B2B: Pitfalls & Opportunities – Assignment Example

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The paper "B2B: Pitfalls & Opportunities" is a good example of an assignment on e-commerce. First of all, selling to an organization such as a business entity is entirely different than selling to an individual consumer. This is the most important concept in B2B e-commerce. A decision to buy is usually a group effort made by the decision-making unit or DMU composed of several people like initiators, buyers, influencers, users, etc. (Blythe & Zimmerman 2005). A B2B business model has many forms such as one-to-one, one-to-many and many-to-many to include catalog sites and auction sites where buyers can bid on a buyer's offerings.

The opportunities and advantages of using a B2B model are speed, choices, streamlining and response (Haig 2001). The B2B sector accounts for slightly over half of all e-commerce today but will grow further to some 90% later this year. The worldwide B2B market will reach some $2 trillion as multinationals as well as big, medium-sized and small companies shift to the online procurement of goods and services. This can be contrasted with business-to-consumer (B2C) revenues that will reach only about $108 billion in annual total purchases.

The most active online markets are those in automotive, chemicals, paper and office products, computers and electronics, construction, and transport and travel facilities (ibid. 2). Most of the value (savings and efficiency gains) will be captured by the buyers and sellers in B2B marketplace transactions. A common pitfall and mistake in B2B business models is their inability to generate sufficient branding. This is due to most of them did not treat branding in a holistic approach (Kotler, Pfoertsch & Michi 2006). Examples of successful brands in a B2B setting are Caterpillar, Cemex, Lenovo, Samsung, Siemens, and IBM.

An example of a similar B2B model that failed is the one that engaged in linking up suppliers and buyers of agriculture products. The farmers had no Internet access and if they have, do not know how to use it. The payment system with the country's banking system was not so well integrated either. One very important thing is that the customer is buying not with his own money but the company funds.

Advertisements in B2B should be more factual and less emotional (Altstiel & Grow 2006).

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