The pandemic created a large shift in consumer behavior as more people turned to the convenience of online shopping. With the allure of easy one-click buying functionality, business buyers are looking for that same ease according to a recent study by Gartner showing that 83% of B2B buyers prefer ordering or paying through digital commerce channels. Retailers need to adapt this type of functionality to remain competitive in today’s climate. Many large retailers also have a sizeable opportunity to add or expand a B2B eCommerce business. When purchasing moved to online, there wasn’t a B2B eCommerce experience that was unique and tailored for that buyer – and this has created a significant gap.
It’s common for B2B buyers to shop with B2C retailers but it’s important to note that business buyers have a vastly different set of needs when making repeat purchases. This can be challenging for retailers specializing in B2C eCommerce. For example, B2B buyers prefer to pay by invoice, not with commercial credit or debit cards. The challenge for B2C companies is that accounts receivable and back-end operations aren’t set up to support invoicing and payment on terms. B2B buyers will naturally gravitate towards retailers that can support their preferred methods of payment leaving retailers that can’t adapt behind. That poses a risky loss as the B2B eCommerce market was valued at $7.35 Trillion in 2020 and is predicted to create revenue of roughly $18.57 Trillion by the end of 2026.
Here are 3 considerations to build an eCommerce experience that will attract and retain B2B buyers:
Offer Business Buy-Now-Pay-Late (BNPL): While more commonly known as trade credit or payment terms, this is an essential component of B2B trade and has been around for decades. For business sellers, providing trade credit is a good way to increase sales and loyalty, as it enables your B2B buyers to better manage their cash flow with more flexible payment options. In fact, 82% of B2B buyers would choose a vendor over others if that vendor offered invoicing at checkout with 30-, 60- or 90-day payment terms. Retailers stand to miss an opportunity with B2B buyers if they don’t provide B2B buyers an alternative payment option, such as paying by invoice online. B2B buyers spend more, more frequently when they have a dedicated financial relationship with a business.
Evaluate fraud risks proactively: Many retailers shy away from offering trade credit as B2B payments are far more complex than B2C payments. Any given B2B transaction may involve multiple stakeholders (the purchaser, the budget owner, the procurement group, the accounts payable team and others) and numerous different payment options (net terms, purchasing cards, and credit cards, among others). Each of those B2B purchasing stakeholders has unique needs and preferences that must be met, and each payment option comes with a unique set of procedural and technological integrations to be managed. And as more B2B customers are acquired online, there has been a growing risk of B2B identity theft and other forms of digital fraud. Our recent research confirms this, as most B2B businesses (98%) shared they have been affected by financial losses due to successful fraud attacks in the last year. Business suppliers must strike the right balance to strengthen their relationships with digital buyers: leveraging data to offer instant decisioning and trade credit but maintaining sophisticated fraud detection processes and a strong track record for risk decisioning.
Find the right partner: You want a payments partner that can finance your trade credit offering and allow you to give your B2B buyers payment terms while protecting your cash flow. Additionally, embedded payments experts can integrate with your eCommerce platforms seamlessly, so you can enable a B2C-like experience, but manage the complex demands of B2B purchasing processes. The right embedded payments partner will have a stellar risk decisioning track record, and bullet-proof fraud detection, to protect your brand from the risk of doing business with a global online marketplace.
Retailers can’t afford to leave B2B buyers behind in the eCommerce revolution nor should they pass up the opportunity to add new revenue from buyers already in their universe. B2B eCommerce takes specialized strategies and professional expertise to be successful, however the investment in building a proper B2B payments program is vital for retailers who intend to compete to own a share of the rapidly growing B2B sales opportunity.