The Consumerization of B2B: the digital B2B buyer

Digital is a ubiquitous term in the consumer space that is used to describe everything from products, experiences, channels to the strategic transformation of organisations. Looking beyond the marketplace, the European Commission announced in April 2014 its aspiration for a ‘digital society’ as part of its Europe 2020 strategy, embedding digital as the primary axis around which citizens will interact with each other and their government.1   In the B2B space, however, the drive for greater digitisation has only just begun to ripple with the consumerization of the B2B buyer. This article will outline the evolution of buying preferences as well as provide some best practice responses from B2B organisations around the world.

We are now firmly in the age of the ‘digital omnivore’ with Deloitte’s 2014 Media Consumer Survey identifying 53% of Australians as multi-platform consumers of digital content – masters of their smartphone, tablet and desktop computers. This has not been confined to Gen Y, with Matures (67+) and Boomers (48 – 66) seeing the fastest rate of compound annual growth of tablet adoption. The expectation of a seamless customer experience across all channels has flowed through to the B2B buyer who may interact with a business in person, over the phone, via the web, on their mobile or through social media. Due to the complexity of B2B transactions, the need for integration of human and digital channels is more pronounced. Moreover, spoilt with the convenience of self-service in the consumer space, B2B buyers are now on the hunt for a superior sales and self-service experience.

Besides the convenience of digital, it is also becoming an increasingly influential marketing channel. For consumers, online reviews and social media can provide uniquely relevant insights into each buying decision, making them just as, if not more, influential than print advertising.  For businesses, they have never had as much access to information about consumers as they do now with the rise of big data and the Internet of Things. Sales teams are now armed with a tremendous arsenal with which to launch targeted offers. In the B2B world, the value of greater digital engagement is evident in research that showed the majority of a buyer’s decision was already completed before they even talk to a vendor. With sales volumes smaller, contract values larger and lead times longer for B2B transactions, insight-driven conversations with customers enabled by the digital channel are fast becoming a new source of competitive advantage.

How are B2B organisations responding?

A scan of global best practices in the B2B market reveals three themes guiding investment across sales enablement, self-service enablement and product innovation.

Table 1

Sales enablement

Best practice organisations are equipping their sales professionals with access to real-time Customer Relationship Management (CRM) data and business intelligence to drive more insightful conversations and increase the conversion of sales opportunities. Overlay that with decision analytics to provide contextual information together with social listening capabilities and sales professionals are able to maximise their interactions with the customer, whether they take place online or offline.

A leading communications provider redefined its small-to-medium sized enterprise offerings by using a data analytics solution to aggregate external and internal data sources to create a 360 degree view of customers. This resulted in new ‘microsegments’ – delivering a 25% increase in revenue through more customised pricing and reducing the time required to generate leads lists by two thirds. The data was made accessible to sales reps and managers in real-time, freeing up time otherwise spent understanding the customer and applying it to identifying at-risk customers and up-sell opportunities.

Self-service enablement

Leading players integrate self-service channels with the rest of the service ecosystem, enabling customer data captured in one channel to be reflected real-time in all others – transforming reactive service transactions into proactive customer conversations. This has accompanied a simplification and personalisation of options for customers to discover, understand and purchase products within their existing contractual arrangements. We’ve also seen a greater emphasis on utilising intuitive design and the adoption of visualisation tools to provide complex usage data back to the customer.

A communications and networking company was heavily reliant on manual touch points to service B2B customers driven by the downstream impacts of having over-customisation in their front-end processes. To address this, they rolled out an integrated digital solution that deployed customer segmentation logic and automatic validation processes between the front-end and back-end to deliver $10M+ of savings in operational efficiencies per year.

Product innovation

B2B companies often operate within a complex ecosystem of providers – an appropriate arena to improve partner collaboration and co-creation. Industry leaders are ditching the monotony of email in favour of collaboration platforms and enterprise social networks to encourage idea generation and unlock products and services innovation. Partnerships are being struck and APIs being exposed to engage external parties and automate the service experience for customers while exploring new revenue opportunities.

A global conglomerate partnered with an online crowd-sourcing platform to develop consumer products based on hundreds of patents originally intended only for industrial application. This created new revenue streams in markets that were previously overlooked.

The pace of consumerization in the B2B space is likely to continue to accelerate. A more complex and multi-layered sales and service process is often cited as a reason for delaying investment in digital capabilities (“no-one’s going to buy a multi-million dollar solution online, right?”). However this complexity is a compelling reason for empowering sales professionals with the digital tools and insights they need to personalise the solution they propose to their customers. While the effects of a deferral of investment may, in the short run, be mitigated by the longer lead times and customer lifecycles of B2B customers, it has become imperative that organisations use this as an opportunity to assess the speed at which digital will influence buying behaviour in their market and make some considered choices – do they have time to explore the full spectrum of opportunities digital can provide or are they already being disrupted and need to adapt to emerging customer demand and competitive threats? Are they being proactive in helping customers navigate the complexity of their B2B transactions? Are they leveraging the game changing opportunity for APIs to connect with the broader B2B ecosystem and increase agility and innovation for customers and service providers alike?

 

[1] For more information – refer to: http://ec.europa.eu/digital-agenda/en/digital-society

[2] Application Programming Interfaces (APIs) allow individuals to use predefined instructions or functions to interact with a set of data or system, instead of creating the code or query from scratch


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