One of the most trivial and truest things to say from 2020 onwards is that “the world has changed since the pandemic”. We have not witnessed the advent of a world order, no governments have collapsed and the balance of the world has not changed. The change, however, has been subtle and perhaps, precisely for this reason, even more, disruptive because it has taken place in our daily lives. Since COVID, the way we work, get around, commute, communicate, and the shop has changed. The way of doing business has also and above all changed.
If we analyze the change in the business sector, other than noticing the so-called “digitalization” of all processes, experts have noticed the rise of business-to-business (B2B) commerce. In this article, we’ll explore what it is and what is its role nowadays.
What is B2B Commerce?
As we’ve mentioned, B2B stands for business-to-business, so B2B Commerce is the term we use to mention the sales of goods or services between businesses.
We use the term B2B Commerce to differentiate our discussion from B2C Commerce which is the sale of products or services from a business to consumers.
B2B Commerce is an important sector of the economy because, as you can easily imagine, businesses need other businesses to function, whether it is for buying supplies and equipment or relying on services provided by external companies or professionals.
Because the pandemic impacted the way companies do business, it also impacted B2B Commerce. Change and development are happening fast and it’s important for organizations to understand the chance and the current role of B2B to be able to adapt and reap the benefits that come with it.
B2B Commerce is going digital
We’ve just mentioned that the change in B2B Commerce is happening fast, but it is also happening on multiple levels. The first and most important data we need to address is that B2B Commerce is growing but the growth is strictly related to another phenomenon: B2B Commerce is going digital. In fact, more than B2B Commerce, today it makes more sense to talk about B2B E-Commerce.
According to a study published on SQLI Digital Experience, “the number of online orders within B2B has grown by 50%” in the past year. And the increase is expected to be even greater in the following years because the same article says that “70% of all B2B purchases are expected to be made only by mid-2025”. An increase of 20% is expected in the next two years!
Is this data so surprising?
Not really. It seems that B2B Commerce is following the same trend that is characterizing the entire business and shopping sector: digitalization.
The boost towards digitalization of the purchasing processes – whether they concern products or services – is often attributed to the pandemic, but this is not entirely true. More than causing the change, the pandemic has accelerated it.
A simple look at the data provided by grandviewresearch.com (see graph) shows us how the B2B market size in North America was already growing before the pandemic and that, after 2020, the growth curve has become steeper. The same can be said for Europe and Asia.
The same can be said for e-commerce in general. Data provided by Statista shows that the number of e-commerce sales worldwide was growing even before the pandemic.
The fact that B2B Commerce is going online seems to fit perfectly into a picture that sees online sales of products and services increasing, whether it’s the B2B or B2C sector. People, including companies and businesses, buy online more and more often.
Other Features of Today’s B2B Commerce
1. B2B Commerce is becoming multichannel
By “channel” we mean the means that buyers use to interact with the seller (and vice-versa). In the last few years, the number of channels used by B2B buyers has significantly increased. While in 2016 buyers would use only five channels, in 2021 they were ten or more channels to interact with suppliers.
In other words, B2B Commerce businesses are adopting an omnichannel sales model. In fact, 94% of B2B sellers believe that the omnichannel model is better and more effective In comparison to the conventional pre-pandemic systems.
This trend is also in line with what is happening in the rest of the sales sector: sales businesses in general are adopting increasingly omnichannel strategies, offering customers a shopping experience across varied online and offline channels, providing flexibility to buyers who can choose how to interact with the supplier.
2. Expectations towards B2B Commerce is higher
B2B buyers have high expectations when it comes to the quality of service provided by their suppliers. This sets new challenges for B2B suppliers who need to bring the quality of their offer to the highest level.
The lack of perceived quality in the various aspects of the online B2B purchasing experience – such as website performance, online availability, and customer service… – often leads buyers to seek new suppliers.
3. In-person contact is still important
Even though remote-based purchases are more and more frequent, in-person interaction is still important in B2B Commerce. A high percentage of B2B buyers (59%) still want to meet the supplier in person before making a purchase. This highlights the need for B2B suppliers to employ an omnichannel approach, one that goes across offline and online interactions, rather than focusing exclusively on online sales in an attempt to follow market growth.
Conclusion
The pandemic has accelerated digitalization in many aspects of life and business, including B2B Commerce. B2B E-commerce is growing and it is expected to grow even further in the next few years.
We can also observe that, within the B2B Sales sector, omnichannel strategies are becoming the norm with B2B buyers expecting high-quality service from suppliers. However, despite the remote-based commerce is increasing, in-person contact still plays an important role in B2B Commerce.
As we move forward, it’s important for B2B sales businesses to keep an eye on emerging trends to remain competitive and meet the evolving needs of B2B buyers.
