International B2B e-commerce: 5 mistakes to avoid

B2B ecommerce

Increasing numbers of B2B businesses both large and small are setting their sights on trading internationally through an e-commerce platform. To give yourself the best chance of making a decent fist of it, Axel Mouquet, CEO of Webhelp Payment Services, proffers his advice and explains which mistakes to avoid.

At Webhelp Payment Services, we know all about trading internationally: we cover 35 countries and we collect 80% of our payments (€1,5 billion a year) outside France on behalf of B2B vendors.

As a payment institution, at Webhelp Payment Services we help our clients to devise and manage their B2B payment strategy. Our shared objective is to improve the customer experience and develop a secure business.

To this end, we offer risk management, transaction management and non-payment management services, working internationally with brands such as Conrad, Aniel, IPH, Procsea, Conforama, Le Duff and Rungis International Market.

From day-to-day practice and our observation of the market, we have identified 5 avoidable mistakes:

    1. The ‘everywhere-at-once, all-at-once’ strategy. The temptation is to launch in several countries at the same time instead of introducing a gradual rollout (which is more advisable as we shall see later). In this faulty model, the starting point is often the home-country e-commerce website or the reference website, which is then cloned and rolled out simultaneously in the different languages and countries. Typically, this is done by employing translators to translate the existing content. But you can bet your bottom dollar (or euro) that it won’t work!
    2. A succession of ‘cut-and-paste’ openings. In this variation on the faulty model above, the plan is to proceed country by country, simply ‘cutting and pasting’ from one site to the next. But here too you’ll be heading for trouble, as B2B conventions vary hugely from country to country. You have to understand and follow not only the law but also business practice, decision-making cycles and order-validation circuits for example. It’s therefore a no-brainer: you must redesign the site – and the customer experience – for each country or region.
    3. Staking everything on adwords. This is perhaps the costliest strategy: the company invests a fortune on buying adwords in the hope that this will capture demand. Of course, you must not neglect or forget about digital marketing, but human contact is important too! In B2B commerce, building a relationship of trust – between professionals – is crucial, especially when your business is starting out. You have to devise a sales force deployment strategy on the ground or operating in the local language. And later you will have to regularly tweak your mix of digital and on-the-ground presence.
    4. Over-centralising your business. Is your company based in Paris, Lyon or Bordeaux? Then it’s there that all of your international operations will be based. We cannot say it often enough: in B2B you must ensure you have a physical presence local to your customers. And your customers will want to check that this presence is on offer, even if it is just a sales or logistics service. In B2B, digital commerce will never do away with borders completely!
    5. Having the same payment conditions everywhere. To speed things up when rolling out your B2B e-commerce platform internationally, it is tempting to standardise your payment conditions. But experience shows that even within Europe there are major differences here, and some of them may even put you at risk. There are differences between payment conditions, respecting payment deadlines, legal aspects of the market, etc., and you also have to take into account local competition, prices and products and services on offer. And in B2B, assessing customer credit risk is crucial. Webhelp offers a range of specific international commerce solutions.

    In summary, our advice is not to spread your resources too thin and to tailor your offer to each locality. To become an international business you will have to identify the key success factors for each country and focus your efforts on them.

    And here are 5 examples of approaches that work well, where we have helped our customers grow their B2B business internationally.

    1. Introduce a gradual, tailored rollout. The idea is to be realistic, starting with the country or region that appears to present the fewest operational difficulties and learning all the lessons you can before expanding elsewhere. On each occasion, you must take the time to understand the specific characteristics of the local demand. You should implement a carefully thought-out, localised approach incorporating co-design and co-construction.
    2. Use the marketplace model. The marketplace model has certainly proved its worth in B2C and now represents a tremendous opportunity in B2B since all the tools and methods are already available. This strategy enables you to construct your offer locally, minimising the risks, investment and any logistical problems involved. And you also have the option of signing up dependable salespeople with a good reputation who are already in place. At Webhelp, we think this model is becoming the go-to approach and that you should consider it very carefully. In other words, you’ll have to have very good reasons not to adopt a marketplace-based approach!
    3. Make sure you have localised payment strategies. This is where Webhelp Payment Services comes in: devising, implementing and managing the complete payment circuit, with the option of including credit insurance, constructing a secure business model for the country in question and taking into account specific customer risks. In this respect we are able to provide tailor-made solutions on the basis of conventional or pooled distribution of profits/risks.
    4. Build locally with international partners. Your success is conditional upon knowing the ins and outs of B2B practices in the country or region concerned. Giving yourself the ability to identify and work with international partners gives you a decisive advantage. Especially if your growth objectives – organic or external – are ambitious.
    5. Develop a local sales force. As we have seen, B2B is not all about digital technology. You should consider gradually introducing sales forces on the ground.


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Are High Street Stores Now The Weakest Link For Retailers?

As I have often detailed here, omnichannel is here to stay. Customer expectations today demand that the experience they have of a brand is just as good online as offline and however they choose to communicate, the service will be great.

That’s what customers expect today, but for many brands it is still not a reality. This article in eCommerce News about retailers in Sweden shows that for retail brands there it is often the physical store that is ruining the omnichannel experience. High street stores are becoming the weakest link.

A quarter of Swedish shoppers feel that they get a much more personal experience when shopping online, according to a new study.

Can you imagine that statement from a couple of years ago when the personal in-store experience was considered to be the reason why people will keep on returning to real stores.

Customers know that brands know about them and this helps retailers identify what customers like, what they are not interested in, and how to offer timely deals that will encourage more purchases. All this information is easier to gather in the online environment, but now there appears to be a backlash against the way that the real in-store experience differs – because the employees of the store do not know you when you walk in off the street!

Naturally the real in-store experience will always remain the weakest link if customer expectations for personalisation are increasing to the point where customers want to be treated as individuals when they walk into a store.

Building this kind of in-store personalisation can be complex, but it depends on the approach. The UK retailer Mothercare wrapped an online receipt system around all their existing processes – so after a purchase was made if the customer gave their email address for the receipt details then the system could match up their details to previous spending and offer additional deals.

This does rely on personalisation after a purchase though. Facebook offers location-aware technology to retailers so they can be aware of which customers that already “like” their brand are nearby to a store. This can be cross-matched with other demographic information to send offers direct to the phone of the customer.

Utilising a system like this also restricts the brand to only working with customers who are active mobile users of Facebook, but I do think that some kind of “logging in” will become more common when customers enter a store they like – probably using apps available from the retailer.

If a customer is encouraged to let the app know that they are in-store and the retailers makes it attractive enough to do this then not only can the in-store experience be personalised, but the retailer gets even more data on what the customer is interested in.

Most of us have now become used to reading news online to the extent that some major newspapers, like The Independent, no longer even provide a printed edition. The online news experience lets us comment on stories and share articles that are interesting. It is a far richer experience that the traditional consumption on news printed on paper and this kind of paradigm shift is taking place with retailers. The online experience is now so good and personalised to the individual; those shoppers want to feel the same way when they walk in a store.

What do you think about these changing expectations? How will it affect retail on the High Street? You can leave your thoughts or comments below.


What did we learn from Black Friday 2015?

A couple of weeks on from Black Friday in the UK and what have we learned?

 

Well, as predicted in The Drum recently, the omnichannel experience is now more important than ever. Creating a seamless customer experience all year round is more important than discounts on a single day. However, Black Friday was still extremely popular so what happened this year?

 

First, it became clear that the online discounts are becoming more popular than those discounts available in-store. I was watching the TV news and thankfully didn't see the traditional scenes of people fighting over TV sets, which fits with retailers saying this year that the in-store rush has eased. Conversely online shopping was up 36% with £1.1bn spent by online bargain hunters.

 

Contrast this with the midnight store openings. At Boots on Oxford Street only journalists were present. Other stores opening early at five or six in the morning found very few customers prepared to brave the cold weather conditions. Analysts also indicated that the recent terror attacks in Paris could have affected the desire for shoppers to line up in the streets all night, but I think the real reason for this change is just that shoppers have moved online.

 

15 major retail websites crashed on Friday. Big names such as Argos, Tesco, and John Lewis all suffered website issues demonstrating that even with all the planning and expectation, the sheer amount of customers all trying to shop online at the same time on the same day can create a nightmare for the IT team managing these ecommerce platforms.

 

Retail analyst Richard Hyman has suggested that about a quarter of UK retailers ignored Black Friday altogether. He said that next year there may be an adjustment in how stores adjust their opening hours and staffing levels, based on the trend for more shoppers to just engage online.

 

The real question for many retailers will be whether Black Friday is worth the effort and discounting. Asda was
the most public refusal this year, although other major brands such as Next and Jigsaw also ignored it. These retailers have all suggested that they would prefer to spread discounts over the entire holiday shopping season rather than focusing on a single day

.

The jury is still out. Black Friday 2015 was an enormous success for online retailers this year, but the message is far more mixed from the High Street. I’m sure it will be taking place again in 2016, but it will be interesting to see how those retailers with both an in-store and online offer manage to promote the event.

 

See how 10 top UK retailers performed on Black Friday

 

 


Banks Are Not Just Being Challenged; They All Need to Change to Survive

I’ve written previously about the wave of “challenger banks” sweeping the UK banking and financial services market. There is a great opportunity for new brands to focus on improving service to the customer and taking market share from the big established brands.

But change in this market is coming from beyond new brands on the High Street alone. Digital banking is changing the banking sector in several ways:

Payment by phone

Services such as Apple Pay are now commonly accepted and stores with low-value items – like coffee chains – are experimenting with their own phone payment systems that connect into the loyalty programme. No more lost cardboard loyalty cards!

Niche services by app

Individual apps for individual banking services are here. Want to transfer money overseas? There will be an app offering this service. Want a loan to buy a car? Why not use a peer-to-peer app? Niche players are using the app store to offer almost every kind of possible banking service.

Location based services

Banks are already using location-based advertising across social networks so it’s only a small leap of the imagination to assume that they will use the same customer insight to directly offer their own services soon. For example, sending an offer on a loan if they can see you are spending more than usual in a month and are currently out shopping again.

Customer analytics

The data available on customers is now so complete that behaviour can be predicted before it takes place. For example, customers that will have trouble maintaining payments on their Visa card can be contacted before the problems become critical.

Omnichannel banking

It goes without saying that customers today expect the service at their bank to blend seamlessly between the branch and their online experience. But think about the reality – are most banks anywhere close to what customers expect? If you check out a new mortgage online and walk into a branch the next day, how would it affect your impression of the bank if the in-branch team were already aware of the type of mortgage you are interested in without you needing to explain all over again?

I think there is a potential existential crisis for the entire banking industry if they do not pay enough attention to these changes. Niche players offering individual financial services via apps can usually undercut the major banks because they do not have the overheads of a national branch network, so in theory these niche service providers should be able to win an enormous amount of business from the traditional banks.

Customer loyalty and inertia will prevent much of the potential business loss, but if customers are increasingly dissatisfied with the service they receive then they will look for an alternative. Why give customers a reason to go looking for a new service provider?

I think that a focus on how to deliver an omnichannel approach to customer service is now critical for all the major banks – as a way of retaining existing customers and for attracting new customers with a combination of their established brand and great service.

What do you think about the changing banking sector? Leave a comment here or get in touch via my LinkedIn profile.

 

Image courtesy Ken Teegardin.


UK Retail Leads in Omnichannel Adoption

Consulting firm Kurt Salmon recently published their 2015 analysis of the retail omnichannel market in Europe. Being British and focused on omnichannel developments in the UK the most striking results that leap out from the research is that British retailers are far ahead of their European counterparts.

The research focused on four different areas; mobile, online, social, and cross channel. It stated that every company surveyed could improve their cross channel offering, but in the other areas there are clear winners.

The leading companies were Topshop, Wallis, and Miss Selfridge, followed by department stores John Lewis and House of Fraser.  A particularly good result was for the Arcadia group, with Topshop the top brand overall across all metrics.

An interesting observation from the survey was that one area where British stores appear far behind continental Europe is in offering stock checking options on the website. Having the ability to go online and check that an item of stock can be found in a store is a strong driver for customers to visit a store. If they need an item quickly it helps immensely to check stock levels or even having the ability to check stock and then reserve the items.

This is a great example of how the online store can be married to the physical store in a way that makes both online and offline work together. Retailers looking to drive cross channel engagement need to consider exactly how to enable customers to use the right channel at the right time, without an enormous cost of switching.

Given that the weakest area for all companies in this research was support for customers across multiple channels there is still plenty of work to be done. Perhaps by next year, some of these companies can have a much stronger omnichannel offer for their customers.

What do you think about the state of omnichannel adoption in retailers across Europe? Leave a comment here or get in touch via my LinkedIn profile.

 

Image via melenita2012


Retail Banks: Are The Challenger Banks Enough?

UK retail banking has been through quite a change in the past 6 or 7 years from the previously unimagined bank runs on Northern Rock to nationalisation and back again. With the government now unwinding state investments in Lloyds and RBS and new ‘challenger’ brands emerging is the industry performing how customers expect?

No. Even with the High Street shake up driven by the challengers, this is an industry where customer expectations are diverging from what the banks are offering.

Look at retail for an example of how brands are reacting to customer expectations. House of Fraser is a great example as I was discussing some of their omnichannel strategy on LinkedIn last week. HoF is reorganising their management and customer focused teams to be driven entirely by the needs of their customer, whether that customer is in a store or online. They are removing the distinction and trying to offer a great service to all customers – not just those on preferred channels.

What is the reality in banking? Well, a recent publication by the British Bankers Association (BBA) features some revealing statistics:

  • 10.6 million banking app logins every day
  • 22.9 million banking apps downloaded
  • £2.9 billion a week transferred using apps
  • 43% decline in telephone contact to banks from 2008 to 2013
  • 6% decline in branch use in the past year

Look at the final two. Visits to bank branches are declining dramatically year on year and the use of telephone banking has been in freefall since 2008. Customers want more. They want the same convenience in banking that they can find from other industries – like retail.

Imagine going to a car dealer and being told that it’s easier to get a new car if you stick with the same manufacturer as your present one, and you can’t compare the prices of alternatives once the dealer gives you a quote on a vehicle?

It sounds absurd, but isn’t this how banks still treat customers? It’s often easier to get new products from the one that has your current account and if a product such as a loan or insurance is offered, how easy is it to run a quick comparison with a rival bank?

The challenger brands are shaking up retail banking on the High Street. Opening hours are being improved and services are becoming easier to purchase, but the entire industry is facing a new challenge from market entrants.

Companies that offer individual financial services are often able to give customers a better deal because they have a narrow product focus and no need to manage a branch network. Even big non-financial brands are offering financial services. You can ask car manufacturer Renault, or any of the big supermarkets, for a personal loan.

The Financial Tech (FinTech) market is also growing fast. Individual financial services offered via apps means that customers can download a tool, get a quick quote on a product and choose whether to use it, at any time of day or night.

So how can the challenger banks and the big established banking brands compete in this new world of financial services? By improving the customer experience. Customers still trust and respect their banks. This is where they have always conducted financial services and it remains the most obvious place to go for most customers. Peer-to-peer lending might be exploding in popularity, but it is still dwarfed by the amount of personal loans issued by the big banking brands.

But, as the BBA research indicates, if the gap between customer expectations and the reality of how banks treat customers get wider then there will be an exodus. Customers are already impatient. If the situation gets worse, the traditional brands and even the High Street challengers will look archaic in the way they treat customers.

What every bank executive needs to be thinking right now is how do I place the customer at the heart of what we do? How do we make it easy to ask questions? How do we make it easy to obtain services when the customer needs them? How do we make the customer journey so easy that banks inspire loyalty from happy customers?

The customer experience is now the number one priority for all banking brands, including the challengers, but it’s not just me saying this. Take a look at the BBA research for yourself by visiting their website here.

What do you think of the way that the challenger banks are changing UK banking and whether it is enough to keep up with customer expectations? Leave a comment here or tweet me on @DavidTurnerCXO


Challenger energy brands need to punch above their weight

Challenger energy brands need to punch above their weight in customer service to make their growth stick.

In the past three years, energy companies other than the big six of British Gas, EDF Energy, npower, E.ON UK, Scottish Power, and SSE have grown their share of the market more than nine-fold, from less than 1 per cent in 2012 to 8.7 per cent today. These fledgling challengers have seen an influx of customers in a space of time that most businesses could only dream of.

However, there is a risk that this could prove a mixed blessing if overwhelmed management systems lead to poor customer service, prompting the new intake to leave just as fast as they arrived.

Inevitably, avoiding this situation will require investment, but there are definite rights and wrongs when going about this and ways to make any expenditure go as far as possible to improve customers’ experience.

As if the rapid growth of these businesses didn’t present challenge enough, it is compounded by the fact that consumers are now more demanding than ever in terms of the ways in which they expect to be able to communicate with their energy suppliers. They want to be able to interact with their suppliers on the web, via desktops and mobiles, as well as by phone or email. Moreover, customers also expect to receive a consistent response regardless of which channel, or combination of channels, they wish to use. Solidly delivering this level of service in a rapidly growing business presents a real management challenge, not only in terms of getting the IT systems right, but also avoiding silos from forming that prevent effective sharing of information across different departments.

Thankfully, setting these systems up in-house is no longer the only option for these challenger energy companies, and the range of hosted customer-management services that are available, either to wholly outsource or to supplement the process, have proliferated in recent years. As well as avoiding significant upfront investment at a time of great change in a business, this type of service also allows users to tap into well-established infrastructures, managed by teams with a great deal of experience running customer communication programmes. At a time when the management needs to be wholly focussed on the commercial and operational sides of their business, this could be an especially wise choice.

If you want to read more about the challenge faced by the newer entrants to the energy markets and the hosted customer management services that are available to help, download our recent white paper: The Power to Compete.