Internet Retailer says “The Web Means Business”

Written March 6th, 2012 by
Categories: B2B eCommerce Research, CEO's Blog
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So here is an interesting article published this week at Internet Retailer entitled “The Web Means Business”.  I always find it fascinating when B2C and B2B folks find each other at a party.  Why are they so amazed that they have so much in common?  Why are they so surprised by their differences?

Here are a few of the “revelations” in the article:

“Five years ago online sales accounted for about 9% of revenue at Allied Electronics, a distributor of electronic components. Today that’s 41%.

That is well in line with what we see in our client base and with the companies that we’re talking to that are looking to replace their existing eCommerce platforms.  Why is it such a surprise that the web is an important B2B sales channel?

“Among wholesalers, the category of electronic transactions that includes sales through web sites grew at 34% per year from 2000 to 2009, the U.S. Commerce Department says”

I must admit that that seems a little more aggressive than even I would have thought.  That’s good to know.

“”We’re seeing the b2c-ifying of b2b,” says Andy Hoar, a Forrester Research Inc analyst.”

We definitely see this every day!  So much so that people often misuse the term “B2C” simply to describe the usability of a website even though it clearly is a B2B business model as defined by personalized catalogs, custom pricing and shipping options and variable payment terms and options.

“But giving b2b Amazon-like appeal is just part of the job: b2b commerce sites must offer features not found on b2c sites—and often that requires custom developmentsuch as …Showing availability by warehouse…a price calculator…and providing the name and phone number of the customer’s sales rep.”

Seriously?  Custom?  Wow!

“…Those projects can take years to roll out and cost millions of dollars.”

I’m amazed that the industry can grow at a rate of 34% per year and still have projects that are this big and take this long to roll out.  We prefer to measure time in weeks and months and we’ve never cashed a check larger than “tens of thousands” in size.  Maybe that’s why we’re growing faster than the industry average :-).

“But many b2b companies have recognized that purchasing agents also are consumers who are used to shopping online and expect to be able to shop the web at work, even if they’re buying coils of metal or tubs of solvents.”

 Amen!

“Many other b2b companies are coming to similar conclusions about the value of the web. All signs point to a significant increase in b2b e-commerce in the years ahead.”

We definitely think so.  We’re on track to facilitate the sale of over $500M of product over the web this year alone. 

By combining the accounting and logistics capabilities of SAP and the merchandising and usability aspects of Magento, we truly are blurring the lines between B2C and B2B more and more every day.  I wonder what we’re going to talk about at the next party we go to? 🙂

 

Sam