Roland Palmer, General Manager of UK, Benelux & Nordics, Alibaba Group takes a look at how B2B retail is the next big space for ecommerce
B2B commerce has undergone a significant revolution since the onset of the COVID-19 pandemic. When factories closed, businesses were forced to look for alternative suppliers and make quick decisions to ensure business continuity. What was once a necessity has now become the new normal, with businesses choosing virtual or digital services to save on costs and ensure convenience.
Despite their popularity, however, the infrastructure of B2B eCommerce platforms available in the UK and the quality of services they offer are lagging compared to their B2C counterparts. In fact, research from Wunderman Thompson shows that 89% of B2B buyers in the UK find buying online more complicated than offline, with 52% frustrated with the online buying experience.
These findings come as UK businesses face a multitude of macroeconomic challenges. Prices of materials and ingredients have risen exponentially, and global freight costs have seen three-digit increases. In addition, supply chain disruptions continue to cause order fulfilment issues, leading to a 38% decline in customer satisfaction and 40% of consumers to change suppliers to outside of the UK.
To overcome these challenges, businesses must review their supply chains and seek out new supplier relationships. Online B2B marketplaces, whilst not providing a silver bullet, help to make sourcing simpler, more efficient, and effective.
With the click of a button, buyers of wholesale goods can browse, explore, and discover products from suppliers around the world. Such platforms can cost-effectively reach and match wholesalers and buyers, delivering a seamless solution for bulk orders.
For SMEs in particular, digital development could be the key in keeping them on the front foot with rapidly evolving demand. Online B2B marketplaces support SMEs with some of the challenges of day-to-day operations and enable them to operate in the broader global market without the need for the resources which available to larger companies. Time is a valuable commodity to all businesses but for SMEs especially, and marketplaces can offer a huge range of products to browse through from global suppliers, without needing to spend precious time travelling.
According to Wunderman Thompson, 49% of B2B purchases in the UK now occur online. As online platforms grow in popularity, buyers are increasingly looking for more innovative ways to shop. In fact, 67% of global B2B buyers said that they wished that B2B sellers online were more innovative in how they used digital technology to improve the experience and a similar percentage (69%) said that if a B2B supplier is digitally innovative, they are more likely to purchase from them.
In terms of technological innovation, there are many lessons B2B platforms can learn from their B2C counterparts. They have shown how technology can be leveraged to make the relationship between buyer and seller – regardless of where they are and what they sell – as seamless as possible.
Livestreaming is one such technology which allows suppliers to showcase the benefits and quality of their products, the story of their operations, and foster relationships based on trust and transparency. And it’s a technology in high demand amongst B2B buyers. During the first week of this year’s Alibaba.com March Expo, more than 700,000 B2B buyers watched 50k livestreams and more than 60,000 manufactures performed livestreams – an increase of 100% from last year.
Virtual reality factory tours are also disrupting the B2B online marketplace space, enabling buyers to go inside a supplier’s factory from the convenience of their office, cutting out international travel whilst giving buyers assurances about the suppliers they ultimately choose.
These technologies are only the start of the future of sourcing, with many others still emerging. The metaverse, whilst still in its infancy, is popular amongst B2B buyers. According to Wunderman Thompson, 67% of B2B buyers say they would like to conduct their online buying in the metaverse using an avatar in the future. Another key innovation likely to shape B2B online marketplaces is digital sales rooms. These are online, secure spaces where buyers and sellers can meet and facilitate sales. 69% of those surveyed by Wunderman Thompson said they would like to conduct their B2B online purchases in online sales rooms in future.
The shift away from offline to online B2B marketplaces will help to streamline business processes, saving time and resources. Ultimately, it will revolutionise procurement for all businesses, helping them to protect and grow their bottom line, even in a challenging business environment.
Roland Palmer is General Manager of UK, Benelux & Nordics, Alibaba Group