Industrial e-Commerce – How to Get a Step Ahead of Your Competition?
Let’s step back for a moment.
Online sales and marketing (a.k.a. e-Commerce) is still in its infancy!
Even the most advanced e-Commerce industrial suppliers have only been doing it for about a decade. e-Commerce technology is still improving, adoption still climbing, user expectations and usage still maturing. What can we now predict about where it is going, so we can be a step ahead, rather than behind, the competition?
If you want to predict the future impact of a technology on your business here’s the process we use:
- Study its development to understand its potential business impacts
- Try to predict its evolution yourself and look at others' predictions
- Use those predictions in your business planning – once the technology is there, you’ll be ready or already there. And maybe in the lead!
At CDS we do this with our software products to try to be ahead of our customers’ needs, but the process is the same for our customers’ businesses. So let’s look at some predictions related to e-Commerce and their impacts on industrial suppliers (manufacturers and distributors). What impacts has e-Commerce already had on the Sales and Marketing process and its future evolution? We can learn much from others’ predictions – for example:
- In 2011, Marc Andreessen, in a Wall Street Journal piece, “Why Software is Eating the World“ predicted that software would take over more and more of our lives and Gartner predicted, “by 2020 customers will self-manage 85% of their relationships with companies without ever directly engaging a human.”
- More recently Forbes noted, "today 80% of B2B purchase cycles are completed before the buyer considers contacting the vendor and, even then, they are loath to do so." And a Forrester report said, "empowered customers are disrupting every industry; competitive barriers like manufacturing strength, distribution power, and information mastery can’t save you. In this age of the customer, the only sustainable competitive advantage is knowledge of and engagement with customers."
- In 2015 this Economist survey and report predicts that Marketing will own the customer buying experience in the next 3-5 years.
Here’s our take on these predictions with respect to the industrial market:
- Time is rapidly proving Gartner and Andreesen right. Software is now instrumental in most business/customer relationship management (e.g. CRM, PRM) and engagement (SEO, SEM, website local search, online intelligence catalogs, expert systems like configurators and automated marketing systems, industrial content systems like CAD model generators, etc.).
- If customers, as Forbes puts it, "are loath to do so" do you think that 80% will increase or decrease? We think it’s going to increase and as we explained in this blog post, “you simply can’t afford to wait for that first call.” Industrial customers, like the rest of us, now search online for what they need. If you are going to influence buying decisions we must engage earlier with potential customers, preferably online.
- We’re not sure if the Economist is right about where the boundary between Sales and Marketing will end up for industrial suppliers but we are sure that industrial Sales and Marketing are fundamentally changing. The expectations for online marketing are certainly increasing and are being met with increasing technology adoption and automation.
Here are some of the drivers and questions to ask as you plan your e-Commerce future:
- Internet and e-Commerce adoption and use - 1 billion internet users of 2005 is now 3 billion in 2015 and forecast to exceed 4 billion by 2020. Furthermore, thanks to mobile (and wearables in the future) users are nearly always connected and online. Proven convenience, reliability and security of are steadily driving up e-Commerce adoption. Is your e-Commerce, SEO, SEM and website search up to date, measurable and performing better than the competition?
- Industrial customers’ buying behavior has changed - and will continue to change driven by convenience, productivity, price, etc. In consequence the sales process has changed dramatically in the last few years and not in a way that has made it easier for your sales people to get in front of prospects! Prospects ignore sales people, so selling the old way is dying out. The marketing process has changed dramatically too. Prospects ignore ads and they research solutions themselves online, so marketing the old way is dying out. The complexity of today’s multiple channels and the preferences of younger generations will increasingly drive this. Is your brand marketing, customer advocacy, engagement and e-Commerce functionality meeting your customers’ expectations now? How about in the forseeable future?
- Many proven B2C e-Commerce innovations are rapidly transitioning to B2B. As MSC Industrial Supply's VP of Strategy recently put it, “B2B customers are increasingly expecting that B2C experience. It does create a lot of pressure for B2B companies to replicate what they see in the B2C world, but it’s also fraught with risk because it’s not a pure translation. So when you think about what our B2C customers are looking for, it’s incumbent upon us to look at this vast array of capabilities that the B2C customers are using today, and make sure that we’re really diligent about picking those that most suit the needs of our B2B customers and add the most value.” Are your internet and e-Commerce plans in place to achieve implementation of those capabilities that will drive your sales?
- Businesses want to measure the effectiveness of their marketing and they can online! As a result, marketing will increasingly be measured as a revenue generator rather than a cost center, just as sales is today. Can you already, or when will you be able to, measure your marketing against revenue generation?
That’s what we think, please let us know what you think by commenting below? Or, if you’d like to discuss any of the questions above give us a call or click either button below…