Johan Liljeros
Manufacturers have been relatively slow to adopt B2B e-commerce, especially compared to direct-to-consumer retailers. For many, the return on investment did not seem attractive enough, or was simply too complex an endeavor.
Combined with A/B and user testing, a manufacturer can design the perfect customer journey from start to purchase.
All this changed in 2020 with the onset of the COVID-19 pandemic. Manufacturers had to move to online B2B sales to overcome physical location closures and supply chain challenges. Mainstream sales channels were faltering and e-commerce offered an efficient alternative.
Many manufacturers who made the leap saw the benefits of online sales almost immediately, with a huge increase in sales and profitability. Still, there are many manufacturers who haven’t gone digital, which is a missed opportunity.
Here are four key reasons why e-commerce for manufacturers makes sense:
Direct access to customers
Using an e-commerce channel to sell to B2B customers provides manufacturers with valuable customer data, including direct insight into how their customers shop and interact with their site.
Customer data is critical to creating winning marketing strategies. It’s also incredibly useful for new product development. Armed with insights from digital touchpoints, manufacturers better understand what their customers want and how they want it. This vision encourages more effective marketing campaigns, more relevant products and services, and improved sales and better profit margins moving forward.
Scalability to grow
E-commerce allows manufacturers to expand their throughput to process orders without the need for additional distributors or sales representatives. Because processes are managed digitally, manufacturers can fulfill many orders through automation and direct processing without any personal contact.
In addition, the e-commerce channel allows manufacturers to “land and expand” into global markets and sell internationally without having to physically move their operations to another country.
Increased brand awareness
Most of today’s buyers, both B2B and B2C, begin their searches for production solutions online. If a manufacturer’s products or services are not available online, they are missing out on visibility to get in front of potential customers.
By having an online store, manufacturers will also be able to take advantage of search engine optimization (SEO) practices to appear higher in Internet search results when people search for things related to their business. In addition, manufacturers control the customer journey to their digital store. Combined with A/B and user testing, a manufacturer can design the perfect customer journey from start to purchase.
How are manufacturers planning their course to take advantage of digital commerce? Here are three key tips:
1. Choose your technology partner wisely
While the e-commerce platform is a vital part of a manufacturer’s investment, the partner that helps implement it will be the component that ensures success. This is not only the technical part with the right software development team, but also involves having a partner who understands the manufacturer’s business and adjacent businesses, and has long experience in online business success . Such a partner will complement a manufacturer’s experience with its market, value proposition and operations by injecting an outside perspective and new ideas. It is important to find a partner that is prepared to challenge a manufacturer in the areas where it needs to be challenged.
Regarding the platform, it is important to also look at possible accelerators that offer short time to market. This approach means checking that all the features you consider a common denominator in a B2B platform are implemented at a certain level. This step is necessary because within B2B there is a level of functionality that everyone uses.
There is also a level of variation in features that will make a manufacturer unique or better fit the way the company operates. In many cases, it is more efficient for a manufacturer to purchase and complete the work on a partially finished platform than to purchase an already completed platform and rebuild it to suit their needs. Instead, the latter approach typically reduces the life expectancy of the platform by many years.
2. Build your online store
After you’ve selected a platform, it’s time to create the site. The manufacturer’s online store must be attractive, user-friendly and unified with the brand. In essence, it is vital to provide customers with the same feel and level of service online to replicate the experience of meeting a sales representative in a physical location.
When building the site, manufacturers must imagine what the customer will want from a shopping trip. Obviously, they will want products to be easily accessible and searchable. Images, schematics, specifications, and certifications are common content elements that B2B manufacturers incorporate into their site. Navigation should be as intuitive as possible and the purchase process should be smooth.
3. Critical tools
There are many tools to consider when setting up an e-commerce channel for a manufacturing company.
One of the best things about e-commerce, as mentioned above, is all the useful customer and user data a seller acquires as customers use their site and place orders. Having a customer relationship management (CRM) tool to collect and centralize this information is essential.
Another must-have is a product information management (PIM) tool to manage the product catalog for all channels. This will help with activities such as onboarding new data, enriching product information, controlling and automating the release process, and servicing the manufacturer’s own channels, industry databases and/or distributors. After implementing a PIM system, companies often see a 50-80% gain in efficiency and a very welcome reduction in returns as the quality of product data always increases.
Stimulating growth
E-commerce for manufacturers is a growing sales channel and more and more B2B customers are turning to online storefronts to grow their business. If you want to expand sales as a manufacturer, a well-conceived e-commerce strategy can provide a business boost and lower your cost of sales. In an era of inflation, this can offset higher raw material costs to help support competitiveness. This strategy is not about competing with the existing sales team; rather, it’s about helping them close more deals, increase productivity, and lift tedious tasks that don’t generate new business.
About the author
Johan Liljeros is Managing Director and Senior Trade Advisor, North America, at Avensiaa company that helps B2B and B2C companies deploy e-commerce technology and strategies.
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