Agility is key to capturing the B2B customer
June 3, 2015 11:07 AM
With online retail behemoth Amazon Inc. launching an expanded B2B online marketplace in April, some B2B e-commerce executives might wonder how they’re going to compete.
But Steve Baruch, vice president of digital and strategy at industrial supplies distributor MSC Industrial Supply Co., says Amazon’s introduction of Amazon Supply, replacing other sections of the site that catered to business-to-business transactions, led him and his team to get back to basics.
“For us it’s taking 75 years of experience and staying laser focused on that,” he told attendees during the B2B workshop at the Internet Retailer Conference and Exhibition.” “For us, it’s not becoming the superstore for the business world, it’s about focusing on the things that create that unique value for our customers.”
MSC’s online sales grew 26.4% year –over year in Q2 2015, accounting for nearly $400 million in overall sales.
Part of that success, Baruch told attendees, came from the company replacing its e-commerce platform in order to better serve customers.
“It was getting to the point where we saw that if we didn’t do it, we were going to be in real trouble,” he said. “It was, frankly, a companywide effort. It’s not something that’s limited to the e-comm or the marketing department. It was about an 18-month process.”
And it’s that kind of forward thinking that other retailers are going to have to adopt to keep growing, says Forrester analyst Andy Hoar, who spoke after Baruch.
With B2B e-commerce expected to account for $780 billion in 2015 and competitors like Amazon entering the fray, companies selling to businesses and other large organizations must remain agile with their technology.
“You need to move quickly and integrate quickly. If you’ve got a system where you’re doing waterfall development and things take a year to turn around, that’s not going to cut it anymore,” he said. “You’ve got to change the culture to a culture that fosters innovation.”
That $780 billion figure, according to Forrester’s research, is twice the B2C e-commerce market, and it’s growing thanks to the fact that more B2B buyers—74% of them—are doing their homework online before making a purchase. Not only that, the number of buyers who make the majority of their B2B purchases online is expected to double within the next three years from 30% to nearly 60%.
Forrester’s Peter Sheldon said the key to capturing that B2B audience is making it similar to a B2C site.
“B2B e-commerce is an extension of B2C,” he told attendees. “Everything that a B2C platform does, you need.”
“If somebody wants to buy their product on your website, sell it to them,” Hoar added. “You’re not in the business of keeping a channel happy, you’re in the business of making a profit.”