B2B drives European eCommerce, says IDC

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According to recent research from IDC, business-to-business (B2B) eCommerce is proving to be the real driver of eCommerce in Europe. All forecasts have indicated that business-to-business will grow in terms of online revenue, but the main focus has been on business-to-consumer (B2C) ecommerce. Last year, three quarters of all Western European internet commerce revenue came from B2B, and this will increase to 87% by 2003, representing over 400 billion euros.

“Of the variety of types of B2B business models – EDI, extranets, eprocurement, emarketplaces, etailers – extranets currently carry the bulk of ecommerce today,” said Mikael Arnbjerg, program manager of IDC’s European Internet and eCommerce Strategies service. “However, emarketplaces, the headline grabbing dot.coms of B2B, will eventually take the lead position as a number of them manage to establish themselves as de facto marketplaces in specific industries.”

Despite the distinction between the various types of business models, it is important that sellers do not think purely in terms of one type of ecommerce. “In the future, it will be crucial that vendors are able to sell through many of these channels, a practice that IDC believes will become commonplace with time,” Arnbjerg added.

Based upon the input obtained from speaking to early adopters of B2B ecommerce, IDC has identified the following main challenges facing companies in the move to ecommerce:
• Companies from outside of the ICT spectrum reported difficulties in getting things to work, for example, integrating back-end systems with the web storefront.
• The skills shortage affects companies in their shift toward ecommerce. eMarketplaces also need to employ people that possess insights into the industry they intend to target.
• All departments likely to be affected by organizational change must be involved in the implementation, with the support of the management.
• A company that implements ecommerce will find that its relations with the outside world will change as a result. The design of the ecommerce solution should take into account the requirements of partners.

The study, The First Generation: Business-to-Business Internet Commerce in Europe, presents a number of business models (extranets, eprocurement, emarketplaces) that have come to represent how organizations conduct transactions via the internet. In addition, this study presents the ecommerce experiences of the following six companies that are among the early adopters of internet-based ecommerce in Europe: BuildOnline, Cisco, Ericsson GSM Systems, FOL Agriculture, SCA Forest and Timber and Steelscreen.



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