“We don’t need to worry much about the B2B customer experience as our users don’t have a choice who they buy from.” This statement was made to me recently by the head of IT of one our B2B customers in the middle of a discovery process focusing on user experience.
His view was that since his company will generally have a supply contract with its customers, CX wasn’t that important, thanks to a lack of purchasing options. This is quite an extreme example, but you can kind of see where he was coming from.
He’s correct that most of his company’s end users must purchase large items from their contracted supplier. He’s right that a poor CX isn’t going to immediately stop them purchasing, as they don’t have a choice. However, he’s very wrong to suggest this means that the B2B customer experience does not matter.
It’s fair to say that retailers have led the digital charge over the last couple of decades. Retail has always been highly competitive, and customers often have a large choice of which company they can buy from; especially online.
This competition has driven innovation, and customer experience is now the battle ground on which the majority of retailers compete. Until recently, B2B has been different. Customers have generally had less choice (in some cases, none) in where to purchase from, and suppliers have generally had a lot less competition; especially online.
This picture is now changing at an increasing rate. Although large items tend to be purchased through pre-agreed contracts, many companies now allow staff to order smaller items through other channels, such as Amazon. For example: a large organization will probably mandate that an employee’s laptop must be purchased through an agreed contract with a specific supplier, but they may let the user buy their mouse, laptop bag, and other smaller items wherever they like.
One of the key differences between B2B and B2C is a separation between the customer and the end user. In a retail environment, the end user is often the customer, but in a B2B environment, this is frequently not the case. The actual customer (the one paying the bills) is likely to be the user’s employer.
This leads to a dangerous perception that the end user doesn’t matter as much since they aren’t the ones making the actual buying decisions, as it ignores how many B2B end users can have a big influence in buying decisions.
In the UK, over 20 million people are either self-employed, or employed by an SME. This is quite a large proportion of the working population. In these circumstances, end users are much more likely to have buying decision power, and therefore will be much more likely to vote with their feet if a competitor is providing a better B2B customer experience.
One of the most important things to consider is that almost every user of a B2B website is also a consumer in their own lives, and has been trained to expect a certain level of customer experience.
Leading retailers are constantly striving to deliver a better customer experience than their competitors, and we’re very used to finely honed checkout experiences, great communication, and very fast delivery.
These expectations are transferred into the B2B world, where users will naturally compare this customer experience to the one that they find in their everyday lives. People don’t just become robots when at work. They’re still people, and in an age where the boundary between work and home is becoming increasingly blurred, it’s important to consider the expectations of your customers.
When Amazon enters a market, it generally has a massive impact on any other companies operating there.
In fact, the single biggest threat to many established retailers is Amazon entering their market; a move that can have a dramatic impact on the business landscape. For example, Amazon doesn’t currently operate in the Nordics or Scandinavia, but it’s probably only a matter of time before they do. This digitally and technologically advanced region seems an ideal market for Amazon to enter, so both retailers and B2B suppliers in this area should be creating a strategy now and focusing on driving customer experience and customer loyalty.
In 2015, the e-commerce giant launched Amazon Business and it quickly became the fastest growing part of their vast business. Within three years, revenue surpassed $10 billion, and is continuing to grow at a rapid rate. While this is currently still quite a small proportion of the overall Amazon business, the potential for growth is huge.
As well as selling a large number of Amazon stocked products and Amazon basics products, the platform is also a marketplace allowing businesses to sell products to other businesses in a similar model to the existing business to consumer platform. The products sold on the platform range from medical supplies to chemicals and raw materials, which means that it’s a risk to almost every supplier and distributor.
Businesses cannot rely on being a niche supplier anymore, and just about every industry is up for grabs right now. A 2018 survey by the technology company Unliog reported that 33% of distributors surveyed cited Amazon as the single biggest threat to their business, but only 48% of those distributors had a strategy for competing with Amazon Business – which is a concern for the other 52%.
It’s not hard to see how Amazon Business is such a threat. Amazon now accounts for around 50% of all e-commerce sales in the US, and around 5% of total retail sales. That’s a lot and it dwarfs the nearest competition. From the very early days, the company was driven with an obsession for customer experience, and it now shows.
The company has now become the de-facto e-commerce website for many people and, crucially, it’s not always about price. Amazon competes on customer experience, and price is just one part of that. It’s very common for clients to tell me that they want to offer their customers the ‘Amazon experience’ which is a great thing to aim for.
B2B organizations should start to think like retailers when it comes to e-commerce. They should consider all users as their customers and aim to provide a B2C-like experience whenever they can.
An ever-changing environment, evolving competition, and increasing customer expectations mean that any B2B organization that fails to understand or focus on customer experience is at risk of being left behind.
This article was first published here: https://www.the-future-of-commerce.com/2019/09/17/why-the-b2b-customer-experience-matters/
For more articles by Branwell Moffat also see https://www.the-future-of-commerce.com/contributor/branwell-moffat.