Frustrated by lack of effective digital purchasing experiences, 70 per cent of B2B buyers are thinking about shifting their preferred vendor to a competitor, according to research released by PROS on Tuesday.
Based on 210 responses from buyers across multiple countries, the Houston-based firm’s COVID-19 B2B Buying Trends Report showed that one in three buyers have terminated a vendor, while two out of three buyers have terminated their contracts based on unavailability of product supply.
Some of the key factors driving a potential shift in vendor preferences included competitive pricing, which was cited by 40 per cent, as well as availability of supply (39 per cent) and a better digital purchasing experience (35 per cent).
Geoff Webb, PROS’ vice-president of strategy, said the results speak to the fact that B2B buyers can’t be as forgiving as their consumer counterparts have been towards companies since the pandemic began.
“The pressure to make the right purchase is so much more challenging in B2B than B2C,” Webb told 360 Magazine. “It’s really to recover from a bad purchase. The buyer therefore is raising the bar in terms of expectations of their vendors.”
The report findings are even more remarkable when you consider how difficult it often is to bring on a new vendor in a B2B company, and how elongated the purchase process can be, noted Valerie Howard, PROS’ solution strategy director.
“It’s not so much that they’re taking a 180-degree shift, but in many cases because of COVID-19, buyers are having to choose certain vendors because they’re offering the transparency and connectedness (around their availability and pricing) to make decisions quickly,” she said.
A minority, or one third, of survey respondents said they thought their vendors were well prepared in terms of the digital channels they offered. Webb suggested that in many cases it’s been a harsh wake-up call.
“In a lot of businesses, the e-commerce approach was not the central process. If what they’ve done in the past is spin up e-commerce but not tightly integrate it into the rest of their business, that becomes problematic,” he said, noting that many have leaned on the traditional B2B selling approach of in-person meetings with a buying committee. “What happened is that the pandemic has disrupted all of those normal connections and forced everybody to work on different time scales. People not used to going through that with particular vendors.”
That said, attitudes may be shifting quickly among B2B firms, said Howard, who complemented the survey data with qualitative interviews with vendors.
“They had had a lot of concern about the risks in driving more interactions to digital channels. They were concerned about losing that personal touch, for example,” she said. “Many of them were pleasantly surprised now that they’ve seen the way buyers are responding.”
This was backed up by the report, where 37 per cent of buyers said they are primarily purchasing through digital channels.
Howard said it’s important to recognize that COVID-19 has taken the entire world by surprise, but that B2B vendors still have time to make adjustments to their digital experiences that still make use of human sales people when necessary.
“There may be customers were you truly need all hands on deck,” she said. “But if you already have an existing customer who’s been doing a lot of repeat orders, set those up for digital interactions. There are other situations where you just use the digital back end to enable their decision-making. The reality is, not eery single deal needs to go through a sales rep.”