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ecommerceDB.com
In-depth: B2B eCommerce 2019
August 2019
Management summary
2
B2B eCommerce refers to exchange of goods and services between companies through anelectronic platform. Companies operating in the B2B eCommerce space follow either the directmodel or the marketplace model to conduct their business. The direct model involves companiessetting up their own platforms and selling directly to the buyers. A marketplace on the other hand isa platform where many companies sell their products alongside their competitors. Even though B2CeCommerce has witnessed widespread adoption, it is the recent evolution and growth of B2BeCommerce, that is grabbing the attention of buyers, sellers and investors all over the world.
One of trends in B2B eCommerce is the rise of vertical or specialized marketplaces. These portalsoffer a deeper range of products in a particular category along with specialized value added services.Companies are also increasingly using big data to deliver a personalized customer experience.Another trend is the rising popularity of mobile shops also in B2B eCommerce.
Due to the strain on legacy platforms, which aren’t designed to handle such scale cloud platforms arepicking up. Additionally, B2B eCommerce companies are now integrating their systems and platformsto establish an omnichannel relationship with their customers.
Paucity of quality customer-data due to smaller number of buyers and hyper specialized services, ishampering personalization efforts. Further, the larger scale and other complexities of the sector suchas larger order quantities, variable prices, more products and tighter delivery deadlines are putting astrain on existing supply chains.
Another barrier to industry growth is that companies often simply extend their ERP solutions toenable e-business, thus putting a big strain on the legacy platforms. With B2B companies nowrequired to be nimble and mimic the B2C shopping experience, a flexible and interoperableeCommerce architecture is of primary importance.
Amazon, Alibaba, Rakuten, Mercateo, Global Sources, Walmart and IndiaMART are the major playersin the global B2B eCommerce market. Amazon rebranded its B2B eCommerce operations fromAmazonSupply to Amazon Business in 2015 and achieved sales of over US$1 billion in just a year.
Alibaba with a share of about 30% in China is now expanding its operational base to India, Europeand the U.S. The company’s vast network of low cost suppliers enables it to dominate the market,followed by Global Sources. IndiaMart, Mercateo, Rakuten and Amazon are the largest B2BeCommerce companies in India, Germany, Japan and the U.S. respectively.
Questions? U.S.: [email protected] EU: [email protected]
Table of contents (1/2)
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Management Summary 02
Table of contents 03
Introduction 05
▪ Overview 06
▪ Business models 07
▪ B2B vs B2C eCommerce 08
▪ eCommerce evolution 09
▪ Global B2B eCommerce market 10
▪ Regional analysis 11
▪ Country analysis: China 14
▪ Country analysis: India 16
▪ Country analysis: U.S. 18
▪ Country analysis: UK 19
Trends 20
▪ Overview 21
▪ Vertical marketplace 22
▪ Personalization 23
▪ Mobile B2B eCommerce 24
▪ Cloud platform 25
▪ Omnichannel strategy 26
Table of contents (2/2)
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Barriers 27
▪ Overview 28
▪ Lack of data 29
▪ Complexity of supply chain 30
▪ Legacy platforms 31
Competitive landscape 32
▪ Overview 33
▪ Amazon 35
▪ Alibaba 46
▪ Rakuten 60
▪ Mercateo 62
▪ Global Sources 67
▪ IndiaMART 71
▪ Walmart 77
Appendix 82
▪ Glossary 83
▪ Statista Digital Market Outlook 84
▪ Statista Global Consumer Survey 85
▪ Statista Research & Analysis, Statista Content & Design 86
▪ Authors 87
Introduction
B2B eCommerce refers to exchange of goods and services between companiesthrough an electronic platform. Companies operating in the B2B eCommercespace follow either the direct model or the marketplace model to conducttheir business.
The direct model involves companies setting up their own platforms andselling directly to the buyers. A marketplace on the other hand is a platformwhere many companies sell their products alongside their competitors. Eventhough B2C eCommerce has witnessed widespread adoption, it is the recentevolution and growth of B2B eCommerce, that is grabbing the attention ofbuyers, sellers and investors all over the world.
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Source: Company information
Trends
One of trends in B2B eCommerce is the rise of vertical or specializedmarketplaces. These portals offer a deeper range of products in a particularcategory along with specialized value added services.
Companies are also increasingly using big data to deliver a personalizedcustomer experience. Another trend is the rising popularity of mobile shopsalso in B2B eCommerce.
Due to the strain on legacy platforms, which aren’t designed to handle suchscale cloud platforms are picking up. Additionally, B2B eCommerce companiesare now integrating their systems and platforms to establish an omnichannelrelationship with their customers.
20
Barriers
Paucity of quality customer-data due to smaller number of buyers and hyperspecialized services, is hampering personalization efforts.
Further, the larger scale and other complexities of the sector such as largerorder quantities, variable prices, more products and tighter delivery deadlinesare putting a strain on existing supply chains.
Another barrier to industry growth is that companies often simply extendtheir ERP solutions to enable e-business, thus putting a big strain on thelegacy platforms. With B2B companies now required to be nimble and mimicthe B2C shopping experience, a flexible and interoperable eCommercearchitecture is of primary importance.
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Competitive landscape
Amazon, Alibaba, Rakuten, Mercateo, Global Sources, Walmart and IndiaMARTare the major players in the global B2B eCommerce market.
Amazon rebranded its B2B eCommerce operations from AmazonSupply toAmazon Business in 2015 and achieved sales of over US$1 billion in just ayear.
Alibaba with a share of about 30% in China is now expanding its operationalbase to India, Europe and the U.S. The company’s vast network of low costsuppliers enables it to dominate the market, followed by Global Sources.
IndiaMart, Mercateo and Rakuten are the largest B2B eCommerce companiesin India, Germany and Japan respectively.
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Appendix
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Glossary
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Term Abbreviation Explanation
Artificial Intelligence AIA simulation of human intelligence by machines including reasoning and self-correction.
Business-to-business eCommerce
B2B e-ComThe process of selling products or services between businesses through the internet via an online sales portal
Business-to-consumer eCommerce
B2C e-Com
The transactions conducted directly between a company and consumers who are the end-users of its products or services through the internet via an online sales portal.
Cash on Delivery CODA transaction, typically through an eCommerce platform, in which payment is made in cash upon delivery of the goods.
Consumer-to-consumer eCommerce
C2C e-ComA business model whereby customers can trade with each other, typically, in the online environment
Gross merchandise value GMVThe total value of merchandise sold over a given period of time
Foreign Direct Investment FDI
A business investment made by a company or individual in a foreign country. This can also take the form of an acquisition of foreign business assets.
Machine Learning ML
The application of AI to a system in order to enable it to automatically learn and improve from experience without being explicitly programmed.
Online-to-offline O2OOnline-to-offline commerce is a business strategy that draws potential customers from online channels to physical stores
Online-to-offline-to-online O2O2O
A business-matching platform, developed by UBM and Alibaba, that integrates online and offline trading. This allows buyers to search and contact sellers (online), arrange meetings (offline) and place orders (online).
Software as a service SaaSA software distribution model in which a third-party provider hosts applications and makes them available to customers over the Internet
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W W W . S T A T I S T A . C O M
Dev Mehta
Authors
Dev Mehta has over 10 years of experience working for marketresearch, legal and consulting companies. Dev worked in varioussectors such as Defense, Digital Marketing, FinTech, Insuranceand Consumer Goods.
Dev completed his Post Graduate Diploma from MasseyUniversity New Zealand, majoring in Business Management anda Masters in Marketing Management from Middlesex University,London
Ann-Kristin Hamke
Ann-Kristin Hamke is the VP Strategic Market Insights at Statista and is in charge of the production of exclusive own Statista content.
After graduating in Business Mathematics, she worked as a consultant with the Boston Consulting Group and contributed to the build-up of the German online fashion retailer About You as a project manager and by heading the business intelligence department.