commerce viewpoint: online trading in b2b...for many b2b organisations, trading online is a new and...
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COMMERCE VIEWPOINT: ONLINE TRADING IN B2B
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For many B2B organisations, trading online is a new and challenging arena. Wherever they find
themselves on the digital maturity spectrum they can all take some valuable lessons from their more
digitally seasoned B2C cousins.
Irrespective of channel, delivering an excellent customer experience is no longer a lofty ambition for
B2B brands – it’s a commercial requirement.
As best practice cascades from B2C to B2B, B2Bs could be forgiven for thinking that many of the
fundamental differences with B2C are being diluted. In most respects that’s not the case. Many key
distinctions prevail.
This Salmon guide serves as a valuable checkpoint on the characteristics specific to B2B - in
particular the B2B customer. It also presents the main recommendations for B2B decision-makers in a
digital-first world, and highlights some of the most important risks.
INTRODUCTION
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THE CUSTOMER IS THE KEY DIFFERENTIATOR
B2B commerce is challenging. Yet many software vendors and technology delivery partners struggle
to understand why. Salmon has delivered numerous global B2B platforms at scale, and highlights the
distinct nature of the B2B customer as arguably the over-riding factor.
Within B2B, customers:
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• Can be individuals, companies, or both.
• Can negotiate bespoke price agreements.
This is a potentially complex area, since
customers can be very diverse, and
agreements can vary according to volume,
date, order history and geographic location.
• Are likely to want to pay using credit terms.
B2Bs need a way to verify new customers
before orders are placed; B2Cs rarely need
to do this.
Supporting your B2B customer is fundamentally different to B2C.
• May want bespoke catalogues, or access to
an exclusive product range.
• May have to record their order in an ERP
system. This means online ordering needs
to be attractive enough to override any
perceived inconvenience. Alternatively, B2Bs
could ensure their website integrates with
the ERP or the website integrates with the
ERP.
• May want to control the spend of buyers
within their procurement organisation. And
this, in turn, drives the need for electronic
procurement.
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Salmon has more than 25 years’ experience in providing robust technical design. Its solutions
architecturally scale and address the needs of both businesses and end customers.
Within B2B, technical design has various complexities. In our experience working across B2B and
various B2C retail sectors, B2B has several distinct differences that merit deeper investigation.
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IMPORTANT FACTORS IN B2B TECHNICAL DESIGN
Watch our video to see how digital technologies are enhancing B2B.
These include:
Contract Pricing – Organisations need to decide
whether to model pricing in the front-end or
back-end. Typically it’s the latter, which means
exposing price to the customer, without being
overly dependent on the back-end for availability.
Organisations – B2Bs need to look at account
management, including the people who manage
accounts, and the ways in which they are
structured and governed.
Global factors – Jointly, we need to assess a
range of variables: single or multi-instance, local
management of content and catalogue, latency,
data privacy, data migration and rollout.
Integration – Different back-end systems
(including ERP) must be handled appropriately
for different regions. Generally, this is achieved
using a middleware tier, often leveraging an
enterprise service bus layer (ESB), and possibly
an operational data store (ODS).
Single code base – B2Bs must build functionality
to minimise differences across regions. That
means creating configurations that are flexible
giving the business maximum agility, regardless
of whether channels are operated centrally or
locally.
Functional features – Specific B2B features
need to be handled, such as quote requests,
parts lists, electronic procurement, entitlement
(including payment, shipping and catalogue),
workflow and approvals, and spend control
systems.
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DRIVING CHANNEL SHIFT
CX in B2B matters. Indeed, we’re starting to see
research (such as a 2016 SiriusDecisions study)
that puts customer experience above price and
the actual offering in B2B buying decisions.
With customer expectations influenced by
Amazon-type CX, moving customers from offline
to online may become a commercial imperative.
Yet enabling this shift can be challenging,
especially if the offline process works well.
To drive channel shift behaviour and migrate
customers towards transacting online, you
could deploy a set of sophisticated digital tools.
These tools can help differentiate you from the
competition.
You’ll also need richer capabilities to be able to
market and create sales lead opportunities, and
encourage more participation in any kind of B2B
community.
First we need to recognise the usage needs of
the customer.
Overleaf on the left are the most common use
cases that sellers should look to capitalise on.
They can do this in two ways: by leveraging
existing B2B platform features, or creating
customised capabilities and functionality. On the
right are features that offer possible solutions.
Car Manufacturer HQLow
demand
Highdemand
Depots
Tyre report:
Received signals
Manage demand
Lowdemand
Highdemand
Car Manufacturer HQStock distributor:
North depot South depot
Tyre sensors could relay data on tyre condition to the manufacturer to help it anticipate demand for new tyres and
allocate stock accordingly. [Watch Video]
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A customer wants to buy direct from the
website having used browser tools to find
suitable items
A customer wants to buy direct from the
website having browsed the online sales
catalogue
A customer wants to buy from the website
using spend control capabilities
A customer wants to buy from the website
using a pre-determined list of items that they
have prepared
A customer wants to view and manage their
organisation, account and invoicing through
self-service tools on the website
A customer wants to buy from the website via a
means of electronic procurement
Implement browser tools like a part finder,
integrated browser search or a browser toolbar
Implement dynamic sales categories and enrich
the onsite search capabilities for merchandising
Implement a budget and workflow approval
system with buyer organisation controls
Implement a quick order form feature or the
ability for customers to upload a list of products
Implement self-service capabilities for handling
organisation management, quote management,
requisition lists, saved orders and invoicing
Implement integration with the customer’s
internal procurement system such as a round-
trip catalogue. This would allow buyers to search
inventory for available items, and build shopping
carts that connect to their own internal systems
for approval and order creation. Alternatively,
send customers custom product catalogues
electronically via FTP or expose a set of web
services using APIs to give access to your
offering.
CUSTOMER USE CASES HOW B2B ORGANISATIONS COULD RESPOND
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MA
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CREATING HOLISTIC CHANGE
While customer experience is a vital component in successful channel shift, there are internal
challenges that need to be overcome too.
If you’re aiming for your customers to go digital by default, you need your staff to do the same.
Inevitably, some people will embrace a move to online more readily than others. There needs to be
an acknowledgement and management of risks and resistance, and a focus both strategically and at
an individual level.
Managing Morale During Disruption
A shift towards online can leave some sales teams feeling like their efforts are no longer as critical
as they once were. Indeed, in some cases, people feel digital transformation pushes them firmly into
second place. Channel shift is just one component of transformation, but it can bring those concerns
to the fore for the first time.
This cultural resistance to change is not unique to B2B, but is part of a wider operational perception
that the status quo is the safer option. This can hinder or derail even the most well-planned channel
shift initiative.
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Salmon believes that organisational change is vital too, and here’s why:
• During a move to online, there may be a perceived negative impact of digital on legacy
processes. Recognising this is the first step to addressing the internal, ingrained cultural barriers
to success. In fact, digital provides an opportunity to address these previously prohibitive legacy
issues, and to enable change.
• Re-purposing roles is crucial. Channel shift must be seen as a benefit to individuals, not just the
wider business, and individuals need a renewed role that validates those concerns.
• A recognition of skills diversity is key. Many people, particularly in sales, will feel threatened
by the advance of digital over a role they previously owned themselves. Users ‘on the ground’
may feel they lack the necessary skills, or may feel that digital is making their contribution less
important. If training is unaddressed, this can create a cultural shockwave.
Salmon believes that channel shift can only be achieved with a dual focus on organisational change.
Otherwise, fragmented transformation can present a considerable challenge.
HOW CAN SALMON HELP?
Salmon has delivered high-impact B2B ecommerce strategies and solutions including global
platforms for companies such as Avnet, Premier Farnell, Celesio, DFS, Domestic & General and Audi
UK. By applying winning experiences from our consumer clients, Salmon empowers B2B customers
to create standout experiences. Contact Salmon to discuss how we can do this for you.
Click for more Salmon B2B resources.
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©2016 Salmon Ltd. All rights reserved. All company and product names, brands and symbols mentioned herein are brand names and/or registered trademarks of their respective owners.
For more information,email: [email protected] visit: www.salmon.com
ABOUT SALMON
Salmon is a global digital commerce consultancy – the largest in WPP’s network of companies. We define and deliver market-changing solutions and customer journeys for the world’s leading brands.
Established in 1989, with operations in London, New York, Melbourne and Beijing, Salmon clients include Argos, Audi UK, DFS, Halfords, Lloyds Pharmacy, Premier Farnell, Sainsbury’s and Selfridges.