BTB E-Commerce: Points to ConsiderMore and more marketers understand how a consumer-targeted Web site is supposed to work, but for business-to-business sites the most effective strategies look very different. In fact, practically every step in the BTB commerce process is unique to that realm.
First off, the BTB Web site delivers an entirely different experience to the buyer than consumer shopping because it's based on business needs rather than the casual shopping culture of browsing. The BTB buyer typically knows what he needs and seeks more information about the actual order in immediate product detail information, inventory and stock availability as well as timing of delivery and payment terms. The shopping interface most closely copies his real-life buying workflow and is tightly integrated with the supply information. More often, the business portal creates an electronic community to facilitate or extend existing relationships with suppliers.
Although they don't often make headlines like books or apparel, the numbers on BTB electronic commerce certainly are impressive. Forrester estimates that $43 billion in BTB e-commerce was carried out in 1998 and expects that to grow to $1.3 trillion by 2003, totaling 36 percent of all Internet sales.
The Intranet or Extranet differs from consumer portals like Yahoo or Lycos in that the user is interacting directly and even generating personalized content for his job functions. The business portal Web site becomes the most convenient source of information exchange for the community, streamlining routine business communications and cutting costs for many business processes. Business portals are more focused and targeted than consumer portals that put everything for everyone on the first page.
As an employee of the company with an Intranet, you can access human resources benefits, tally your vacation days, reserve a rental car for your business trip and order office supplies.
The BTB site helps forge internal relationships through bulletin boards, chat and e-mail, facilitating the potential for future revenue streams and meeting one-to-one customer needs.
Payment capabilities and security. Contrary to business-to-consumer payments, payment on BTB sites is more often completed with electronic purchase orders or direct electronic purchases. Digital cash (also called e-cash, smart cards, e-wallets and impact cards) and electronic purchase orders are all being tested and implemented on BTB sites where purchase cards are used as a cost-effective form of payment. Employees are issued cards with company-approved spending limits for the allowable amount corresponding to their purchasing authority.
Marketing applications. Marketing for BTB companies is very different from marketing to individual consumers; it requires different information where availability ranks higher than price. Each niche industry has different ways of marketing their products to the individual trading communities and targeted customer.
To lure traffic to a BTB e-commerce site or business portal community, you must provide content and interactivity specialized for that community's interests, along with an assertive marketing campaign that includes newsletters, seminars and an e-mail program. Professionals can interact through chat and live events, which avail the community of new business opportunities for special events marketing. Content is typically community-generated or syndicated from other sites and wire services.
For communication and interactivity, the BTB site may provide a personalized career area for internal job postings, a direct marketplace, an auction center to sell off surplus supplies, and a place to generate leads, mini-storefronts or catalogs for each vendor or supplier. The site can expand communication through distance learning, surveys, video conferencing, telephony, contests and software distribution.
A company can recoup some costs and drive revenue through the Intranet or Extranet with sales of special promotional areas, targeted advertising and sponsorships. Currently, advertising and sponsorships generate an average of 95 percent of revenue, but that should decrease to about 70 percent when revenue streams develop from other business models. These might include auctions, virtual trade shows, subscriptions sales, lead-generation fees or posted requests for proposals and revenue share commissions.
Intuit advertises its Quicken product on Fleet Bank's customer Extranet. Dell, Cisco, Motorola, Levi's and Amazon have opened the doors for well-branded sites to share customers and offer cross-selling, distribution channel opportunities and new market development in the BTB space.
Many of these business portals are seeking ways to introduce procurement solutions to generate transaction fees, user fees and sales commissions. According to T. Craig Barry, director of B-commerce development at Xceed Interactive, providing suppliers with product branding and positioning opportunities will be an important value proposition to enable buyers to differentiate and access the service attributes of the commodities offered within their trading portal community.
As Federal and state governments seek to automate the procurement process, suppliers will be given unique opportunities to develop online strategies reaching desktop procurement buyers through advertising and revenue-share models. This also provides a great opportunity for small and medium-sized suppliers to get online and gain market share, and for other firms to advertise to this type of customer.
Advertising in BTB. Targeting an Intranet can truly be worth the effort in accessing your target audience. Presence on this type of site provides more effective coverage than any other direct marketing program. Advertisements are often regarded as company endorsements for supported products and services. Additionally, you will have the opportunity to send special offers for employees or target your message directly to the customers' established needs. The banners and creative must relate specifically to the targeted placement on the BTB site, leveraging information gained from one-to-one marketing programs.
Many employees do not have access to the Internet and rely solely on their company Intranet. Extranet marketing is a great way to reach large buyers and suppliers if your product/service is BTB-oriented.
Sandra Gassmann is the owner of Sage Marketing & Consulting Inc, New York, a Net marketing strategies firm. Her e-mail address is firstname.lastname@example.org.