The big shifts coming to B2B

One of my happier moments of this past week was receiving an invitation to get a copy of a newly released Magento white paper entitled “The Changing Landscape of B2B eCommerce”.  After 6 years, and close to 20 SAP and Magento integrated B2B eCommerce projects, I’m excited to see Magento starting to take ownership of their leadership in this space…of course with a little help from Corevist :-).

Click on the image of the white paper to take you to the Magento website where you can sign up to get your very own copy.

What I’m going to do today is give you a bit more of a sneak preview into the report.

Unfortunately, while I totally agree with the contents of the first two sections: Major Trends Shaping the Future of B2B eCommerce and Where Most B2B eCommerce Efforts Fall Short, the folks at Magento somewhat missed the mark in their concluding section entitled Five Ways to Improve the B2B eCommerce Buying Experience.  More on that later.

Let me start today with a quote from the Introduction which pretty much is the punchline of the whole report:

“So, instead of picking up the phone to call a vendor for pricing or engaging directly with sales, marketing, and customer service reps, B2B buyers increasingly prefer the option to self-serve online—researching, finding, buying, and managing their accounts through a single Web-based platform. ”

That’s pretty much it in a nutshell.

So what are the trends that are enabling the growth of B2B eCommerce?

The report puts forth 4 influencing factors:

1. Cultural – My 35 year old daughter wanted to listen to an energizing Spotify playlist to motivate her through a 7 mile run last week.  Spotify asked her to start running so they could get a sense of her desired cadence and based on that they would assemble her playlist.  That, in conjunction with her normal running app that coaches and motivates her through her run, made for an awesome outing for her.  I ask you, is she going to be happy going to work on Monday and placing a fax order for products from one of her supplier’s paper catalogs?  Seriously?  The times they are a changin’.  As an aside, I trained for, and ran in, three marathons the old school way.  A lot of running with very little smiling. I was just born in the wrong era.
2. Mobility – There are more mobile phones in the US than there are people.  That’s also true for Brazil, Russia, Germany, Italy, the United Kingdom, France, Argentina and a host of others.  Hong Kong has 2.4 mobile devices per person for gods sake!  I’m thinking both the internet and mobility are trends that are here to stay.  What do you think????
3. Infrastructure – Call me up tomorrow and in two days I’ll have your SAP Magento Integrated B2B eCommerce website up and running against your SAP QA system.  You’ll be placing and tracking orders in 48 hours!  Infrastructure is clearly not an obstacle anymore!
4. Procurement processes – While phone, fax, email and EDI are still here and won’t go away anytime soon, preferences to B2B eCommerce are clearly shifting.  The report cites several reports backing this up.

So how are companies that are attempting to launch their own B2B eCommerce initiatives getting it wrong?

I’ve literally interacted with hundreds of companies over the last 8 years and I can vouch for the list that the folks at Magento have assembled.

1. Choosing the wrong deployment model – You wouldn’t mow 5 acres of grass with a push lawnmower and you certainly don’t need a tractor to manicure a quarter of an acre.  I’ve not met many Manufacturers that really needed to host and manage their own eCommerce infrastructure in house.  Make the wrong decision and you either won’t be able to get the job done or your paying way more than you need to.
2. Opting for a turnkey, Marketplace platform – Let’s just say that Corevist has replaced many a Shopify, YahooStore and Amazon Store in our history.  You can’t do serious B2B eCommerce without your own platform.  It may be a great place to start, and a way to test the receptivity of your customers to using the internet, but it’s simply not scalable.
3. Failure to integrate with existing systems – Obviously this is my favorite one!  There are three approaches that we’ve seen in the SAP market.
   1. Don’t integrate – this approach is a non-starter.
   2. Duplicate everything that’s in SAP – Sounds like the way to go until you have those first conversations about pricing, inventory, credit limits, freight terms, and omnichannel tracking and reporting.  Definitely doable but you’re managing the synchronization of 2 ERP class systems forever.  Most of our projects are designed to repair the damage done to the relationship between our clients and their customers because of the inevitable errors that creep into this integration approach.
   3. The Corevist way – See my post “Are you integrating Magento to SAP or SAP to Magento?“
4. Not paying attention to scalability – I would emphasize that scalability doesn’t just refer to technology.  Frankly, I think the bigger mistake is not scaling the organization and it’s processes for the growth and success of the B2B eCommerce program.  The technology part is trivial compared to the people part.

And this brings me to my only criticism of this white paper.

The 5 Ways to Improve the B2B eCommerce Buying Experience are heavily slanted towards the “consumerization” of the buying experience.

Helping the user find products, making relevant product recommendations and nurturing leads.  There is only a mere mention, and a partial one at that, of what I’ve come to learn is what really makes or breaks the B2B eCommerce experience.., the level of integration of the website with SAP.  That manifests on the website as support for personalized purchasing rules and pricing by sales area.  Support for varying order types by user (think sample orders, quotes, standard orders, returns etc.).

The white paper alludes to the fact that “…With B2B, order tracking, invoicing, and account management tend to be much more complicated.”   That’s an understatement.  Especially when B2B clients may continue to order via phone/fax/email and EDI but still want to go to the web to track orders, make spot purchases, research their order and payment history etc.

All in all though, this white paper is a nice contribution to the body of literature for the burgeoning B2B eCommerce market.  It’s especially a great value for the price (it’s free).  Just let Magento put you on their mailing list, and, based on what I know about their plans are for the B2B eCommerce market, it’s a safe bet that you’ll receive nothing but great value from now on!

Sam