The tech-driven shift to D2C in the B2B sector

The app economy has inspired an ‘on-demand’ self-service culture among all kinds of consumers. The B2B sector is no exception and brands are responding to the changing customer demands through Direct-to-consumer models.

The way brands connect and engage with their customers has changed significantly in the last two years. The digital-first era is transforming conventional buying patterns and behaviours. Customers across segments – whether it’s B2B or B2C – are expecting digital-first, personal and connected experiences as they consume products and services.

As a part of this shift, digital commerce or e-commerce has been sweeping the B2B segment lately. According to a McKinsey report, nearly two-thirds of B2B companies across industry sectors now offer e-commerce capabilities. That is an extraordinary number for an industry which has preferred in-person sales so far.

This was an inevitable change. But, something more interesting is happening to the B2B space – the emergence of the D2C or direct-to-consumer model. What was once considered an exclusive domain for B2C brands is now helping B2B companies explore new possibilities.

Key drivers
The global pandemic was vital for the growth of the direct-to-customer approach in the B2B segment. It propelled a rapid shift to the digital way of working and compelled companies to launch apps & services at lightning speed. This marked a stark change in what was perceived by buyers as “good enough”.

B2B buyers are therefore taking on the habits of B2C buyers, which has shaken some legacy business models and thought processes. A study conducted by TrustRadius in 2021 found that millennials comprise 60% of today’s B2B technology buyers. This generational shift has already moved the needle for B2B e-commerce with a 200% growth in D2C purchases between 2019 and 2020 (source: Salesforce).

Adobe CEO Shantanu Narayen emphasized, saying “making the digital economy personal” is a matter of greatest importance to businesses. Adoption of D2C models is helping businesses get this ‘experience’ part right, experts argue. Adoption of digital sales channels have helped brands enhance customer relationships, reach out to more customers and improve the overall competitive advantage.

For the successful implementation of D2C models, brands must focus on three key areas
Become data-driven: B2B brands understand the power of data in creating compelling D2C models. Throughout the digital buying cycle, data must be leveraged to create a compelling experience for corporate buyers. But brands are grappling with the challenge of fragmented data sets, legacy technologies and siloed approaches in this journey. Moreover, gaining customer insights become a challenge as B2B companies have historically preferred indirect sales channels which distanced them for end-users.

The D2C space is highly competitive and brands must focus on data and customer insights for decision-making. B2C brands can learn a thing or two from their B2C counterparts on how to be data-driven. Predictive analytics, AI/ML and customer insights solutions can help brands understand customer behaviour, brand perception and create a 360 degree view of the buyers.

Take it personal: Personalized experience has become a universal ask. Successful brands have excelled in gathering customer insights and transforming them into personalized interactions and service offerings.

Buyers want real-time responses and digital experiences while brands must also focus on providing this at scale. Metaverse has already shown that the lines between physical and virtual words are blurring.

The app economy has inspired an ‘on-demand’ self-service culture and B2B brands must prepare to cater to the growing customer demand through D2C models. Website personalization, short buying cycles, proactivity and the ability to provide a connected experience are a few things that brands must prioritize.

Leverage Tech: From AI-powered live search to product recommendation engine to digital signatures, technology is the backbone of building a D2C strategy. Digital experience platforms are growing in popularity among brands that strive to provide a cohesive CX (customer experience).

Experts recommend taking a ‘composable’ and software-driven approach while building an ecommerce platform and the underlying tech stack to be able to evolve as you move along. Increasingly, brands are embracing a tech-first, digital-native model of being. D2C strategies will help them pivot to the future more quickly.


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