B2B Ecommerce Trends 2020/COVID-19
Originally published December 4, 2019. Updated for COVID-19 B2B ecommerce trends 7/30/20.
B2B ecommerce is changing fast as 2020 progresses. The COVID-19 pandemic has rewritten procurement processes in every industry that purchases physical goods. With both sales reps and their customers working from home, manufacturers are striving to establish greater trust, transparency, and availability in their branded commerce experiences—all while facing a competitive threat (or opportunity) from marketplaces like Amazon.
No doubt about it, 2020 trends in B2B ecommerce are putting new pressure on manufacturers to define their digital identities.
I. COVID-19 B2B Ecommerce Trends:
1. 66% B2B leaders now believe ecommerce solutions are essential, up from 48% pre-COVID
COVID-19 has changed everything—and it’s driving manufacturers to B2B ecommerce.
McKinsey & Company recently reported on the rising trend of buyers preferring self-service due to COVID-19. B2B leaders are taking note of their customers’ changing preferences: 66% of B2B decision-makers surveyed now believe self-service is more important to customers than traditional sales interactions—up from 48% before the pandemic.
COVID-19 is driving the B2B world to ecommerce. We expect this trend to continue, given the uncertain future.
2. COVID-driven B2B ecommerce solutions aren’t going anywhere
Another survey from McKinsey & Company uncovered a startling trend: 80% of B2B leaders will retain their new, digital selling models, even after the pandemic ends.
In particular, that means a shift away from directed/traditional selling–and a trend toward B2B ecommerce as the COVID-19 pandemic continues. Where 55% of respondents depended on in-person selling before the pandemic, that number is now down to 21%.
It’s no small segment making these decisions, either. Of the 3,600 B2B leaders surveyed, 96% have shifted their go-to-market strategy due to the pandemic.
3. COVID-19 is disrupting medical B2B ecommerce—but not all medical companies are winning
Here at Corevist, we have numerous clients in the medical B2B ecommerce space. These companies manufacture or distribute a large variety of medical supplies, from durable equipment to pharmaceuticals.
Perhaps not surprisingly, the COVID-19 pandemic has affected different segments of medical B2B ecommerce in different ways. As of now, it appears that companies directly in the supply chain for COVID-19 relief products are benefiting the most, while firms that manufacture supplies for elective treatments are seeing a sharp downturn.
Read more here: COVID-19 Impact On Medical B2B Ecommerce.
II. Customer Experience Trends in B2B Ecommerce:
4. Manufacturers are seeking to establish transparency and trust in B2B ecommerce transactions
In 2020, manufacturers must win the trust of customers through their B2B ecommerce user experience. After all, 44% of B2B decision-makers want to see pricing online, while 41% want self-service functionality.
A lack of clarity here adds considerable friction to your customer experience. It may even cost you the transaction—and the imperative is even stronger now due to the COVID-19 pandemic, as customers and staff are working from home.
Think of it like this. If you couldn’t see these things in the ecommerce store, would you complete the transaction?
- The same contract pricing/scaled pricing which you can get by calling Customer Service.
- 100% accurate, real-time inventory availability (or ATP).
- 100% accurate account standing, so you know whether your account will go on credit block after you place the order.
- Full order history for the account, all channels included (EDI, ecommerce, phone, fax, email, etc.)
Of course, it’s not just visibility into ERP data. B2B ecommerce users need to interact with the ERP system, too. They need to be able to do things like:
- Post 100% error-free orders from ecommerce to the ERP system (so they can count on the order getting their in the time they were promised).
- View and pay down open invoices to keep the account in good standing (and thus keep placing orders via B2B ecommerce).
- Modify open orders after placement (as allowed by your business processes).
Obviously, much of this functionality is essential to an easy, intuitive customer experience. But getting your B2B ecommerce channel to interact with your ERP system in real time isn’t that simple. We’ve seen far too many projects which never got integrated due to the complexity of the problem.
That’s why we built Corevist Commerce on a direct, real-time integration to SAP. It’s a next-generation B2B ecommerce solution that addresses these emerging trends in B2B customer experience.
5. Manufacturers are taking ownership of their product content
We’ll talk more about the strategic challenge which Amazon poses to manufacturers in #6 below. But we need to address the customer experience challenge first, as it’s becoming a dominant trend in B2B ecommerce in 2020.
Amazon has changed the expectations of everyone who buys anything online. The company is a leader in ecommerce customer experience, and they’re setting a high bar for manufacturers. This challenge is most apparent in the area of rich content—i.e. product images, detailed descriptions, etc.
In a word, Amazon is forcing B2B ecommerce players to engage in the same kind of product presentation and shopping experience which is the bread and butter of B2C/retail sellers.
Historically, manufacturers haven’t had to worry about product content or presentation. With their products sold primarily through distributors, sales reps, and dealers, manufacturers haven’t had to unify the product information depository (historically a print catalog, e-catalog, or SAP GUI screen for a Customer Service rep) with the order placement process (historically phone/fax/email/EDI).
B2B ecommerce changes that. It puts full product information one click away from the shopping cart. Which means manufacturers must own their product content (and its presentation in B2B ecommerce). That means offering all the information a customer needs to complete the transaction in ecommerce—things like:
- Intelligent product search
- Detailed product comparison functionality
- Multiple product images
- Product demo videos
- Full product documentation/specifications
- User reviews
- Cross-sell/upsell for related products
6. Manufacturers are extending ecommerce access to 3PLs
For global manufacturers using 3PLs (3rd party logistics providers) in their fulfillment process, ecommerce may feel like the impossible dream. But here’s a B2B ecommerce trend which is carrying over from 2019 to 2020: Manufacturers are extending ecommerce access to the employees of their 3PL.
This is a revolutionary trend, and COVID-19 has only accelerated it. It allows 3rd party warehouse workers to interact with the commerce data they need to do their jobs. (Note: real-time ERP integration is especially critical in this case, so 3PL employees can update orders in the ERP in real time when they modify them or ship them out.)
7. Manufacturers are seeking platforms that support complex user roles/permissions
If B2B ecommerce is going to work for manufacturers during COVID-19 and beyond, it has to support tiered user privileges (the ability to limit which users can do which activities in ecommerce). As Gartner reports, top B2B ecommerce platforms are still lacking in these areas.
This is why we built Corevist Commerce on a real-time integration to SAP ERP. Whatever workflows you support in SAP, Corevist supports those on the web. What’s more, our solution supports tiered user permissions.
8. Manufacturers are implementing self-service online payment solutions for invoices
This 2020 B2B ecommerce trend is accelerating due to COVID-19: Manufacturers need web-based, customer-facing A/R solutions. That way, customers can pay down invoices through self-service from a laptop or mobile device, working from home.
If dealers and distributors have to call Customer Service to pay down invoices, or if they have to mail in a check, that process contributes to your cost of order fulfillment (and it makes you harder to do business with). What’s more, these manual processes are often delayed due to the COVID-19 situation. If you’re going to enable self-service order placement with B2B ecommerce, it stands to reason you might want to empower customers to pay down invoices, too.
We solve this problem with Corevist Bill Pay. It’s a web-based, customer-facing A/R solution that empowers your customers to see their open invoices and pay them down through your preferred payment methods (e.g. credit/debit card, ACH transfer, eCheck, Paypal, and more).
Since Corevist Bill Pay is applicable to any manufacturer who accepts orders on invoice, this functionality is also available as part of our other products like Corevist Commerce, Corevist Field Sales Portal, and more.
For the full picture, check out our Corevist Product Comparison Chart.
III. Strategic Trends in B2B Ecommerce:
9. Manufacturers are learning they must define their strategic relationship with marketplaces like Amazon, Alibaba, etc.
Here are two staggering trends in B2B ecommerce which are having a massive impact in 2020 as the COVID pandemic forces people to work from home:
- Amazon Business is projected to double its revenue from $10B in 2018 to $20B in 2020.
- Alibaba recently set a new record for the single largest Singles Day GMV in recorded history, with $38B in one day. That’s 27.5% growth over last year, beating Wall Street projections.
We first identified this trend in 2019, but it’s only growing stronger in 2020: Manufacturers must deal with the threat/opportunity posed by marketplaces like Amazon, Alibaba, MercadoLibre, and others—especially now that manufacturers’ sales and customer service reps are grounded due to COVID (and customers are shopping from home).
We say “threat/opportunity” because the rise of marketplaces constitutes a threat if manufacturers don’t deal with it strategically. Yet we expect smart manufacturers to turn this threat into a great opportunity. The key is an intelligent response to the rising trend of B2B ecommerce marketplaces. That means answering questions like:
- Are customers looking for our products (or competitors’ similar products) on Amazon or other marketplaces?
- If not, why not? Will that change in the future?
- If so, are customers finding what they need on Amazon?
- More importantly, if our market is represented on Amazon, are our products available there?
- If they’re available, who’s selling them? Are we protecting our interests?
As manufacturers set out to answer these questions, they’ll find that they fall into 1 of 3 categories as far as their marketplace representation:
- The manufacturer’s products aren’t on Amazon or other marketplaces at all. We see this in industries which are regulated or otherwise specialized to the extent that Amazon hasn’t cracked that particular market (yet). These manufacturers are in the clear for now, but they should take action to understand whether Amazon will represent an opportunity/threat in the future.
- The manufacturer’s products are on Amazon/other marketplaces, but the manufacturer has no control over the transaction. In this case, the manufacturer’s products are sold by a third party, whether legitimately or not. The manufacturer may not even know that they’re being represented on Amazon by third parties. Manufacturers in this situation MUST act to define their strategy and use Amazon to their advantage. The risks of doing nothing are high.
- The manufacturer has established their own branded presence on Amazon and other marketplaces, selling their own products. This is the state of maturity which manufacturers should strive for. It ensures that the manufacturer has some control over the transaction.
The key here is for manufacturers to recognize which category they fall into, then develop a plan to address any strategic risks and opportunities which they face in that category.
The good news is that this B2B ecommerce trend forces manufacturers to reckon with the elephant in the room—product content. (See #2 above.) In the long run, learnings from Amazon can only help manufacturers compete in the digital age.
10. Manufacturers must define who will lead B2B ecommerce—Insider, or Outsider?
For many manufacturers, B2B ecommerce is new ground, and it may be difficult to find the proper expertise in-house to lead the initiative.
However, before you bring in a new digital expert to lead the ecommerce transition, it’s worth noting the struggles which other companies have had with that route. See this article for more: Digital Transformation Leader—Insider or Outsider?
Whichever route manufacturers choose, the key is to find a leader who can relate the IT/tech side of B2B ecommerce to the unique ins-and-outs of your business.
11. Manufacturers with disconnected POC (proof of concept) stores must figure out a path forward, both during COVID and after
Manufacturers often launch a pilot or proof of concept to convince key stakeholders in the organization that B2B ecommerce is viable. For companies who’ve done this, the key challenge in 2020 is to take the next step. How do you transition from that proof of concept—and what do you transition to?
Manufacturers should put customer experience first when replacing a standalone POC. The replacement solution should provide the same real-time data from the ERP which customers could get if they called customer service. This is critical during the COVID pandemic, as a B2B ecommerce solution without this data is essentially useless.
If the proof of concept was disconnected from the ERP system (as it usually is, since integrating that temporary storefront wouldn’t be a good investment), it’s likely failing customers in several key areas:
- The standalone POC can’t show the customer’s unique, contract-based pricing/scaled pricing.
- The standalone POC has no capacity to show real-time inventory availability, which makes it difficult for customers to pull the trigger with confidence.
- The standalone POC doesn’t allow customers to manage their accounts through self-service credit checks, invoice payments, order status checks, and more.
In 2020, manufacturers are putting customer experience first in choosing more permanent B2B ecommerce solutions—both to grapple with COVID, and to meet customer needs in the new normal. That usually means prioritizing a real-time ERP integration, since it’s the most reliable and efficient way to provide the information which customers need to buy with confidence.
12. Manufacturers must define their strategic revenue target for B2B ecommerce
It’s not enough to launch B2B ecommerce because that’s the current industry trend. Without a business case, you’re slapping a solution on an unclear problem.
We find it’s helpful to orient your B2B ecommerce initiative around a single, provocative question:
What percentage of your overall revenue do you want to come from ecommerce?
It’s worth answering this question along a timeline, too. What percentage in the first year? Second? Fifth?
Maybe your target is 5% of existing revenue in the first year, 10% the next, and 20% in the third year.
Or maybe, like Grainger, you plan to do 80% of your revenue through ecommerce by 2022.
Whatever the numbers, manufacturers should define them. Only with these high-level goals set can you prioritize B2B ecommerce functionality (and a rollout plan) that will empower you to make a real difference in your bottom line.
13. Manufacturers are struggling to overcome staffing challenges in supporting B2B ecommerce
Manufacturers face real challenges in the IT department when it comes to B2B ecommerce. This is especially true with rolling furloughs and reduced staffing capacities due to COVID-19.
Even if you have IT resources still working full-time, they’re overloaded with the immense challenges of supporting all your newly-remote workers. They can’t take on another project—and if you’re going to integrate to the ERP system, which is essential to good customer experience (see #1 above), you need that real-time integration.
So who’s going to manage and support your B2B ecommerce channel, both during COVID and beyond?
As manufacturers confront the difficulty of owning this responsibility in-house, they’re showing an increasing preference for managed B2B ecommerce in 2020.
This is why we built Corevist Commerce. It’s a fully-managed, SAP-integrated B2B ecommerce solution for manufacturers. Our unique integration allows you to maintain business data in one place only (SAP ERP), with that data reflected on the web in real time.
That means no new additional work for your IT team. It’s why 1/3 of Corevist clients have no dedicated in-house resources supporting ecommerce.
Learn more here: The Corevist Difference.
14. Manufacturers are asking for one platform to handle B2B, B2C, Sales reps, and everyone in between
2020 is an omnichannel world—more than any previous year, due to the impact of COVID-19 and everyone working from home. Manufacturers are meeting this challenge head-on by seeking out ecommerce solutions that will work for all their market segments: B2B, B2C, B2B2C, sales reps selling in person, and more.
Once again, ERP integration is the key. With a templatized approach, manufacturers can roll out multiple storefronts for multiple user types—without reinventing the wheel. Manufacturers who choose solutions like this will gain a strategic advantage as they’re able to increase their ecommerce footprint rapidly with a minimum of capital outlay.
Corevist Commerce meets this need out of the box. Our integration architecture is scalable and templatized, meaning you can stand up multiple ecommerce stores without duplicate investment.
Our clients love this. Brian Poole, Sr. Dir. of IT Enterprise Architecture & Engineering at Bioventus, put it this way:
“We already had our CRM up and going. We wanted to start with something for our sales force and introduce it for our customers, so as they interacted with our customers, the sales force could speak intelligently about the platform and how to use it. But we knew that if we started with our CRM, we would end up with customers on one platform and sales reps on another one… We didn’t want to do that.”
15. Competitive pressures are driving manufacturers to learn from the best practices of distributors
Here’s a key B2B ecommerce trend which we’ll see increase in 2020: as manufacturers enter the B2B ecommerce space, they find themselves competing with distributors—both their own, and those they don’t know. The relationship with their own distributors is murky, and manufacturers must tread carefully (see this post for some advice—Manufacturers Getting Closer To The Consumer).
However, the competitive problem is unavoidable. It’s easiest to state it as a question which your customers will ask whether they realize it or not:
- Why should I spend time on this manufacturer’s B2B ecommerce site, rather than going to a site that offers me every product I need to complete the job at hand?
This question illustrates the scope of the problem, too. Manufacturers don’t need to carry everything under the sun, like a distributor would; they just need to consider carrying add-on products from 3rd parties that supplement their major products.
When manufacturers grow their catalog to include consumables, spare parts, and other auxiliary products which the buyer may buy elsewhere, value increases for all parties. The manufacturer gets a greater share of the revenue which customers are spending on the project, and the customer saves time because they can buy everything they need for the project in one place. It’s a win-win.
For more, see these posts on our blog:
- Manufacturers Must Sell 3rd Party Products—Distribution is a new game for manufacturers, but no manufacturer can afford to dismiss the idea out of hand. Why? Because it’s a key way of putting the customer first.
- Think Like A Distributor, Act Like A Manufacturer—Obviously, you can’t abandon the emphases that have made your company successful as a manufacturer. Rather, you need to add new skills and emphases to your existing abilities as a company.
16. Manufacturers are exploring “Sales first” options for transitioning the organization to digital commerce
Not every organization is ready to launch B2B ecommerce to customers, right off the bat. We’re seeing a trend in which manufacturers launch a Field Sales Portal for their sales reps first, then extend access to customers in Phase II of the project. We expect this trend to grow in 2020, as it provides a “fail-early” method of transitioning to B2B ecommerce.
One company that’s done this well is our client, Bioventus. This manufacturer of orthobiologics wanted to transition to a digital commerce model, but they wanted their Sales reps to be a key part of the initiative—not only at the outset, but on an ongoing basis. Bioventus launched the Corevist Field Sales Portal first, then expanded their B2B ecommerce coverage to include customers—to great success.
IV. Technical Trends in B2B Ecommerce:
17. Manufacturers are seeking templatized approaches to ERP integration (for fast global rollouts)
This 2020 B2B ecommerce trend is relevant for any company that needs multiple storefronts—but it’s especially germane to global manufacturers who need ecommerce in multiple geographies or sales areas. It allows manufacturers to leverage economies of scale as far as their integration architecture.
ERP integration is often the single biggest cost in standing up B2B ecommerce. If you choose a middleware-based solution (which we don’t recommend), you’ll have to build and maintain business rules in three separate places (ERP, middleware, and B2B ecommerce). What’s more, you may have to rebuild this architecture again and again, in various permutations, for every brand or geography where you want to launch ecommerce.
Corevist overcomes this hurdle with a unique, templatized approach to ERP integration. We call it our “B2B Mall Architecture.” This approach allows manufacturers to invest once in their ERP integration architecture, then offer that architecture to each subdivision or geography that’s launching ecommerce—just as a mall owner provides each vendor with the utilities and space they need to do business.
18. Manufacturers are choosing SSO (single sign on) solutions to streamline their customer experience
Work is just getting more complicated, right?
This is true for anyone who uses multiple cloud-based software solutions to do their job. It’s true in the lives of B2B ecommerce users, too.
Manufacturers are countering this trend by offering SSO (single sign on) solutions which include their B2B ecommerce channel, as well as other applications which customers need to do business with the company. While this isn’t a new B2B ecommerce trend for 2020, we expect it to continue to grow.
Click here to learn more about SSO in Corevist Commerce.
19. Manufacturers are embracing headless B2B ecommerce
This isn’t as gruesome as it sounds. 😊
“Headless” simply refers to an ecommerce solution in which the customer-facing frontend has been decoupled from the nuts-and-bolts backend. A solution like this allows you to use different frontend platforms of your choice while marrying them to a single backend (usually with some form of ERP integration).
With the two parts decoupled, you have more flexibility to customize the frontend platform without having to reinvent the “backend wheel.” This helps to meet the needs of different stakeholders within the organization—e.g. giving Marketing full control of ecommerce branding, without disrupting the ERP integration (thus keeping IT happy).
Here’s an example:
Moving forward: FREE case study
Want to see B2B ecommerce trends playing out in real life? Download this case study on Mannington Mills. You’ll learn how this top manufacturer of flooring launched Corevist Commerce, with an Amazon-style catalog and rich content, and grew web sales by 150%.
FREE Case study: 150% Sales Growth with Rich Content