The digital migration of sales operations presents massive opportunities in efficiency and cost savings for B2B sellers like manufacturers and wholesalers, but the motivations for making the online shift haven’t always been about driving the overall optimization of the enterprise.
According to Boris Lokschin, co-founder and CEO of Spryker, the initial push of B2B organizations into the world of B2B eCommerce was, unlike the B2C ecosystem, more about cutting costs than elevating top-line expectations. Businesses began to embrace the online, self-service model for the 70 percent to 80 percent of their smaller customer accounts in order to allow account managers to focus on the most lucrative larger accounts.
But the industry is in the midst of major change in which B2B firms increasingly understand the top-line opportunities of embracing the eCommerce model.
“B2B companies, especially manufacturers, now recognize they need to build additional revenue streams,” Lokschin told PYMNTS in a recent interview.
This has created an ecosystem in which B2B organizations are driving toward new business models like recurring revenue streams and migrating onto online marketplaces. These shifts can yield value beyond merely cutting costs: indeed, this evolution can strengthen cash flow and improve the customer experience, but only if firms can overcome some pretty lofty challenges.
A New Way To Operate
Today, embracing B2B eCommerce isn’t simply about shifting product information and sales workflows to a digital platform. As Lokschin explained, organizations are figuring out how to operate in entirely new ways while facing ever-rising customer expectations.
One of the biggest hurdles, he said, is in navigating a newly-transparent market. Online commerce has widened customer visibility into product availability and costs, allowing buyers to far more quickly and easily compare vendors and drive up competition.
At the same time, B2B firms are tasked with migrating already complex processes online. Workflows like customer account management, price customization, massive catalogs and complicated product descriptions are still in place, yet must now be shifted to the digital realm. To aid with these initiatives, organizations are now facing the challenge of acquiring the right digital talent.
Making this process even more complicated, said Lokschin, is that the eCommerce shift is not a one-and-done process. Rather, migrating operations online involves rethinking how an entire organization operates. Legacy manual sales workflows have been in-place for years, but in order to succeed online, sellers must embrace a bit of experimentation and flexibility.
“This is trial-and-error mode,” said Lokschin. “It’s a very different mode of operation than the traditional one they’re used to.”
Considering the nuances of B2B eCommerce and customization requirements each seller and buyer faces, Lokschin noted that traditional Software-as-a-Service solutions might not be the right fit when debuting digital sales operations.
For less sophisticated verticals like online retail, SaaS does an adequate job of offering an application programming interface (API)-first, headless tool upon which sellers can base their business. There are basic expectations and standards that online shoppers have when purchasing shoes or clothing online, like search filters and support for various payment methods. SaaS tools offer an easy way for vendors to build upon the bare minimum of those needs.
Considering the complexity of the B2B landscape, however, each technology user — that is, the B2B seller — requires its own features and functionality. One organization will need to display products in a far different way than another firm, for example.
“You need to take into account that there will be customization,” said Lokschin. “There will be customers that want to adjust your way of displaying products or discount engine. This is where SaaS fails — SaaS only works if you don’t allow for customization.”
Platform-as-a-Service, he said, supports the level of customization required by empowering those vendors to have control over the way those applications function — rather than SaaS, in which application functionality is predetermined.
“It’s much harder than to just sell shoes online in three different colors and five different sizes,” added Lokschin. “Sellers need technology that mirrors the organizational complexity they already have while building new digital models.”
As B2B organizations ease their way into a more experimental way of operating and embrace the opportunities of digitization, more avenues for innovation will emerge that can drive up revenues and strengthen the customer experience.
Lokschin highlighted two key innovations that may be on the path to further B2B eCommerce disruption. Augmented reality, for one, could be a valuable tool for sellers that must display highly complex and intricate products more interactively — a technology that may continue to prove valuable considering the continued closure of trade shows and in-person meetings.
The second, he said, is the IoT (Internet-of-Things) commerce model, in which the machinery and products themselves are connected to the cloud and can initiate upsell opportunities like the automatic scheduling of maintenance or replacement parts.
While disruption is never frictionless, B2B sellers that can embrace the changes brought on by emerging technologies and shifting market demands will be better positioned for success.
Articles listed with Cash Tech News as the author are either general information, or may have been imported from another website, to bring our readers a rich media experience that encompasses articles that we find interesting, as well as those curated by others.
The views and opinions expressed here are for informational purposes only, and should not be confused with professional financial advice. These opinions are solely those of the author and do not necessarily reflect the views of CashTechNews.com. Every investment and trade involves risk. You should conduct your own research, and contact your professional financial advisor before making any investment.
Corrections, feedback, and ideas should be submitted through the website contact form.