There are so many different ways to reach your customer nowadays—whether it be by brick-and-mortar stores, websites, mobile apps, social media, catalogs—the list is ever-growing. All sources seem to say that e-commerce is experiencing double-digit growth without any indication of slowing. What also is changing is the face of the retailer, the consumer and distribution. No longer is e-commerce relegated to business-to-consumer (B2C) sales; business-to-business (B2B) retail is gaining popularity as well, including both manufacturers and warehouse distributors.
According to Ranga Bodla, director of industry marketing for manufacturing and wholesale distribution at NetSuite, “As high as 85 percent of distributors are looking at revamping their website for e-commerce. I think the most important thing for preparing for e-commerce growth is you can’t put your head in the sand. You have to make sure that you’re focused and paying attention, because whether or not you change your business to adapt to e-commerce, the industry is changing.”
Your Customer Base Is Evolving
Even if you’re not 100 percent prepared to take on the challenge of e-commerce now, it is important to have a plan, so you can eventually meet the demand of expectant online consumers. While there are plenty of customers willing to pick up a phone and loyally rely on their already established supplier relationships, there is a small yet increasing amount of customers who are more comfortable online. If you’re not there, you could miss myriad opportunities.
“It’s not to say that you have to suddenly stop everything you’re doing and suddenly put all your efforts into e-commerce, but what you do have to do is have a road map for how you’re going to attack e-commerce, and best make it a part of your overall strategy and competitive advantage because it’s not going to fall in your lap. It’s going to bypass you,” Bodla comments. “We did a Webinar with an organization called Unleash and it was specifically geared toward competing with the big dogs—how to prepare for Amazon and Google to come into the distribution market.”
On the Webinar was one of NetSuite’s customers, Monterey Lighting, which recently entered the e-commerce market. Bodla says the company doesn’t know when e-commerce is going to burst onto the distributor scene, but it wanted to be ready because when it happens, it’s going to happen rapidly. As Bodla aptly put it, “It’s almost like when a stock market rally happens—80 percent of the gains happen in the first part. You want to be ahead of it, not behind it.”
Moreover, Bodla believes that there are two schools of thought in regard to Amazon and Google entering the distributor e-commerce marketplace: “They’re going to be a freight train that is going to transform this industry, and we need to be prepared for how we’re going to effectively remain ahead and use our knowledge as a competitive differentiator.” Then there are those who say Amazon and Google can never provide the kind of information manufacturers and distributors can, so they’re not a threat.
With all that being said, if customers want to buy a product when a supplier is unavailable, whether because it doesn’t have a solid online presence or it’s closed for the weekend, they’re not going to wait for you to present yourself unless you offer something more than those suppliers who are available everywhere and at any time. That means you must provide the utmost in customer service, product availability, market knowledge, aftermarket service, etc. that actually makes the wait worth their while.
Rick Chavie, vice president of omni-commerce, hybris software, warns, “Consumerization of B2B is a hot topic in 2013 as companies struggle to move from traditional sales representative/catalog interactions to convergence with digital commerce.”