered that:
- Approximately, 97 percent of customers say they’ve backed out of making a purchase due to inconvenience.
- 56 percent of millennials rate convenience tremendously when shopping online.
- 52 percent of customers say over half of the purchases are affected by convenience.
With so many choices on the internet, and more time available to shop around and appraise, merchants will need to find ways to stay competitive where convenience is considered. To cater to better client experience, convenience, and value-add capacities, Gartner has suggested the inclusion of solutions to physical products such as:
- Auto replenishment
- Predictive maintenance
- Marketplace surgeries
- Payment providers
We feel that with the inclusion of such solutions, we can expect to find a higher retention rate of customers along with higher possibility of constant recurring revenue.
What leads us to believe this prediction will hold true?
Subscription based models are in the middle of recurring revenue in eCommerce. With the emphasis on customer retention, as opposed to customer acquisition, merchants have a greater likelihood of keeping the loyalty of current customers. It’s been said that while the likelihood of selling to another client is between 5% and 10%, the likelihood of selling to an existing client is between 60% and 70% (Marketing Metrics).
And what keeps the customers loyal you may ask? The advantages of budgeting and convenience. The subscription model provides a reduced effort situation where customers can”set it, and forget it” while also having the ability to track their expenditure.
At exactly the exact same time, merchants also benefit from the ability to create more data driven decisions and create more cross selling and advertising opportunities. While many organizations have started to deploy subscription versions, the market keeps growing exponentially and can nevertheless be infiltrated.
- The eCommerce subscription market has increased by 100 percent every year from 2013 to 2018 (McKinsey)
- The biggest businesses in the subscription eCommerce marketplace have risen from $57 million in sales in 2011 to 7.5 billion in earnings. (McKinsey)
If carefully thought out, this may be a feasible choice for many companies as the barriers to entry remain fairly low for the time being.
Auto Replenishment and Predictive Maintenance
Auto replenishment and predictive maintenance are a huge time saver during COVID-19. What once began as an intrusive idea, when Amazon started their”Dash Buttons” that could auto replenish certain things when they were running low, has become a convenience that customers crave essentials, like groceries.
Based on Oracle’s Consumer Behavior report in 2017, 48 percent of people would love to be able to automobile replenish frequently bought items. Companies like Peet’s Coffee and Ziploc have seen 50 percent of their sales from incorporated Dash buttons, while Cotonelle reported that they even doubled their share of wallet in 2018 because of auto-replenishment. The addition of these services eliminates the inconvenience of customers encountering out-of-stock situations, while merchants have the ability to maximize their efficiency by matching customer requirements.
When we consider marketplaces, the first ones that come to mind are market giants such as Amazon, Walmart and Alibaba. However, because barriers to entry have started to diminish, it’s made it much easier and affordable for merchants to have a part of the revenue pie – and this is 1 slice you do not want to overlook. In accordance with this 2019 UPS Pulse of the Online Shopper study:
- 96 percent of online shoppers have used a market
- 38 percent of shoppers see a market from once a week to multiple times per day
- 38 percent of shoppers begin their online research on a market more than any other station
- 48 percent of spontaneous shoppers store on marketplaces
You may question if creating a market that shows other brands is helpful for your business. However, in fact, you might in fact be losing out on potential revenue by not considering the alternative. The fact of the matter is, consumers want to get the best bang for their buck, and they do this through research and comparisons. Generally, consumers spend 79 days gathering information prior to making a purchase and what better place for them to perform this study than on a market.
As a merchant, you need to be where customers are spending their time, and why not be the chief that customers flock to for advice. Even if your product isn’t chosen at checkout, you’d have created a platform that’s generating revenue with every transaction, without the overwhelming lack of cost and development time to make a product.
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Finally, as the market shifts away from money and strip cards, towards contactless payments and electronic wallets, convenience increases while market times decrease for customers. But though these choices bring ease of use and speed to the table, there’s still some skepticism about safety from older generations. In terms of millennials and Gen Z’s, their relaxation in technology have made these solutions critical when making a purchase. According to report,”Emerging Trends In the Point of Sale,” by FreedomPay and Ingenico Group:
- Approximately 75 percent of millennials were happy with contactless payments
- Almost 75 percent of GenZ were happy with contactless payments and declared it a”must have”
- 85 percent of millennials and 84 percent of Gen Z believe contactless payment protected.
With an array of payment solutions can be an integral strategy for reducing abandoned carts and maximizing revenue. Providing a favorite method of payment to customers will be just as important as supplying products. This reduces the friction at the conclusion of a customer purchasing ring, which in turn will assist with leaving a positive impression and fostering customer retention. There has also been positive correlation between higher transactions and extra digital payment services. According to this 2019 UPS Pulse of the Online Shopper, normally, shoppers who use digital wallets even spend $62 more each transaction. Along with higher earning potentials, it’s of my view that the companies which will be prosperous in the future are ones which decrease the frustration of the checkout procedure and cater to the shopper with all the options of payment solutions.
- Millennials and Gen Z have the maximum spending power and appealing to their needs is critical for the success of your enterprise.
- Convenience and client experience are the key deciding factors when making a purchase.
- The subscription market is supposed to increase at a rate of 68 percent from 2019-2025 reaching $478.2 billion. With barriers to entry being an all-time low at this time, brands should grab the chance to develop this support.
- Automobile replenishment and predictive maintenance services will be crucial for frequently bought items, in order to”set it, and forget it”
- Marketplaces will offer a new avenue for revenue that does not need developmental cost and time for producing products and fulfilling demand
- Payment solutions is the final step of the buying process that could determine whether a customer completes a purchase.
As you assess adding services such as these, it is very important that you also look at the eCommerce software you decide to support it. As we move to our post COVID-19 planet, you may wish to move and adapt quickly to keep up with your clients. Using a Composable Commerce approach, it’s a lot easier for your staff to move quickly and incorporate all the features you want to design and optimize your distinguished commerce experiences.
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