eBook: the modern merchant model
Chapter 1: The digitalization trend in B2B e-commerce
The digitalization trend in B2B e-commerce
In recent years, the trend toward digitalization in the retail sector has been steadily increasing. In this chapter, we’ll be focusing on digital business-to-business (B2B) commerce by asking: What factors have driven the payment options in B2B e-commerce for direct (merchant-owned websites) and indirect (marketplaces) B2B e-commerce?
Arguably the biggest game changer has been the consumerization of business-to-consumer (B2C) purchasing habits merging with the B2B ecosystem – a trend that will only increase in the coming years.
Why?
Because of the changing demographics: Millennials and Gen Z make up over 60% of the global workforce.4 Both groups form the majority of today’s online B2C shoppers. Both Millennials and Gen Z use e-commerce to shop faster, get the best prices and discount offers, read customer reviews, and benefit from fast shipping.
> 60% of the workforce consists of Millennials and Gen Z
This is to say, external factors are not changing B2B purchasing, but rather the personas of the employees who manage
procurement and purchasing processes today are changing and driving this trend.
B2B e-commerce as a whole is growing fast and will further accelerate its growth with a compound annual growth rate (CAGR) of 16.5% between 2022 and 2026.4
Procure-to-pay defined
The coordinated process between the purchasing department and accounts payable to fulfill a need for goods or services in a timely manner and at a reasonable price.
There is no doubt that the pandemic has led to on-site procure-to-pay processes being handled digitally and in a decentralized manner. But it won’t stop there: Forecasts expect B2B e-commerce volumes to exceed the US$40 trillion mark in 2026.
Will this growth simply be initiated by buyers? Not really. Suppliers are increasingly digitalizing their points of sales in the B2B space.
- A survey by Vaimo found that, in 2022, 41% of surveyed B2B distributors plan to modernize their digital presence.4
- This is a sensible strategy because, according to Forrester Research, 74% of B2B buyers today research online before making a purchase.
Buyers and vendors on both sides of the B2B ecosystem are taking proactive steps to enhance their digital presence, driving this growth.4
Did you know?
An estimated 80% of B2B buyers today are looking for a similar purchasing experience to that found on B2C websites.4
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