Thirty per cent of corporate customers now start their e-commerce purchases on sites owned by consumer giants Amazon and Google rather than the 22 per cent who turn first to independent supplier portals, according to research that will be released Wednesday by Avionos.
The Chicago-based digital commerce marketing firm’s 2019 report, titled Positioning B2B Commerce In A Digital First World, is based on a survey of approximately 150 buyers across the U.S. While contract pricing was cited as the top consideration when making e-commerce purchases from suppliers by 46 per cent of those polled, convenient ordering and ease of use came both in close behind at 43 per cent. Surprisingly, things like the ability to view order status or history came in last out of the top five at 41 per cent, just after “reputable brand name” at 42 per cent.
While Avionos obviously has a vested interest in presenting data that confirms the need for its services, the research showed how quickly B2B buyers are turning to channels owned by the same tech giants through which they might purchase a TV set or books in their personal lives.
“New competitors like Amazon Business are taking market share away from suppliers, using competitive pricing to get shoppers in the door, and robust, innovative eCommerce experiences to impress and win business,” the report said, adding that younger B2B buyers under 35 were more likely to choose Amazon Business as their preferred place to start making purchases for their companies. “The stakes for delivering cohesive, seamless eCommerce experiences are high all around, and they will become even greater as younger buyers earn more control over their organizations’ budgets and purchasing decisions.”
Avionos is not the only one charting the growth prospects for Amazon Business. In a research note published last month, Bank of America analyst Justin Post published a note forecasting that Amazon Business will capture 10 percent of the B2B market in the U.S. and 5 percent of the international B2B market by 2021.
“B2B has many more hurdles to adoption given the complex (and often offline) procurement processes, but Amazon is driving steady adoption,” Post’s note read. “The company is solving procurement bottlenecks with new features, and we think Amazon is well positioned in the category with an active marketplace and same-day fulfilment capabilities. Long-term, B2B will be an important driver of retail sales growth.”
In fact, low prices may not be key to the increased competition from the likes of Amazon Business. The Avionos research showed 74 per cent of B2B buyers would choose a supplier with “excellent e-commerce and customer portal capabilities” even if the supplier’s product was moderately higher priced than a competitor’s. That shot up to 91 per cent among the younger survey respondents.