MSTS is out with a new report on B2B sellers and buyer payment preferences. There are valuable insights and solutions to some of the challenges faced by B2B sellers, but one statistic shocked me.
The research showed that 57% of B2B buyers did not complete a purchase for their companies because the vendor checkout process took too long. With all of the tools and technology, choice of payments partners, and features available to B2B vendors, it’s hard to imagine that businesses selling to business would see cart abandonment levels this high.
The good news is there are solutions and some very real ways that businesses can lower their B2B costs, increase sales, and improve the chances of securing business customers for life.
B2B payments overview
MSTS found that 90% of customers research the seller’s payment options before buying. It also found 74% of B2B buyers will purchase from a competitor if a vendor’s e-commerce store can’t meet their purchase expectations.
“B2B eCommerce transactions today are often limited in how customers can pay. The payment mechanisms typically found online are credit cards, which are expensive for sellers and difficult for buyers to reconcile once the statement arrives. Invoices are hard for buyers to find and download, and the ability to apply procurement processes is fraught with complications or entirely absent. These factors combine to make eCommerce for B2B transactions much more painful for customers when compared to their B2C purchasing experiences,” MSTS President, Brandon Spear said.
Research showed 86% of B2B buyers use credit cards to make purchases online on a weekly or monthly basis. The interesting thing is that this may not be their preferred way to pay and that offering alternatives could increase your sales.
In fact, more than three-quarters (77%) of all B2B buyers agree vendors should offer additional payment options beyond credit cards to improve the buying experience. 50% of B2B buyers said they prefer a payment method other than a credit card when purchasing for their company.
This really shattered my preconceived notions about the B2B market.
B2B payments problems abound
What else are buyers saying about B2B payments? Another big surprise is how many B2B buyers experience problems with their payments.
“Ninety percent of B2B buyers who make purchases once a week experience some sort of pain during the purchasing process, compared to 79% of B2B buyers who make purchases monthly. Among the most prevalent sources of concern for B2B buyers is a drawn-out checkout and onboarding process as well as a lack of preferred payment options,” the report said.
Let’s look at what the MSTS research found when it comes to key B2B payments problems:
– 90% of B2B buyers who make purchases once a week experience some sort of pain during the purchasing process
– 48% of B2B buyers did not complete a purchase for their companies because their preferred payment method wasn’t an option
– 77% of B2B buyers say it takes a day or more for a new vendor to onboard them before they can make purchases online
– 27% of B2B buyers agree the time it takes to complete onboarding for payment on terms can create frustration when they attempt to make purchases for their company
– 76% of B2B buyers have encountered an issue that has prevented them from completing an online purchase with a credit card
– 79% of B2B buyers who most often use credit cards to pay for online purchases experience post-transaction pain.
While this may look like a long list of payments challenges for B2B vendors, the solutions are not as difficult as they may look according to Spear.
Solutions to B2B payments problems
B2B buyers were clear about their payments preferences and their answers provide a path to solutions for B2B sellers.
MSTS learned that 50% of buyers prefer a payment method other than a credit card when purchasing for their company. And, 77% of all B2B buyers agree vendors should offer additional payment options beyond credit cards to improve the buyer experience.
“A payment option beyond credit cards that businesses may want to consider offering is ACH. Credit cards are often declined due to suspicion of fraud or expired cards and ACH minimizes those failures. In addition, ACH typically has low or flat rates and offers more controls on payment dates,” Spear said.
Clearly, the limited payments options most B2B vendors offer are out of step with buyer expectations. That gap is even bigger if you’re selling across borders or on other continents were payments preferences are local or very different from our typical North American credit card payments bias.
You can read the full article on PaymentsNext.com.