According to a recent survey of 406 executives by Jupiter Research, 54% of buyers would give their suppliers preferential status if they were to offer the type of value-added services commonly found in the brick-and-mortar world. The survey also indicated that 80% of buyers would be more willing to trade online with those suppliers who added more comprehensive services, such as collaborative product design and increased supply-chain inventory visibility to their site. In light of the survey's results, Jupiter suggests suppliers provide buyers with these services, which they term "buyer productivity applications", and keep an eye on simplifying B2B interactions. They also add that B2B players should concentrate more on creating customer loyalty and less on trying to reduce transaction costs. Jupiter Research proposes that forging closer partnerships will introduce new efficiencies, which will in turn result in cost savings further down the line.

The researchers highlight three main areas where value-added applications would be instrumental: design collaboration, supply chain inventory visibility and interactive planning. They also predict that b-to-b buyers will remain slow to move online for about the next year and a half. During this time they suggest suppliers implement "Buyer Productivity Applications" which should be adjusted according to their customers' profiles. By doing this, the analysts contend, suppliers can encourage a greater degree of buyer sophistication on the Internet that will result in greater allegiance and higher revenues. Jupiter analyst, Jon Gibs explains, "At present, supplier strategy means going online only to meet the few buyers already there. But future supplier plans include bold new collaboration applications that will help buyers get with the program. By investing in programs buyers really value, suppliers may finally experience the market expansion they've been waiting for."

Of course, analysts aren't soft peddling the financial investment associated such services. They bluntly state that added services initiatives are costly and suppliers therefore need to carefully plan. A good strategy for added services should take buyer motivations into account to ensure an arrangement benefiting both parties. Jupiter analysts offer the following tips to help decide which value-added services to offer:

• Suppliers should thoroughly research best buyers. This includes conducting in-depth survey work and needs-assessment studies.

• Suppliers should take a hand in training the buyers and not be afraid to lead the way in buyer training.

• Suppliers should move their existing buyers online. Start off with simple transactions and escalate from there as the buyers gradually adjust to the new medium.

• Once the existing buyers feel comfortable online, suppliers should work at attracting new businesses, a necessity if they want to expand their market share online.

Sources: B-to-B Buyers Will Increasingly Trade Online if Suppliers Offer More Comprehensive Services, Reports Jupiter Media Metrix
Office.com, May 24, 2001
http://finance.individual.com/display_news.asp?doc_id=PR20010524NYTH010&page=news

What's Wrong with Online Suppliers?
Demir Barlas
Line56, May 25, 2001
http://www.line56.com/articles/default.asp?NewsID=2544&ml=2