Summary of the 2016 Manufacturing & Distribution Sales and Technology Survey Report

November 2016

The annual Manufacturing and Distribution Sales and Technology Survey conducted by the B2B commerce technology experts at Handshake aims to reveal insights about manufacturing and distribution across dozens of industries. This year, the survey focused on the changes that are occurring in sales, fulfillment processes, e-commerce and mobile technology as a result of emerging technologies and evolving customer expectations. The results, while not surprising, can give businesses of all sizes a glimpse of the future and help them develop a successful strategy to not only survive, but thrive.

The Omnichannel Reality

The development of B2B e-commerce offerings is the number-one investment companies are undertaking in 2016 and beyond. What is the driving force behind this activity? According to the survey, customer expectations are becoming increasingly influenced by the accessibility and functionality of B2C e-commerce applications and services.

The key here is the omnichannel engagement, a seamless sales approach that allows customers to have the same experiences with a brand across every touchpoint, from encounters in stores, in the field and at trade shows to web- and mobile-based interactions. Now, customers are able to research purchases, initiate an order on their computer or mobile device, head to the store to confirm that they’ve made the right choice and complete the order face-to-face with a sales rep – all without having to re-enter information.

Forty-four percent of respondents have online order capabilities, and out of those, a full 63 percent offer mobile ordering as well. Of the companies that don’t yet have e-commerce capabilities, 50 percent have plans to develop a B2B e-commerce solution within the year and 20 percent are implementing these capabilities within six months. Over 20 percent of the businesses surveyed reported that a quarter or more of their revenue comes through online and mobile channels.

These numbers are promising, but the fact that 75 percent of these mobile interactions are conducted via mobile web browsing rather than dedicated mobile applications poses a problem. At 85 percent, the vast majority of consumers prefer mobile applications, as they are designed for mobile devices and provide targeted functionality for conducting e-commerce activities.

Despite the growth of online and mobile experiences, email, phone and fax remain the primary methods by which manufacturers and distributors receive orders from customers. This continued trend highlights the importance of omnichannel experiences with multiple touch points that provide consistent experiences as well as ample opportunities to increase the adoption of e-commerce portals. In fact, the survey found that 29 percent of companies that introduced their e-commerce portals by using just one channel, such as email, phone calls, in-store conversations, trade show interactions or direct mail, reported a majority of their customers placing at least one order via online or mobile methods. That number shoots up to 54 percent, however, for businesses that used five or more of these channels.

Increasing Product Discoverability

The survey also uncovered insights about the ability of B2B e-commerce portals to help customers discover new products. The self-service model that serves as the basis for omnichannel experiences is leading to more interactive browsing that allows for comprehensive product research. Half of the companies surveyed reported that this, in turn, is leading to more sales across multiple categories of goods, and 34 percent have noticed that the average value of orders increased as well. Forty-five percent also report that orders are coming in more frequently, with 38 percent stating that customers who were inactive for six months or more are placing orders through newly implemented e-commerce portals.

Direct E-Commerce versus Marketplace E-Commerce

Most companies that were surveyed prefer the direct e-commerce model over the marketplace model, and omnichannel experiences have a lot to do with it. Although the marketplace model can help businesses reach customers that may have otherwise overlooked their products, the direct model gives companies better control over their customer’s experiences and provide more personalized interactions, two important aspects of creating seamless interactions across all portals. Over 75 percent of respondents utilize the direct model, and 56 percent have no plans to offer their products on an open marketplace in the next 12 months.

The Changing Role of Sales Reps

Although there are major changes occurring in customer preferences and increased calls for online and mobile solutions, field sales are still the most common way for businesses to make sales. With 88 percent of businesses reporting that their sales team either stayed the same or increased in size over the past 12 months, there’s little evidence that sales reps are being phased out. In fact, they are playing a major role in the e-commerce cycle, providing the face of the company in an otherwise impersonal process, building relationships and instilling a greater sense of trust between companies and customers. Due to developments in order-taking technology, sales professionals are also seeing their duties evolve from mere order-placers to sources of in-depth product information, strategic planning partners and market intelligence advisors.

The 2016 Manufacturing and Distribution Sales and Technology survey points to a transition from traditional, single-point approaches to more comprehensive solutions that provide greater autonomy to customers while simultaneously allowing companies to shape the interactions these consumers experience. Online and mobile touch points are only part of the omnichannel movement. Sales reps and in-store engagements are still very necessary to round out the seamless experiences that B2B customers increasingly desire.

For additional insights on how to make your business more successful and profitable, contact the professionals at Goldin Peiser & Peiser.

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