B2B pricing will normally be more complex that running B2C and retail shops. This is normally due to things like customer specific pricing, negotiated rates, volume discounts.
Negotiated Pricing |
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Pricing is often flexible and can be negotiated on a per-client basis. This requires handling a large volume of pricing data. While managing this within an ERP system may not be a major challenge, customer-specific pricing can introduce complexities. Here are a couple of reasons why:
- Transferring a large volume of pricing data from the ERP to commerce systems or a promotion engine can be overwhelming.
- Displaying pricing on product detail pages tend to be simple, even with customer-specific pricing. However, challenges arise on product listing pages or search results. For example, how do you handle pricing when displaying 16 products per page?
The situation becomes even more complex when using a search engine to generate product listing pages. How do you sort products based on price when different customers see different prices?
We'll explore various options to address this challenge later in the article.
Customer-Specific Discounts |
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B2B companies often negotiate exclusive discounts for specific customers or groups based on buying history, transaction volume, or contractual agreements.
This poses challenges for promotion engines, which must balance flexibility with high-speed processing. A common solution is to update promotional data using aggregated data elements or categories, simplifying calculations for the promotion engine.
Contractual Pricing |
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Many B2B transactions operate under contracts that define specific pricing models over a set period. This requires the commerce or pricing engine to support customer-specific pricing across different timeframes.
The complexity increases when orders are modified after purchase. What happens if a customer changes an order after pricing updates have taken effect? How should recalculations be handled?
Few commerce systems manage these scenarios effectively—except for ERP systems.
Dynamic Pricing |
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Dynamic pricing, a strategy well-known in B2C, is gaining traction in B2B. Who haven't seen flight tickets changing in "surprising" ways?
But, it's getting more and more acceptable to use Dynamic pricing, also in the B2B space.
These AI and automation systems can dynamically adjust prices and discounts based on predefined rules to maximize profitability.
On External Promotion Engines...
Not all commerce systems handle all aspects of discounts, which can limit business growth. Moreover, future promotional strategies are hard to predict. One solution is to integrate external promotion engines, such as Talon.One or Voucherify, which provide robust features beyond the core commerce engine.
Challenges
Personalized Prices and Promotions - UI Challenges |
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On a category or search results page, each product tile may display pricing and discounts—both of which can be personalized per user, company, or group.
Challenges include:
- Handle a potentially huge amount of prices for each product/SKU
- Sorting and filtering products based on price is complex.
- Pricing facets will have to be personalized.
- Showing promotion eligibility is complex, batch calculated or in some cases not possible at search or indexing time.
One solution is pre-calculating data at indexing time:
- Push base prices.
- Push a price structure that tells a custom price per customer/group.
- Calculate a structure that tells if a given customer/group qualifies for a discount.
This approach improves the user experience but may struggle with large datasets and frequent price changes.
Another option, personalized pricing can be fetched dynamically when rendering pages, though this increases demand on the commerce engine. Caching and pre-calculation can mitigate performance issues.
A final option is to rely solely on the commerce engine, sacrificing advanced search capabilities for reduced complexity.
None of these options is really "out of the box", although some search engines actually now starts to focus on handling complex B2B pricing challenges.
Complex Promotions
Your commerce engine may not support all promotion types. For example, POS/ERP systems like MS Dynamics or SAP provide extensive promotion flexibility (e.g., "Buy 2 items from Category A, get 50% off 2 items in Category B").
If a new promotion type isn’t natively supported, you can develop it within the commerce engine or integrate an external promotion engine. While this may impact performance, the flexibility it offers can be a significant advantage.
Final Thoughts
B2B pricing is complex, but businesses have several options when selecting a commerce platform.
This article highlights key challenges and provides strategies based on real-world implementations.
If you’re facing a pricing challenge, reach out—we thrive on solving complex problems to support your business growth.
ROLAND VILLEMOES
CTO
