Online marketplaces such as Amazon, eBay and Etsy have dominated the B2C space for years – but more recently, B2B marketplaces have been gaining traction around the world. If you work for a B2B brand, should you be selling on a B2B marketplace and what’s the international growth opportunity for your business? Read on to find out more.
A B2B marketplace is a digital platform that enables companies to connect with other organisations to trade in one place. In a B2B marketplace, the sellers are brands, manufacturers, suppliers and wholesalers, and the customers are other businesses. Transactions are processed online by the marketplace operator.
B2B marketplaces are sometimes also known as B2B trading platforms, B2B procuring or sourcing websites, B2B portals, multi-vendor marketplaces, or B2B directories.
The last few years have seen the rise of B2B marketplaces around the world, especially in Asia which leads the way for B2B e-commerce but also in the US and Europe. Their growth continues although B2B marketplaces remain less mature than the B2C segment. Growth is uneven across industries – they are most prevalent in MRO (maintenance, repair and operations), food equipment and automotive. Gartner projects that 75% of B2B procurement spending will take place via online marketplaces by 2023.
B2B marketplaces share similarities with B2C marketplaces, but there are key differences:
Currently, it’s estimated that about a third of B2B buyers buy 50% or more of their goods from B2B marketplaces.
Digital natives and millennials are taking over
B2B buyers are getting younger: According to B2B International, millennials will make up 44% of the workforce by 2025. A study by Global Web Index showed that 74% of millennials are involved in making buying decisions at B2B companies. They are driving a digital approach to B2B buying and selling. Whilst statistics vary by market, most B2B searches now take place via mobile.
B2B buyers increasingly have consumer expectations shaped by B2C
Younger B2B decision-makers are digital natives who grew up online. They are used to the speed and ease of Amazon and eBay – on-demand, easy-to-use consumer platforms which have radically shaped their expectations in business. For their B2B buying, they want a consumer-like experience that minimises purchasing complexities. They also want transparent pricing to support their decisions.
B2B buying is collaborative
The typical B2B path to purchase is longer and involves more decision-makers than B2C. As a result, the agile nature of online marketplaces – which makes product comparisons easier and pricing more transparent – lends itself to the collaborative nature of B2B buying.
The effect of the Covid-19 pandemic
The lockdowns, social distancing and restriction measures caused by the pandemic bolstered online marketplaces across the board, as B2B customers turned to e-commerce to maintain their operations. B2B marketplaces have helped to mitigate the supply chain and business continuity issues highlighted by the pandemic. By gaining access to a broader array of vendors, B2B buyers are able to decrease their dependence on a small group of suppliers.
European B2B marketplaces
There are over 300 B2B marketplaces in Europe alone, up from just 20 in 2010. Examples include:
Asian B2B marketplaces
Asia has long been a leader in B2B e-commerce. Key marketplace players include:
US B2B marketplaces
Australian B2B marketplaces
UK B2B marketplaces
The UK generally lags behind its B2B marketplace peers in North America and the Asia-Pacific region. But the UK does have some big players including these examples aimed at tradespeople :
Vertical B2B marketplaces
A vertical marketplace – sometimes called a ‘vortal’ or vertical portal – specialises in a single category of products or a particular industry.
Horizontal B2B marketplaces
A horizontal marketplace sells products and services of different types, across multiple sectors.
One-to-many B2B marketplaces
A one-to-many marketplace is operated by a single purchaser. For example, a large car company like Nissan can establish an e-commerce marketplace where suppliers can be granted access and submit bids and quotations.
Many-to-many B2B marketplaces
A many-to-many marketplace is managed by a third party and involves multiple buyers and sellers from different entities. Alibaba and Amazon Business fall into this category.
Local B2B marketplaces
A local marketplace caters to a particular market.
Global B2B marketplaces
A global marketplace facilitates transactions across borders. This brings with it greater challenges related to international payments, cross-border logistics, linguistic barriers and more. Using a Local In-Market Expert can help you to navigate these challenges.
In conclusion: If your business is looking to expand, connect with other businesses, or build its customer base, then it’s worth considering a B2B marketplace. This is an area of B2B which is set only to grow in the years ahead.
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If you are looking to grow your B2B brand internationally, Oban can help. Since 2002, we’ve been helping businesses of all sizes expand across borders using our LIME network. To find out how, please get in touch.
Oban International is the digital marketing agency specialising in international expansion. Our LIME (Local In-Market Expert) Network provides up to date cultural input and insights from over 80 markets around the world, helping clients realise the best marketing opportunities and avoid the costliest mistakes.
