Manufacturers and distributors selling via e-commerce to other businesses have traditionally lagged behind their business-to-consumer counterparts in adapting to changing customer needs. But B2B companies are learning from the successes and failures of mature online retailers, giving them a leg up in their quest to deliver better customer experiences.
This isn’t to say that B2B is an industry of technology and commerce laggards. Where consumer brands are the trailblazers, B2B companies are the settlers following the paths forged by their predecessors and building upon what consumer brands started. Today’s B2B customers expect them to have already cut down trees and located the narrow points of the river crossing; they expect B2B e-commerce teams to provide the most basic stages of personalization (e.g., displaying order history or greeting an
email recipient by name) and immediately implement more advanced techniques.
The B2B e-commerce industry is evolving quickly, and it won’t be long before it catches up, or even overtakes, consumer brands’ online capabilities. Personalization is one of the areas where B2B companies are innovating quickly to catch up. Yet there is still plenty of room to grow. A recent study showed that more than a third of shoppers (35%) say brands do a “poor” or “very poor” job of personalizing the online shopping experience, with just 7% saying that brands do this “very well.”
The Tiers of Personalization
Personalization on B2B e-commerce sites has evolved significantly over the past few years. Thanks to technological advances in areas like artificial intelligence (AI) and predictive analytics, every industry is now approaching the ideal of one-to-one engagement. The days of mass-market strategies are over, and customer segment sizes are shrinking. But as the technology and methods of personalization become more complex, companies must pinpoint the extent of their capabilities if they plan on progressing further.
Here’s a look at the multiple stages of personalization. The best way to understand the differences between the tiers is to consider a crawl-walk-run-sprint analogy. Where do you stack up?
- Basic experience personalization: By today’s standards, this is hardly regarded as personalization anymore. The earliest stage of personalization involves identifying customers by account, and, when they log into a website, greeting them by name, recalling their order history and displaying other inserted profile information in the site’s My Account tab.
There’s no excuse for any company today to not provide this type of account-based personalization. It is the absolute minimum for online customer experience, and customers across industries now expect it as a given.
- Guided experience: This is the low-hanging fruit in B2B e-commerce personalization. Even if a company provides a single service or product, not every visitor is looking for the same information on a given site. At the most basic level of personalization, the guided experience allows the users to personalize the experience themselves by providing pathways relevant to them.
A good example is Flinn Scientific’s website, which displays three potential journeys prominently on its home page (High School, College, K-8). By clicking on one of the three pathways, the content they see will differ. This provides a more seamless user experience, which will in effect lead to sales.
- Personalize based on segments & personas: Targeting content is one step above the guided experience. In this case, marketers and content managers configure rules to group customers with similarities into segments, and then adjust the website elements each segment experiences. These groups are based on implicit data collected about the visitor (geographic location or referring URL) and explicit data (order history or industry) the visitor provides.
Amazon’s product recommendations are a common B2C example of this type of personalization. To illustrate a B2B example, if a buyer for a construction company purchases lumber from a website, the website could suggest products that other construction companies purchased, such as paint or staging materials.
Although most consumer brands have achieved this level of personalization today, this strategy still relies on broad categories that aren’t necessarily accurate. And it’s still a reactive approach to personalization, relying on “best guess” data. Personalization technologies that enable this capability rely on the merchant configuring the customer segment and the content that segment should see, which contributes to why only 35% of online shoppers say companies do a good job of personalization. With such difficulties, this model is difficult to scale.
- Personalized experience based on machine learning: To combat the reactiveness of personalization by segment and manually matching content, e-commerce product merchandisers can implement new machine learning technology. With machine learning algorithms, brands can analyze individual customer behavior as well as the behavior of other customers simultaneously in real time. By looking at these behaviors together, the algorithms select and display the highest converting content to each unique customer.
This level of personalization shifts the role of the product merchandiser from match-maker between segment and content to that of an analyst with his hands on the levers and dials of personalization.
Tier 4 (Sprint):
- Individualization: This is the top of the personalization pyramid. Here, each site visitor receives a unique, one-of-a-kind experience every time she interacts with a brand on any digital channel. Individualization is achieved when content, product recommendations and site experience are personalized to each customer. And companies, B2B and B2C alike, can only reach this point when they’ve gone through the earlier crawl, walk and run stages that combine basic customer data, behavioral data, segmentation and machine learning algorithms.
Individualization draws on data to deliver unique experiences to customers based on their individual buying habits, preferences and behaviors within distinct buyers’ journeys. A company equipped with these capabilities could predict exactly what motivates a buyer to purchase and offer them highly accurate recommendations and relevant promotions at the right time, boosting customer loyalty and driving more sales.
Individualization is the Future of Personalization
Thanks to the recent emphasis on AI, this technology is finally available for brands to proactively personalize the customer experience in real time. Because this is so new, few consumer brands have implemented it, which gives B2B time to catch up.
Individualization is where everyone is headed: a combination of personalization and predictive analytics that proactively engages customers using data and real-time decision-making. Half-baked attempts at personalizing experiences will no longer cut it. While not many businesses (even in the consumer space) have reached maturity with individualization, 2017 will be the year we’ll see massive progress.
To get on board, businesses need to invest in technology that mines big data for specific insights. For a lot of companies, this means replacing legacy data systems with newer, more powerful platforms. While this costs time and money, it’s a necessity for businesses looking to offer more streamlined and personalized experiences to buyers—especially as B2B e-commerce competition heats up.
Ed Kennedy is senior director of e-commerce at Episerver, a provider of e-commerce and content management technology, where he oversees product strategy. Formerly an e-commerce expert with several web design and development firms, he has helped enterprise businesses plan and execute more than 100 e-commerce projects. Follow him on Twitter @CommerceEd.Favorite