According to industry analysts, business to business e-commerce spending will increase to more than $1 trillion by the year 2020. Yet many small to medium-sized manufacturers and distributors (and some larger ones) are still failing to achieve a strong return from their e-commerce initiatives. Some experience low rates of adoption after the launch of their new site. Others are surprised that the initial choice of software isn’t meeting requirements, and they end up having to re-platform soon after their initial implementation. Unfortunately, some of these projects just flat out fail, never getting off the ground.
There are several reasons why B2B e-commerce can be such a challenging endeavor. Many software vendors would argue that technology alone can solve the problem. In my experience however, the issues go much deeper. I believe there is a basic mindset that needs to be changed before success in B2B e-commerce can be realized. This required shift usually stems from a lack of appreciation for the complexities of manufacturers and distributors as it relates to commerce.
Fortunately, the B2B e-commerce world is no longer a new frontier. The good news is that most primary points of failure in B2B e-commerce can be avoided if they are recognized early enough. In my experience, these points of failure are usually related to the following business scenarios:
- A sense of “transform or die” creates a rush to implement without proper communication. Trying to launch too much too soon can force B2B firms into poor e-commerce decisions. Often this involves a lack of communications planning. Companies may expect that the launch of a well-designed site on its own will encourage use – the “if you build it, they will come” ideal. Yet this is a real fallacy as adoption is never automatic. Key stakeholders need to understand the value of the system, and a well-defined and well-communicated site launch and onboarding strategy must be in place before the intensity of testing and implementation phases begin. The value proposition of the new e-commerce site is an integral part of its success, and this must be communicated and marketed to existing and new customers, as well as employees and partners.
- Attempts to use e-commerce solutions primarily built for B2C to power vastly different B2B commerce processes. Although similarities exist at a user design level, the idea that manufacturers and distributors focus primarily on B2C experiences throughout the buying cycle is creating expensive, if not dangerous, misalignment with their e-commerce initiatives. I believe that the e-commerce foundation for manufacturers and distributors must be specifically built on a platform architected for B2B first and foremost, not for retail. The system must acknowledge and handle the fact that B2B e-commerce is driven by the need to connect complex business processes and data from the back office to drive better, user friendly experience across the enterprise. Those B2B business processes and data must drive that experience in order for the technology and project to succeed. It is all about making it easier for people and customers to engage and do business. E-commerce engines built for retail simply cannot handle this complexity without expensive customization.
- And yet having said that, enterprise applications are often ill-equipped to provide the right B2B digital experience. A strong B2B commerce system doesn’t just add an “Amazon-like” e-commerce solution to the existing enterprise systems. For B2B e-commerce to succeed, the company must update and integrate the online and the offline customer experiences. The e-commerce solution must be able to customize those experiences based on the buyer’s role and responsibility, the complexity of the transaction and the integration needs of the enterprise. The result is what I call a “unified” commerce solution, one that acknowledges and handles the fact that B2B buying scenarios are complex, and can range from entirely self-service to entirely sales supported, and everything in between. This is a critical success factor for B2B e-commerce, and one that an e-commerce engine architected primarily for B2C and retail can rarely handle.
- Finally, we’re seeing a rise in e-commerce environments that contain a mashup of individual applications as B2B companies try to solve specific needs one by one. This creates a virtual cobweb of tools like CMS, CRM, quoting tools and retail e-commerce solutions that cannot communicate with each other. The cloud has made it even more convenient to add these types of solutions without significant investment or even the involvement of the IT department.The result is a disparate collection of apps that are nearly impossible to integrate, and do not support a unified e-commerce environment.
Avoiding these pitfalls to build a successful B2B e-commerce solution requires a new mindset involving careful planning, respect for the complexities of B2B industry and teamwork between all the stakeholders involved.