The last ten years have seen a transformation in the adoption of online buying from consumers. Gone are the days where we were hesitant to enter credit card details, nervous about the goods arriving or having to wait for hours for a delivery. B2C online shopping is now simple. Click and pay and choose the delivery slot or delivery location.

Online buying is based on several key factors:

  • Firstly, easy access to a credit card. Some larger corporations afford staff cards, but many follow the traditional route of buying it on your own card and claiming back.

  • Secondly, no credit. You choose, you pay. In the B2B space it’s usual to gain 30 days’ credit. Buying instantly online won’t please the company accountants and doesn’t help the cashflow.

  • Thirdly, great user experience. Whether you’re shopping on mobile, tablet or desktop, most consumer websites are geared towards your technology. Sadly many B2B websites have not yet caught up as there is a perception that all business users only use desktops. Really? When did you last review your web analytics?

Interestingly both Amazon and eBay have identified B2B as a target area. They invite manufacturers to register and offer their services via the platform. Amazon understands the issues faced by B2B and have options for multi-user accounts, pre-set limits, addition of purchase orders as well as payment options. Only available in the US today, but this could change tomorrow.

There are additional hurdles to online buying for many in the B2B environment. The nature of the product is a key issue. B2C focuses on buying tangible products. B2B often involves services which cannot easily be purchased online.

Plus, B2B buying is complex. There may be framework agreements, tenders and more in place. Plus the buyer may consist of a team of people. This means staff can’t circumnavigate the system and need to stick with the approved suppliers list and agreed processes.

To ensure more businesses adopt online buying we need some key changes:

  • Easily accessible, time-limited credit cards. Fraud is often a concern when staff are handed cards and some companies restrict the type of purchases that can be made, to fuel, accommodation and transport. This means that buying the office stationery may require approval. It then takes too long and is easier to email the order and gain the goods on account. A one-month only credit card restricted to a certain financial limit could solve this issue.

  • The credit factor cannot be solved easily unless the customer has already sought and gained approval for this process. However, there are a range of websites such as PeoplePerHour.com, Fiver.com where individuals provides services such as design and copywriting. The buyer pays upfront, but the funds remain in escrow until the work is deemed complete and at this time the seller is paid. A similar arrangement could be organised whereby the buyer promises to pay in 30 days and the seller accepts the terms. It would require a technology gateway to facilitate the process. Alternatively companies could offer pre-pay cards.

In larger organisations where there are formal supplier arrangements in place, one solution could be to work with the vendors and encourage them to create a B2B store where purchase could be made, against the agreed contracts.

The final factor, the intangibility of services, could partly follow the PeoplePerHour model where specific services are grouped into a block with a set fee. The challenge for those providing the services is that they then commoditise their work and remove potential added value!

In the future, the B2B buying experience will be easier. Companies not offering great user experience, simple buying options and a range of delivery options, won’t exist. This is unlikely to take place quickly as B2B moves more slowly than B2C. These changes may take several years and will speed up as prime movers, such as Amazon and eBay stake their claims on B2B.

 

By Annmarie Hanlon, The Worshipful Company of Marketors.

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