e-commerce and industry: The time is ripe, but it has to be done properly!
- 02 Nov 2020
It’s now a reality! B2B e-commerce offers a major source of opportunities for inter-company business. It has been spurred on among other things by a new generation of buyers. The B2B digital natives now outnumber the older generations.
E-commerce is now a key channel for industrial purchasing. According to a study by Xerfi and Roland Berger, the percentage of e-commerce in these sectors is increasing and offers new opportunities in its development: 35% for industrial supplies, 32% in the medical sector, 20% in the automotive industry.
As with the B2C markets, the B2B marketplaces are also an expanding e-commerce channel.
Making your business more agile and decentralising sales channels
The business benefits are enormous: internal costs per order divided by 4, gaining new clients, extending the range of services available 24/7 or conquering new markets more easily.
Nevertheless, e-commerce also brings with it a fair amount of complexity. It’s a revolution for companies accustomed to using traditional marketing channels and “pallet-by-pallet” logistics.
To avoid enduring project pains and a difficult or even unsuccessful transformation of your company, a number of prerequisites must be met.
1. An e-commerce project is not an ERP project
MVPs, projects lasting a few weeks or a few months at the most, are now frequently encountered.
There are no business benefits to be gained from carrying out an initial launch including its entire 12 month roadmap. The focus must be on test & learn.
Three aspects of MVP work require attention to secure the business and to achieve a better ROI:
- Keep it functional: a limited perimeter, closely linked to customers’ habits and internal processes. Focus on manual processes and a handful of major key functions.
- Select your beta testers... your closest clients. When the Accor group introduced its marketplace, as a priority it chose its hotel brands, as it’s easier to involve them in the choice of experiences, faster to convert them over to the new platform, while offering more security for the business during the launch phase. The subsequent deployments concerned the partners then the independent hotels.
- Choose more mature beta-suppliers. To optimise the ROI for the project, you should focus on onboarding part of the catalogue in phase 1 and therefore a number of your suppliers. Logically, the most mature in terms of the IT system, to secure interfacing with third-party solutions, order flows, stocks, product data, etc.. But also, the most mature in terms of customer relations and logistics in a drop-shipping or marketplace model, as they are the ones underpinning the commitments made to clients.
2. Eradicating irritants is a priority
Above all, the business roadmap should include the removal of the worst irritants. These are often simple aspects of the customer relations process reported by staff or by the clients themselves: making it easy to obtain invoices, custom prices, a fast buying process by product reference or simply access to complete information concerning the product catalogue.
3. e-commerce doesn’t only concern the e-commerce Manager
We are still seeing too many B2B e-commerce projects which don’t involve enough stakeholders and are not supported by senior management.
However, an e-commerce project brings with it significant organisational and human changes: logistics with new expectations where delivery is concerned, finance, sales representatives, procurement or human resources with new skills to be taken onboard and new talents to be recruited.
4. More customer autonomy requires more discipline
Welcome to the world of multichannel selling! Welcome to open data!
The digital channel should facilitate order booking, open up data (products, stock, prices, etc.) while at the same time maintaining a high degree of personalisation in interactions with clients.
This means for example that product-related information must be coherent at all contact points between your clients and company, stock and deadline information must be carefully controlled if presented, and interactions with the client must be split between the web, the sales representatives and the sales admins.
However, this unification and sharing of data can be something of a headache when comes to avoiding disappointment and spoiling purchasing intentions.
Launching an e-commerce website is a formidable and necessary business venture but an e-commerce website/portal is not enough to build long-term customer loyalty. It must fit in with the wider digital ecosystem.
5. The flexibility of the ecosystem
The success of the largest e-commerce operators lies in their capacity to offer a unique experience, in particular creating a functional and differentiated experience in relation to their competitors. They have succeeded in adapting the digital ecosystem to the precise needs and requirements of their clients and easily digitalizing their internal processes. e-commerce is already having a major impact on the way companies do business. The e-commerce platform must reduce constraints and offer the best opportunities in terms of experience, without compromise.
The different technological components must all integrate well within the IT system, which will often have significant legacy requirements.
So, we naturally avoid “All-in One” Saas solutions and logically seek out the most flexible and open platforms. Open Source technology, headless architectures and micro-services favouring the best-of-breed form the mainstay of this philosophy to build the most efficient digital ecosystem in terms of customer experience and revenue for the company.
“A little impatience can ruin a great project” - Confucius
As we have seen, the launch of e-commerce activities can be a major event for the whole organisation.
However, many projects ultimately flounder and fail because hasty decisions were taken when choosing service providers and software publishers. Experience has shown that the e-commerce ecosystem is highly specific. An e-commerce platform is not simply an add-on for an ERP system. Just because having a CRM system with the same publisher, it doesn’t mean that one’s business will work any better. We should take the time to read between the slides and carefully choose partners who can support in the long-term.