Navigating B2B Ecommerce Channel Conflict: Strategies for Success

Customers insist on more choices regarding where, when, and how they can purchase goods – including buying directly from brand manufacturers.

As they continue to become more digitally connected, there is a growing demand from buyers who prefer to make their purchases outside of traditional channels.

The rising number of B2B buyers who want to research and buy products and services online has become too important to ignore.

With statistics showcasing the continued rise of B2B ecommerce, which is set to reach $1.2 trillion and account for over 13% of all B2B US sales by 2021 (Forrester), what is still holding back many B2B businesses from exploring non-traditional sales channels or establishing their own ecommerce storefront?

The Answer: Channel Conflict.

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What is Channel Conflict?

Channel conflict occurs when manufacturers sell their products directly to end consumers instead of first going through traditional distribution channels like dealers or retailers.

As more customers are looking for options to purchase their goods online, manufacturers want to be able to capture these growing online markets for their brands, but don’t want to create conflicts with their existing ecosystem of distributors, dealers, retailers, and sales reps.

Without a well-planned multi-channel strategy in place, making the choice to expand the sale of your products through these newly established channels, including online, can result in alienation of physical stores, partners, and even your own sales teams.

However, when done correctly, you can satisfy and grow multiple channels for your business without harming existing channel relationships.

Channels in the Equation

For decades, it had not been a profitable option for manufacturers to sell direct to consumers and risk losing their important distribution channels or retailer partners. However, with the growth of the internet and online capabilities, it has become easier than ever for manufacturers to market and sell products directly to the end consumer.

BigCommerce earned 7 medals in The 2020 Paradigm B2B Combine (Mid-Market Edition)

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Opportunities for offering products and services to the same set of customers online and offline leads to rising concerns amongst existing channel partners. When it comes to addressing and managing channel conflict, there are a variety of key players that are involved.

1. Ecommerce.

With the rapid growth of ecommerce, selling online has become quicker and more accessible than ever before.

The ability to successfully conduct B2B operations online is no longer limited to large enterprise companies.

Small and medium-sized businesses also have access to the tools they need to create their own individually branded ecommerce site, enhance their B2B sales through online process automation, and utilize their branded site to further expand their businesses.

Leveraging a SaaS platform like BigCommerce makes online expansion both quick and affordable.

The release of new features and APIs including Wishlists API, Bulk Edit, and Price Lists allows BigCommerce to be capable of handling very customized B2B workflows for businesses.

Paired with B2B application, “Bundle B2B,” which extends the native capabilities of BigCommerce to provide additional enterprise-level B2B functions like corporate account management and custom catalogs and pricing, businesses can easily offer greater convenience and benefits to customers online without the overwhelming costs and obstacles.

2. Your physical store.

Despite the rise of online shops, in-person brick-and-mortar stores still maintain a presence.

With advantages including instant enjoyment, face-to-face assistance, and the ability to touch, feel, and try on items in person, there continues to be a large segment of consumers looking to shop in physical stores.

Physical storefronts that deliver exceptional customer experiences and immersive brand experiences continue to generate both lasting impressions and returning customers.

3. In-store partners.

Retailer partners who carry your brand in their stores deliver value to your end-users in terms of quality, service, and local availability.

The channel also increases access to prospects and customers who frequent retail stores to purchase the types of products you offer.

Utilizing an existing network of in-store partners allows manufacturers to expand their physical geographical reach without having to set up their own store outlets to cover the territories where existing retailers already operate.

4. Online partners (Amazon, eBay, etc.).

Selling on online marketplaces is another method that manufacturers use to grow their businesses and reach large new audiences.

Outside of creating and developing their own ecommerce site, offering products on popular and widely established online sites like Amazon or eBay is a way that manufacturers expand their reach to previously untapped customers, including those from around the globe.