Frustrated with formalised internal purchasing, individual B2B end-user buyers are bypassing procurement processes to buy direct whenever they can. We explore the changing realities of B2B online commerce and how B2B sellers should target this new – and growing – opportunity.
Say hello to a new class of business-to-business (B2B) buyers – the empowered business end-user. As new research conducted by Forrester Consulting commissioned by Intershop reveals, these ‘rogue’ buyers are pervasive across many organisations. What’s more, over the next three years they’re set to increase the volume and amount of purchasing they undertake– going online to research and purchase the goods and services they want and need for the workplace.
Frustrated by traditional, slow and formal procurement processes, these ‘user buyers’ prefer to go direct whenever they can, using digital channels to seek out which suppliers can provide the services and products they need quickly and conveniently. And that presents a major opportunity for B2B sellers looking to penetrate deeper into B2B organisations or steal market share from B2C sites that are gaining these new buyers daily.
For its study ‘The Rise of the Empowered B2B Empowered End-User Buyer’, Forrester Consulting conducted in-depth surveys with over 1500 of this new category of buyer in organisations with more than 500 employees across Australia, China, France, Germany, the US and the UK – territories where there is the largest preponderance of B2B online commerce.
The research, commissioned by Intershop to evaluate the expectations and behaviours of the business end-user buyer, highlights why B2B sellers need to implement robust and full-featured e-commerce capabilities quickly to cater to the sophisticated needs and preferences of this fast-growing and digitally empowered group of buyers.
Here are six key recommendations B2B sellers should keep in mind when looking to mine this growing market opportunity:
1. Ignore the business end-user buyer at your peril
The survey found that 52% of end-user buyers find it more convenient to ditch formal procurement channels and go online to buy directly the goods and services they want - with a third (33%) saying they have a better understanding of their needs than procurement colleagues.
Uninhibited by the constraints of procurement policies end-user buyers, who span staff to VPs across organisations of all sizes, buy a wide assortment of products and services on their own – from office supplies to travel services to software – with 85% making online purchases at their desk during working hours. What’s more, 64% purchase online at least weekly or monthly without involving procurement.
These buyers have plans to ramp up their purchasing activities yet further. Over half (55%) the survey respondents confirmed they expect to increase or significantly increase the percentage of work purchases they make online in the next 18 months, with 44% also saying they expect the average purchase size to increase.
2. It’s time to own the relationship with end-user buyers
B2B sellers are no longer competing just with other suppliers – the competitive landscape is changing with direct-to-customer manufacturers, Internet pure plays and horizontal expansion from B2C organisations all looking to exploit the growing base of end-user customers. Indeed, the survey found that 18% of end-user buyers begin their research – and even end up finalising purchases – on popular consumer websites.
That means B2B sellers need to market to – and directly own – the relationship with end-user buyers by providing the content, convenience and appropriate online experience that engages buyers and drives loyalty.
3. B2B end-user buyers are sophisticated and savvy
With many years of experience of buying online for work, B2B end-user buyers know what they’re up to.
Over half (52%) said they’d been making online work-related purchases for six years or more and will leverage a multitude of payment options to make their final purchase, including invoice and purchase order approaches (87%) and company-issued credit/debit cards (74%). Given that a quarter use consumer websites for their final online purchases, it’s not surprising they’re also comfortable using their personal credit/debit card (58%) and other popular online payment services (42%).
What’s more, they’re using multiple devices to undertake their research and purchases. Almost 90% use their desktop/laptop, with 69% confirming they’re secure using a tablet device and 51% stating they’re happy using smartphones for work-related purchases.
Given the explosion of smartphone usage within the workforce, the use of mobile devices for work purchases will only gain momentum. B2B sellers should not ignore mobile when planning their multi-channel mix. Many of their B2C counterparts use mobile as part of their customer service and delivery model, tailoring the experience to the end-user’s contextual situation.
4. Why customer experience counts
The majority of research for work-related purchases begins online during normal working hours. And when it comes to customer experience, end-user buyers expect the online B2B sellers they make purchases from to offer technical content – both traditional and rich media – and information such as stock availability.
With over half (52%) of end-user buyers saying they make purchases on their own because it is convenient and faster, the requirement for a product or service is often viewed as urgent. Twenty-eight percent of end user buyers considered a supplier when it provided the right technical information, while 61% expect suppliers to share specification sheets and instruction manuals (38%). They also expect to see rich media content, with 38% confirming they find video content helpful when making purchases online.
These buyers also value full transparency around delivery costs (53%) and expected delivery information (44%), while 49% expect visibility into stock availability (49%). Advanced features such as product comparisons, 360-degree rotational views, recommendations, ratings and reviews were also valued by end-user buyers.
B2B sellers need to exploit e-commerce capabilities to ensure they’re able to support the full purchase lifecycle – from search optimisation, to aligning content and information strategies to buyer needs, as well as providing multiple payment and fulfilment options.
5. Getting experience right generates long term loyalty
The convenience of having all the right information and content at your fingertips is just the tip of the iceberg for end-user buyers. Compared to offline channels, these buyers expect online suppliers to offer faster shipping options (35%) as well as order tracking functionality (32%).
But getting the customer experience right, however, pays off for B2B sellers. The study revealed that over half of end-user buyers are loyal to the online suppliers they have had a good experience with and will re-engage with again for repeat purchasing.
6. Chinese end-user buyers require a more tailored approach
It should come as no surprise that a number of local and regional variations emerged, particularly among Chinese end-user buyers. Compared to their western counterparts, end-user buyers in China tended to expect more online purchases to be made on their own, with 90% confirming their procurement teams are more likely to encourage them to conduct online research compared with other countries.
End-user buyers in China were also more secure using mobile devices and place greater value on technical information and social content. And while a positive past experience is important for end-user buyers in the US (71%) and the UK (60%), the top factor driving loyalty for Chinese end-user buyers was product quality (50%).
Today’s B2B buyers are no longer based solely within the corporate procurement function; end-user buyers are proliferating across enterprise organisations and SMBs alike. Tired of being inconvenienced by procurement teams that don’t understand their unique requirements or fail to execute in a timely manner, these buyers are going online to track down and buy the products and services they need.
Using multiple devices, during the working day they’re using multiple devices to seek out suppliers that can provide what they need quickly and efficiently – and expect rich product information, easy-to-use websites, and transparent pricing and delivery costs.
By offering this new breed of savvy B2B buyer the right experience, information and support, B2B sellers will be able to tap into a fast-growing opportunity. And technology has a critical role to play in this online experience. To cater for the speed and convenience requirements alone will demand a flexible platform from a partner that is constantly innovating. Are you ready?
By Matthew Diss from Intershop.
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