B2B Product Spending Shows Modest Growth

August 8, 2014

This article is included in these additional categories:

B2B | Education | Financial Services | Food & Restaurants | Pharma & Healthcare | Retail & E-Commerce

Epsilon-B2B-Product-Spending-Growth-by-Industry-in-2013-Aug2014Business spending has seen “modest growth” over the last few years, reports Epsilon in its 2014 Multichannel Trend Report [download page], with spending increasing by 3% since 2011. But online product sales are increasing more rapidly, up by almost 8% between 2011 and 2013; online sales (versus mail order/call center) have grown to represent roughly 65% of all sales last year, representing close to a 5% point increase in share from 2011. The study also identifies the industries and categories seeing the biggest increases in spend.

Last year, companies in the finance and insurance industry saw the largest increase in spending, at 6%, followed by heavy industry (5%) and retail and restaurants (5%). Spending growth was more modest for those in the business and legal (3%) and education (1%) industries, while dipping among those in the health (-1%) and government (-1%) sectors.

Delving further into the performance last year of various B2B categories, the report shows that:

  • Ad specialty sales grew by 3%;
  • Cards and stationery sales were flat;
  • Food gift sales inched up by 1%;
  • Furniture sales declined by 2%;
  • Gift and give-away sales declined by 2%;
  • HR/Training and seminar sales increased by 2%;
  • Sales of magazines, newsletter and books grew by 2%;
  • Office supplies and high-tech equipment sales were flat;
  • Sales of tools and agriculture rose by 7%; and
  • Uniforms and commercial/industrial safety sales declined by 1%.

For almost all of those categories, sales growth in 2013 was slower than in 2012. The only exceptions were ad specialty sales (which had been flat in 2012), office supplies and high tech equipment (which had declined by 3% in 2012) and tools and agriculture (which had increased by 4% in 2012).

About the Data: Asked for clarification about spending and sales data, Epsilon responded as follows:

“For reporting on the 2013 Sales Growth by Industry, we analyzed the purchase behavior of the contacts who work within specific industries ”“ e.g. Finance & Insurance, Heavy Industries, etc across all of the types. For the graph displayed in the trend report, we only reported on their gross spend across the Abacus Cooperative. We also measured the variance in number of active contacts, transactions, AOS, purchase frequency, etc, but did not display it in this report. Ultimately, the contacts in Government and Health Industries actual reduced their spend by ~1% while all of the other industries saw growth.

For the category data, Epsilon has created classifications/categories for all of the members of the Abacus Cooperative. Each contributor of the Co-op has their data in the category/ies that is/are most representative of their business. For example, if you look at the Ad Specialty super category: for all of the Abacus Cooperative members who offer Ad Specialty products/merchandise, their gross sales went up 3% in 2013 compared to 2012. In 2013, these companies had 4% more active contacts who spent 1% less per transaction. It is essentially a more granular level of classifications ”“ based on the contributors to the cooperative database.”

Meanwhile, the data is based on 93 business offers across all channels with purchase activity for 2012 and 2013. Epsilon’s Multichannel Trends Report data is based on the aggregated merchandise purchase data from the Abacus Cooperative database.

Epsilon also notes in its report that:

“The data housed in the Abacus Cooperative database does not include all direct merchandise transactions conducted in the U.S. but does provide a representative view of the consumer and business omnichannel retail industry. This report contains all captured activity provided by Abacus Cooperative members across channels.

Note: New Abacus Cooperative members provide a full history of transactional data, while those that leave the Abacus Cooperative have their data purged from the database. To compensate for this turnover, the Trend Report only includes those companies that were active members of the Abacus Cooperative for the entire time period analyzed.

This provides a stable group of merchants for analysis over time which isolates channel shifts and differences in seasonal purchasing patterns by channel.”

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