Six Ways Members Can Beat Amazon in Online B2B

June 10, 2020

Amazon Business continues to disrupt distribution and is expected to reach $52 billion in sales by the end of 2023. The Coronavirus pandemic has further shifted B2B traffic to Amazon and pointed out the shortcomings of many independent online distributors. Since selling their products directly on Amazon Business ultimately results in weak customer loyalty and fractionalized sales, independent distributors must form their own online marketplaces to succeed. But how can independents compete against online B2B giants like Amazon Business, Alibaba, and eBay?

Here are 6 ways your members can succeed in the B2B eCommerce marketplace:

Focus On A Specific Vertical

Amazon Business is a multi-category marketplace, typically offering commodity products that are easy to store, pack, and ship. To compete, independents need to dominate a vertical-specific marketplace, rather than attempting to co-exist in a multi-category marketplace. Specializing in a specific vertical allows independents to offer a comprehensive selection of products, typically with lower prices and better price transparency.

However, if there can only be one or two dominant players in any given vertical, how can the majority of independents succeed? This is where Buying Groups can step in. Buying Groups with the vision of becoming the dominant marketplace player within their vertical can create a platform where all of their members can flourish.

Mine The Data

An eCommerce site’s data offers invaluable insights into customer activity that can be used to constantly improve traffic and sales. What paths do customers use to navigate your site? Traffic patterns may suggest new products or cross-promotional opportunities.

Service Your Customers

As a successful independent, you know your product and your customers better than any multi-category marketplace. Make it easy for customers to ask questions. Don’t just rely on FAQs or online manuals. Integrate online chat – with a trained service rep and not an automated chatbot. Call your customers to answer questions rather than relying on email. Offer technical support.

Make It Easy

Make it simple to do business with you. For online marketplaces, search is king – if your customers can’t find it, they can’t buy it. Pair every product with images and videos to reduce confusion and enhance product descriptions. Optimize site speed. Provide charge accounts and invoice options. Save past orders, and make re-ordering as easy as one or two clicks. Track when certain products were purchased, and pro-actively remind customers of maintenance parts.

Reduce Total Costs

Reducing costs for customers doesn’t always mean lowering prices. Localized product inventory and efficient cross-border fulfillment can save customers time and money. Look for other ways to reduce shipping costs. Offer rebate incentives to guide buyers to specific categories or to reward large customers without jeopardizing street prices.

Don’t Forget The Underserved

Amazon focuses on large customers who buy commodity products and who ask few questions. Independent marketplaces can serve smaller, irregular customers whose purchases add up.

The stakes are high for independents. The trick is to not emulate Amazon Business. Independents will succeed by combining the knowledge, service, and passion independents bring to traditional distribution with new online tools and strategies. Buying Groups can play a role by educating members and by offering relevant shared services.

Written by Steve Seguin


LBMX offers a business-to-business marketplace platform, helping independent businesses, their Buying Groups, and suppliers buy better and sell more. Its Private Group Marketplace for Groups has transformed billing and ordering, rebate management, real-time analytics, e-commerce and product information management across the building materials, HVAC, plumbing, sporting goods, industrial supply, manufacturing, and agricultural industries. Its LBMX Supply Cloud platform allows suppliers to look at their industrial distribution customers through one lens, offering full EDI, PIM, Analytics and Payments.

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