Estimates from eMarketer calculate B2B companies spent $4.07 billion on online advertising in 2017. In 2018, the spending is expected to increase 13 percent to 4.6 billion. Across the board, companies are pouring more money into technologies that allow them to place advertisements where their customers are. While traditional media still has a place in advertising, consumers have transitioned an increasing portion on their lives online and businesses have followed.
While the 13 percent increase in online advertising spending is in the double digits, 2018’s predicted spending growth is the lowest in recent history. The percent change in spending from 2014 to 2015 was the largest with 19.7 percent. However, the B2B industry has maintained an online advertising spending growth of roughly 16 percent since 2013.
The Internet has created a new dynamic and structure for B2B businesses in which marketing teams, sales teams and e-commerce tools converge to maximize revenue. Some industry studies have painted a bleak future for sales teams, one in which they’ll be phased out entirely and replaced with automated e-commerce stores. The assumption is often backed up with data indicating a shifting consumer preference towards e-commerce. Even though Internet accessibility and overall technological adaption rates are increasing globally, e-commerce and traditional sales roles have integrated together. New studies and industry reports have now suggested B2B businesses can reinforce their existing channels while simultaneously integrating new technology such as e-commerce.
In a Forrester Research study of B2B businesses, 89 percent of businesses surveyed indicated that implementing e-commerce increased their annual revenue. The modern business world is dominated by efficiency: who can attract the most customers, who can capture new markets the fastest and who can get the highest return on their investments. E-commerce websites have allowed sales teams to become more efficient, especially within the B2B market. Sales team members save time and become more productive when an e-commerce website is available for customers to fill out their own orders through a spreadsheet ordering format.
Allowing e-commerce software to take some of the tasks that were previously completed manually by sales teams and digitize them increases productivity. Founder of B2X Partners Justin King analyzed B2B sales from Forst & Sullivan, which are expected to reach $12 trillion by 2020. “If a sales team is looking at e-commerce as a threat or as a hit to their personal income, they won’t get behind an effort like this,” says King. “Bringing them into the fold early and incorporating them into your e-commerce team early is important.”
“In most cases, a few sales reps will naturally latch onto the idea. Bringing them into the fold early and incorporating them into your e-commerce team early is important.” — Justin King, 2017
E-commerce can be used as a tool for B2B sales teams. E-commerce websites can take large amounts of data and condense them into a portable fashion, essentially allowing your sales representatives to access your entire inventory from anywhere. Dirxion online catalogs serve as both a reference tool to sales representatives and a familiar, fully-integrated e-commerce experience for customers. For instance, Dirxion customer Proface America uses spreadsheet ordering functions in their online catalogs, which allows customers to independently place orders, freeing sales representatives from having to complete the process manually. Dirxion online catalogs can also be easily updated, thanks to in-house production and development teams, ensuring all sales representatives, no matter where they are, has access to fully-updated product lines and prices. In doing so, Dirxion customers mitigate production, printing and distribution costs previously associated with constructing print catalogs.
Global B2B e-commerce has already outgrown B2C, with the B2B e-commerce market expected to reach $1.1 trillion in value in 2019 as compared to B2C ($480 billion), according to Forrester. B2B e-commerce on the global scale remains in its infancy, despite the market having some sort of B2B e-commerce for the past two decades. At one point in the late 90s, Gartner estimated B2B e-commerce would reach $7.2 trillion by 2004.
The majority of the business world is now online, but technology adoption has moved at a slower-than-average pace within the B2B e-commerce sector. The technology and systems of the average B2B business fell below rising standards set by larger B2B corporations who could afford to invest in e-commerce technology. According to a 2015 survey conducted by eMarketer, 55 percent of B2B corporations in the “Leader” category of technology adoption considered e-commerce investment critically important for sales.
“We are still fairly early in the maturity. It’s started to accelerate, but adoption has been a little slow. In the next five years, we’ll probably see a significant amount of growth in B2B ecommerce. —Brian Walker, SAP Hybris
The Chinese market for B2B e-commerce has grown at an increasingly rapid rate, netting $2.3 trillion in e-commerce sales in 2015, 80 percent of that being exclusively from B2B sales, according to Cross-border eCommerce. Compared to the U.S.’s B2B e-commerce value, China’s will reach $2.1 trillion by 2020 with companies such as Alibaba (valued at $264 billion) bolstering China’s exports.
Dirxion online catalogs give B2B businesses an opportunity to tap into the developing global e-commerce market. Businesses that fail to include and accommodate for an international market essentially choose to leave sales on the table. Business Wire forecasts English-language exclusive sites will account for only 33 percent of online global purchasing in 2020. Dirxion online catalogs can support a variety of languages or multiple languages at once. For instance, Dirxion customer Kennametal has a language toggle feature on their online catalogs to support languages such as French and Japanese.
Recently, CEO of W.W. Grainger D.G. Macpherson, one of the largest B2B companies in the U.S., predicted 80 percent of their sales will occur through online channels by 2020, according to Industrial Distribution. E-commerce as a whole has grown for the company, accounting for 41 percent of their total sales in 2015 and 60 percent in 2016.
We’re still focused on the online model. It’s a strong source of profitable revenue growth. We expect that to grow 20 percent this year and grow profit even more off of that. — D.G. Macpherson, CEO of W.W. Grainger
B2B businesses have benefited greatly from the market’s transition into e-commerce. Forrester Research analyst Andy Hoar conducted a report that predicted U.S. B2B e-commerce will generate $1.18 trillion in revenue by 2021. The Internet has eliminated sales barriers as well. Though this means your direct competition no longer has to be close to you, it opens the door for new sales in markets that were previously not accessible. The B2B buying market has evolved to conform to the shopping habits of its dominant buyer, millennials. According to Think With Google,in 2014 nearly half of B2B researchers, those making B2B buying decisions, were millennials. Compared to other generations, millennials grew up in the digital age and are digital natives, taking their online preferences with them when they moved into the workforce.
E-commerce has changed how consumers interact with B2B products. E-commerce websites for B2B businesses allow products to be sorted and easily filed into a searchable format. Consumers react positively to well-designed websites and will often abandon a company if they feel their online presence is subpar compared with a competitor.Mobile e-commerce has seen a boost in recent years, meaning B2B businesses can profit from consumers being able to access their e-commerce site on a smartphone or tablet.
Dirxion online catalogs give B2B businesses another avenue in a multi-channel marketing approach and allows them to capitalize on the rise of the B2B e-commerce market. For B2B businesses with many catalogs spanning multiple departments of their company, Dirxion’s bookshelf feature organizes the individual catalogs on a central landing page and integrates cross-catalog searching. Existing e-commerce platforms can be integrated into the catalog or B2B businesses can employ the Dirxion order form feature to generate a request for a quote.
The B2B e-commerce market is estimated to be worth roughly $1.1 trillion by 2021, according to predictions from Forrester Research. The market is at an inflection point, driven by the changing preferences of the B2B customer. According to the same Forrester study, 74 percent of B2B buyers research half or more of their work purchases online before buying. The number of customers who make half or more of their work purchases online is expected to increase 26 percent in 2017. It’s also seen as more convenient to purchase online — 93 percent of B2B buyers prefer to buy online when they’ve decided what to buy.
According to “think with Google,” the way B2B customers conduct research has changed as well. Purchase rates of B2B customers on mobile devices has raised 22 percent in the past two years. Online shoppers in general have become accustomed to their preferred e-commerce websites providing a multi-channel approach. B2B e-commerce empowers buyers by giving them the convenience of researching and purchasing from anywhere 24/7. The internet has changed not only how consumers buy products but how they research them and interact with brands.
Businesses can cut costs by shifting their B2B business more into the e-commerce realm. According to Forrester, Coca-Cola reduced their average cost-per-interaction by 85 percent by moving offline B2B customers online. Thanks to the Internet, consumers now have more information and options for purchasing than ever. Online catalogs provide a new purchasing platform for consumers, either integrating with an existing e-commerce platform or providing an order form that’s then sent to the company’s sales team upon completion.
MSC Industrial is one of the largest distributors of metalworking, repair and operations (MRO) products and services for manufacturers worldwide. They take pride in having over 1 million product offerings, many of which are itemized in their annual Big Book, a master catalog that is over 4,000 pages.
One of MSC’s primary goals is strong customer service, hoping to ensure supply purchases are fast and easy. That poses a challenge for the online version of the Big Book, a challenge that Dirxion helps MSC overcome every year.
In order to create a fast online catalog experience, Dirxion uses custom processes to provide an optimal experience. Because of the scope of this project — a few thousand pages, hundreds of thousands of product links — our production engineers fine tune page outputs and set up a unique linking algorithm to connect the Big Book to MSC’s e-commerce pages.
Every time someone visits the MSC site, the online catalog is available through a tab on the left-hand side that opens an embedded version of the Big Book. Once opened, pages click through effortlessly with minimal loading time through unique compression settings. Thousands of pages, hundreds of thousands of links, all loading for MSC’s customers near-instantaneously.
From here, you can search for specific items, add to cart and check out. If you need to come back to a page, simply bookmark the page. There’s a variety of features available in the MSC online catalog, and no features were compromised in creating this custom display.
Many B2B catalog providers do business in a variety of countries, cultures and languages. Without the translated catalog, a lot of business could be lost in translation. That is why we think it is important to support a wide selection of languages in our online catalog product.
Among our customers, one of the best practices is use a toggle to switch between languages supported by the print catalog. Industrial metalworking manufacturer, Kennametal, is a prime example, whose online catalog supports 14 languages under one URL. Canadian industrial tools supplier Acklands Grainger has a drop-down toggle to choose between English or French.
If separate URLs are more desirable, consider YP eDirectories. They needed an option for two languages, French and English, to better serve customers in French or English speaking provinces. Instead of using one landing page with a multi-lingual drop down, they chose to use two different links/landing pages and split their directories using that technique.
A third option was used by KohlerPeople where we created a landing page with their six languages under each cover. It works well because the user knows which language they want and they can easily select it.
In a global economy that requires us to do business in multiple languages, these options are important. The primary goal of the online catalog is to expand the reach of your publications, and ignoring foreign languages is a sure-fire way not to do that.