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Whitepaper: e-Commerce Strategies for B2B Sales and Marketing

November 22, 2010 Leave a comment

B2B e-commerce strategyAfter the dot-com era, B2B e-Commerce has once again gained strong interest among businesses and software vendors over the last 3-5 years and this time the difference is that the Internet is viewed as the foundation platform – not a channel in silo – for all sales and marketing efforts.

The key drivers behind this shift include B2C/B2B convergence, market expansion through business model innovation (e.g. serving the long-tail via web channel), the need to build online brand presence. The result is B2B firms are rethinking their e-business strategy to leverage the Internet to deliver a streamlined, buyer-centric and engaging experience that enables buyers to efficiently interact and transact with the brand and at the same time makes it possible for sellers to reduce administrative costs, increase sales and improve brand loyalty.

This whitepaper discusses B2B e-Commerce drivers and strategies to inspire new ideas for the digital transformation of your business, customer examples, and how IBM WebSphere Commerce solution can help to execute on the strategy. Below is the list of key topics discussed in this whitepaper:

  • B2B e-Commerce Key Drivers
  • Next-generation B2B e-Commerce Strategy
    1. Operational automation
    2. Buyer-centric marketing
    3. Rich customer experience
  • Four steps to implementing next-generation B2B e-Commerce strategy
    1. Online order taking
    2. One-to-one marketing
    3. Online order making
    4. Community marketing
  • IBM WebSphere Commerce B2B Solution
    • Catalog, Contracts, and Org. Modeling
    • Marketing, Merchandising and Multi-sites
    • Web 2.0 store and Community support

While this paper discusses WebSphere Commerce solution, the recent acquisition of Sterling Commerce further enhances the solution to meet advanced business requirements.

Thanks to the customer and business community that helped to shape my thinking and special thanks to J.J.Keller, NewPig, and Wasserstrom for sharing their experience in this paper.

As always, your questions and comments are most welcome.

Note: The postings on this site are my own and don’t necessarily represent IBM’s positions, strategies or opinions.

2010 B2B e-Commerce Trends

April 20, 2010 6 comments


During this past tax day many restaurants offered freebies like free samples and discounts to promote new products and attract customers as the industry starts to recover from the most challenging period of economic downturn. While I couldn’t find any manufacturer or distributor doing the same, I did find lots of evidence that manufacturers, distributors, and other B2B industries are focusing on e-commerce strategies to position for the economic upturn.

According to the Managing Automation’s recent article on Internet Is Engine of Manufacturers’ Growth, Study Says,

“The industrial manufacturing sector is leading the U.S. economy out of the recession on the strength of a number of key growth strategies … selling into new industries, innovating to develop new products and services, and leveraging the Internet to pick up the pace of business are the top growth drivers. Of the 1,176 respondents to the survey, 71% said their online strategy would be important or critical. The Internet, it turns out, has taken center stage in this recovery.

In another study by BtoB Magazine on 2010 Outlook: Marketing Priorities and Plans,

“…within online marketing, the top areas that will see spending increases include Web site development (70.7% plan increases), e-mail marketing (68.6%), search marketing (62.3%), social media (60.3%)”

Finally, AMR International study on “Online B2B Marketing in the United States: Assessment and Forecast to 2010” reports an increasing focus on online channel (compared to offline) for lead generation and customer retention.

All the above studies and statistics are pointing towards an essential shift to the online channel. To facilitate this shift the B2B companies need to embrace the following five B2B e-commerce trends:

Interestingly, the recent Forrester report Trends 2010: eCommerce Platform and Technology discussed three trends and one of which is around B2B eCommerce,

“business-to-business (B2B) eCommerce will emerge as a growing and critical component of the overall sales landscape. eBusiness leaders will turn to their eCommerce solution providers to help them maximize these opportunities and drive their customer experience and businesses forward”.

Definitely there is a lot of data and agreement on the importance of B2B e-commerce. May be 2010 will be the new inflection point for B2B e-commerce. What are your thoughts?

Note: The above posting is my own and don’t necessarily represent positions, strategies or opinions of IBM or other companies

Three elements of B2B online transformation

March 31, 2010 1 comment

The 2009 Global CRM Leaders Study reveals that 46% of executives view delivering effective online customer experience as a biggest challenge. For many Business-to-Business (B2B) companies this mean shifting from the traditional phone/fax/e-mail channel to the Internet/web channel that delivers rich, contextual, and buyer-centric experience. This is a significant transformation as the familiar human aspect of business transactions will now be replaced by an online experience.

This post offers three elements that B2B companies should focus on for a successful online transformation.

  • Operational Automation

  • The goal of this first element is to automate all sales administration tasks by using the online channel to approve buyer registration, deliver buyer-specific online catalog, display contract-based price, and automatically enforce other contractual terms and conditions. The automation helps to reduce operational costs and relieve sales personnel from manual low value processes to focus on value selling.

  • Buyer-centric Marketing

  • A recent article “Three B2B Value-Proposition Rules That Create Preference, Not Just Parity” at MarketingProfs mentions that,

    In fact, you need to inject emotion into your messaging. Even in B2B, you have to get decision makers emotionally invested in the decision. They will justify with facts, but they will buy based on how your solution will influence their success or failure in their jobs.

    Buyer-centric marketing helps to influence B2B buyers by applying proven B2C online marketing techniques to B2B marketing. The first step includes using advertisement banners, product recommendations, and marketing promotions. Then B2B companies should develop an “ongoing dialog” with buyers by capturing triggers (e.g. page views/clicks, abandoned shop cart, or any time-based events) and respond with actions (e.g. promotional offer, customer landing page, or a mobile SMS message). This idea of nurturing an “ongoing dialog” helps to deliver a virtual salesperson experience, keep the buyers engaged with the brand, and improve sales.

  • Rich Online Experience

  • The final element is about simplifying processes, increasing customer satisfaction, and building brand loyalty by delivering personalized experiences based on buyer persona and buyer organization (e.g. tier 1, tier 2 partners). B2B e-commerce sites are leveraging Rich Internet Application (RIA) technologies to deliver an intuitive shopping experience and offers tools like a mini-shopping cart and quick info pop-up to streamline the checkout process. Buyers should be able to easily compare products, add items to shopping cart, and checkout, without leaving the current page. To enable community interaction, the sites should support product ratings & reviews, forums, and blogs.

    These three elements will guide B2B companies through a successful online transformation journey, and help create streamlined business processes, improve online sales, and build brand differentiation.

    Note: The above posting is my own and don’t necessarily represent positions, strategies or opinions of IBM or other companies

    How everyday moments inspire business model innovation?

    March 15, 2010 1 comment

    When thinking about business model innovation, I see interesting examples in my day-to-day life. Last month when we picked up our daughter from day care, we were reminded about her upcoming photo session. So we dressed her up in her favorite pink dress the next day and went on the day as usual. But after a week, to our surprise, our daughter came home with 10 different professional photos in various sizes. Along with the options, the package had several pricing options from $25 to $200.

    When I reflected on this experience, I realized even in this everyday moment, there was a smart b2B2C business model behind it; the photo studio (a small business) is partnering with a number of day cares (a big Business) in the local area to reach new customers and offering various options to meet different price points for consumers.

    Though this appears obvious, there are three simple, but important takeaways:

    1. Don’t wait for customers to come to you
      Go where the customers gather! The studio did this by going to the day care where they can find the perfect audience – parents and children.
    2. Build emotional connection
      The studio found a way to build on the emotional connection between parents and children and deliver a product offering for this target audience. Similarly, every business must find a way to build emotional connection with the brand because emotions and relationships are equally important as the intrinsic value of the product.
    3. Make it easy to transact
      This entire experience with day care and studio was seamless to us. We didn’t have to arrange a photo shoot with the studio, transport the child or deal with a separate bill. In fact, we did not have to interact with the studio and the day care included the charges in our monthly bill. As a parent, there a few moments that is as seamless as this photo session.

    For B2B companies, these takeaways would translate to 1) automating sales operation processes for seamless interaction with other businesses 2) buyer-centric marketing to build emotional connection and 3) delivering a rich experience to become easy to do business with – the three elements of Next-generation B2B e-commerce.

    A relatable example from the retail industry is JCWhitney.com selling automotive parts through marketplace at Sears.com. According to the Internet Retailer,

    “Last September Whitney began supplying Sears.com with more than 130,000 items for its parts and accessories inventory for cars, trucks, motorcycles and other vehicles. Sears will process all transactions, but order fulfillment and customer service will be the responsibility of individual retailers.”

    So now, for example, you can buy a Rotor for 1985 Ford Ranger from Sears.com which is typically sold in auto parts stores like JC Whitney and others.

    Enabling your business model innovation
    In today’s increasingly complex environment, business model innovation can be critical to organizational success. For strategies and practical guidance on business model innovation refer to the IBM Institute for Business Value study “Seizing the advantage: When and how to innovate your business model”. IBM WebSphere Commerce solution helps B2B companies to execute a variety of business models including B2B direct, Value chain, and Partner hosting. Examples include Wasserstrom selling directly to both businesses and consumers and Mazda selling through dealers using the value chain business model.

    Note: The above posting is my own and don’t necessarily represent positions, strategies or opinions of IBM or other companies

    Wasserstrom takes commercial kitchen (products) to consumer market

    February 25, 2010 3 comments

    Market expansion to B2B sellers can be challenging as the buyer community tends to be small and finite (as opposed to B2C selling where theoretically the entire world could be your market). Typically sellers expand their market by adding adjacent product offerings (e.g. after-sales maintenance, accessories) or by serving new geographies. But if your industry serves consumer-oriented goods (especially Automotive, CPG, and Industrial Supplies) then one of the best ways to expand your market is to serve the consumer market in addition to serving other businesses. Though this seems obvious many B2B sellers that carry consumer-oriented products have little or no focus on the consumer market. But Wasserstrom, a 108 year old foodservice supplier, is not one among them!

    Wasserstrom expands into consumer market

    Early this week, I spoke with Brad Wasserstrom, President of The Wasserstrom Company and Dale Edman Assistant VP of e-commerce to understand their online strategy (Thanks to both!). Wasserstrom serves over 10 different commercial markets including local and chain restaurants, public facilities and stores. They sell every thing from dinner plates to dishwashers and the wide range of product assortment is a key strength. With the launch of their new e-commerce site built on IBM WebSphere Commerce they are able to serve both B2B and B2C segments from a single platform and open up over 160,000 products to the consumer market. Now I know where to buy (http://www.wasserstrom.com) the high-quality tableware and glassware that we find in our favorite restaurants.

    What makes Wasserstrom.com successful?

    When I asked what made their online business successful, Brad Wasserstrom mentioned, “Delivering distinct personalized experience to our national account customers and public customers from a single site is a key factor and the other is the depth and breadth of product offerings”. “To improve our brand awareness among the public we do online and search marketing and once we get the shopper to our site we provide resources and tools that will make them comfortable to buy from us”. Dale Edman added, “We do several things on the site including recommendations, cross/up-sell of accessories and related product patterns, ratings and reviews to help increase our wallet share”.

    What does it mean for B2B sellers?

    I suggest B2B sellers to take a closer look at the product offerings and its application/usage patterns to identify specific product categories that is of interest to the consumer market. If you do find then it could be a great opportunity to expand your market and I’ll be interested in hearing about it!

    Note: The above posting is my own and don’t necessarily represent IBM’s or Wasserstrom’s positions, strategies or opinions

    Categories: B2C, Marketing, Sales Tags:

    Mazda wins CIO award for e-commerce site

    February 6, 2010 4 comments

    Congratulations to Mazda NA Operations on winning the prestigious 2009 CIO 100 award for transforming business through innovation! Now, Car dealerships can deploy customized websites in 15 minutes!

    Channel conflict is usually an issue for manufacturers as intermediaries like distributors, and resellers shield manufacturers from directly reaching end consumers. In automotive industry the dealers essentially represent the manufacturer brand and consumers typically experience the brand through dealers. While this model works well for initial purchase the consumer’s brand loyalty towards the manufacturer diminishes over time. For instance, how many of us insist on using OEM replacement parts on a 5-year old car? This means lost after-sales business for the manufacturer.

    Mazda took an innovative approach to solve channel conflict by transforming their business model by providing individual dealers with a co-branded e-commerce site that sells OEM accessories to consumers. The solution allows Mazda to “touch” the end consumer directly while enabling dealers to leverage Mazda accessories catalog and IT infrastructure. It’s a win-win situation!

    This B2B2C solution is built using IBM WebSphere Commerce platform that allows Mazda to host 100’s of individual sites for the dealers. The dealers use rich user interface to personalize their site by uploading their own logo and displaying advertisement banners. No site design or programming required on the dealer side. See this case study for further details.

    Per CIO.com, “Mazda projects the tool will lead to a 35 percent increase in accessory sales.” This is a perfect example of B2B 2.0 concept where the manufacturer is able to increase top-line revenue with a new sales channel and build brand loyalty with the consumer –- all without upsetting the distribution channel.

    So, how do you handle channel conflict in your business?

    Note: The above posting is my own and don’t necessarily represent IBM’s or Mazda’s positions, strategies or opinions.

    Categories: B2B e-commerce 2.0, Sales Tags: