Understanding Customer Diversity in B2B eCommerce
In 1913, Gertrude Stein proclaimed that “a rose is a rose is a rose is a rose”.
In 2017, I’m proclaiming that “a business isn’t a business isn’t a business isn’t a business”, especially when it comes to B2B eCommerce.
I’m writing this lengthy (that’s a warning) blog post today because towards the later half of 2016, we started to see an alarming uptick in SAP B2B Manufacturers trying to shoehorn themselves into B2C eCommerce platforms. Our nine years of experience implementing and supporting dozens of SAP Integrated B2B eCommerce websites suggests that there is a bubble of trouble working its way through the system.
This blog post is my civic duty. 🙂
The most important lesson that we’ve learned is that:
You (Manufacturers) can’t lump all of your business customers into a single bucket called “customers”.
B2B eCommerce is more accurately described as B2Bn eCommerce, where n=all of the different business types that need to be supported by your B2B eCommerce website. Of course you can lump them all together, but not if you want to get the most out of your B2B eCommerce investments and deliver the most valuable personalized eCommerce experience possible.
Before I drill down on the varying business types and how they impose different requirements on your B2B eCommerce website, I do want to point out that they all do share the following basic set of common, B2C derived, requirements:
- accommodate users with different skill-sets (casual versus power),
- access from different platforms (desktop, tablet and mobile),
- presentation of different languages and currencies,
- provide 24×7 availability and suitable response times and,
- maximize maintainability by using one instance of SAP, Corevist and Magento,
- SAP Integration is THE KEY TO SUCCESS! Don’t let anyone either convince you otherwise or oversimplify the complexity of the challenge.
In addition, custom pricing and real time product availability are the two most critical B2B requirements that are also shared by all businesses. What varies from business to business is if, when, and how, they are displayed throughout the user’s journey on the website.
The following are the types of businesses that our clients do business with. I’ll first give a brief description of their definition and then list the features they exercise in getting their jobs done on our SAP Integrated B2B eCommerce websites.
Manufacturers typically have a small number of geographically dispersed Distributors. Their prime responsibility is to service regional customers and consequently are asked to not only provide product expertise and services, but to stock inventory locally. Their order sizes, and value, are typically quite large and almost exclusively order on account via purchase orders. While many of these Distributors interact with our Manufacturing clients via EDI, they still derive value from coming to our B2B website. Some of the features they use most are:
- a quick real time checking of inventory (no sense placing an EDI order for products that aren’t available)
- validate contract pricing
- real time order/shipment tracking
- reprinting of order related documents (order confirmations and invoices)
- order history reporting
While these larger Distributors only place the occasional rush order on the Corevist website, smaller Distributors rely on the Corevist website to place and manage all of their orders. In order to cater to their needs we offer the following capabilities:
- ability to place a quick order for a few items where the skus are known
- a shopping cart that accommodates dozens or hundreds of line items
- ability to upload excel lists of products to the shopping cart
- Product Selector – browse, search for skus that are contractually available for purchase (as supported by Magento)
- translation of Distributor’s product numbers into Manufacturer’s skus in the shopping cart (as defined by SAP CMIR)
- special workflow for seasonal orders
- ability to specify required delivery dates at the line item level
- tiered pricing (as defined in SAP)
- minimum order quantities (as defined in SAP)
- product substitutions (as defined in SAP)
- electronic bill presentment and online payment
The next level down in the distribution channel are Dealers. They typically buy products from regional Distributors but depending on geography, product line and/or overall business model, Dealers may buy directly from the Manufacturer. Truth be known, Manufacturers are always looking for ways to go “Dealer Direct” if at all possible because they get to reclaim some margin for their bottom line.
Manufacturers are constantly managing Dealer recruitment. Finding and hiring new ones, rewarding top producers and firing under performers and those that present excessive financial risks.
Dealers typically place smaller orders and prefer to stock as little inventory as possible. A complicating factor with Dealers is that sometimes they buy product from the Manufacturer for re-sale (taxable) and sometimes they buy product for their own consumption in their delivery of services to their customers (non-taxable). Think of a Beauty Salon owner that buys shampoo for resale as well as in the delivery of haircuts. Sometimes they buy both in the same shopping cart.
Unlike Distributors who are happy to have freight costs tacked onto their orders at the time that they are shipped from the Manufacturer, Dealers are sometimes quite sensitive to shipping costs and want to know them at order checkout time.
In addition to providing all of the aforementioned Distributor’s functionality to the Dealer, in order to accommodate their specific needs, we’ve incorporated the following capabilities into our platform:
- Single-sign-on support in order make it easy for the Dealer to navigate to various Manufacturer provided web applications for product training, retrieving marketing assets, managing of co-op funds and the use of hand-held scanners for inventory control,
- Integration of website registration with SAP Customer Master creation and triggered workflow
- Acceptance of first order (put on order block) along with new customer registration
- PCI compliant credit card acceptance
- Credit limit display and checking
- Ability to make real time invoice payments in order to free up credit hold preventing placement of new order
- Ability to drop-ship orders with, or without, address validation.
- Provide line item text to be used to help deliver goods to the right place/person.
- Integration to Fraud prevention services (via integration with Paymetric)
- Ability to accommodate both taxable and non-taxable items in the same shopping cart
- Leveraging real time tax calculation from Vertex
- Multiple saved carts to facilitate ordering efficiency for regular replenishment orders, individual customer orders, favorites,
- Quick reorder from previous orders or saved carts
- Ability to update various fields in SAP Customer Master in real time
- In addition to having a Product Selector for quick sku searches, a full blown catalog with unlimited Rich Content is available
- Integration with real time Freight Shopping services from ShipERP, ProcessWeaver etc.
- Ability to select which Plant(s) to source and ship products from
- Abandoned cart notifications as a reminder that orders need to be placed
Corporations – Purchasing Managers and/or Individuals
Manufacturers also sell direct to their end user customers and typically have a significant sales force to support that channel. Depending on the products sold, and the sophistication of the buying organization’s IT systems and purchasing processes, our Manufacturing clients have to accommodate an array of scenarios. They can range from what literally looks like a simple Business-to-Consumer experience where a retail price is charged and credit cards are accepted, to a sophisticated integration with the customers in-house purchasing system via a “punch-out” integration.
Some of the scenarios that we support are:
- Provide personalized branding per customer
- Purchaser / Approver workflow,
- Punchout integration (SAP Ariba, Sciquest, Oracle etc. via Punchout2Go),
- Support both header and line item discounts and promotions (as defined in SAP),
- In cart up-selling and cross-selling to help unsophisticated users purchase all of the items needed to get the job done,
- Reordering of pre-configured products.
Associations and Buying Groups
Associations and Buying Groups are special forms of purchasing entities that present unique challenges with regards to how they define the working relationships among their members. Their ultimate goal is to aggregate purchasing power in order to enjoy special volume discounts from the Manufacturer. The website’s challenge is to model these business relationships.
Does the Association’s HQ place orders on behalf of members and have products shipped to them and settle finances with the members directly? Or, do individual members purchase directly from the Manufacturer at the agreed upon contract prices and settle their accounts directly with the Manufacturer? Should HQ be able to see all member’s aggregated ordering patterns or are they to be held private?
- Support all combinations of SoldTo, ShipTo, Payer and BillTo relationships
- Ensure security, privileges and privacy of all business relationships as appropriate.
Intra-company (Divisions, Subsidiaries, Business Units)
You would think that all employees of a Manufacturer who are on SAP , regardless of their division, business unit or location, would simply have access to SAP native functionality to transfer goods across those lines. This should be especially true with the advent of SAP’s HTML5 based Fiori applications which now offer users relief from the overly complex native SAP GUI screens. However, based on our client’s practical experiences, there are still too many implementation obstacles facing Fiori including: lack of bona fide eCommerce capabilities, too many SAP prerequisites required and yet another technology stack that an overworked and understaffed IT staff has to support.
To that end, many of our clients simply set up their internal users with accounts on the Corevist website and they’re off and running.
- Support multiple Sales Areas and Document Types
While you don’t normally think of your Suppliers buying product from you and consequently having a need to use your B2B eCommerce website, there are situations where that actually happens. We have one client who makes raw materials that they ship to a third party overseas for transformation into an intermediate product. Our client than buys that transformed intermediate product back from that third party supplier in order to do final assembly and packaging into finished goods.
The transaction where that third party Supplier purchases the raw materials from our client is managed by the Corevist SAP Integrated B2B eCommerce website. Only a handful of skus are purchased, but quantities available and estimated delivery times are crucial pieces of information that are provided by the website.
Internal Salesforce and External Agents
Whether they are out in the field or are housed in a call center, salespeople are chartered with recruiting and supporting the distribution/dealer network and/or managing corporate accounts. To that end they need tools, and increasingly they are mobile applications, that help them interact with SAP in order to get their jobs done.
The following capabilities were developed specifically for salespeople:
- Ability to place orders on behalf of a client
- Simple maintenance of a salesperson’s accounts by associating both (salesperson and their accounts) with a territory (as defined in SAP)
- Full visibility to every customer’s transactional history including all order statuses and ordering history, credit history, warranty claims and returns.
- Ability to review large orders typically associated with seasonal or promotional orders before they are placed.
- Ability to place sample orders and ship them to existing clients or drop-ship to new prospective clients.
- Review and management of Quotes
Marketplaces (Amazon, eBay, Alibaba)
Marketplaces that cater to B2B customers and/or B2C customers are an emerging distribution channel for many of our Industrial Manufacturers. While their primary focus is to control their brand through their own distributors and dealers, there are great lessons to be learned by participating in these marketplaces. While there are firms like ChannelAdvisor that specialize in assisting Manufacturers with these integrations, some of our clients dip their toe in these waters by simply leveraging the Corevist infrastructure that they have in place to support all of the above business types.
- https access of SAP transactions – order entry, inventory status
If you’ve made it down this far in this post, thank you for your perseverance!
My hope is that if you’re embarking on an SAP Integrated B2B eCommerce project, before you make a platform decision…especially a decision to shoehorn yourself into a B2C eCommerce platform…you’ll heed my advice and survey what types of businesses and users you’re going to be inviting to your website. Finally, I’ll close out this post with a poem by Sam Bayer:
If you spend the time to plan upfront
And take your B2C eCommerce platform and punt
Information spewing at you as if from a fire hose
No doubt in the end you’ll come out smelling like a rose.