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B-to-B Marketers Should Take Another Look at E-Commerce

Ruth StevensE-commerce opportunity is evolving fast, but only 25% of B-to-B marketers are taking advantage of it, according to a 2012 Oracle study.  Time for another look says Ruth Stevens, BIIA’s Board Member and Contributing Editor. 

The typical B-to-B company selling online is the classic catalogers like Edmund Optics and Seton, which were fast to supplement their print catalogs with e-commerce.   But with the new functionality now available, just about any business marketer can find ways to reduce selling expense and attract new customers by integrating e-commerce into their go-to-market strategies.

A worthy example is Dow Corning, which found itself under huge price pressure, as the silicone category grew commoditized.  To meet the market demand for lower prices, Dow Corning launched in 2002 an entirely new brand, called Xiameter, where customers could buy trailer-loads of certain products at a 10-15% discount through a newly built e-commerce engine.   Xiameter sales grew so successfully that in 2009, Dow Corning moved as much as 2500 of its 7000 products to the site.  Today, Xiameter represents 40% of Dow Corning’s $6 billion in sales.

Another example is Symantec, which created an online store specifically to serve its small-to-medium business customers in North America.  Today, 100% of Symantec’s $300 million SMB sales run through this channel, which is operated for them by the SaaS outsourcing supplier Rainmaker Systems.  Symantec is enjoying not only lower selling expense, but also admirable revenue growth, with sales up 25%, and trial-to-conversion rates up 33% in the first year.

Why are these online ventures working so well?  It’s thanks to new technology combined with changes in buyer behavior.  The growth of consumer etailing has clearly been a contributing factor.  Business buyers are people, too.  So, their increasing comfort with e-commerce in their personal lives spills over to their jobs.

But business buyers also expect consumer-like functionality in e-commerce.  And a seamless experience.  This is where the new technologies come in.  Platform suppliers like Rainmaker are building systems specifically designed to support B-to-B buying processes, with consumer-like features and ease of use.

So what are the e-commerce success factors for business marketers as they look to take advantage of these opportunities?  Here are some tips:

  • Review your customer segments and product lines for e-commerce potential.  Small and medium business customers may be a perfect fit.  Same for high-volume, repetitive-sales product categories, like replacement parts or warranty renewals.
  • Examine your sales and marketing process for elements that can be automated with e-commerce technology.  Look at quote management, contract pricing, channel partner support, purchase order processing, order approvals, cross sell and upsell, licensing, renewals, reactivation, winback—there are more than you may think.
  • Select software that was built specifically for the complexity of business markets.  Companies that buy consumer solutions and try adding B-to-B capabilities will quickly be frustrated.
  • Select software that provides consumer-like e-commerce functionality.  Ease of use is the competitive watchword today, according to Forrester’s recent study “Thrive by Adopting Proven B2C Principles.”
  • Make sure you connect your e-commerce with your existing accounting, manufacturing and other systems.  Xiameter customers, for example, get their order confirmation, shipping notices and invoices out of Dow Corning’s SAP, which also communicates with the manufacturing plants to get the order produced.
  • Consider using cloud-based suppliers, where you can get up and running in less than a month, and leave the technology to someone else.  Rainmaker Systems offers not only dedicated “sales assist” from its call center, they will even deal with their clients on a revenue-share basis.
  • Remember that e-commerce is global by definition.  So look for technology that offers multiple languages and currencies, and supports tax and customer compliance.

How are you integrating e-commerce into your sales and marketing?

A version of this post appeared in Biznology, the digital marketing blog.

About the Author:  Ruth P. Stevens consults on customer acquisition and retention, teaches marketing at Columbia Business School.  She is a member of the BIIA Board of Directors and BIIA’s contributing editor on the subjects of B2B marketing and eMarketing Strategy. www.ruthstevens.com

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