In last week’s blog we discussed the pressure that arises when manufacturers mandate digital readiness.
It’s obvious that many midsized distributors have tried to solve the problem of digital mandates by acquiring more technology, including expensive tech stacks. While technology is crucial of course, it’s not the solution. It’s the enabler of the solution. This small, but powerful distinction is creating disruption all on its own.
Technology has become a major disruptor within the distribution industry for a couple of reasons. First, most midsize and smaller distributors feel they have to compete with larger enterprises by trying to build the same massive tech stacks to handle their online operations. Unfortunately, they rarely have the expertise, the budget or the staff to evaluate, implement and maintain these kinds of “best in breed” solutions. Attempting to support a solution that is highly complex – and often has too many unneeded bells and whistles – can literally bury a smaller organization. It may be impossible to compete with the capabilities and resources that a larger distributor – or Amazon for that matter – can offer based on an expensive, highly customized ecommerce stack.
The other reason that technology has become a disruptor is that too many distributors are selecting ecommerce software that is CRM-based. With the amount of marketing hype out there, it’s easy to think that CRM-based commerce is the right approach. The reason it’s NOT a good choice, however is that customer data is often spread across multiple backend systems within a B2B distributors’ environment. Choosing technology where rules are based on CRM functions may work in a B2C world, but often requires too much customization for midsized and smaller distributors.
The real way around this disruptor is to ignore the CRM-based solutions, and the massive tech stacks of bigger competitors. The idea is to choose technology that is built for B2B and can scale as more customers begin to adopt the new, hybrid commerce system. That choice should be based on the following four elements:
1. Native B2B Capability
Smaller distributors need to find good, affordable tech stacks that provide most of their B2B commerce needs out of the box. Having said that, the solution must also include the ability to manage the customers’ data and make it accessible to both internal and external customers in a highly usable fashion.
2. Fully Functional Mobile Capability
All of this capability must extend fully to the mobile app. And that mobile app needs to be configurable out of the box to avoid heavy customization. The people of B2B need solutions that focus on efficiency, particularly where the field is concerned. Customer service reps, technicians, sales and others need to find information quickly and easily so they can complete tasks more efficiently. If that doesn’t happen, neither does adoption of the new ecommerce tools.
3. Ease of Integration
Midsized distributors may be dealing with legacy systems, or software that contains complex, internally-based rules and naming conventions. The new technology solution has to be able to integrate easily with more than just the CRM. Customer data is spread across multiple siloed systems, including the ERP. A B2B commerce system can’t simply pull information from the backend and present it “as is.” That information is not likely to be catalogued in a way that an external customer may understand.
Although not all cloud-based solutions are the right choice, for many small to midsized distributors they provide scalability without added costs. Cloud-based technology leaves the upgrades and maintenance in the hands of the vendor, relieving the need for more resources to staff and manage a complex B2B ecommerce solution. New features can be added via automatic updates, to provide capabilities as customers demand them.
Getting the most out of B2B commerce means closing the digital gap and taking everything involved in the buying cycle – product, inventory, invoice and all the other “back office” information – and making it more accessible as part of a modern, efficient user experience. It’s about much more than an online shopping cart, or moving the buying process online.
As a software company, it may seem odd that we consider technology itself to be a major disruptor for 2019. Yet massive opportunity within our industry has lured many “wannabes” into the equation. Marketing has begun to convince many smaller distributors that they need to buy their competitive edge when it comes to their B2B ecommerce solution. This message is simply untrue and it’s causing disruption that is stalling – and even crushing – many promising ecommerce initiatives.