Most marketers would agree that successfully implementing a business-to-business (B2B) marketing strategy, whether online or traditional, is significantly more difficult than implementing one aimed at consumers.
Despite industry turmoil, major B2B players are still realizing the potential opportunity cost of neglecting their e-strategy; the B2B marketplace’s growth forecasts are still impressive, even without the Internet hype of the late 1990s. Players are still hungry for these lucrative markets, but successful approaches are not as obvious as they are in consumer markets.
Accenture recently released an excellent study titled “Was It an Illusion? Putting More B in B2B.” It takes an unbiased look at the current B2B e-commerce marketplace, evaluates successful strategies and opportunities in B2B, and deciphers what buyers and sellers should be doing.
The study starts out by explaining that direct players in the industry do not provide unbiased evaluations of industry trends, because they are too caught up in the turmoil themselves. It is best to be left up to less-biased outsiders, such as Accenture.
The study forecasts that the minimum U.S. B2B e-commerce market will reach $2.5 trillion by 2004, provided companies continue refining their e-marketing strategies through traditional marketing and research. B2B online purchasing is still very young, with less than half of companies purchasing online in any capacity and those adopters still using the Web only for a portion of their purchasing. With only 3-4 percent of B2B purchases taking place online, the potential to capitalize is still abundantly clear.
The research also outlines some of the main reasons that online B2B fails. Some companies attempt to entirely change their business processes, move completely away from their traditional ways, and forget to learn from their customers’ experiences. Another downfall is forgetting to properly customize each process. To date, B2B online customer satisfaction has been low, and these are contributing factors.
Pricing Not Primary
When B2B sales started becoming commonplace, it was forecast that pricing was likely to be the most sensitive factor among buyers. To many people’s surprise, however, pricing has not been the key determinant of success for most B2B strategies.
To date, purchasers have indicated that their pricing agendas are secondary, that what matters most in buying online is that the company be well branded, with a good reputation for fulfillment and service. Online sales from reputable companies that target key industry segments appear to be outperforming more price-sensitive options. So, building brand equity online via old-school marketing procedures is far more important than many other features.
In fact, the top three areas that account for more than 50 percent of B2B buyers’ preferences were outlined as brand, customer service, then pricing. Site functionality, personalization features, and integration are all considered less important.
Regardless of the Internet economy’s current status, B2B e-commerce is still in its early stages and will continue growing at impressive rates over the next five years. Furthermore, those companies currently purchasing online are drastically increasing their spend ratios, especially as transaction processes improve and broadband usage increases.
The report concludes with a number of lessons that have emerged and approaches that should help pay dividends moving forward. It confirms that properly targeting your audience and learning about your customers through regular marketing means will be key in contributing to sustainability. Remember, marketing through any vehicle is still marketing.
The report also stresses that integrating traditional processes and brands with nontraditional Web strategy is important; companies that maintain consistency here will benefit from stronger brand equity and customer acceptance.
Lastly, the report suggests companies remain focused on Web strategies that contribute to their bottom line, generally by increasing sales or reducing costs. Furthermore, if a site is to be strictly an informative, content-based vehicle, then it is wasteful to invest in costly technology that provides unnecessary features.
Essentially, the stakes are often higher in the B2B world than in the business-to-consumer (B2C), and the Web is no exception. Regardless of deflating market conditions, huge stakes are still up for grabs on the Web, particularly in the business marketplaces. Online sales and marketing often benefit most from taking a step back and implementing old, successful marketing approaches. The online customer is still a customer who needs to feel good about a purchase being made, and the best way to fill this need is to understand what purchasers require.