In the coming years, B2B business is expected to grow at double digit rates, and more vendors will enter the B2B market in earnest. In this article, we look at how this market is beginning to take hold in the global e-commerce landscape through marketplaces.
What is a B2B marketplace? A B2B marketplace is a platform where manufacturers, suppliers, and traders can transact with companies looking to buy raw materials, finished goods, and services. In terms of sales, it is currently the most important model in B2B sales and one of the main reasons for the growth of B2B e-commerce. A study carried out by ibi Research in Germany in 2018 found that more than 25% of surveyed companies use B2B marketplaces for B2B sales. Of those, 31% sell through Amazon Business – twice as many as the second most used provider, Mercateo.
Buyers can search the marketplace by product type or directly from the manufacturer’s list. The main goal of B2B marketplaces is to simplify everything related to purchasing. These platforms can be generalized or specialized in their field of activity – hybrid (selling their own products) or pure player (simple intermediary). B2B marketplaces offer the same opportunities as traditional B2C marketplaces, but adapt to the typical circumstances of a business. For example, buyers can view the supplier’s certifications, have a company information page, and open accounts for several users. In addition, the prices displayed take into account the specifics of the B2B sector, and traders can benefit from tax-free programs. These are just a few examples of B2B customization.
Two B2B marketplaces dominate the market
B2B marketplaces are becoming increasingly popular among e-commerce professionals, but two companies currently dominate this market: Alibaba and Amazon. By 2017, Amazon Business sold $280 billion worth of goods and generated $178 billion in revenue. Alibaba’s sales were just $40 billion, three times as many goods as the American giant. Amazon’s success is not limited to the United States. The American giant, which achieved $1 billion in sales in its launch year (2015), is now also successful in Europe, with its platform available in Germany, the UK and France.
Currently, the American-Asian duo dominates, but other marketplaces such as Staples, Mercateo, Cdiscount Pro and ManoManoPro are also determined to make their mark.
Advantages of B2B Marketplaces B2B marketplaces bring many benefits to both sellers and buyers. By selling their products on B2B marketplaces, sellers not only benefit from reduced costs (sales acquisition, advertising, infrastructure, etc.), access to online commerce, a large and new audience, and multiple distribution channels, but also from a beautiful showcase to promote their products and services to professionals.
Shoppers who are already accustomed to using marketplaces in their personal shopping process are more likely to buy on these platforms.
Buyers benefit from a wide product selection, a simplified purchasing process, price transparency to compare before making a purchase decision, reduced transaction costs, and a superior shopping experience that meets B2C e-commerce standards.
Like B2C, B2B e-commerce is now also driven by marketplaces. A study conducted by Roland Berger in 2017 revealed that the total sales of B2B e-commerce was $7.6 trillion, with 80% of the transactions occurring in the Asian region. According to Forrester’s latest forecast, B2B marketplaces will continue to grow in importance in 2020. And sellers will increasingly turn to digital product management to capitalize on this market potential. This trend may be even stronger in Europe, where enthusiasm for marketplaces is at an all-time high.
