Business-To-Business (B2B) E-Commerce Market

The global Business-To-Business (B2B) E-Commerce Market is valued at USD 18.8 Trillion in 2023 and is projected to reach a value of USD 83.5 Trillion by 2032 at a CAGR (Compound Annual Growth Rate) of 18.1% between 2024 and 2032.

Key Highlights

• Asia Pacific region led the market in 2023, with 80.2% of the total market share
• North America is projected to register the fastest growth rate during the forecast period
• The Intermediary-Oriented segment significantly contributed to the market’s expansion in 2023, over 60.5% of the market share
• Based on Application, the Home & Kitchen segment took the lead in the market, contributing 23.2% of considerable revenue share
• Adoption of diverse digital payment methods such as e-wallets, cryptocurrencies, and BNPL (Buy Now, Pay Later) options to facilitate smoother transactions. Ensuring secure and seamless payment processes to build trust and reduce transaction friction

Regional Overview

The Asia Pacific market exhibited significant dominance in 2023, with 80.2% of revenue share. The growing numbers of B2B vendors in the region created an opportunity for the growth of the e-commerce sector in the region. The pandemic forced various businesses to shift to online creating opportunities for the growth of the Business-To-Business (B2B) E-Commerce. Vendors in the region are now building technology that supports their business, marketing in an online manner, and planning operational strategies that will help their business in the long run.

North America is anticipated to show strong growth over the forecast period. The presence of major players in the region has already established the B2B markets in the regions. The pandemic has forced several other businesses to shift to the online business model to grow their business online and attract a wider audience. The factors like same-day delivery, enhanced shopping experience, integration of advanced technologies like advances in Artificial Intelligence (AI) & cloud technology will improve the customer experience, propelling for growth in the e-commerce space.

China Market Overview

The China Business-To-Business (B2B) E-Commerce market size was valued at USD 1,245 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 16.5% from 2024 to 2032, reaching USD 4,890 billion by 2032. This growth is driven by rising demand for consumer goods, electronics, healthcare, pharmaceuticals, and beauty products, which has accelerated post-pandemic. Additionally, the rapid adoption of advanced technologies like automation, machine learning, and data analytics is enhancing the production capabilities of manufacturing companies and boosting the growth of B2B e-commerce platforms.

Deployment Type Overview

• In 2023, the Intermediary segment dominated the global market with 60.5% of revenue share. Based on deployment type, the market is divided into Supplier-Oriented, Buyer-Oriented, and Intermediary-Oriented.
• The intermediary segment acquired the largest share of the market in the forecast period. The online deployment model enabled the seller to reduce costs in hosting a website, logistics, and customer support. The intermediate model aids in company scalability and will play an important role in the expansion of the intermediary-oriented segment in the overall e-commerce industry.
• The supplier-oriented Business-To-Business (B2B) E-Commerce model is projected to grow at a rapid pace during the forecast period. The supplier-oriented model helps customers gather information about suppliers of any product in a region or country.

Application Overview

• In 2023, the Home and Kitchen segment dominated the global market with 23.2% of revenue share. Based on application, the market is segmented into Home & Kitchen, Consumer Electronics, Industrial & Science, Healthcare, Clothing, Beauty & Personal Care, Sports Apparels, Books & Stationary, Automotive, and Others.
• The home and kitchen segment captured the highest revenue share over the forecast period. The demand for small appliances & other kitchen products witnesses tremendous growth during the pandemic as people spent more time at home. The wide range of products, lower cost, social media influence, and the rising awareness about a healthy lifestyle, fuel the growth of this segment in the forecast period.
• The demand for consumer electronics through online channels also witnessed significant growth during the forecast period. During the pandemic, the consumer’s focus on purchasing durables and electronics, including laptops, smartphones, ACs increased. Remote working also led consumers to invest in electronics that supported the work-from-home.

Key Trends

1. Businesses are increasingly integrating AI, machine learning, and big data analytics to enhance operational efficiency, personalize customer experiences, and optimize supply chains. Cloud-based platforms are also becoming the backbone of B2B e-commerce, offering scalability, flexibility, & cost-efficiency.
2. With the proliferation of smartphones, more businesses are conducting transactions through mobile devices, leading to the development of mobile-friendly B2B e-commerce platforms. Companies are investing in dedicated mobile apps to facilitate seamless transactions, improve user experience, and provide real-time updates.
3. AI & machine learning are being used to analyze customer data and provide personalized recommendations, enhancing the overall buying experience. Focus on improving UX through intuitive interfaces, easy navigation, and efficient customer support is becoming crucial for B2B platforms.
4. Blockchain technology is being used to secure transactions, ensure data integrity, and provide transparency in supply chains. Automated, self-executing contracts on blockchain are streamlining processes and reducing the need for intermediaries.
5. Increasing awareness and demand for sustainable & ethical practices are driving businesses to adopt eco-friendly operations and supply chains. Emphasis on CSR initiatives is influencing B2B buyers to prefer partners who demonstrate ethical practices and social responsibility.

India Government Initiatives

• Government Support for Digital Transactions in India: The Indian government is endorsing technologies like UPI, RuPay, DigiLocker, and eKYC to promote digital transactions, expand adoption in smaller cities, and foster innovation. In Budget 2023-24, it was reported that digital payments saw a 76% increase in transactions and a 91% rise in value in 2022. Furthermore, fiscal support of INR 1,500 Cr for enhancing this digital public infrastructure will continue into 2023-24.
• Boosting E-commerce through Rural Broadband Initiatives: E-commerce stands to benefit from government efforts to enhance rural broadband access under the Digital India initiative. Programs like BharatNet, with an investment of approximately INR 61,000 Cr, aim to provide broadband connectivity to 250,000 Gram Panchayats across India.
• One District One Product (ODOP) Program: The Government launched the ODOP program to select, brand, and promote a distinctive product from each district across India, fostering comprehensive socioeconomic development nationwide.
• Government e-Marketplace (GeM): GeM is a centralized portal facilitating online procurement of common-use goods and services for various Government Departments, Organizations, and PSUs. Currently, GeM serves 68,636 government buyers, offers access to over 3.1 million products, and connects 6.3 million sellers and service providers.
• Open Network for Digital Commerce (ONDC): ONDC, supported by DPIIT and the Ministry of Commerce and Industry, is an open network protocol aimed at transforming India's e-commerce market from operator-driven to facilitator-driven. Presently operational in 273 cities, ONDC boasts a network of 35,000 sellers.

Premium Insights

Chinese B2B marketers are adopting innovative strategies to enhance their operations. By utilizing integrated communication and network channels, companies are optimizing business processes and accessing a large, skilled workforce. These resources enable manufacturers to reach and sell to global audiences through e-commerce, contributing to the growth and success of the Chinese B2B market. The central and provincial government agencies support domestic manufacturers and entrepreneurs with low-interest business loans, startup seed funding, and angel investment opportunities. The government also promotes new tech SMEs by offering preferential tax policies and simplifying licensing and permissions for tech companies. According to the Global Startup Ecosystem Index 2024 by StartupBlink, China ranks 6th globally, with Beijing and Shanghai being top cities for startups.

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Market Dynamics

The COVID-19 pandemic brought a change in consumer shopping preference from over the counter to online shopping, creating the demand for growth of the market. The coronavirus pandemic, limited physical contact but to ensure business continuity, several business-to-business vendors encouraged their customers to shop online, driving the growth of the Business-To-Business (B2B) E-Commerce market in the forecast period. The increase in the number of orders, changes in consumer behavior, supply chain disruptions, and closure of physical stores have positively impacted the E-commerce business outlook.

The rising preference for online shopping, particularly among women, as well as the growing influence of social media platforms on purchasing behavior, will fuel the growth of the Business-To-Business (B2B) E-Commerce market in the coming years. The rapid advancement in technology related to financial transactions will play an increasingly important role in business-to-business transactions as it becomes smarter & more complex. Moreover, its advantage allows businesses to conduct business without having to maintain a physical presence, saving money on infrastructure, communication, and overhead, lower costs associated with logistics and customer support will propel the growth of the market in the approaching years.

Competitive Landscape

The B2B e-commerce market is characterized by intense competition among key players striving to innovate and expand their market share through strategic partnerships and technological advancements. For instance, in January 2023, Walmart Commerce Technologies and Walmart GoLocal partnered with Salesforce to offer retailers technologies for seamless local pickup and delivery via the Salesforce AppExchange. This partnership leverages Walmart's Store Assist app, which enhances in-store fulfillment by improving picking accuracy, speed, and efficiency, and provides a smooth handoff between employees, customers, and third-party delivery drivers.

Recent Market Developments

Amazon India Partners with West Bengal Industrial Development Corporation (WBIDC)

• In November 2023, Amazon India signed a memorandum of understanding (MoU) with the WBIDC to empower micro, small, and medium enterprises (MSMEs) and enhance e-commerce exports from West Bengal. This collaboration aligns with the District as Exports Hub initiative outlined in the Foreign Trade Policy, aiming to establish dedicated e-commerce export hubs in key districts across the state.

Flipkart Launches 'Flipkart Commerce Cloud'

• In October 2023, Flipkart introduced the 'Flipkart Commerce Cloud,' a retail intelligence service designed for international retailers and e-commerce firms. This platform delivers comprehensive retail intelligence & AI-driven services, providing tailored solutions to enhance the capabilities of merchants and e-commerce businesses globally.

Techstars and eBay Inc. Announce Strategic Partnership

• In June 2023, Techstars and eBay Inc. launched "Techstars Future of Ecommerce powered by eBay Inc." This strategic partnership aims to foster innovation & support companies in the e-commerce sector by leveraging both organizations' strengths. The program provides developing entrepreneurs with guidance, tools, and opportunities to shape the future of e-commerce.

The global Business-To-Business (B2B) E-Commerce market can be categorized as Deployment Type, Application, and Region.