B2B ecommerce: Why is it a good way to grow
Last year, Forrester predicted that B2B ecommerce would reach $3 trillion. By comparison, in 2018, the ecommerce market reached $1.134 trillion. This was above the $954 billion projected in 2017.
This goes to show that B2B ecommerce is a booming industry. B2B has several advantages over traditional B2C, and it is especially suited to ecommerce. In this article we will walk through B2B and why it’s perfect for ecommerce.
What is B2B?
B2B is an abbreviation for business-to-business. B2B is a business practice where businesses sell primarily to other businesses. For example, manufacturers sell to wholesalers. Or, in another instance, retailers make purchases from wholesalers. This differs from when companies do business directly with consumers and individuals. This type of transaction is typically called B2C.
Since B2B occurs between companies, it typically occurs within the supply chain. This means that B2B often involves raw materials, like building supplies. B2B can also be useful for service companies. For example, rather than marketing lawn care services to individuals, a lawn care company could offer its services to other companies with landscaping needs. By offering services to other companies, B2B can be a great way to grow revenue using online platforms.
How B2B Differs from B2C
At its most basic, B2B differs from B2C because it focuses on business-to-business sales. As stated before, B2B generally focuses on raw materials, but it can also include services. In other cases, manufactured materials, or components are also sold. Typically, except in specialized circumstances, these types of goods are not sold directly to consumers. They can often be started with a small business loan.
Some industries tend to trend toward B2B or B2C. However, unlike B2C businesses, which often require brick-and-mortar facilities, B2B businesses can often thrive on ecommerce alone. For example, think of a service company, like a payroll company. The responsibility of the payroll company is to provide its services to other companies.
On the other hand, retail outlets, like shopping malls, are B2C centered. Another key difference is that B2B focuses on building strong business relationships. B2C focuses on building a strong consumer following. With these differences in mind, let’s apply them to how B2B can grow your business.
B2B Opens an Entire Field of Clients
Since B2C focuses only on consumers, by expanding to B2B, you can effectively grow your potential buyers simply by expanding into B2B. Similarly, if you are looking to start a business, B2B offers the ability to tap into many clients you would be unable to access as a B2C business.
Remember, even if B2B will not give you access to all the same consumers, there are still huge markets to be found. For example, point-of-sale software companies have potential clients of every public retailer in the world; a huge market indeed.
B2B Builds Your Marketing Funnel
It’s critical to engage your audience correctly when working in B2B. One great reason to engage in B2B is that, unlike B2C, B2B allows you to build individualized relationships with others. These relationships allow you to build lasting reliable income for your business by negotiating contracts, purchasing agreements, and sales agreements.
To build these relationships, the B2B funnel can be used. In the beginning, utilize lead generation to develop prospects. From there, B2B managers can nurture these leads until they secure the buyer’s purchase. In the end, once a purchase is finalized, this can be used as the step in which a relationship is formalized and it can become a repeat process to supply the needs of the buyer over time.
Because these steps can easily be taken online, that makes B2B perfect for ecommerce marketing. By using customizable ecommerce websites, you can easily build a professional website that will help enhance your marketing funnel.
Challenges to Avoid So You Can Maximize Results
When setting up your B2B there are a few risks and challenges to keep in mind. By heeding these issues, you can get the most out of a B2B enterprise. First, B2B relies on building relationships. This means that it’s key to make your business stand out to reach customers. Second, B2B commerce can sell huge volumes of goods, but they tend to miss out on individual customer sales. Typically, B2Bs are busy working with a smaller pool of customers. Remember to utilize invoicing software to ensure you get paid.
Third, B2B can be complicated to set up because of the limited customer base and specialized knowledge required. Engaging in careful research can help mitigate this risk. Finally, web design is key when it comes to B2B. Because many B2B companies rely on their online presence, it’s essential that their website, order tracking, and customer service are all on point. PrestaShop’s ecommerce platform can help tackle these issues and give your business a leg up.