Transparency and Trust in B2B Transactions with Michael Vax of CommerceIsDigital
The B2B eCommerce Podcast
Transparency and Trust in B2B Transactions with Michael Vax of CommerceIsDigital
Full Transcript
Aaron Sheehan: Hi, welcome to a very special episode of the OroCommerce B2B UnCut podcast. I’m one of your hosts, Aaron Sheehan. Today’s episode is a little different and very special. It’s from a webinar I recorded with Michael Vax, a noted and experienced B2B expert who’s worked for some of the top names in B2B eCommerce software. He has his own website, courses, and educational offerings called Commerce Digital, where he provides valuable advice to businesses undergoing digital transformation. He teaches you how to do it well and what to avoid.
I had a great conversation with Michael a few weeks back, and it was so good we wanted to make it available to our podcast subscribers. We’re really excited to present this, I think you’ll find it very interesting. And without further ado, here’s the webinar.
Michael Vax: I’m looking forward to a future where we have systems that can personalize the customer experience in real time. I’m thinking about the future when the product and system know me as the customer and what I need to do. It automatically filters products for me or even changes product descriptions. Because the system knows I’m using this product for one purpose, and you’re using it for another goal.
Aaron: Welcome to all, good morning, good evening, good afternoon, whatever time zone you’re in. We’ll have a range represented here today. Of course, this is a recorded webinar, so the recording will be sent out to registrants afterwards. Feel free to share it with a coworker or friend, colleague. And when you share the webinar organically by sending them a copy of the video, they don’t get on our email list. So it’s a considerate way to share good content.
We are a little past the hour, so I’ll go ahead and kick us off. I want to start with a bit of housekeeping. Normally, these webinars are panels with multiple guests. Sometimes I’m moderating, sometimes I’m a guest. But today is special because it’s just the two of us. It’s two bald guys! Michael will get first crack at answering questions, then maybe I’ll respond, and we’ll have a little dialogue.
We’ll put a poll question up on the screen for those of you who are B2B buyers and sellers. If you’re a manufacturer or distributor, or you buy from manufacturers and distributors, please contribute to the polls. We’ll sweat the questions pretty hard. And at the end, if we have time, we’ll take questions from the audience.
As I said, this is recorded, and it might be going out as a special episode of OroCommerce’s B2B Uncut podcast. So, if you want to listen to this without being blinded by the glare off of our heads, you can do that via Spotify, Apple Podcasts, or whatever client you use for podcasts.
I’d like to introduce Michael Vax, joining us from sunny and beautiful Barcelona. He’s a legend in the B2B eCommerce world, and he’s graciously lending us his time and expertise. Michael, can you please tell the audience who you are and why your opinion matters?
Michael: Thank you for having me. It’s my pleasure to be here. I spent most of my career in product development for major eCommerce platform companies. I was CTO of a company called Elastic Path in Canada. I also worked for Hybris, a SAP Commerce Cloud, where I was Head of Product. I also worked as VP of Product for a company called Spryker. So I’ve spent a lot of time in eCommerce, probably most of it on B2B and developing B2B functionality, advising customers on B2B functionality, and so on.
Now, I also try to help the industry close the knowledge gap that exists around eCommerce implementation in big companies, especially in B2B. So, I created a company called Commerce Digital, where I do consulting and offer training. My courses are vendor independent, don’t require a technical background, and focus on B2B problems. I’m sharing my screen now so you can see Commerce Digital, specifically the B2B part. I actually have multiple B2B courses. One is focused on the implementation team, and the other one is more about business strategy and process optimization. Some businesses are still quite new to eCommerce, especially B2B, which is complex. I enjoy helping people learn about best practices, how to properly select, implement, and sell to make it successful. Because, it’s really about knowledge. Sometimes just having a system isn’t enough, you need help.
Aaron: That’s an excellent introduction. I’ve put a link to the Commerce Digital website and the specific course in the chat. So if anybody wants to click on that, Mike will accept your instructions and see how much traffic he can drive to his site.
I’ll introduce myself briefly. I imagine many of you know who I am because I do a lot of Oro webinars and podcasts. I’m Aaron Sheehan, Director of Product Marketing at OroCommerce. I’ve been in the eCommerce space for less time than Michael, only 10 years, but in technology a bit longer than that. Funnily enough, I’ve ended up doing a lot of B2B commerce on the implementation side. Most of my 10 years have been spent at an SI, or systems integrator, doing consulting and delivery of digital transformation for manufacturers and distributors across a variety of platforms.
I’m happy to be at OroCommerce because Oro is, to me, unquestionably the market leader in capabilities for B2B companies. It really unifies sales across all digital touchpoints. I have a longer TED Talk we might get into a little later about the function of commerce inside of a B2B sales organization. But I want to start off with a topic that came about a couple of months ago when Michael and I were talking. We were comparing notes about the B2B commerce space and both noted that a statement gets made often: B2B buyers want a B2C experience. B2C is sort of the North Star for what, if you are implementing a B2B commerce program, both on platform selection and then how you run it, you’re supposed to think of, I guess, Target or a consumer brand as sort of like the goal.
And I think we both thought, that’s not really right. But it sure gets said a lot by people in the space. I was looking at a report that OroCommerce had commissioned through Forrester. They surveyed people on their top pain points in terms of their buying experiences today. If you go all the way to the bottom, the second to last pain point is “missing features standard in consumer eCommerce.” The things that are at the top are localization and customization, accurate pricing, accurate stock, accurate information, basic things. People aren’t thinking of it in terms of “I want a zero friction consumer experience,” they’re thinking of it in terms of, “I need to be able to tell my buyers how many units I have in the warehouse.” That’s a key point.
So, first question for you, Michael: Why don’t B2B buyers want that consumer experience? And maybe, what do we mean by consumer experience when we say that?
Michael: It’s a very interesting topic and, as always, a complex one. There are some aspects of the B2C experience that B2B buyers want, but there are definitely aspects they don’t need or have specific requirements for. I think the right place to start is: What’s the difference between B2C buyers and B2B buyers? What are their objectives? Why are they actually coming to the site?
The main difference for me is that B2B buyers come to do a job. They didn’t come because they need something, they’re interested in buying a new golf set, or some clothes, or something. They have a job to do. This is a substantial difference from an objective perspective.
Also, these are people under pressure. When I think about B2B buyers, I imagine their screens covered with sticky notes. They’re super busy people. In addition, the cost of error is huge in B2B. Usually, there are no free returns.
Aaron: So, the screen might be covered with sticky notes, but they are definitely super busy people.
Michael: Exactly! And if you’re not receiving an order on time, your production line might be affected. It’s really a big pressure on these people. And the experience should be designed to optimize their productivity, which is a very different objective from making it enjoyable. So, the B2C experience, with a lot of ads and videos, might not be the right one. We need to optimize for busy people who need to get the job done and minimize the chance of mistakes.
Also, when we’re talking about the chance of mistakes, there’s a tremendous amount of information available about B2B products. It’s a complex purchase. Not everyone buying is an expert, even if the people selling are. This creates complexity. We need to optimize for productivity to make sure people understand what they’re buying and minimize mistakes. That, in itself, makes the experience already very different from B2C.
Aaron: I agree. I think of it in terms of friction. In the consumer technology space, a lot of what’s been sold over the past 5-10 years has been about removing friction. There’s an obsession with faster, more convenient, and the “Buy Now” button is everywhere. You can consume anywhere. But to get to the point where a consumer can click the “Buy Now” button on their TV to buy a shirt from a show they’re watching, so much context has to be set in advance. You must already want it, you’re looking at an advertisement for it. So you know what you’re buying, you’re simply presented with a commoditized expression of commerce.
But in B2B, a little friction is actually a good thing. Friction can establish trust and convey a sense of value. However, the kind of friction that comes from a slow system, or taking a long time to get information, isn’t useful.
Going back to that survey, disjointed buying systems that don’t communicate are a big problem for people. Nobody wants to wait around for an answer. As you pointed out, this is high pressure with high cost of error. I can’t simply click a button and assume I’ll get what I need when I get it. And I think people would rather talk to a human, in general, when they’re trying to establish that level of trust. A chatbot just doesn’t give the same feeling necessarily.
I want to go ahead and put up a poll question. This is aimed at sellers. If you’re a manufacturer, distributor, supplier, or retailer, I’m curious to know the primary method that a customer uses to buy from you today. Please take a couple of seconds to answer.
It seems, looking at the results, that the clear majority is still phone or email. This reinforces the point about friction earlier, it’s still the default. There are ways to change it, and it is changing and evolving, but most of the companies I speak with who are pure-play eCommerce or pure self-service, Michael, are still a minority.
Let’s talk more about friction. I think you used a good term, and I want to explore different sides to see where we can see good experiences. Because, the experience is definitely better when a new customer comes to your site, in most cases in B2C, and they might register, they might not register. But in B2B, many businesses start with this “gated community” or “walled garden” mentality. I think it’s outdated. Everything about the internet, and the web in general, is about transparency and openness.
Some businesses say, “Okay, you need to register and sign a contract with us before we can do business with you.” It’s historical, but it has problems. If your competitor actually allows people to see products and buy immediately, you’re putting yourself at a disadvantage. There are some legal reasons for it, but I always advise customers to see how far they can go towards openness.
For example, you can publish your catalog, maybe not your custom-made products, but the majority of your products can probably be shown to customers without requiring a login. Use it as a way to get attention and encourage them to put something in the cart. You might not show prices because most pricing needs to be customer-specific, but I’m sure everyone has a default price list, at least for simpler products. Why not show it? You can tell customers to register for better prices. And, of course, there’s the question of payment methods. In B2B, you rely on credit, but practically every business has a credit card now. So, if you have a new customer who wants to try you out, show them the product, show them your default prices, and maybe allow them to buy using a credit card.
Then, you can say, “Please register and you’ll get better terms,” and you can do a credit check. I’ve worked with B2B customers in Europe who actually integrated their systems with credit bureaus in different countries. They sync and do live credit checks, or you can simply try to buy on a credit card basis. So, that’s something that’s good in B2C, and I encourage B2B customers to adopt it.
Aaron: Good advice. I’ll add that I’ve seen marketplaces used as a proxy for doing this. B2B marketplaces, not like consumer Amazon, but B2B-specific ones where the account isn’t yours, you’re just getting a transaction at the other end, can be used as a channel to develop leads. Buyers can get your products at a price you’re willing to accept, and you can establish a relationship afterwards if there’s a fit.
That’s one of the reasons Oro has pretty robust marketplace functionality. We have customers who are using marketplaces, as well as their own buyer portals on their website, to bring in third-party products. Maybe they manufacture but also have distribution and supplier agreements with third parties that reach a wider variety of people. Then, for some of those relationships, the customer can actually get the stock in their hand on the factory floor. And they’ll say, “Oh, I’m going to call them and see what else they have,” because they know it’s not all in the marketplace.
Michael: Very good point.
Aaron: Second question: What are the expectations in a B2B context for a good customer experience? And do you think those are different between someone buying from a manufacturer and someone buying from a distributor?
Michael: Yes, definitely. I think that expectations are evolving, and I suppose, if you do have a digital way of buying, especially with changing generations of buyers, a digital way of buying might be key for them. But there are other aspects. Of course, I already touched on payment methods. B2B payments are very different. If you don’t have P2P payment methods, it means payments have to happen offline. It’s difficult reconciliation, requiring approval and conservation, which definitely degrades the customer experience.
The other side, which really differentiates B2B buying, is the collaborative process. In B2C, usually, I’m buying something and might ask for advice on the sofa. I might even get approval from my spouse. But in B2B, it’s a standard product, and someone with technical expertise, like an engineer, might be the one wanting to buy it. Someone else is responsible for approving it, who owns the budget. They also have an approval process, and then there’s someone in the procurement department who places the order.
This is what really differentiates a B2B platform from a B2C eCommerce platform. The buyer is an organization. It has many users, they collaborate with each other, and there’s a workflow. People don’t want to go through a process where they’re on the site, but then have to print an order, go to their manager to sign it, and then send it back to the procurement department. All of this approval and collaboration should happen digitally.
What people expect is to be given advice in the form of a sales representative coming across a situation. They want to be nurtured. They’re under a lot of stress. And they want something that empowers them to be more productive and reach more customers. They want a way to provide their own expertise. Because in B2B interaction, the people who know a product the best are the ones who work for it, maybe the manufacturer or the distributor. These are the people with the expertise.
So the question is: How do you integrate this expertise into the digital buying process? You need to have things like the ability to create a request for quote (RFQ), communicate back and forth between seller and buyer, segment RFQs, allow salespeople to access the online store and do things on behalf of a customer, like suggest additional discounts. This collaboration between people with expertise and buyers who need that expertise should happen across all channels.
Again, nobody cancels phones or WhatsApp, but it needs to be integrated into workflows and functionality in the eCommerce system.
Aaron: Absolutely, absolutely! This is a really good time to launch the next poll question, which is for buyers. How many people from your team are involved in the buying journey, including the approvals and payments process that you were just talking about, Michael?
One thing I’ve seen done well in companies that have made the pivot to eCommerce, or were able to get their catalog and some of their buying and account management online, is to take sellers and turn them into product experts or service experts. Their role is no longer the gatekeeper between an order and the fulfillment of that order. Their role becomes generating trust and demonstrating expertise with the accounts they already have.
Yes, there will always be people who pick up the phone, fax an order in, come in and hand you a piece of paper, or mail in a catalog order. But as more and more buyers become used to digital self-service, some of your team can transition into being the experts. Let’s be real, at a lot of companies I’ve worked with, the experts are usually a handful of people who are wearing a lot of hats and doing a lot of jobs. They might be working in the factory, in a distribution center, they might be on the road, and they know a lot of things. But to get an answer, you have to get a hold of them when they’re rushing from one place to another.
You need more people like that, and moving to eCommerce doesn’t mean laying people off. It means retraining and reskilling people to add more value. Fundamentally, the purpose of digitization, digital transformation, is to add more value to your buyers.
Looking at the poll results, the clear winner is 90% of the respondents have three to six or more people involved in the buying journey, including approvals and payments. As you pointed out, it’s a team buying from a team, not an individual.
I want to move on to the next question. Because of this collaboration, one thing that’s proven pivotal for experience is having multiple shopping carts. In B2B, there’s more than one person involved in the process.
Michael: Yes. As you go through different versions of the buying process with different people with different permissions, your eCommerce platform should be able to provide that. It could be carts, it could be lists, some sort of sorting for recurring purchases, like…
Aaron: Exactly! We see that a lot across our customer base. Oro supports the idea of saving shopping lists for future use. If I’m buying consumables, I have a monthly replenishment order, and it’s pretty predictable what I’m going to be buying. I might have to adjust quantities, but I know what size filters, couplings, oil, lubricant, or whatever it is that I buy. I want to be quick, I don’t have a lot of time to browse your catalog every time to find the right product.
Which brings me to the next question, which is about product discovery. This is where it’s loudest to me that “B2B buyers want a B2C experience.” I think it’s because the vendors saying this are usually front-end experience, personalization, search, and merchandising vendors. What they’re really trying to solve is delivering high-quality product information, all the time, on target, to the right buyer.
We still use the word “catalog,” which to me echoes printed catalogs like the Sears catalog or Uline catalog. You’ve worked with a lot of manufacturers and distributors around the globe for a long time. What do B2B buyers actually want for product discovery? How does that process differ from how a consumer might be thinking of product discovery?
Michael: For distributors, it’s a huge issue. Product taxonomy is often more advanced and complex. You can kind of get away with just putting everything in a description and title, maybe a few structured attributes. But in B2B, you’re going to have a lot of different attributes. You might have a lot of different variants of the same screw. There might be more than a dozen candidates.
The question is how you handle information, working with structured data like attributes and non-structured data like descriptions. Structured data allows you to do the initial filtering and comparison of products. You need to select from a candidate pool, say from a dozen different screws, with different geometries, blends, forms, or materials. This all needs to be structured information. This is more difficult for distributors because they receive information from multiple sources, and each manufacturer might send the data in a different format. But, when a customer goes to the site and tries to discover a product, they don’t care. They want to see everything structured the same way, consistent categories, and so on. There are some different tools to manage it, like PIM, or Product Information Management. I’m actually working on that now in the fashion industry, but the principles are the same.
This is what really differentiates the problems you have. And, of course, all of this searching and large tool investment is worth it, especially when you have a huge catalog.
Another thing you can do is use guided selling. Sometimes, customers need to buy a complex product, or a combination of products because they have a project. It’s easy to set up a bundle, but in many cases, it’s a configurable bundle. Based on what you select first, you can select the next product, and so on. You really need to develop this kind of step-by-step walk for customers with complex projects, which will put less pressure on your support team because customers can figure it out themselves.
Aaron: That’s an excellent point. OroCommerce just released an update to its configurable kits functionality with the latest 6.0 release. What you’re describing is often referred to as CPQ, or Configure Price Quote, workflows. We see this a lot, especially in manufacturing, and there aren’t a ton of great systems that do it well. There are a lot of systems, but not a lot that are really great.
Oro allows you to pre-configure a configurable bundle for a particular type of client, even a particular account or a specific individual inside a subsidiary of an account. You can say, “Here, we’ve pre-configured this, but you still have options within the kit.” There could be services, maybe there’s some contract service contract management attached to it. This is something that Oro customers are using to do this today, because of the CRM capabilities, the catalog capabilities, and now the configurable bundle/configurable product features.
This is a great way of doing product discovery, where you’re curating an experience that’s guided, to use your term, it’s guided selling. Many buyers don’t have time to simply go to a search bar and search through. As you pointed out earlier with the T-shirt distributor example, most distributors are selling hundreds of copies of almost the same thing. And, considering how good supplier data often is, there won’t even be a picture, or it will be the same picture repeated dozens of times. The more you can put the right products, pre-built and pre-configured, in front of your buyers in advance, you’re saving them time. And, to your earlier point, it’s pressure, you have to buy the right thing. The more you can remove the wrong terms from the buyer journey in B2B, the happier your customers will be because time is money.
I want to go ahead and put up the next poll question, which is about seller priorities. If you’re a manufacturer, distributor, supplier, or wholesaler, what’s the key priority for you in the next 12 months to improve the buying experience? We just talked about product data fixtures. If they stink, let’s be honest, they often aren’t any, or they’re not high-quality. We also talked about customer service, issue resolution. Maybe a buyer wants to find information about a product, or they have to call you to figure out how to configure a bundle.
Customer onboarding can be another area of improvement, making it easier or faster. And then finally, self-service account management tools.
eCommerce isn’t on this list, necessarily, but it shows up in every one of these. If you implement eCommerce as a channel, the transformational process you go through should improve all of the things on this poll. But a lot of times, what people really want from eCommerce is a customer-facing portal into their ERP. That’s what the last option is about, self-service account management. Can I see my orders? Where’s my stuff? How much do I owe you? Can I pay my invoice? Do I have a wish list or shopping list, or shared shopping cart, or active quote? None of those things involve actually going through a checkout with a credit card, but all of them involve revenue coming into your business and happy customers.
We’ll give this another few seconds for folks to answer. This is good stuff. And then we’ll move on to the very final question, which is going to be about AI. You can’t do a webinar in the year 2024 without talking about AI, and I apologize, it’s just the world we live in. But I want to make it a bit more focused. You’ve written a book on this topic, is that right?
Michael: Yes, that’s right.
Aaron: The question is: Name one way you think AI is going to make the B2B buyer experience or customer experience better, and one way you’re afraid it might make it worse. Let’s start with the bad.
Michael: Many people are now experimenting with chatbots, adding them to customer support. Customer expectations changed with ChatGPT’s release about the quality of chatbots. People have high expectations.
I recently published a blog on this, about things not to do when putting AI chatbots in place, but what I would emphasize is that when a customer interacts with a chatbot on your site, in their mind, they’re interacting with your brain. And if the bot doesn’t help them, if it just wastes their time, they’ll think the bot is stupid. And by association, it reflects negatively on your brand, which you don’t want. So there’s great capability in these bots, but you can also use them incorrectly. That’s something I see a lot unfortunately, people rush to put them in, and it becomes a bad experience.
Talking about good experiences, it’s super difficult for me to pick just one, but I would suggest looking at AI in two ways. One way is how it impacts customer experience, and that’s the topic we’re discussing here. There’s also how AI impacts productivity and back-end operations. That’s another thing to consider, because it will actually save you money.
If I had to pick one way AI will improve the customer experience, I would say it’s the ability to personalize the experience for the customer. I’m looking forward to the near future when we have systems that can do it in real time. I’m measuring the future when the product and system know me as the customer and what I need to do. It automatically filters products for me or even changes the product description. Because the system knows I’m using this product for one purpose, and you’re using it for another goal. It could even explain to me how this product can be useful for my business. It’s absolutely huge.
Aaron: I was having a conversation with a large European manufacturer, a customer of ours, a couple of weeks ago. One of the problems they were trying to solve was that they sell across a wide range, they have a huge catalog, they manufacture a lot of different things, but they’re mostly in the same general product family. They’re just packaged and sold to different industries in different ways. But the problem they were trying to solve is that they have customers who buy only a very small subset of their product line. They believe those customers would buy more if they knew those products existed, if they went out of their way to go through…
And this goes to your point. If you know who your customers are and what they buy, it sounds obvious if you know what your products are. But a lot of people don’t actually know what they sell. A rep might know what their book of business looks like, but there might be very few people who know everything that’s available for sale.
This isn’t only a great way of learning about your own business and digitizing it for future use, it’s also a great way to think about what the next set of products should be, what the next market should be. AI can do quite a bit to make that more efficient and effective.
I really appreciate the time here. We have one more question, the bonus round. If you’ve made it this long, congratulations.
Consider this: If you could add one more buyer journey or customer experience improvement over the next 12 months, what could it be? It’s a short answer, you can type whatever you want. Extra credit if you say something Michael or I have already mentioned, because then we feel better about our position as thought leaders. But really, you can say anything you want.
I want to say thanks to everyone for attending. I think this has been valuable and very entertaining to host. You have a lot of knowledge, Michael, I really appreciate you sharing it with our audience today.
The links to your site, Commerce Digital, are in the chat. If it’s not available, it’s commercedigital.com.
Michael: That’s right. Whether you know it or like it or not, it absolutely is.
Aaron: Thanks again for your time. For those listening to this later, hopefully, we were able to meet your expectations. We’ve given you a digital copy, and as I said, this will be a special episode of the podcast when it goes out. We’ll let everyone know so you can share the podcast with your coworkers.
If you’d like a copy of the video, please send me an email, and I’ll be able to get a copy to you and anyone else in your organization. Thanks so much, and have a wonderful rest of your day or evening, whatever time it is for you.
Michael: Thank you, Aaron. Bye bye.