It’s 2024. 64% of B2B buyers are Millennial or Gen Z. That means they’re digitally savvy professionals accustomed to the trust, ease and convenience of Amazon, Klarna and contactless payments. For businesses like yours, this means one thing: you can’t afford to mess about with the clunky and complex nature of offline purchasing processes.
According to Digital Commerce 360, e-commerce has become the favoured sales channel among B2B sellers, with 35% rating it more effective than in-person sales (26%), video conferencing (12%) and email (10%). The humble telephone is preferred by just 8% of respondents.
Your B2B customers expect a digital experience that mirrors what they’re used to in their personal lives: effortless ordering, personalised offers and frictionless payments within self-serve and omnichannel environments. This year, we’ll see which B2B suppliers have what it takes to meet these demands.
Join us as we dive headfirst into the biggest trends and developments set to reshape the world of B2B e-commerce in 2024.
1. Changing buyer expectations force sellers to adapt
As Baby Boomers and Generation X join the ranks of the retired, a growing number of Millennials and Gen Zers are taking their place in the workforce – with significant knock-on effects for B2B trade.
This generational shift has created a widening gap between buyer expectations and what sellers are capable of delivering. The result? Merchants are struggling to reach, engage, win and retain the loyalty of new customers.
Often, these new, younger buyers have significantly higher standards when it comes to making business purchases. For example…
- Did we already mention their digital savviness? Given their readiness to embrace new technologies, younger buyers are more likely to use a self-service channel than their predecessors. This is putting pressure on traditional vendors to explore channels such as external marketplaces, app stores, and e-commerce websites.
- Ever sat with a Millennial or Gen Zer for more than an hour without them Googling something on their phone? Didn’t think so. These buyers conduct thorough research prior to purchasing, placing greater value on third party sources and user reviews.
- Believe it or not (we’re looking at you, Boomers), their high standards mean that Millennial and Gen Z buyers are quicker to express dissatisfaction with online purchasing processes. According to Forrester, 90% are dissatisfied with suppliers in at least one area, compared to 71% of older buyers.
The potent cocktail of significantly changing buyer behaviour and ongoing economic uncertainty means that B2B sellers must be prepared to adapt their strategies in order to be successful in 2024.
2. Optimising the omnichannel experience
Did you know that B2B buyers use around 10 channels during the purchasing journey?
During the COVID-19 pandemic, remote interactions became ‘the new normal’. Sellers were forced to increase their digital presence in order to meet buyers in the only place they were allowed to. Video conferencing tools like Zoom, automated chatbots, online marketplaces and social media took precedence over traditional, in-person sales.
Even though the height of the pandemic may seem like a distant memory now, buyers show no signs of returning to the offline buying journeys of yesteryear – at least, not entirely.
- According to McKinsey, 97% of B2B buyers are happy to make purchases in an end-to-end, digital self-serve model, with the vast majority comfortable spending $50K or more in one online transaction.
- Two-thirds of businesses are spending more online now than they did prior to the pandemic. Those spending more have increased the value of their orders by an average of 45%.
- Nearly 90% of buyers use digital channels as their primary method of identifying new suppliers, while 74% go online to evaluate new suppliers.
- 60% of web searches happen on a mobile device, and in some sectors like food and beverages, this reaches almost 75%.
What does all this mean? In 2024, buyers expect an omnichannel experience where they get consistency and high-level customer care wherever they interact with you – in a bricks and mortar store, over the phone or via digital platforms. It once again comes down to the omnichannel services they already get as consumers and an expectation for this to be replicated in their professional lives.
What can you do? Invest in the technology and work required to facilitate a seamless, customer-centric user experience across all channels. Streamline and connect operations across all the touchpoints you have with buyers, including customer service tools, marketing messaging, payment systems, fulfilment capabilities and buyer accounts.
3. The unstoppable rise of B2B marketplaces
Over the past few years, we’ve kept a close eye on the development of a new and highly effective sales channel in B2B. Whether you’re launching a company-owned platform or selling your products via a third party, marketplaces are the place to be in 2024.
Across several key B2B industries, marketplaces have emerged as ‘one-stop shop’ platforms where buyers can find, evaluate and purchase all the stock, materials, products and services they need to run their businesses. Across Europe alone, more than 400 B2B marketplaces are already operational (we recently partnered up with Point Nine to assess 200+ of the most prominent platforms), and this growth shows no sign of slowing.
For those merchants who build their own marketplace, the model offers an opportunity to become more agile, grow profits and experiment with new offerings – without the risk of developing and storing new products. And for those who choose to sell via a third party marketplace? The opportunity to sell to a large, engaged group of buyers without the usual acquisition costs.
Meanwhile, according to research by Oro, the benefits to buyers are manifold:
- 65% of businesses make 1% to 24% of their B2B purchases through B2B marketplaces.
- 72% say discovering new products or services has been a very significant benefit of purchasing through a B2B marketplace.
- 55% say faster purchasing and delivery has been a very significant benefit.
- 52% say greater vendor choice has been a very significant benefit.
B2B marketplaces are driving digitisation and buyer satisfaction across entire value chains in industries as varied as food and beverages, corporate travel, construction, automotive and healthcare.
But there’s still work to be done. Buyers agree that a lack of real-time stock information (58%) and inability to search information about products or services (58%) are the two most significant pain points associated with B2B marketplaces. Significantly, 51% were most dissatisfied by limited interactions between buyers and sellers, suggesting a need to balance the human element of selling with digital demands. Through 2024, marketplace operators hoping to win market share must double down on efforts to address these buyer expectations.
4. GenAI: more than a buzzword
You’ve probably heard of ChatGPT. You might have seen the AI-generated images of Pope Francis wearing a big white puffer jacket from last year. But did you know that Generative AI (GenAI) has some – how do we put this? – more useful applications than writing your Valentine’s Day card or creating a fake photo of one of the world’s most famous people…
In 2023, GenAI went mainstream – but its applications in e-commerce were limited. Yes, businesses in the B2B and B2C worlds have begun using it to create content for product pages and enhance imagery, but this is really just the tip of the iceberg. Here’s what we expect to see more of in 2024:
- Assessment of business processes practices in order to identify weaknesses and recommend improvements.
- Creation of personalised content and messaging based on individual buyer preferences and activity.
- Automation of inventory records, order processing and fulfilment in order to minimise errors and manual tasks.
- Analysis of real-time data in order to drive product development, build market insights and create personalised buyer experiences.
- Enhanced customer experience supported by virtual assistants and chatbots that help buyers find exactly what they’re looking for.
It’s still a slow burner. Forrester predicts that only around 25% of businesses will see any return on investment (ROI) from GenAI this year. But those who get it right before their competitors stand to reap the lion’s share of the rewards.
5. Payment choice, flexibility and security are top of mind
Lifted from a dusty operation hidden away in the corner of the back office, recent years have seen the payment experience become a core part of the e-commerce strategy of successful B2B sellers. But this practice is no longer just for the pioneering and the innovative. Instead, choice and flexibility at the checkout is a must-have for B2B sellers hoping for a successful 2024.
In practice, payment choice and flexibility can take many forms, but we boil it down to mean this: the right combination of payment terms and settlement methods.
Payment terms are all about when your buyer pays. Do they expect a trade account when they shop with you? Perhaps they require longer terms of 90 days or maybe they want the option to spread payment over 3 instalments? Meanwhile, settlement methods are how they pay. Consider the payment methods that are most convenient for your buyers and suitable for the purchases they’re making on your platform.
If you can’t get this right, your buyers won’t think twice about finding a supplier who can. 85% of B2B buyers would turn to a competitor if their supplier’s digital channel can’t keep up with their desires as a buyer.
Meanwhile, as fraudsters grow more sophisticated, data breaches are becoming commonplace. Over the next year, payment security will be a critical area of focus for B2B sellers. Generative AI, real time data and machine learning will help to prevent fraud and make credit scoring as accurate as possible, while security technologies like virtual card numbers and biometric authentication will become more widely adopted.
Summarised: our 2024 B2B e-commerce predictions
So, what have we learned? In 2024, the line between B2B and B2C will continue to blur as the expectations and demands of younger business buyers are increasingly influenced by their polished and personalised experiences as consumers. But by harnessing the power of marketplace platforms, checkout optimisation, generative AI and omnichannel sales, B2B sellers can reach, engage and win over the new generation of B2B business buyers.
Sounds like a challenge, right? That’s because it is. But we know that it’s a challenge you’re prepared to tackle head on, and your friends at Hokodo are never too far away to give a helping hand. Chat with a Payments Expert today to find out how flexible, instant payment terms can help your business to thrive in 2024.