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Sana Commerce

Addressing (and Overcoming) Distributors’ Top E-Commerce Objections


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    There is still quite a bit of friction when it comes to distributors embracing B2B’s shift toward e-commerce.

    Many want to stick to the status quo, or to maintain a traditional sales model in order to appease their sales team. But distributors who are still dragging their feet should make strides to keep up with digital marketplace trends in order to give B2B buyers on-demand access to the right tools and channels.

    Among distributors who are still torn on whether or not to invest in e-commerce, common objections include:

     

    • “It’s not a priority / We don’t need it.”
    • “We need to focus on building relationships.”
    • “We don’t have the data.”
    • “We don’t have the budget."

     

    There is a long list of reasons why these objections don’t hold merit —or at least not enough merit to justify overlooking an e-commerce strategy entirely. But to debunk common misconceptions and dive into distributors’ current objections toward digitization, we must first understand how the market is changing around them.

    The New Supply Chain: Doing More with Less

    Within the supply chain, suppliers and manufacturers are consolidating resources and reducing costs wherever necessary to keep better pace with consumer demands.

    As this happens, and as processes are streamlined, the role of the distributor is becoming superfluous and, in some instances, being eliminated altogether. Many manufacturers are even choosing to sell directly to retailers or end-users. Forrester predicts that by 2020, there will be as many as one million fewer sellers in B2B, simply based on a lack of demand.

    Surviving this digital-driven purge will only pose more of a challenge as distributors face additional pressure from existing competitors who are already embracing e-commerce. This includes giants like Amazon and eBay, as well as new competitors who are innovating from the get-go.

    Sana Commerce Digital Distribution Blog

    Distributors: if digitization is not a priority for you yet, it certainly should be.

    Empowered B2B Buyers Are Doing Things Their Way

    Many distributors are stuck in the ways of traditional sales, with concerns about whether digital can be as profitable and successful as their existing model has been. But an omnichannel strategy that melds digital and traditional approaches can be even stronger.

    B2B buyers are looking for the fastest, most efficient way to get the products they want and need. With digital, they have 24/7 access to view and purchase products— and the benefits of having a digital channel haven’t gone unnoticed. These buyers are increasingly empowered, and are taking matters into their own hands.

    Take a look at the data:

     

    • Before a buyer contacts a potential supplier, they’ve already completed as much as 70% of the buying process (beginning largely with online research).
    • 40% of B2B buyers currently prefer buying directly from manufacturers over distributors (most cite accurate and reliable product information on many manufacturers’ web stores).
    • Among this 40%, buyers are also willing to pay up to 20% more to be able to buy directly from manufacturers

     

    This buyer behavior is simply an indicator that distributors will soon miss their opportunity to adapt and to delight customers online. (This needs to happen before consumers move onto the next trend and expect even more).

    Distributors need to do better and do more, starting with leveraging digital channels to improve the customer experience. This will allow them to focus on strengthening relationships with customers who are engaging and purchasing across channels, and getting products into the hands of consumers faster.

    But for distributors, knowing how to step into the e-commerce field without squandering an investment or underwhelming customers is just as important as knowing enough to go digital at all. In fact, distributors not offering a satisfactory e-commerce experience are at risk to lose 2% to 4% of their online revenue every year (Real Results Marketing).

    Here’s how you do it right:

    Where Distributors Should Invest (for a Profitable, Data-Driven and Customer-Centric E-Commerce Strategy)

    With more and more distributors fighting to prove their value within the supply chain, mastering e-commerce (as well as more holistic omnichannel strategies) is essential.

    According to MyCustomer, half of B2B businesses view winning and retaining new customers as their biggest challenge in 2018, while another 38% cite up- and cross-selling to existing customers. Online sales can easily be the key to overcoming these challenges, but only if executed properly. (It may be an investment, but it’s a worthwhile one that’s likely to yield a sizeable return):

    Top Areas of Investment for Distribution E-Commerce

    Here’s a summary: let your data drive your online sales channel, invest in better and more reliable data, and make sure your web store looks good and performs well. It’s that simple (as long as you can confidently rely on your ERP).

    “To win in omnichannel B2B,” says Forrester, “throw out old assumptions about customers, websites and sales reps, and innovate.”

    In e-commerce, in traditional sales, and beyond, success will continue to be about taking what you have, maximizing its potential by embracing what’s new, and continuing to learn and adapt over time.

    For more insights on how to leverage digital to create a strong customer experience, read our white paper.

    Sana Commerce Customer Experience White Paper

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