With the holiday season in the rear-view mirror, shoppers may be looking for a break. However, retailers are primed to use this time to begin implementing a busy 2024 road map. Retail industry leaders are exploring ways to navigate the ripple effects of inflation and to integrate data-driven insights into digital transformation strategies.
When previewing channel priorities for the new year, e-commerce is expected to continue being a driving force — growing by double digits through 2027. And we can’t forget corporate buyers, who have already developed shopping habits as consumers first. Selling to business buyers who masquerade as consumers by using corporate cards for their business purchases takes a small leap for many retailers to put a business-focused strategy in place. Because these shoppers are already acquired, retailers have an opportunity to shift their focus to building business loyalty that encourages repeat purchases. Below are a few tips retailers can integrate today to meet corporate buyer needs and increase sales.
Using Choice to Build B2B Buyer Loyalty
Retailers are well-versed in loyalty best practices for the B2C side, but there are some questions when it comes to what builds business buyer loyalty. Fortunately, recent research has revealed exactly what B2B customers want — and it’s more than “surprise and delight” or a points-based program. In today’s digital world, 72 percent of global business buyers are more loyal to a retailer that offers their preferred payment methods that makes doing business easier.
This is the case as business buyers’ needs come from a place that’s more technical and less emotional. When people make a purchase for their company, they’re using a different set of evaluation criteria that includes how easy it is to use their preferred payment type.
What Are the Preferred B2B Payment Methods?
According to this new study of 300 global business buyers, 95 percent of respondents say they use their corporate credit cards at least monthly with an average ticket total of $20,800. So, yes, accepting credit cards is essential for attracting these customers.
But for larger purchases, trade credit is preferred by over half (59 percent) of business buyers. Trade credit, also called net terms or invoice terms, is a form of short-term financing that sellers (in this case, retailers) offer to buyers. It’s common in the B2B world, but many consumer-focused retailers aren’t as familiar with this billing process.
There are multiple forms of payment used by businesses, including checks and cash on delivery. However, corporate credit cards and trade credit are the top two payment methods today’s business buyers want when making purchases. And without being able to offer payment options, retailers will struggle to build B2B buyer loyalty and close larger deals.
Automated Trade Credit Helps Ease Business Buying
Offering trade credit is easier said than done. It can be tempting to set up an internal DIY process to get to market quickly, but I don’t recommend it. There are many steps involved, including vetting new customers, loan underwriting, invoicing and collections. It’s a nuanced process that requires experience and expertise to set up, and advanced technology to automate.
And trade credit must be automated. Manual processes are often sluggish, fraught with errors, and don’t scale quickly. Today’s B2B buyers cite inefficient processes, inaccurate invoices, and slow onboarding as their top three pain points during the purchasing experience. These are all symptoms of manual handling behind the scenes.
Instead, retailers that want to increase B2B sales should invest in a B2B payments and invoicing platform that can vet customers and extend right-sized trade credit offers in moments — not days or even weeks. Then, a system is needed to also generate invoices that accurately reflect negotiated prices and other required details. The best B2B payments provider will handle dunning and collections, removing a large burden from in-house teams and freeing those teams up to focus on other strategic business activities.
A Winning Strategy to Boost Sales
Adding a payments and invoicing solution that allows corporate buyers to pay in the manner most convenient to them — by card or net terms — can significantly increase a retailer’s share of the growing B2B market. Overall, offering payment choice, alongside convenient, automated and customized invoicing, are the keys to building loyalty among business buyers. With these updates to the payments experience, retailers can drive B2B loyalty and average order value in 2024 and beyond.
Brandon Spear is the CEO of TreviPay, the global B2B payments and invoicing network.
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