B2B eCommerce marketplaces are eCommerce services that bring multiple sellers together on a single online platform. In contrast to a traditional eCommerce store, buyers on a B2B marketplace can browse and buy products from many different sellers, which is why they are also known as multi-vendor marketplaces.
Online B2B marketplaces are attractive to both buyers and sellers. Buyers gain access to a wide range of pre-vetted sellers in a convenient location. Sellers reach a larger customer base than they could individually. Digital Commerce estimates that B2B marketplace sales could reach $3.6 trillion by 2024, an increase of just under $3 trillion from 2018.
Many B2B sellers may already sell via large public B2B marketplaces like Amazon Business and Alibaba. But these marketplace giants are the tip of the iceberg.
An increasing number of B2B sellers with eCommerce stores choose to launch their own B2B marketplace. According to Gartner, 15% of medium to enterprise businesses will operate a B2B marketplace by 2023.
In the past, building a B2B marketplace would have been a complex and expensive proposition, but modern marketplace platform software like Mirakl can transform a single-seller B2B eCommerce store into a B2B marketplace, empowering sellers to launch marketplaces based on their existing store.
A key benefit of this approach is that services that work with a business’s existing store will also work with their Mirakl-powered B2B eCommerce marketplace, including PunchOut2Go’s B2B Commerce Integration Platform.
There are several types of B2B marketplaces. In this article, we will explore some of the key differences, how buyers and sellers benefit, and how PunchOut2Go can help bring eCommerce marketplaces and eProcurement platforms together to enable procurement automation features that include Punchout catalogs, purchase order automation, and invoice automation.
Why are B2B eCommerce Marketplaces Flourishing in 2022?
As a consumer, buying products online involves nothing more strenuous than a Google search followed by cursory price comparisons and a glance at the reviews. For a B2B buyer, the process is more complex and, consequently, more expensive.
Sellers have to be identified and vetted. Contract negotiations may take months and involve many different stakeholders. Once the relationship is established, it must be monitored and managed for compliance, which requires manual and automated audits related to products and pricing.
B2B sales are just as complicated from the seller’s perspective; they must find buyers, negotiate, implement processes and policies agreeable to both sides of the transaction, and manage contracts, invoicing, and inventory.
B2B eCommerce marketplaces streamline business-to-business procurement and sales by acting as a digital intermediary between buyers and sellers.
A multi-vendor eCommerce platform allows buyers to find new products and sellers more easily, often pre-vetted according to the marketplace’s standards. Marketplaces typically provide data that helps buyers make a decision, and they streamline procurement with digital processes for RFPs and RFIs, contract negotiation, purchasing, and invoicing.
In short, B2B multi-vendor marketplace platforms reduce the cost and complexity of procurement while encouraging buyers to spend more time on the marketplace operator’s site.
Public vs. Private B2B Marketplaces
Public B2B marketplaces, which may also be called independent or open marketplaces, are marketplaces in the traditional sense, such as Amazon, Alibaba, Walmart, and Best Buy. Any seller that fulfills specific criteria can join and sell their products, and any buyer who is interested in those products can make a purchase. The biggest B2B market in the world, Alibaba, is a public marketplace, as are the Ariba Network, Amazon Business, and many other marketplaces.
A private marketplace, in contrast, is created primarily to serve the needs of one business. A company like Walmart may operate private marketplaces with a one-to-many configuration, bringing its sellers together on a platform it controls to increase procurement efficiency throughout its locations and business units.
Businesses create private eCommerce marketplaces in many different scenarios. For example, a company might outsource manufacturing to several organizations while buying parts from others. To enhance procurement efficiency and accelerate sales, it could create a private marketplace that connects its manufacturers to its sellers. Larger sellers or groups of sellers may combine to create a private marketplace for select buyers.
Software and services providers like Mirakl exist to help businesses launch and manage marketplaces of both types while extending and embracing their chosen eCommerce technology, such as Adobe Commerce, SAP Commerce Cloud, and Salesforce Commerce Cloud.
Vertical vs. Horizontal B2B Marketplaces
We have already mentioned the paradigmatic examples of a horizontal marketplace: Alibaba and Amazon Business. A horizontal marketplace sells many different product categories across multiple industries. They typically operate on a many-to-many principle: many buyers can connect with many sellers.
Vertical marketplaces, in contrast, are tightly focused on the needs of a specific sector within an industry. 1-800Flowers.com owns and operates a marketplace, also leveraging Mirakl on Adobe Commerce, within the floral, gift, and gourmet foods verticals. It connects thousands of florists and 3P sellers with B2B and B2C buyers and takes a percentage of the transaction without the need to warehouse products.
Vertical marketplaces often play a key role in sourcing products for retail. For example, in the fashion industry, Joor and NuOrder connect fashion brands with retailers, helping them to source and buy products. To show you just how prevalent vertical marketplaces are in some industries, Joor works with 200,000 retailers and 8,600 brands across the world.
The Benefits of B2B eCommerce Marketplaces
Traditionally, B2B sales are conducted through one-on-one relationships between buyers and sellers. B2B eCommerce marketplaces offer flexible alternatives for building buyer relationships and can provide additional advantages, including:
Enhanced shopping experience and ability to attract customers.
Improved information flow, which enhances planning and coordination.
Simplified and accelerated ordering with powerful online product comparison tools.
Reduced staffing costs for research, procurement, and sales relationship management.
Increased pricing transparency leading to more efficient markets.
The ability to test product lines’ selling effectiveness.
New business opportunities through the network effects of well-organized marketplaces.
Sellers are empowered to “sell more” by offering 3rd party products through their commerce solution, driving revenue opportunities while providing more value to their customers.
PunchOut2Go Connects Buyer eProcurement Platforms to B2B Marketplaces
EProcurement is the fastest-growing B2B sales channel, and buyers want to integrate sellers with their eProcurement spend management, internal private marketplaces, and ERP platforms. That includes B2B marketplaces.
However, integrating buyer eProcurement platforms with a B2B eCommerce market is not straightforward. Buyers use a huge number of different eProcurement platforms, each with unique integration requirements. That makes it challenging to offer integration and automation features such as Punchout catalogs, purchase order automation, and invoice automation.
The PunchOut2Go Integration Platform as a Service (iPaaS) provides the technology and support marketplace operators need to overcome B2B integration challenges and connect with their buyers.
The PunchOut2Go cloud integration platform can help:
B2B buyers to integrate B2B marketplace platforms with their eProcurement or ERP platforms.
B2B marketplaces to offer features such as Punchout catalogs and purchase order automation to buyers.
B2B sellers to offer more diverse purchasing methods to their buyers who have invested in eProcurement platforms.
Learn more about how PunchOut2Go empowers businesses to connect with thousands of trading partners on B2B eCommerce marketplaces.