You Probably Won’t Recognize The Next Great B2B Marketplace
I hear this a lot lately: “My boss told me we need to get on marketplaces. What are the best practices?”
After a few minutes unpacking the situation, we get to the part about the day in the life of the customer.
That’s when I generally hear crickets.
When marketplaces come up with vendors, I hear things like “aggregating,” “go vertical,” and even the dreaded “ . . . can do whatever they want.”
But when I listen to users, I hear, “I got it from the Wayfair app — I get everything from Wayfair!”
Soon you’ll be obsessed with a thing that makes your workday remarkably better.
It’ll have an app, a website, and delightful people you can talk to when you need help . . . and a cool name.
But you’re probably not describing it as “a revolutionary marketplace” or “the Uber of [fill in the blank].”
You won’t see any seams. It’ll just work.
In my coverage of B2B commerce within Forrester’s digital transformation practice, I’m seeing a slow realization that the way we’ve been selling stuff online has structural limitations.
Structural — meaning that sellers’ sites have hit the point of diminishing returns.
You don’t buy fresh fruit the way you buy books.
But most of the B2B sites out there overuse the shelf metaphor despite the type of stuff they’re selling.
Sellers need to rethink how they craft their digital sales experience to fit what they’re selling.
This will look different, site user experience (UX) won’t be homogenized, and the variety of UX will be more vast than consumer sites because, in the world of B2B, there’s a broad variety of stuff for sale.
Take the problem of preseason buying in fashion apparel wholesale trade.
The trade show was the physical solution that solved friction for both buyers and sellers.
The format illustrates how a problem like that can’t be solved by any one seller or any one buyer.
The model of B2B eCommerce that’s pervasive today can’t solve this problem. And it’s not because of their feature sets.
No retailer can solve the problem by making their site feature-rich.
No brand can solve the problem by making their site feature-rich.
Neither participant in the process can solve the friction that comes from one of them needing to use dozens of the other participants’ unique sites.
A New Type Of Participant
NuORDER is an example of a two-sided platform that digitalizes the trade show model. It brings retailers and brands onto a single site with an experience that’s optimized for buying and selling wholesale fashion preseason (i.e., pre-SKU).
It has deep expertise in its target sub-industry use case and builds technology that delights every participant.
Its users don’t call it a marketplace.
Its users call it NuORDER and say they really prefer using it instead of using paper line sheets and email.
Pumps are complex devices because there’s a big variety of stuff that’s pumped around the world.
It all has its own fluid properties like fluid density, viscosity, and vapor pressure. The fluid may be flammable or hazardous or life-sustaining water. Designing pumps requires balancing tradeoffs like performance, size, materials for corrosion resistance, and, of course, cost — the kind of design work that takes an engineer. Engineers use computational fluid dynamics software to validate their design like how car designers test aerodynamics.
Pumps are configured.
All the sub-assemblies and components parts are individually manufactured, then shipped to distributors or OEMs. The distributors and OEMs assemble them into pumps when they receive an order.
Imagine ordering a pizza — but imagine if a certain type of onion would buckle and explode if it were between double pepperoni and a layer of cheese with a gap that lets the sauce touch it.
Pump buyers need their own application-specific configurations — and they have an emotional need to be convinced that their configuration is tested and validated to handle the demands of their application before they buy it.
The experience can be full of friction if you take a traditional search/faceted navigation approach.
Even if you buy face to face with a sales rep who uses a configuration tool, settling on a valid configuration takes a lot.
Who Has Stewardship Of This Problem?
A buyer can’t build a site for this, because they buy more than just pumps.
A manufacturer can’t build a site for this, because pumps are made of parts from multiple manufacturers.
A distributor can’t build a site for this because they’re notoriously low-margin, have a lot of capital tied up in inventory, and are feeling the squeeze of manufacturers going direct. There’s a lot more to unpack here — but that’s for later.
With its latest acquisition of Intelliquip, I see FPX positioning itself to be the new type of participant to remove process friction in this sub-industry.
Intelliquip brings fluid engineering science to virtually test configurations and provide buyers with performance graphs and the dimensional outline of a pump that’s never been produced before.
Why Do I Think What NuORDER And FPX Are Doing Is So Significant?
Because they’ve taken stewardship of the process experience.
They treat each participant as a first-class actor and eliminate their friction.
What they’ve built could not have been built by any single participant (retailer or brand).
My colleagues Ted Schadler and Nigel Fenwick have written about the emergence of these types of platforms in their pieces “How To Build A Platform Business” and “How To Build A Better (Digital) Mousetrap.”
Are you in a sub-industry that’s starving for this? Reach out to schedule an inquiry.
In the meantime, let me know how your friction-elimination program is going! Best of luck!