B2B ecommerce is on the rise, and it’s Australia and New Zealand (ANZ) that are leading the charge when it comes to tech and meeting customer demands.
That’s the conclusion of an October 2023 survey published jointly by the B2B Ecommerce Association and SAP, a provider of ecommerce solutions and platforms. Serving as sponsors of the survey, the two companies revealed current priorities held by businesses in the B2B ecommerce space.
But it isn’t all good news. The survey also found that there are challenges to overcome – some of which could constrict future growth – if the ANZ is to maintain its position as a global B2B ecommerce leader.
There’s a lot of data to dig through. That’s where this summary comes in – it examines the main talking points and most important survey findings pulled from the report.
B2B Ecommerce Growth Rates Are Outpacing Total B2B Growth
Perhaps there’s no better indicator of the rapid rise of B2B ecommerce growth in the ANZ than the fact that the growth of revenue generated by online sales is outpacing that seen across all B2B sales techniques. The joint report points out that ecommerce sales rose by 18% between 2022 and 2023 – 7.3% more than the 10.7% growth experienced across all B2B sales channels.
That’s impressive.
However, there is a caveat.
Though the 18% growth is impressive, the actual dollar figures show that B2B ecommerce still has a way to go. Revenue from ecommerce rose to $28.84 billion from $24.44 billion between 2022 and 2023. Total B2B revenue – though it grew at a slower rate – still rose from $273.57 billion to $303.30 billion.
The Gap Between ANZ’s B2B Ecommerce Winners and Losers Will Grow
Though the survey showcased the growth of B2B ecommerce, it also highlighted a divide that’s developing between those who embrace online selling and those who don’t. Of the 124 B2B executives who were quizzed, 56% of those that generated at least a quarter of their revenue from B2B ecommerce believe themselves to be ahead of the pack.
But that pack isn’t necessarily trying to play catch up. Of the executives whose companies only made 10% of their revenue from B2B ecommerce, fewer than half (45%) say their upcoming digital plans are “ambitious” or designed to make them “market leaders.” Compare that to the executives of companies that get more than 10% of their revenue from ecommerce – 82% say their future plans are ambitious – and one thing is clear.
The winners are more likely to keep winning while the current losers will only fall further behind because they don’t prioritise online B2B sales.
Self-Service Channels Are Becoming Increasingly Important Revenue Streams
Building from this concept of “winners” and “losers” in B2B ecommerce, the winners are making a lot of money by selling online. The survey found that 60% of the ANZ companies quizzed generated at
least $50 million in sales via self-service digital channels over the past year. Better yet, more than a quarter (27%) said that their annual revenue exceeded $500 million.
Self-service online channels are the main sources of these online sales.
The survey discovered that exactly a third of the executives quizzed said that at least 25% of their revenue comes from self-service sales channels. That’s ahead of those that said at least a quarter of their sales come from call centres (16%) and in-person sales (32%).
Only branch-based sales channels proved more effective than online self-service channels.
Online Expansion Plans Vary Depending on the Company
The survey also asked respondents about their plans for B2B ecommerce plans over the next 18 months. Responses were clear – ANZ companies want to do more. Two in five said they planned to launch more ecommerce sites in regions they don’t currently serve online, with the same amount saying that launching a B2B buying portal for distributors is a big priority.
Interestingly, there’s also another divide between the current “winners” and “losers” in B2B ecommerce. Of those that generate more than $500 million per year in ecommerce revenue, 51.7% pointed to using the web to go cross-border as a major goal. By contrast, fewer than a quarter (20.5%) of companies with lower sales have similar plans.
On the service level, priorities shift from expansion to making sure that the surveyed companies are getting things right. Nearly two-thirds of respondents (65%) pointed to improving self-service mechanisms as a priority. Better order management and fulfilment were also high on the agenda, with 52% of respondents calling that a priority.
Challenges Still Need to Be Overcome
In addition to their varying prioritisations, the survey respondents also highlighted their biggest challenges when moving forward with B2B ecommerce. Finding the right people to maintain systems and websites was easily the biggest, with 35% deeming that a “Significant” challenge versus only 19% who said it’s no challenge.
Other potential issues were more technical. Data privacy was highlighted as a “Significant” challenge for 27% of businesses, with increasing website sophistication, upgrading legacy systems, and supply chain diversification also getting a mention.
Evolution is necessary to overcome these potential pitfalls. Again, the “winners” in the survey – those companies generating more than $500 million per year from B2B ecommerce – lead the charge. Over half (51.7%) say they’re looking to replace their current ecommerce systems to stay ahead of the pack, versus 27.7% of companies generating less than $500 million annually.
The Four Keys
The whitepaper wraps up with a set of four keys that SAP and the B2B Ecommerce Association believe are key to the ongoing success of B2B ecommerce in the ANZ:
1. Listen to the voice of your customer, but don’t ignore the opinions of technology partners and internal stakeholders.
2. Upgrading the customer experience by identifying bottlenecks so you create a more buyer-friendly experience.
3. Master the core technology early so you can focus on iterating on what you have rather than constantly breaking down and rebuilding.
4. “Okay” is not enough when your competitors are delivering experiences that your B2B customers love.
Think of these four keys as advice for those companies that have yet to properly prioritise B2B ecommerce. They highlight what the “winners” are doing well, along with showcasing what those who are yet to reveal the potential of ecommerce in their setups need to achieve in order to see growth.
