Running counter to economic sluggishness in the consumer sector last year, b-to-b purchases grew 13% compared with 2006, according to Abacus, a division of Epsilon, in its 2008 Abacus Trend Report published last month. That’s more than double the rate of consumer purchases, which grew 6% year over year.
The trend report is based on aggregated merchandise purchase data from the Abacus cooperative database and its ChannelView campaign data.
“B-to-b is a big success story this year,” said Elisa Krause, VP-analytics at Abacus. “To see above-average growth for the b-to-b community, especially when consumer [spending] is growing at a slower pace, was surprising.”
Abacus found that b-to-b marketers have seen elevated spending in nine out of 12 categories across the Abacus business cooperative. “It’s not just one product category leading the pack, it’s across the board growth,” Krause said.
However, one industry expert disagreed with Abacus’ conclusions.
“I don’t see a comparison,” said Bernice Grossman, president of DMRS Group, a database consulting company. “I don’t compare what consumers do with what businesses do because the decision-making that goes into what a consumer buys and doesn’t buy is very different from what companies buy.”
“I can’t think of two more different verticals,” Grossman continued. “We don’t market the same way, we don’t market the same items. I would never compare the two. Instead, I would compare within b-to-b and within b-to-c.”
One interesting finding from the report: Small businesses are increasing spending while larger companies are scaling back.
Spending by small businesses—defined by Abacus as those with fewer than 50 employees—grew by 15% compared with the prior year, while large companies reduced their spending by 6%.
“This represents a great opportunity to target smaller organizations,” Krause said.
Among its other findings, the report supported the notion that the shift to online purchasing continues to grow and has become the purchase channel of choice over the direct channel for consumers. The percentage of sales taking place online has grown by 40% in the last four year, increasing 11% this past year to make up 56% of all direct consumer revenue.
B-to-b marketing is right on its heels.
The importance of the Internet in b-to-b marketing is catching up with its business-to-consumer counterparts as demonstrated by the 14% jump in online sales in 2007, bringing the total to 42% of all b-to-b direct channel revenue. Direct channel revenue is comprised of all channels except for retail (online, mail, phone, etc.).