When you think about ecommerce, you probably think about small businesses with solo entrepreneurs setting up online stores, selling their independently produced, possibly handmade wares to new markets all across the globe. Either that, or Amazon.
What you might not think about or realize, is the fact that B2B ecommerce is over twice the size of B2C.
While the retail side of things may be the face of ecommerce, B2B is both the heart and the muscle. According to a recent Forrester Research report, sales from U.S. manufacturers, wholesalers and distributors to other companies will account for $855 billion in 2016, and will top $1.1 trillion in 2020. That number jumps to $12 trillion when you look at ecommerce worldwide by 2020, when the U.S. and China are predicted to be the strongest two B2B ecommerce countries.
We’ve previously discussed some general ecommerce trends to be aware of, but let’s take a closer look at what is driving this growth in B2B ecommerce specifically, and how to take advantage of it.
This explosion in B2B is happening for a few reasons, but a lot of it comes down to expectations and increasing pressure by companies and industry leaders for their business counterparts to do their B2B selling and buying online. Just as EDI (electronic data interchange) once made paper procurement transactions obsolete, the internet is doing the same to EDI. Like with so many other current internet trends, mobile is also playing a big part, as the expectation has become that orders are able to be placed through mobile devices. Amazon has also done their part to fuel this growth, by expanding their business-facing wing, offering much of the security and familiarity that purchasers are already familiar with from the consumer side.
It’s important to recognize that a majority of B2B ecommerce purchasing decisions are being made before the buyer ever hits a seller’s website. 89% of buyers are doing research on the internet as part of their purchasing process, with an average of twelve searches being done before they ever land on a specific brand’s site. Once they do get to a site, 57% of the buying process is done before any contact is ever made with Sales. Also worth noting is that even with a single company, a buyer isn’t necessarily the only person that a business has to appeal to. 70% of B2B purchases are decided upon by at least 2 people, and nearly a third are decided by more than 5 people.
Even though B2C ecommerce lacks anywhere close to the dollars generated by B2B, the consumer-facing side is still very much driving trends across the ecommerce industry. 80% of B2B companies utilizing ecommerce believe that their customers’ expectations have been influenced by B2C ecommerce. This is also reflected in the things that B2B buyers are saying that they want from their purchasing experiences, including better, more enhanced search options, better organization of information on a site, and more personalization. Even social media plays its part, with 75% of B2B buyers saying that they are influenced by social.
Despite the large revenues from B2B ecommerce, it still represents only about 10% of B2B sales. As we move into the future though, that number is sure to grow. Over the next five years, 69% of companies say they expect to stop printing a catalog. Don’t make the mistake of thinking ecommerce isn’t that important to jump onto sooner rather than later – it is. Certainly, a lot of B2B ecommerce is just a channel shift, with the same business moving from offline to online purchasing, but not as much as you might think. Going back the last decade, B2B companies with ecommerce estimate that over 30% of their ecommerce revenue is incremental – a number which is sure to only go up as we race closer to $1.1 trillion.
Need helping getting your business up to date on the latest ecommerce and general marketing trends? Contact the experts at 10twelve today!