B2B ecommerce is here to stay. Business leaders pointed a keen and wary eye toward born-in-the-cloud digital disruptors when they broke on the B2B scene nearly a decade ago. In the early days, there was much speculation as to how much market share the “new guys” could grab. Speculation quickly turned to spectatorship. We watched in awe as a more than $1 billion bite was taken out of the B2B market within a few short years.
Today, amid the challenges of COVID-19, a real urgency has emerged. Having a smart, frictionless, AI-driven, best-in-class ecommerce experience is no longer an option. According to a study by Episerver, “B2B Digital Experiences Report 2019: How Companies Are Meeting Rising Expectations,” 82% of B2B companies say they will use artificial intelligence to personalize customer experiences online in the next three years.
Every B2B executive feels the pressure to act, yet achieving the ideal offering in this emerging channel is certainly not straightforward. A significant transition that must take place before a company can effectively price and transact commerce online—and even more questions to answer before the transition can begin.
The good news is that B2B technology has caught up to the online behemoths. In this article, I’ll walk you through some AI-driven ecommerce solutions that can bring a sales rep-like experience online while giving customers the experience they want. Let’s jump in.
Meeting customers—and beating competitors—through ecommerce
There is no beating around the bush: B2B customers want the same speed and convenience of buying online that they have as consumers. If you’re grappling with ecommerce, you may have heard the rumblings from customers that they don’t want to talk to salespeople to complete a transaction and it’s too hard to do business with you.
Fair points. They are also difficult to reconcile with the very nature of B2B, which has largely been relationship-driven with highly negotiated sales. In terms of competitors, there are plenty. Born-in-the-cloud, non-traditional competitors, Amazon, even traditional competitors simply moving and adapting faster. Each of which poses a new consideration for your own company’s eCommerce channel, including:
- How do I move my catalog online?
- How can I get a simple quote for a customer without a sales touch?
- Should I show the same prices to new customers versus tenured customers?
- Will moving online impact customer loyalty?
- How can I evolve beyond an order entry system with static prices and recommendations?
- How long will it take for ecommerce to reduce the cost of doing business?
None of these questions can be effectively addressed in a silo. Rather, a more comprehensive, reimagined approach to pricing and sales is required.
Harmonizing pricing to the market and across sales channels
Pricing is undoubtedly the largest hurdle for ecommerce in a B2B environment. There are so many triggers that you need to be able to respond to on a day-to-day basis. Externally, there’s unprecedented volatility, supply chain disruption, even competitors taking this opportunity to change their market position and grab more share. Internally, executives want to respond to competition while acquiring and gaining more business as well. The internal processes to make corporate strategy a reality, however, are inefficient.
As external conditions change, they create pricing triggers, or events that necessitate a price change. Executives set strategy based on these triggers, pricing teams must update pricing across channels, geographics, customer types, and more, and IT has to acquire and pull various data sources, then make sure that data connects between back-office systems and the ecommerce site.
Certainly, the summary above is an over-simplified version of the process that takes place. In practice, it’s crushingly complex, rife with opportunities for making mistakes that result in significant margin loss. Consider this workflow example, based on our conversations with B2B companies of all stripes. It demonstrates all the actions that take place before a new price can make it to a customer, and more importantly, an ecommerce channel.
With ecommerce in the pricing mix, critical questions come into play. First of which is: Which price should you present? Meaning, when sales reps are presenting prices to customers, they can have a conversation with them, gauge their response, adjust pricing if needed, or let the customer know they will work to arrive at a lower price, should the customer request a price exception. Essentially, sales reps can recover the sale if necessary; the opposite is true on ecommerce, where customers can and will bounce to competitors to price shop. Yet, simply racing to the bottom on ecommerce pricing isn’t the solution either.
B2B companies are seeing that their ecommerce pricing strategies must be as differentiated and nuanced as they are in the “traditional” sales channel. This requires presenting varied pricing based on whether the customer is a new customer on the open web or an existing customer with a login. Sellers need to reprice existing business needs and price new business accordingly for each unique customer relationship. Each of these unique prices should be market-aligned while meeting customer expectations. Additionally, online pricing must be aligned to what sales reps are quoting, particularly as customers utilize a blend of ecommerce and direct sales to transact with one company.
Sound complicated? It is. The good news is that there are solutions that can dynamically generate and deliver prices to the ecommerce system that meet all these goals and more. B2B companies have a wealth of information about their buyers. Advances in price optimization and price management give you the ability to take various triggers and data—supply and demand information, inventory positions, competitive data, and more—and use those data elements in a more efficient and intelligent manner.
Pricing teams can determine if and how pricing needs to change in an automated and dynamic way, then optimize pricing, impose rules and strategies as needed to dynamically generate and deliver prices into your ecommerce system as well as other sales systems like CRM, ERP or CPQ. By doing so, it is faster and more efficient to harmonize pricing to the market and across channels.
Expanding product purchases, retaining purchase volume, and growing wallet-share online
Pricing is one piece of delivering a sales-like experience to an online world; another piece of the puzzle is enabling sales growth online. Here, capitalizing on sales growth opportunities is a goal many companies have not yet fully attained. Despite significant investments in ecommerce and sales intelligence technology—a market that will reach $5 billion by 2027, according to a projection by Grandview Research– companies still lack a centralized, connected solution.
Typically, sales operations, category managers, product managers, marketing promotion managers, business intelligence analysts and others must set tactics that will achieve executive strategy. Yet, the go-to solution is manual spreadsheets or perhaps discrete reports from business intelligence tools. This is often an extremely time-intensive and manual effort for the analysts.
Such manual approaches in complex B2B environments make it impossible to identify all of the opportunities for sales growth across all customers and products or to dynamically update those opportunities into ecommerce. Consider a large B2B company with 500,000 products and 20,000 customers. That company could generate more than one billion potential sales recommendations. Given the sheer volume and complexity, sales teams using manual tools can’t possibly perform analysis and generate guidance at the pace of change within a modern business.
Enterprising companies, however, are embracing a new centralized approach that uses AI to generate sales growth intelligence faster and bridges discrete strategies and systems to drive specific actions across the entire customer lifecycle. Advanced data science can determine which customers offer incremental revenue opportunities and what products and quantities customers should be buying. This can generate a swath of customer actions.
For ecommerce, some of the most promising actions include:
- Recommending products customers are most likely to purchase based on what’s in their cart or what similar customers purchase;
- Prompting customers to buy products they’ve previously purchased when it appears their purchase volume in a given product category has been declining;
- Recommending excess inventory to customers most likely to buy it;
- Suggesting higher margin or preferred brand products based on items a customer searched for or added to their cart.
Users can also personalize online pricing with insights generated from price optimization, price management or predictive sales analytics.
Given the inevitable shift to ecommerce channels, B2B executives are accelerating their plans to incorporate AI into their digital channels. By utilizing practical AI and software that’s designed to meet the unique challenges of B2B commerce, companies can deliver a sales-like experience into ecommerce and be better positioned to compete and win. In short, the window to make predictions, prepare, and look to the future may very well be closed. The future is already here. The question is: Are you prepared?
Pete Eppele is senior vice president of products and science at Zilliant, a provider of technology designed to address the pricing, sales and commercial needs of B2B manufacturing, distribution, and services companies.Favorite