The time to be listed on a B2B marketplace is now. Or more specifically, yesterday!
B2B e-commerce historically lags behind its B2C counterpart when it comes to sales and adoption. However, there are signals suggesting that the tide is turning. In 2018, B2B e-commerce sales in the United States surpassed USD$1 trillion for the first time and accounted for 7.2% of B2B sales. Forrester Research forecasts that by 2023, these US numbers will increase to $1.8 trillion and 17%, respectively.
Part of what’s driving this change is that Millennials are not only the newest generation of B2B buyers to enter the field, but they are now becoming the majority – and they’re bringing their preferences for digital transactions and marketplace shopping with them.
For wholesalers, distributors, and manufacturers to maintain a strong multichannel strategy in today’s landscape, participating in a B2B marketplace is a must.
Here’s what you should know to successfully prepare your brand for marketplace success!
Top B2B Marketplaces To Consider
Unsure of which marketplace to list on? In search for an additional channel to reach global customers? Consider the following B2B marketplaces for your company’s newest revenue stream.
Alibaba is not just a platform that connects Chinese factories to buyers worldwide – as of July 2019, it is now open to US-based sellers. SMBs are the target market for sellers, as Alibaba is banking on the statistic that 70% of small US businesses are not digitized. At the moment, US sellers only have access to buyers within the US, India, Canada, and Brazil.
This marketplace needs no introduction. However, note that Amazon Business is currently only available in the US, the UK, Germany, France, Italy, Spain, Japan, and India. This makes it a viable platform for SMBs based in those countries who are looking to fast-track their global e-commerce growth.
If your company’s manufacturing is done in China, DHGate is a good platform to consider as it is a trusted platform for China-based wholesalers across all industries. DHGate also maintains warehouses in the US and UK, making it easier to reach customers in those countries.
Looking to sell refurbished and used items, in addition to new items to a captivated global audience? eBay Business Supply is a sensible place to start. B2B buyers on this platform are looking for wide selections at great values; sellers should be prepared to offer deep discounts on bulk purchases.
Exporters India was founded in 1997 and connects Indian suppliers with buyers globally. The categories on the website are wide-ranging: from fashion and home supplies to chemicals, machines & equipment and everything in between.
This relatively new wholesale marketplace is quickly becoming a fan favorite in the B2B world. Based in the US, with offices in China, Nigeria, and Pakistan, the platform has a robust product base and 500,000+ registered users. Their point of difference is that they offer additional in-house advertising packages and assistance in optimising listings to help sellers make the most of the platform.
Founded in 1971, Global Sources is an established marketplace that links Asia-based wholesalers to the rest of the world. In addition to their online platform, they are known for facilitating and hosting large-scale trade shows throughout the year in Hong Kong, giving buyers and sellers the opportunity to build relationships in person.
If you’re a wholesaler in fashion, beauty, or home, you need to be on Joor. Based in New York, they aim to strengthen the partnership between brands and retailers through their data-driven system, which provides useful metrics and trends to both parties in real-time.
Moglix is a B2B marketplace primarily focussed on equipment, such as machinery, industrial tools and safety supplies. At the moment, the platform is focussed on buyers and sellers in India only.
ThaiTrade is an English language platform, focussed on connecting Thai suppliers with worldwide buyers. The platform was established by the Department of International Trade Promotion and hosts over 20,000 sellers and over a million buyers.
Thomas started out as a print directory in the 1800s, and has transformed into a major digital marketplace for engineering and manufacturing products in North America. With over half a million suppliers on the platform, new businesses are encouraged to create a free profile and listing for the opportunity to be seen by their millions of large scale buyers.
Trade Key is a global B2B marketplace with buyers and sellers from over 200 countries. The platform is available in English, Chinese, Spanish, Arabic, Japanese and French and hosts products from almost any category.
The Benefits of Selling on a B2B Marketplace
Get in front of a global audience quickly
B2B suppliers shouldn’t ignore building up their own website channel. However, for those interested in growing quickly, partnering with a marketplace can help reach that goal.
By listing your best selling products on a well-known marketplace, you are exposing your brand to an engaged audience with a higher number of quality leads.
Marketplaces can also help newer brands rank higher in search engines. There is a better chance of products getting on the first page of Google through an established marketplace that is well optimised, versus a new company website that will need more time to rank.
Being listed on the right marketplaces brings you closer to your ideal customers, allowing you to more efficiently promote your product. These platforms also give you the tools needed to easily show related products and other models with additional features, making cross-selling and up-selling effortless.
Lower your marketing costs
There are additional costs that come with participating in marketplaces, such as subscription fees, featured ads, transaction fees, listing fees. Still, as customer acquisition costs for paid search and social media rise, these marketplace fees may end up being relatively low in comparison.
Also, marketplace costs may be worth it for smaller brands who do not have the bandwidth to create a company website that offers convenience, personalization, logistics, and payment infrastructure.
Offer a streamlined experience for both buyers and sellers.
Emerging brands can take advantage of the resources and convenience that B2B marketplace platforms offer.
Major marketplaces have their B2B mobile e-commerce apps up and running, making it even easier for younger B2B buyers who are mobile-first to discover suppliers. On both mobile and web, these platforms can also make the checkout process and payment collection easier.
For sellers, marketplaces can also provide access to logistics services that allow orders to be fulfilled more efficiently, at and lower shipping costs. In some US states, marketplaces are also responsible for collecting and remitting sales tax on behalf of sellers, effectively removing a major operational barrier for suppliers.
Receive customer reviews to increase credibility
Positive ratings and reviews on your marketplace product pages can persuade new buyers to give your brand a try, improving your reputation on the platform and increasing your sales even more.
Best of all, requests for reviews are automated through the marketplace, reducing the efforts needed to build your reputation.
The Risks of B2B Marketplace Selling
Prepare for competition
Since marketplaces provide a lot of benefits for sellers, brands need to be prepared to face the competition.
This can be an uphill battle, especially if platforms have strict branding rules in place, or do not allow for flexibility when it comes to editing the look and feel of the listings.
If there is not enough room in the budget to spend on feature ads, extra efforts will have to be made to stand out to prospects. To get a leg up on the competition, suppliers can choose to further optimise listings for search and write succinct, yet informative product descriptions that convince buyers as they do their research.
Order quantities and profits may initially shrink due to competition
For newer brands, selling on marketplaces can be difficult at first if there are more established, popular brands on the platform. It’s possible to lose out to these known brands, or receive requests for smaller orders as buyers will want to test quality before committing to bigger orders.
Another issue sellers face is the need to lower prices. Since B2B buyers are motivated by the price transparencies and ease of comparisons that marketplaces offer, sellers need to be willing to accept reduced profit margins.
The customer relationship may be harder to cultivate
While the traffic and increased number of qualified leads is a great incentive for being on a marketplace, it does come with strings attached.
It’s not uncommon for marketplaces to restrict access to buyers’ information, and to limit suppliers’ communications with buyers. Amazon’s Seller code of conduct states that you can’t influence customer ratings, are not allowed to contact buyers outside of the Buyer-Seller Messaging platform, and can’t circumvent the Amazon sales process.
Managing inventory across multiple platforms can complicate operations
Maintaining multiple sales channels is beneficial for suppliers – but it does mean that there needs to be a dedicated person or team to manage orders across every platform. In order to do this efficiently, it may make sense for brands to allocate budget towards a multi-channel selling software to ensure no order gets left behind.
Use B2B Marketplaces to Build Your Multichannel Strategy
Having a multichannel strategy is a must for B2B businesses to remain competitive. While B2B e-commerce may seem nascent, the trends suggest that opportunities for growth are around the corner.
56% of businesses expect to make at least half of their work-related purchases online. Additionally, 1 in 4 B2B buyers are making these purchases through a mobile device. By choosing to maintain a presence on the right B2B marketplace, suppliers can get a head start on digitizing their business and being where their tech-savvy, global customers are.