B2B ecommerce keeps growing…and growing: New research from Forrester estimates that B2B eCommerce will reach $1.2 trillion and account for 13.1% of all B2B sales in the US by 2021. By the end of 2017, Forrester expects eCommerce to reach $889 billion and represent 11% of total B2B sales in the US, while the total percentage of B2B buyers that research their purchases online will rise from 38% to 55% over the next four years.
To succeed in B2B digital commerce, however, companies have to meet constantly-rising customer expectations. After all, B2B buyers are also consumers who have learned to set the bar high — thanks to high-quality digital experiences they enjoy with companies like Amazon, Uber and AirBnB. They expect quality and consistency across devices, anywhere, anytime, and they expect nothing less from their B2B vendors. Research from KPMG’s 2016 Global CEO Survey revealed that 88% of CEOs are concerned about the loyalty of their customers, so customer experience is clearly becoming a significant brand differentiator in the age of digital.
But legacy solutions won’t cut it in this environment, because they don’t provide the cohesive, streamlined purchasing process, holistic experience and enhanced customer engagement that’s necessary to compete, says Justin Hoss, principal, Advisory and the National Technology Sector Leader for Life Sciences at KPMG. Instead, companies must work towards implementing a customer-centric B2B sales platform that meets the expectations of today’s customers. “Legacy processes and systems can really impede progress, so CIOs and technology executives must lead from the top and get their organizations to ‘think digitally’ while moving their organization swiftly through this journey,” he says.
An agile mindset is critical for B2B commerce success
In order to take B2B customer-centricity to the next level when it comes to commerce technology, the organization has to get in the mindset that agility is critical, and by focusing on burst and sprints, a CIO will move the organization forward.
“This mindset is the biggest obstacle for most global organizations,” says Hoss, who points out that failure should be an option as long as it is quick. “Then, you can learn and move on from there,” he explains.
CIOs, he continues, need to focus on innovation. “You would be surprised what a small change can do to one’s behavior,” he says. Innovation is critical, especially in fast-moving biopharma organizations and other global firms, he explains, and a great deal of innovation can come right from their commerce platforms – creating a whole new market.
How one pharma company boosted B2B customer centricity
One KPMG client, a global specialty biopharmaceuticals manufacturer, faced two significant challenges. One, they were on a transition service agreement with their former medical device parent, and the platform, as well as the processes, were ‘built for purpose’ for that organization. Secondly, it wasn’t biotech or biopharma customer-centric, which significantly hampered the enterprise’s agility to support its network of distributors, specialty pharma providers and national health services organizations – which is significantly different than a traditional medical device company.
In a B2B digital commerce environment in which orders often cost hundreds of thousands of dollars, the purchasing experience must drive the solution design. The platform and technological underpinnings must support the carefully purpose-built buying experience. So, KPMG worked to help the client implement a digital commerce system that would suit the needs of and streamline the purchasing process for its customers.
“The company also will be driving more orders to the digital platform – because it is easier than picking up the phone, which is the case for most short orders today,” says Hoss. “In the future, the platform will be flexible enough to offer additional automation via digital labor and artificial intelligence.”
Lessons for B2B digital commerce success
Hoss cites several important lessons and tips for those looking to succeed in B2B digital commerce:
Don’t focus on perfection — ever. When retiring a legacy platform, says Hoss, start with an unconstrained systems model and implement in small functional releases, based on what the ‘as a service’ platform offers to you today. “I always say in IT, ‘hope for future platform’ is not a strategy, it will get you all stuck in the muck and the mire,” he explains. “Don’t spend a lot of time on ‘current processes’, as they will undoubtedly constrain your art of the possible thinking.”
Get into mindset of ‘constant beta.’ CIOs and technology executives can focus too much effort on ‘picking the right platform’, with drawn out software selection process and contractual models. “In the digital world, the platform will shift as the technology and your organization evolves,” says Hoss. “IT needs to get into the mindset of ‘constant beta’ in both process and systems.”
Being nimble is critical in this new digital ecosystem. In the B2B life sciences world and other global firms, being nimble is essential — which means to be easily adaptable in what Hoss calls the 3 “Ps” — partners, platforms and processes. “The digital ecosystem will constantly be morphing,” he explains. “So should you.”
Focus on the user, not the technology. Journey mapping, which maps the most crucial factors influencing the customer in given situations, is especially helpful when designing a new end-to-end digital solution. “Each user in the process needs to be identified by their persona, and not only will this help with overall process architecture, but will help you jumpstart the behavior change management activities that are needed for such a large change,” says Hoss. Changing the technology is the easy part, he emphasizes. Changing the organizational and customers mindset “to do things differently” is the challenge.