Similarities and Differences Between PunchOut Catalogs and eCommerce Websites

Competition in the B2B market has increased alongside the number of potential suppliers. Competition is excellent for an industry, and it’s no different for the B2B sector. One of the technologies that have seen significant adoption in recent months has been PunchOut Catalogs. Businesses that institute a PunchOut Catalog tend to have more flexibility in interacting with their customers. There are several significant benefits that PunchOut catalogs bring to the table. However, because of their similarities to eCommerce websites, quite a lot of businesses have opted to avoid the PunchOut route, and stick with their standard eCommerce offerings.

Digital Commerce Through Separate Lenses

For the uninitiated, SAP Ariba (who created the idea) explains that a PunchOut Catalog is a product listing that exists on a supplier’s website, but that buyers can view from the safety and comfort of their own procurement software front-end. Companies that cover a large volume of products usually have categories for their listings. In an eCommerce website, these different categories make it easy to find what a buyer is looking for. PunchOut takes this categorization one step further, enabling businesses to develop multiple listings for different product categories.

Immediately, it becomes apparent that PunchOut is a much more streamlined methodology for the distribution of products to buyers. While a buyer may spend a long time on an eCommerce site selecting items and putting them together before completing their order, PunchOut catalogs limit their selection to the products relevant to their industry. Additionally, thanks to PunchOut’s ability to offer data transfer between procurement software and the website itself, the order can be updated automatically in the buyers’ procurement software using standardized data transfer.

The Similarities Between PunchOut and eCommerce Websites

When we examine the way that PunchOut operates and compare if to eCommerce websites, there is a definite similarity between both of them. Both are systems that cater to B2B sales and marketing. Buyers can easily browse both systems, select products, and check out. In a lot of cases today, electronic invoicing can be transmitted to the buyer from the vendor in either markup format (for direct import) or in a human-readable form (for manual input). Both of these systems focus on making the procurement process as simple as possible. However, even though they both deal with online procurement, how they approach this differs significantly.

The Fundamental Differences Between eCommerce and PunchOut

Businesses that already have an eCommerce system instituted may have realized how much easier it makes the procurement process and generation of purchase orders. B2B eCommerce sites tailor themselves to the needs of a business. The B2B transaction workflow consists of several vital elements, including credit limits, authorization levels, and the ability to generate purchase orders. User accounts are usually required for visitors before they can check out. Finalization of order results in either an authorized purchase order for fulfillment or a sale may differ. It depends on the type of customer or business the website is dealing with. Here is where we notice the first difference between these methodologies for product management.

Scale

PunchOut catalogs came about as a way for the largest B2B customers to interact with their clients. As smaller businesses started adopting PunchOut catalogs, it allowed them the same level of interaction with their clientele. B2B eCommerce sites evolved differently, as a front-end that customers of all sizes could interact with. Thus, when a user finalizes an order, they have the option of turning it into a PO for the supplier’s fulfillment, a Sales Order, or even a cash purchase.

Approach

Another significant difference between the two systems is how they approach the customer’s role in the purchase. B2B eCommerce sites focus on offering variety across all the industries they provide goods to. Through specialized categories, the site can provide products to a wide range of customers. PunchOut catalogs offer a similar service but allow the supplier to update catalog listing at their leisure. This ease of updating makes their implementation more flexible. It also limits the volume of products that a customer may need to sift through to find what they’re looking for.

Customer Management

ECommerce websites that are specifically designed for B2B sales and marketing are unique for each business. Even so, they demonstrate some similarities regardless of the company. For example, B2B websites usually need to combine a product listing system alongside a content management system (CMS) and a customer relationship management module (CRM). Tying these systems together isn’t difficult, but ensuring they work well alongside each other requires constant monitoring and upgrading. PunchOut systems are a lot simpler by offering an authorization system that’s tied to a business’s procurement software. The buyer can seamlessly connect, complete orders from the catalog, and finish up with PO generation after authorizations are complete. Customers are managed through their own procurement software instead of having separate systems depending on each other. Businesses may even maintain their own CRM tied to the logins from PunchOut to aid in relationship management.

Flexibility

We already covered how eCommerce websites manage product listings through different industry-dedicated pages. PunchOut systems use distinct catalog systems to update their offerings. For the supplier, this means that as products change, they can dynamically update their product listings on the catalogs instead of having to head into a CMS to edit and manipulate values. Additionally, for products that make up the core of the company’s line, a static catalog can be developed, making it even easier for buyers to start ordering products.

Which One Should a Business Choose?

B2B supply is relationship-based at heart. While a B2B supplier should still focus on building and maintaining their relationship with customers, they shouldn’t overlook the option to provide self-buying opportunities to those consumers. PunchOut tends to focus more on the needs of the client rather than trying to cover as broad a possible spectrum as possible for products.

Deciding on one or the other may be a wrong way to consider using PunchOut to aid a business. Instead, a company should see PunchOut as an addition to their existing eCommerce website, as opposed to a replacement for it. They both appeal to different demographics of customers. Smaller buyers may be content dealing with an eCommerce website, while larger companies may require the flexibility and automation offered by PunchOut. To compete with other businesses already offering PunchOut catalogs as a solution to buyers, a company may have to consider investing in the technology. As more procurement teams move towards digital records and electronic invoicing, it becomes more of a pressing concern.