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Welcome to the Distribution Revolution

Strategic Content Lead

October 22, 2020

The Digital revolution requires a shift from simply selling products to serving customers across both the B2B and B2C industries. But, to meet the needs of the consumer in today’s markets, firms must face up to the dominating presence of third-party marketplaces like Amazon Business.

Now is the time to work out the strategies that will enable you to compete and capture market share and leverage the growing importance of independent marketplaces for your own benefit. From technology and organisational strategies, to designing new customer journeys that add value and build consumer loyalty, it’s time to make a change.

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In the first of 3 webinars looking at how to capitalise on the distribution revolution, we discussed why firms need to change the way they operate if they want to stay profitable in the face of the marketplace giants. We were joined by Randy Woods, Mark Pepin and Steffie Vreen-Vroomen to discuss the key issues at play, and what you need to do to respond.

If you weren’t able to make the session, why not watch the full recording?

Watch the full recording

Or if you’re short on time, here are our three key takeaways.

Embrace the industrial distribution transformation

Marketplaces are making it easy for customers to compare products, prices and to quickly order online, so it’s time to find a way to differentiate yourself by offering value added services that the third-party marketplaces can’t. There’s a B2B humanization in play. We know that B2B buyers value the convenience of self-service, and research suggests that today one in three buyers would prefer to buy online rather than speaking to a sales rep. If relationships are at the core of your business, you need to make sure you can achieve that same personalised service across physical and digital channels.

Think in terms of customer journeys, not customer moments. Firms like Amazon Business and Alibaba are great if you’re dealing with simple products, but that’s rarely the case for the clients we work with. You need to capitalise on the IP that you have, on the complex products and buying cycles that you have more power over. Think about how you can use your digital touchpoints to help clients to switch between products and work out how you can digitally enable your sales teams to spend less time on admin tasks and more time adding real value, strengthening relationships and spotting new revenue opportunities. -Mark Pepin, E-commerce Business Director

Don’t try and compete on price

It’s unlikely you’ll be the cheapest option, but that doesn’t mean that you can’t still capture market share by offering a better overall service. You know your industry, your customers, their key challenges and your products better than any pure marketplace. Leverage that knowledge and expertise and provide an experience and proposition that is better than 'just cheap and easy.'

In the faceless third-party marketplace experience, customers miss out on the power of a personalised service. From identifying customer pain points to offering timely product recommendations, intuitive ordering processes at each stage of the project lifecycle can make it more beneficial for businesses to do business with you; you’re giving them a reason to return.

The growth of these marketplaces is undeniable, and they are fully equipped to keep growing further over the coming years. You’re not going to be able to compete with Amazon, so you need a strategy for dealing with them. You could decide to partner up, or you could decide to offer consumers a service that Amazon can’t. - Randy Woods, EVP, North America

Know how to be found

By definition B2B distributors are already marketplaces in and of themselves. If 90% of people currently use search engines to find products, you need to make sure you’re in that line up too. If your product content is held behind a registration or login page, you’re missing a trick. Think about the SEO, marketing and organisational strategies that will make sure you’re top of the list. Alternatively, explore the option of setting up your own marketplace and get access to the data that will enable you to strengthen the customer relationship and offer an even better experience.

We’ve already seen lots of manufacturers setting up their own marketplaces. They are starting to experiment with the D2C model that is in turn giving them access to really useful data around customer behaviour as well as insights into surges and trends that they can then act upon to improve the future experience. -Steffie Vreen-Vroomen, Senior Digital Consultant, Valtech Netherlands

To be better than the marketplace giants, you need to bolster your organisation with new business models, technologies and processes that will enable you to focus on real connections and offer something more valuable than just a cheaper product. By thinking about the long-term customer journey rather than single touchpoints you can leverage the wealth of customer knowledge that you have. Exploit your industry expertise and create value-based propositions that increase customer loyalty and keep them coming back to your business time and time again.

Now is the time to invest in digital teams and services if you want to compete against the third-party marketplace giants. Digital channels don’t just allow you to do what you were doing before in a better way, they allow you to innovate new services that provide an alternative to competing on price alone.

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