2D Sales Drawings
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Image credit – Digitalcommerce360.com
Industrial eCommerce – Now, Then, How…
For over 20 years eCommerce has been permanently changing the way consumers and businesses buy and sell. Its been a multi-generational process that is far from over! This post updates you on where the industry is now, extrapolates forward to where it may be going and provides an Industrial eCommerce generational tool to help you assess your progress.
Industrial Supplier Update
The graph above shows (according to an international survey of more than 700 executives at B2B companies conducted by Hanover Research for PROS Inc.) that more than 50% of companies in all these segments are already transforming their commerce operations to digital and most of the rest plan to do so in the year ahead. Industrial eCommerce is way beyond the tipping point as these results show:
Amazon Business Update
Obviously Amazon Business is now an ‘industrial supplier’ too but their impact on the market and traditional industrial suppliers (like those mentioned above) deserves its own section. Why? In the last two years Amazon Business has gone from $1B to $10B (“Amazon Business has now reached a $10 billion annual sales run rate and is serving millions of private and public-sector organizations in eight countries,” CEO, Jeff Bezos). If that hasn’t got your attention, try guessing how fast they will 10X that to $100B* as Amazon Business Prime continues to add new value/benefits for customers. We’ve previously written about Amazon Business and shared our recommendations for industrial suppliers – see Amazon; Friend, Foe or Frenemy to Industrial Suppliers and 2 Industrial Suppliers eCommerce Experience with Amazon.
Latest Survey Results
Industrial B2B eCommerce Maturity Model
The table below illustrates the multi-generational development of industrial B2B eCommerce across some of the key areas. Capabilities created in earlier generations are assumed to still be available in later generations. This is a general guide, whether particular capabilities fall in one or another generation is debatable and some of the generation 4.0 capabilities are educated guesses. What isn’t debatable is that the more mature your eCommerce solution, the less competitive risk you face and the more likely you are to gain a larger share of the eCommerce pie. Generation 3.0 is highlighted because that’s approximately where the leading industrial suppliers (manufacturers and distributors) are now or shortly will be.
2 Implications and Recommendations
1. Are you a disruptor or the disrupted? It’s every business’s choice but we recommend the former rather than the latter! The industrial eCommerce results above show the switch to eCommerce continues to accelerate (Amazon Business is likely driving some of that acceleration) so we recommend accelerating your transition to eCommerce!
2. eCommerce continues to mature so staying up-to-date with customer expectations is essential. As the table above shows we all need to continue to invest and modernize our eCommerce. Laggards may actually get to jump a generation or two, perhaps even leap ahead of their competitors? Either way and with the ISM September 2018 report showing 25 months of expansion in the manufacturing sector is there a better time than now?
As always, if you have questions please ask them by leaving a comment below, click to ask a question or call for a discussion. In the meantime CDS will continue to keep developing its tools for online industrial marketing.
* On the Amazon Business question above – this may be a clue: sales volume for Amazon Business will exceed $25 billion by 2021, according to analysts at Robert W. Baird & Co. Inc.