B2B (business-to-business) is the exchange of goods and services between two businesses rather than a business and a consumer. B2B facilitates the transfer of raw materials, parts and components from which additional profit is derived, through manufacturing or final sales to consumers.

B2B marketing techniques rely on the same basic principles as consumer marketing, but are executed in a unique way. While consumers choose products based not only on price but on popularity, status, and other emotional triggers, B2B buyers make decisions on price and profit potential alone.

An example of a traditional B2B market is automobile manufacturing. A vehicle’s components are generally manufactured by different companies, and the auto manufacturer purchases these parts independently. The tires, hoses, batteries and electronics may be manufactured by separate companies, and then are sold directly to the automobile manufacturer. The products themselves do not end up in the hands of consumers, though often, the end product of the purchasing business does. Because so many small transactions result in one large business-to-consumer sale, B2B companies tend to be high volume.

A B2B marketer can effectively put their product or service into the right hands by positioning their offering in an exciting manner, understanding the customer’s needs, and proposing the right solutions to combine the two. It is important for B2B marketers to understand their clients’ needs before implementing any marketing or advertising tactic. In consumer marketing, an effective advertisement can be blasted out over wide channels, and a percentage of consumers will be driven to buy the product. However, since B2B marketing is so much more specialized, marketers run the risk of alienating their specific prospective candidates if they do not pay close attention to their needs before tailoring their services to those needs.

B2B E-commerce, or e-biz, is a slightly more evolved version of commerce. This type involves the electronic exchange of business documents between businesses for the purpose of conducting commerce. Trading partners within supply-chain networks are typical participants, as they exchange electronic documents in support of the purchasing of goods and services. B2B E-commerce is used for contract manufacturing, customs declarations, global trade compliance, order management and supply-chain logistics. By using B2B E-commerce, companies can improve communications among partners and enhance the purchasing experience from business to business.

With E-commerce retail giants like amazon and staples launching B2B E-commerce portals in India, B2B E-commerce in certainly climbing up the trend ladder. The aim behind setting up such portals is the ease and comfort with which small business and house run business can obtain supplies. Amazon also payment through its one platform payment portal and also has free door delivery.

B2B E-commerce in India is in line with the government’s digital growth plans. Online B2B can be a wide platform with lots of scope however there are many hurdles it faces. Apart from policy ambiguity, B2B works on thin margins, hence, there are concerns about its scale and operation. In India, there will also be a taxation hurdle which exists for interstate transactions. The biggest barrier that will be faced when B2B E-commerce takes over the market will be trust and flexibility. Brand will make a big difference and will also determine how successful the venture is. Another factor that will also have its effect felt is flexibility of the business model that the organization has in place. While deviating into B2B E-commerce , companies need to keep in mind that they need to control a lot of sub-bodies like pricing, sales, channel and distribution and hence should take help from a specialized sales body while developing the online portal.

The most important aspect of E-commerce is identifying your customer segment and having a strategic plan to ensure appropriate proposition to each segment. The company should also have its long term goals clear.

After considering the essentials for a successful B2B E-commerce venture, the likelihood of an E-commerce era in India is high. Firstly, because the government will be for the proposal as it is part of their digital growth plan and secondly because it proves to be beneficial to both organizations. It will help cut overhead costs and other variable costs while at the same time making the process of obtaining the goods easier and faster. India being a developing country is prone to such change and evolution. Though some critics may say that this will reduce the employment rate in India, you can’t expect development without losing on anything else, just like we often hear, “you can’t have the cake and eat it too”.  Setting up a B2B E-commerce portal in India is far easier than setting it up in country which is already developed and in its peak stage of growth as the economy will not be too flexible and will not easily adapt to such a harsh transition. With giant retail organizations already moving into B2B E-commerce in India, the trend is soon to follow with other smaller and larger organizations alike.

The New World of B2B Marketing



Written by Taarini Chandramouli

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