The Guide to B2B2X Ecommerce
7 Key Factors to Leveraging Ecommerce to Scale and Expand Existing Channels
As merchants continually fight for market share there will always be new opportunities to leverage digital commerce channels. Manufacturers, distributors, and retailers that focus on evolving will be best prepared to handle any future market challenges. Use this guide to drive results in B2B2X ecommerce programs.
This Guide to B2B2X Ecommerce covers the following. Use the links below to jump ahead to relevant sections.
Part 1: What is B2B2X?
Part 2: 7 Key Considerations for Launching and Scaling B2B2X
Part 3: B2B2X Customer Stories
What is B2B2X?
B2B2X is a business model that allows business 1 (B1) to use technology to sell its products through business 2 (B2), which has existing relationships with buyers as end-users of the product(s). ( Digital Commerce 360) Common examples of B2B2X include franchises, manufacturers, and wholesalers that support dealer networks, and white-label business models.
7 Key Considerations When Launching a B2B2X Business Model
The ideal business scenario is when B1 wants to solve a problem for buyers but does not want to enter or manage the same business as B2. B1 then enables B2 as a customer or channel with both parties benefiting.
For instance, if a uniform manufacturer wants to extend its market reach to schools but doesn’t want to manage individual team stores, it can empower a school administrator or coach with ecommerce technology to serve buyers directly. Coaches want to provide the right uniforms and equipment for the team but likely don’t want to become experts at managing the intricacies of ecommerce, such as product data and inventory. Finding technology to support B1 and B2 while providing an optimal experience for buyers is critical to scaling B2B2X business models.
The following list of considerations provides context on what to expect as a business begins to set requirements and processes for a B2B2X distribution channel program.
1. Evaluate Digital Maturity
Segmenting distribution partners by digital maturity and ecommerce capabilities will provide a target list for a B2B2X ecommerce program. Those dealers and distributors with a lower level of digital maturity often do not have the resources internally to support an ecommerce sales channel to end-customers. Being at the top of the supply chain provides manufacturers and master distributors with the opportunity to provide the technology benefit of ecommerce to distribution partners in this context.
2. Identify Potential Channel Conflicts
Manufacturers and master distributors typically have exclusive relationships with distribution partners. This can create channel conflict issues when these merchants look to a direct-to-consumer (D2C) model for ecommerce. Channel conflict issues resulting from disintermediation can be prevented by enabling distribution partners to provide greater value to buyers with a B2B2X ecommerce model.
Channel
conflicts are usually obvious with B2C and D2C ecommerce models as the
target customer is the end buyer in both. However, in B2B ecommerce, it
can be overlooked that business accounts may actually be a distribution
partner’s buyer.
To
avoid such challenges, working with distribution partners to serve
buyers with a B2B2X ecommerce model can keep all stakeholders happy.
When B1 sets up a storefront on behalf of B2, B1 maintains control of
product information and also gains access to customer data, with B2
still being compensated for sales to the buyer. Znode allows merchants
to set up unlimited stores, including stores for B2, with multi-store management. Additionally, Znode’s B Stores allow B2 to self-serve and manage its own store, making it a great option for:
3. Data Sharing, Management, and Accessibility
Data accessibility presents another challenge for manufacturers, wholesalers, and master distributors. The last reseller of the product traditionally holds the customer data. Data management in this manner becomes a major obstacle for manufacturers looking to improve the product, improve the customer experience, or build a relationship with the customer.
A B2B2X business model requires more advanced digital maturity from a merchant than B2B. Having API-accessible data sources is almost a minimum to pass pricing, inventory, and customer data back and forth between B1 and B2. Otherwise, the only true way to achieve data transparency between B1 and B2 would be an ecommerce platform that allows both parties control.
Znode’s B Stores allow both parties access to product information, customer records, pricing, and promotions. Additional shared data types can include inventory and warehouses, loyalty programs, and more. Znode provides the data and control to keep B1 and B2 happy and mutually growing. As manufacturers gain access to buyer data for a B2B2X ecommerce model managed with Znode, data can be collected to better understand the user experience. Manufacturers, suppliers, and wholesalers can leverage Znode’s B Stores to enable channels and grow digital sales while maintaining control and visibility into customer data, product information, and more.
4. Supply-Chain Visibility
Additional optimization allows B1 to provide held inventory of products to B2 and buyers while also providing on-hand inventory for B2. Znode’s warehouse management systems allow administrators access to multiple warehouses to supply a single ecommerce store so buyers can easily see which products are in stock based on real-time data.
5. Brand Consistency
In B2B ecommerce, manufacturers desire brand control. The B2B2X business model solves this by providing brand control to B1, while allowing B2 to manage its distributor brand. Znode’s B Stores allow B2 to leverage templates to launch a shopping experience that meets the distributor’s brand guidelines agreed upon with B1.
6. Product Information
Product complexity can be a limitation to applying the B2B2X business model. Some product lines are so complex, and demand such high levels of technical support that selling them directly to a buyer is not viable. Consider the chemical industry, which can be highly regulated and mandates certifications by product purchasers before sales are allowed.
Universal product information alignment is critical in successfully implementing B2B2X regardless of product complexity. Inaccurate product information is often a challenge when selling through distribution partners.
B Stores allow manufacturers, distributors, and retailers to curate digital catalogs using the native ecommerce PIM system. Those catalogs can then be shared with the appropriate B stores. This level of product information control easily aligns B1 and B2 and ensures buyers see the most accurate product information.
7. Customer Experience & Support
When B2B2X business models have the right technology all parties benefit greatly. With Znode’s B Stores, shoppers access a curated experience with the exact products, pricing, and functionality needed to make a purchase, as well as access to ongoing support such as warranty information.
The impact of these seven factors depends greatly on the technology utilized to enable the B2B2X model. Znode was built for B2B2X with native multi-store management, catalog and data management, and self-serve stores for the middle B in B2B2X.
B2B2X Ecommerce Programs and Use Cases
Hyster-Yale Group Lifts B2B2B Ecommerce
Hyster-Yale Group, a leading, globally integrated, full-line lift truck manufacturer, wanted to digitally support buyers and an expansive dealer network that serves both Hyster and Yale brands. With a combined catalog of over one million SKUs, Hyster-Yale Group sought an enterprise ecommerce platform that could scale globally. The manufacturer wanted to centralize brand selection, product identification, order placement, and dealer fulfillment in one platform for a unified shopping experience. This experience mandated B2B2X ecommerce capabilities and a change to its technology stack.
With Znode, Hyster Yale Group was able to offer the centralized ecommerce experience for SKU selection, purchasing and order routing to dealers addressing the B2B2X ecommerce model. Watch the webinar replay to learn more about the Hyster Yale Group story.
Staples Promotional Products Champions B2B2X Ecommerce
Staples Promotional Products required a way to merge its four legacy ecommerce systems into one centralized and flexible ecommerce environment. With a rapidly growing B2B2B ecommerce strategy that included setting up storefronts on behalf of B2 sellers, Staples Promotional Products was looking to continue its digital transformation.
Znode enabled Staples Promotional Products to set up stores on behalf of buyers. Znode’s multi-store functionality provides the foundation for the distributor’s B2B2B ecommerce business model. Check out the full Staples Promotional Products customer story here.