Hokodo Co-founder and President, Louis Carbonnier, was recently invited to join an episode of the Ecommerce Edge podcast. Hosted by Jason Greenwood, founder of Greenwood Consulting and collaborator on Hokodo’s Definitive Guide to B2B E-commerce Buyer Demands, the conversation was a tour de force in all things B2B e-commerce. Here’s a snapshot of what we learned from Louis and Jason.
1. Want to attract more customers? Stop gating your B2B e-commerce site
One of the first topics of conversation on the podcast episode concerns the B2B sellers who choose to gate vast parts of their e-commerce offering, making things like the product catalogue, pricing and shipping details only visible to customers with an approved account. Jason references the finding that 69% of B2B buyers find researching suppliers online on their own more effective than interacting with a sales rep.
“What that tells me is that this whole idea of a gated B2B e-commerce website, the reality is that you're not going to be in the consideration set for most of these modern B2B buyers because they are starting their supplier selection journey with a Google search,” Jason explains.
Very simply, if potential buyers don’t know that you sell a particular product or manufacture a certain part, you’re not going to have an opportunity to talk to them.
“It kills the awareness and it kills the consideration,” Louis adds. “The top of your funnel basically shrinks.”
2. E-commerce is driving digital transformation
Next, Louis and Jason examine how e-commerce platforms and strategies are driving further digital transformation in B2B, highlighting how self-service e-commerce experiences force B2B brands to examine their:
- Product data
- Customer data
- Price list
- Images, videos and PDFs
“All of that rich product data that typically has lived in a salesperson's head or in a print catalogue or in a PDF on a network drive that the salesperson attaches to an email and sends to their customer. It centralises all this information and it takes this institutional knowledge and turns it into a digital equivalent.”
The bottom line?
“The reality is you can't become channel agnostic until you have digital versions of all your product data. It's that simple.”
3. E-commerce is the fastest growing distribution channel
When asked to gaze into his crystal ball, Louis is quick to predict the bright future of B2B e-commerce.
“Gradually this new business line, this e-commerce channel, is actually going to take over the old processes. And it's going to be a bit like a reverse takeover where, what was the new kid on the block, is actually helping B2B companies replatform and migrate all their systems to something that's more instant, more reliable, and a single source of truth.”
Then, Louis shares that for the vast majority of Hokodo’s clients, e-commerce is the fastest growing distribution channel – even those that only currently process 10-20% of their transactions via online channels.
4. B2B sellers need to pay attention to purchase frequency
During the conversation, Louis reveals what he believes to be one of the most important metrics for B2B sellers to track: not conversion rate or average order value, but purchase frequency. Why?
When a B2B buyer identifies you as their preferred supplier, the share of wallet that you can capture is much higher. A buyer goes from doing the odd purchase every other month to 20 transactions in a 30-day period. How? By giving them great payment terms and a good user experience.
“Of course, you might get a 30% increase in conversions, and maybe some increase in AOV. But for instance, imagine the buyer is a professional in the construction sector. If they need three bags of cement to build a house, they won't be buying 10 just because you give them payment terms or a better payment method. They need three bags of cement to finish that job and that's what they're going to buy. What you really want them to do is that the next time they have a job and they need to buy cement, they go to your website and they procure from you.”
B2B sellers must consider the frequency of transactions and the loyalty that can be driven from customers when you provide a better online purchasing experience.
5. B2B sellers can (and should) incentivise their sales team to digitise customers
“I believe that most B2B brands should be incentivising their sales team to move transactions, at least for replenishment ordering, into the digital channel,” explains Jason partway through the podcast episode, before suggesting that salespeople could be offered extra commission for transactions that take place via a digital channel.
Not only is the online channel often a better, faster and easier experience for the customer, but it is also more efficient for the seller and provides access to a wealth of invaluable information.
“We are able to gather data around site search queries, new product development, cross-sells, upsells [...] so that we can craft that experience to get better over time. That is a gold mine for B2B brands.”
6. E-commerce is never finished, but an ongoing investment
According to Jason, many B2B brands make the incorrect assumption that once they have launched an e-commerce site then it is complete and finished, not to be revisited for another 5 years. Unfortunately, they couldn’t be more mistaken.
“It's never one-and-done. That's the whole point,” Jason says. “This is a process of ongoing digital transformation in the business. And in order to make the business case for recurring investment, we have to see data as an asset instead of a cost centre in the business. And if you look at it that way, then it becomes pretty easy to make the business case for ongoing investment in digital channels.”
7. E-commerce is creating fundamental change in business structures
The immediate nature of e-commerce means that instant decisions and real-time answers are becoming the norm. And it’s having a transformative impact, not just broadly on B2B commerce, but on the way that individual teams in B2B businesses interact.
“It’s forcing us to reinvent all the finance bits surrounding the B2B transaction,” says Louis. “E -commerce is propelling us forward in areas where we had no idea that it would. For example, finance teams are reinventing themselves and becoming the engine that supports the sales and no longer a back-office function as it often used to be.”
8. Omnichannel is the next frontier
Towards the end of the episode, Jason asks Louis what’s next for B2B. The answer? Omnichannel. It seems that e-commerce may only be the start when it comes to the revolution of B2B transactions.
“Merchants really want to be omnichannel and have a seamless, consistent experience across all their distribution channels,” explains Louis, highlighting that the most successful B2B sellers are going to be those who can be relied on to deliver the same quality of goods (or services), at the same price, just as easily, across any channel. Better get started then.
Check out the full podcast episode below.
If you would like to learn more about the changing demands and expectations of B2B e-commerce buyers, make sure to download our industry-defining research report.
