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Once seen as secondary to in-person sales, the e-commerce channel has rocketed to the forefront since 2020 and is now a key purchasing gateway for many corporate buyers.
Despite this, misconceptions abound, with a number of B2B companies telling us that “customers aren’t ready” and “e-commerce is an immature space for businesses like ours.”
McKinsey & Company’s latest B2B Pulse helps put these notions squarely to rest. Not only are corporate buyers open to e-commerce, two-thirds now rely on digital and remote channels throughout their purchasing journey. While some B2B companies see e-commerce as the purview of cutting-edge tech players, the reality is that suppliers across industries are ramping up their capabilities at astonishing speeds.
The conventional wisdom around B2B e-commerce is due for a reset. These charts expose five prevailing myths.
Myth #1: Most B2B companies don’t offer e-commerce.
Wrong. Nearly two-thirds (65 percent) of B2B companies across industry sectors now offer e-commerce capabilities, defined as fully executing a sales transaction online. This is up from 53 percent in early 2021. Spurred by the massive wave in digital adoption over the past two years, sellers have accelerated their digital timetables. In a remarkable first, B2B sellers are now more likely to offer e-commerce channels than in-person selling, an uptick that accelerated even as widespread vaccine rollouts allowed face-to-face interactions to resume (Exhibit 1).
Overwhelming customer demand is a key reason for this uptick. Our research shows that e-commerce now drives more than 18 percent of all revenue for the average B2B company, putting it on par with in-person sales and ahead of all other channels (Exhibit 2).
Myth #2: B2B buyers prefer face-to-face interactions.
Not so. Two-thirds of corporate customers intentionally reach for digital or remote in-person engagement when given a choice. Moreover, they’re doing so at every stage of the purchasing journey. In all, e-commerce has surpassed in-person as the single most effective channel (Exhibit 3).
Online chat is also becoming a mainstay, with more than 50 percent of B2B companies now providing this feature, and adoption of video conferencing also continuing to increase. For top B2B companies, it’s becoming clear that these elements are crucial aids to customer decision making and lift the buyer-seller interaction beyond the transactional.
Myth #3: Just a basic e-commerce site can suffice.
False. Our research shows that the majority of B2B companies are treating e-commerce as a full-service channel—and investing accordingly. While proponents of this myth take a “slow and steady” approach to their e-commerce build-out on the assumption that developing digital capabilities and managing channel conflict makes it necessary, the rest of the field is tackling these issues head on. More than 80 percent say they hold their e-commerce channel to the same or higher standard as other channels and that it offers the same or better levels of excellence in product and service availability, pricing, performance guarantees, shipping and delivery, and personalized recommendations (Exhibit 4).
Myth #4: E-commerce is only for repeat or low-ticket purchases.
Not anymore. Business buyers have shed whatever concerns they may once have had about completing major transactions online. More than one-third (35 percent) now say they are willing to spend $500,000 or more in a single transaction on digital channels, a figure that has grown steadily over the past 12 months, and a whopping 15 percent of corporate decision makers are comfortable making purchases worth more than $1 million online (Exhibit 5).
Myth #5: Digital marketplaces are a next-level ‘nice-to-have.’
B2B buyers say the opposite. They see digital marketplaces as an important part of the purchasing mix. A sizable 60 percent of B2B buyers indicate they are open to purchasing on digital marketplaces, roughly the same percentage as those who buy from supplier-branded websites (64 percent) (Exhibit 6).
Rather than seeing marketplaces as an afterthought, close to one in five B2B companies have already built one, either directly or through partnerships, and another 60 percent are in the process of doing so.
The performance bar is likely only going to get higher as leading B2B companies stretch their capabilities and refine their approaches. This is the time for B2B sales leaders to set aside outdated myths and embrace these five actions:
- Lean into B2B e-commerce or be sidelined: With potentially a third of sales at stake, e-commerce is a vital lynchpin for continued B2B revenue growth. If you don’t currently offer an online sales channel, ramp up that capability now.
- Win the journey, not just the transaction: Corporate decision makers are turning to e-commerce at every stage of the buying process, from research to reorders, and will walk away if the experience doesn’t deliver what they need.
- Don’t settle for easy: Rather than being daunted by learning curves, tackle them methodically, prioritizing critical capabilities and partnering closely with key distributors.
- Design your site with million-dollar transactions in mind: Treat e-commerce as a full-service destination and design the online experience to support big- and small-ticket sales.
- Recognize that e-commerce is an ecosystem play: Leading B2Bs maximize their online “surface area,” recognizing that the more avenues they can use to get in front of customers, the better. A well-rounded e-commerce presence will include a specific marketplace and partner strategy.