Why API-Driven Automation in B2B Ecommerce is Rising

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Ecommerce applications were once monoliths that brought all the features of an eCommerce store together in a single lump of software. Today, it is increasingly common for B2B eCommerce “applications” to be composed of modular components that communicate with each other over the web, each providing a subset of the information and functionality needed for a complete store.

But the Integration of modular components goes far beyond the functionality of a single application. Just as we can think of a modern B2B eCommerce store as a collection of modules, the store itself is a module in a more extensive system, one that might include eProcurement platforms, stock, and logistics management systems, CRM applications, and others.

These disparate components need a way to talk to each other, and it is the development of more sophisticated interfaces – known as APIs – that have allowed modern B2B eCommerce to adapt and evolve.

What is an API?

An API ( Application Programming Interface) is an interface that allows software to talk to other software. At its broadest definition, an API allows one program or code module to access the functionality of other programs or modules. APIs are often – although not always – used to request data and send instructions between applications.

When we talk about B2B eCommerce and APIs, we are usually referring to a particular type of API — web APIs. A Web API allows one program or service to communicate with others over the web.

For example, an eCommerce store might have a currency conversion feature that relies on up-to-date conversion data from a third-party API. The eCommerce store sends a request via the web, and the API responds with conversion data in a format the eCommerce store understands.

But web APIs can be used for far more than simple information lookups.

Headless Ecommerce

Headless eCommerce – also known as decoupled eCommerce – is one of the most significant developments in B2B eCommerce in recent years. Headless eCommerce splits eCommerce applications into two main components: the Back-end, which contains most of the eCommerce functionality, and the Front-end, the interface that users interact with.

Ecommerce solutions such as BigCommerce and Elastic Path are API-driven platforms. They offer all the features a B2B seller needs: a cart, payment processing, catalog management, search, bulk pricing, and more. But they don’t provide the “store,” the web application that users interact with.

This is where Headless eCommerce comes in. Headless eCommerce allows B2B businesses to create the front-end that best fits their unique scenarios. The B2B eCommerce experience can be tailored for specific market segments or the specific channel in which it will be accessed by users. The constraints of a one-size-fits-all solution don’t limit it.

Headless eCommerce also allows businesses to choose their technology Stack. The backend – what BigCommerce calls a Commerce as a Service Platform – provides the core functionality, accessed via an API. The B2B seller can use any technology stack compatible with the API to access it – and that includes most modern languages and frameworks.

Why is this useful? Because the traditional model of a monolithic eCommerce application hosted on a server and accessed in a web browser doesn’t fit the modern B2B eCommerce world. Buyers expect to be able to buy via multiple channels, from desktop browsers to web applications, to mobile apps, to integrated punchout catalogs.

When buyers go through your sales team rather than self-serving, the salespeople also need to use the business’s eCommerce sales platform, but they have very different requirements than external buyers.

B2B Integration

One of the biggest challenges facing B2B buyers and sellers is integration and automation. B2B sales historically involved a lot of one-on-one sales, generating many documents that had to be manually processed.

Manual processing causes many problems for both sides of the B2B sales relationship: it’s expensive, error-prone, opaque, and it is challenging to ensure compliance with procurement policies when documents and data are hidden away in email inboxes.

The solution to these problems is in integrating eProcurement platforms like SAP Ariba, Oracle Netsuite, or IBM Websphere with vendors’ ecommerce platforms. These platforms allow businesses to acquire needed goods and services and are designed to improve productivity and reduce costs through features such as inventory tracking, supplier management, order fulfillment, and document management.  Both the eprocurement platform and the ecommerce platform centralize, digitize, and automate the purchasing processes. The buyer can get  quotes using negotiated pricing,  generate purchase orders from the quote,  and receive invoices from the order.  

However, the big win for eProcurement and eCommerce is their ability to talk to each other via APIs. This ability to hook up an eProcurement platform like Coupa or PeopleSoft  to an eCommerce application like WooCommerce or Magento  allows for the streamlining and automation of many procurement processes (price quoting, purchase orders, and invoicing). The APIs ensure the data entered by the buyer is transferred to the seller accurately and quickly.

Punchout catalogs, for example, have become extremely popular with B2B buyers. A punchout catalog allows a buyer to “embed” a supplier’s eCommerce store within their eProcurement platform. A punchout catalog typically has the products the buyer negotiated with the vendor for along with any special pricing or discounts. 

Both sides of the transaction can talk to each other using API-driven automation, and that means buyers can quickly authenticate and order on an eCommerce store and have their order information automatically added to their eProcurement platform for processing and approval. Other API-driven automation is also possible: purchase orders can be sent to the eCommerce store once an order is approved, invoices can be returned to the eProcurement platform once the order is fulfilled, and so on. 

Integration and automation afford the same benefits to communications and document exchange between transaction partners that eCommerce and eProcurement afford to internal processes.

But integration and automation for eCommerce and eProcurement platforms are not as straightforward as for headless eCommerce. With headless, the front-end is developed to be compatible with an existing back-end. That back-end functionality is accessed via an API and the advantage for developers is that the API’s protocol and data exchange formats are known in advance.

There are hundreds of eCommerce and eProcurement platforms in use, and they communicate in many different ways. There is no true industry standard API, which makes it challenging and expensive for B2B suppliers and buyers to integrate. Often only the most significant suppliers are integrated, leaving a long tail of expensive and error-prone transactions.

In 2019, however, the cost of eCommerce / eProcurement integration is much lower than it once was. Thanks to third-party integration gateways, which translate between incompatible APIs, any eProcurement platform can be integrated with any eCommerce store.

API-Driven B2B Ecommerce Is Here To Stay

We have looked at just two of the ways API-driven eCommerce is helping the B2B space to evolve, automate, and reduce costs. We might also have mentioned shipping APIs, recommendation engines, API-powered eCommerce search, anti-fraud APIs, and services that empower B2B sellers to connect their stores with other components of their infrastructure.

While API-driven services encourage Decoupling and separation of functionality, they also drive deeper connectivity and automation – a trend that is so beneficial that we’re likely to see even greater reliance on APIs and integration in the future.

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