‹ Back to all posts
Post date
Estimated read time
5 minute read
Word Count

DTC or Wholesale: Why Your Brand Should Do Both and How Shopify B2B Makes It Easy

Here’s a little secret: a lot of brands have DTC eCommerce sites, but their revenue is largely driven by B2B. Why? It’s a smart model for building brand equity and brand recognition. And for keeping the lights on. Smaller brands (and even not-so-small brands) realistically can’t boil the internet ocean, so the savvy ones go where the market is more in their favor (e.g., third-party retail shops, gyms, salons, hotels) to get in front of their audiences directly with less competition. 

Whether your brand is currently B2B or DTC or a hybrid of the two, the wholesale business model is having a moment – bolstered by tools like Shopify B2B that make wholesale a whole lot more efficient and cost-effective for brands. These tools help brands create an eCommerce shopping experience for wholesale buyers, which is beneficial for a variety of reasons:

  • Appeals to a new generation of wholesale buyers who are used to shopping online 
  • Enables brands to scale B2B sales without having to invest in a large sales team
  • Helps brands more efficiently set up and grow membership or pro/influencer programs 
  • Makes wholesale more data-driven by tracking what sells through what store
  • Allows brands to automate and personalize marketing to wholesale buyers
  • Reduces customer acquisition and marketing costs
  • Opens a path for brands to sell internationally 

Shopify B2B allows brands to manage both DTC and wholesale from the same admin and with one inventory management system. Brands also can choose to run both from a single storefront or create an integrated expansion store customized for B2B customers. 

How big is the wholesale market, anyways?

It’s big. B2B sales in the U.S. have been steadily increasing since 2020; in December 2021 sales were nearly 22% higher than the previous year. Another report reveals that B2B eCommerce, in particular, is growing faster than all U.S. manufacturing and distributor sales, and in 2021 reached more than $13 trillion in sales. 

Deliver a DTC shopping experience for B2B customers

Platforms like Shopify B2B aren’t completely upending the wholesale business model – likely we’ll still need human salespeople to initiate and manage some aspects of wholesale customer relationships. In fact, 76% of wholesale buyers say they do want to talk to a salesperson when they’re doing research on what to buy. However, the landscape is changing and online B2B experiences are in demand. Research shows only 15% of wholesale buyers want to talk to a salesperson for reorders of the same products. 

Another key feature of the DTC shopping experience that’s exciting for B2B is applying personalization to drive sales. A B2B eCommerce site enables brands to proactively offer promotional pricing and recommend products they think a specific retailer/business would be interested in – based on their business’ customer demographics, geographic location, industry trends, and more. 

Enable a different B2B sales model

If the majority of B2B customers can easily reorder online (from a beautiful, user-friendly eCommerce site), sales teams can be smaller, and salespeople can focus on building relationships with their highest value customers. With B2B eCommerce, most customers will only require some up-front attention from the sales team to set up a business account. Then they can log in and reorder through the website – personalized with custom product catalogs, price lists, and payment terms. 

Beyond cost savings, this self-service B2B model can enable brands to sell to smaller buyers that perhaps a sales team wouldn’t be able to cost-effectively focus on – capturing a new market.  

In addition, using a B2B eCommerce site to track sales provides brands with invaluable data about their wholesale business. Shopify B2B flips the old model of setting up wholesale accounts by person/buyer and instead sets up accounts by “company profile” (retailer and location/branch). This lets brands track how much product is purchased through each retailer/location and use those insights to help grow the business. 

Leverage wholesale to build your brand

B2B can do more than bring in additional sales. If done right, a wholesale strategy can help build brand recognition and equity in new markets. Selling through retailers that appeal to a brand’s target audience is essentially co-branding or partner marketing – the association of the product brand with the retailer brand can be mutually beneficial. For example, a Pilates studio enhances its clients’ experience by offering organic beverages for sale and the beverage brand gets an introduction and implicit recommendation from the Pilates studio. 

Similarly, brands can use a wholesale model to build a pro/influencer or membership program by enabling influencers (e.g., instructors, professional athletes, chefs, lifestyle gurus) to purchase products through a B2B eCommerce site. Going back to the Pilates studio example: Pilates instructors need to wear athletic gear! Having an eCommerce B2B site makes it easier for them to be wearing (and showcasing) yours. 

Explore selling internationally

Shopify Markets provides a platform for brands to sell directly to international customers, a channel which also has seen growth (76% of shoppers have made a cross-border purchase, up from 69% in 2019). In addition to DTC, Shopify Markets also can support B2B sales. 

Wholesale can provide another – and perhaps simpler – way to expand a brand’s business internationally. Selling through retailers in other countries means brands can leave the marketing (e.g., different languages, cultures, competitors) and pricing (e.g., different currencies, market prices) up to them. Shopify Markets Pro (available in spring 2023) will help simplify creating price lists for wholesale buyers in other countries. Further, Shopify assumes risk and liability for international wholesale businesses, calculating duties and taxes, ensuring regulatory compliance, and handling cross-border complexities.

Wholesale can boost your eCommerce business

B2B eCommerce is here to stay. Gartner predicts that 80% of B2B sales interactions between brands and buyers will happen on digital channels by 2025. It’s exciting to see what we used to think of as “wholesale” – brands selling through large retailers – morphing and expanding to encompass creative strategies including partnerships, co-marketing and pro memberships that can open up more opportunities in niche markets. What’s clear is that, for any of these digital B2B strategies to succeed, brands need to focus on customer experience and embrace a DTC-like shopping experience for wholesale. We can help! Contact us.