The old theory that B2B companies can avoid selling through online channels is done, and B2B e-commerce solutions "contribute significantly to key selling metrics and incremental revenue," according to a new Forrester Research Report commissioned by EPiServer.
Forrester said 50 percent of B2B companies have plans to change or upgrade e-commerce technology in the next 18 months.
"Every company that plans to compete in the future must transform digitally simply because all your competitors are planning for it now," said Bob Egner, vice president of product management at EPiServer, which sells an e-commerce platform. "There are no restrictions based on type of product or service, or on geography. In fact, many of our customers find they can expand geographically in a shorter time frame and at a lower cost by going digital."
So what do B2B organizations moving to e-commerce do first?
Egner told CMSWire he calls the shift to selling through the online channel for B2B organizations a “digital transformation.” Defining what that means for an organization is the most important first step for many, he added.
"Typically this means defining what they want to accomplish, factoring in data points from their customers and their competitive position in the market," Egner said. "Some organizations simply want to open a new channel to customers by activating the online sales channel while others want to improve the way they deliver service and reduce sales 'friction.' In either case, you need to define what you want to accomplish and how it will help your customers and business before jumping into technology."
According to the Forrester survey, "B2B eCommerce Produces Results -- Get On Board," 39 percent of SaaS implementations cost less than $1 million, compared to only 10 percent of on premise implementations.
Eight percent said it cost more than $7 million to initially implement their core e-commerce solution, while 33 percent said between $3 and $7 million and 34 percent reported paying between $1 and $3 million. About one in five survey respondents said theirs cost between $500,000 and $1 million, and six percent added it was less than $500,000.
So it's in investment for sure.
Cost depends on a variety of factors, Egner said. Organizations must answer these questions before making a purchase:
- What do you want to accomplish with this system?
- How significant are the other process and technology changes that need to be made to activate a new online channel?
- How many systems will need to be integrated to provide a smooth, low friction experience that your customers may have become familiar with in their private lives as “connected consumers?”
- What is the impact to your staff as they have to adapt current processes and skills to deal with a digital approach as opposed to any traditional methods in use today?
Don't Do This
Organizations that lack a plan on how to transform their business and purchase technology won't survive, Egner said. Organizations don't have to create a big, multi-department project in their digital transformation.
"But you must at least create a simple roadmap of the steps and phases you expect to go through," he said. "Equally important, make sure to spend some time thinking about the business results you should achieve with each step on the roadmap. Successful organizations can measure incremental results on each step before proceeding to the next step."
Egner said he's seen B2B organizations use their e-commerce solutions to help respond to customer demands.
"Beyond making a great experience," Egner told us, "we’ve seen our most successful customers provide additional value with reminders and alerts for repeat orders, digital tools and calculators to make it easy to select and configure an order, and functionality that makes it easier to manage the vendor/client relationship."
IBM Led the Pack
IBM was named the top B2B e-commerce vendor, according to the first Forrester Wave report on the field in October.
The report, “The Forrester Wave: B2B Commerce Suites, Q4 2013,” evaluated 66 criteria and identified the seven top providers. In addition to IBM, they include Commerce Server, SAP’s hybris, Insite Software, Intershop, NetSuite and Oracle Commerce. The report pointed out that, although the B2B e-commerce market in the US alone is more than twice that of the B2C e-commerce market, B2B is "far less mature" and less robust in terms of the online experience.