B2B Commerce Is Not a Technological Challenge
We asked one of our B2B experts questions about the digital transformation in B2B. Kees works as practice lead B2B commerce and has joined the Emakina Team in 2018. He is currently responsible for our client Royal Friesland Campina.
Why do you want to talk about B2B commerce?
As often remarked, there are a lot of similarities in how B2B businesses currently enter the digital commerce era to how B2C businesses did this over the past two decades. One difference, however, is that the technological challenge of building a web shop has been largely solved. It is still a lot of work, and it still requires a lot of customisation, especially in the B2B market where every business is unique, but it is very solvable. The technology is no longer the main challenge.
If not a technological challenge, what kind of a challenge is it?
It is a business challenge, especially for higher-tech manufacturers. B2B commerce requires not only organisational adaptation to a new process, but often also a radical shift in thinking: From selling products to being a domain expert that sells solutions and services, services which require your products as part of the solution. It is no longer about selling a machine, part or ingredient to a company, it is about being the expert that ensures that this company can optimise their value chain by using your machine, part or ingredient.
Let’s talk about organisational adaptation: What happens when B2B businesses focus on becoming domain experts that sell solutions and services rather than products alone?
The sales representatives become domain consultants, and what is sold is confidence and trust. It is not about just selling products, because at some point there will always be someone else that offers the same product cheaper. It is about selling the confidence that their product or service will be rock-solid because you delivered the expertise on your part as well as the components.
A nice example is a vendor of farming storage facilities – instead of just selling machines, they discovered that they had a lot more to offer as storage experts, ensuring that farmers can rest assured that their yield won’t rot or loose moisture over the winter and thus becomes less valuable. They already offered the tools to measure temperature, humidity, and CO2, but they moved towards ‘storage as a service’ where they themselves conduct the analysis and re-calibration of the tools based on the measurements. They sell a storage experience rather than storage equipment.
What role does technology play in this shift?
Commonly the IT department plays a major role in B2B businesses due to a reliance on ERP systems and the like – software that is used to manage their business processes. The risk is that digital transformation is narrowed to an IT challenge only: let’s add an e-commerce platform to our IT landscape and we’re good to go. For most B2B businesses however, digital transformation requires significant changes throughout the entire business–basically, the added value you deliver to your customers through your sales organisation needs to be translated to online. This requires new content, new roles, and new processes to make sure you’re not just building an online catalog of products with a buy button: because that lines you up for the race to the bottom with competitors that deliver similar goods.
Can you give us some best practises for starting out in B2B commerce?
It is important to start thinking from the business perspective of your customer: How can you help them become successful? This could be by offering the same products as your competitor at a lower price, but for most of us that is not a viable business strategy. Think about how, when and in what mindset they order your products, and what guidance and knowledge they need to feel assured that they are making the best choice.
Then think about how you can organise your business to deliver that: Who will act as the expert consultant, who will write content, and what team will own the digital channel?
Only after this steps have been completed is it sensible to start building your digital solution. It is advisable to start small, take one small market or vertical, a few clients you trust and appreciate, and work with them towards a first small release. Learn fast and iterate, until you feel you can make the next steps. Smaller steps will also give your organisation the required time to adapt.
If you would like to join a client session about this topic, or if you would like to discuss other prevalent topics, please feel free to connect with our team.