by Fronetics | Apr 20, 2017 | Blog, Manufacturing & Distribution, Strategy, Supply Chain
Industrial product buyers are changing how, why, and where they buy. Are you prepared to accommodate their preferences?
Distribution has always been an industry built on relationships. The loyal customer favored companies where they developed strong working relationships with a sales representative.
But recently distributors have felt a shift in the tide. Buyers have grown impatient with one-on-one sales relationships and quickly embraced the convenience of buying directly from manufacturers, for one. Distributors are left scrambling to keep up with such trends.
So how do distributors stay ahead of the game?
UPS recently conducted a study of the behaviors, preferences and perceptions of industrial product buyers. It found four major market forces driving change: customer demands, direct-from-manufacturer purchasing, e-commerce, and millennials. Additionally, the study offered up a few interesting takeaways we thought were worth highlighting.
5 trends in industrial product buying
1) Purchasing drivers
The study asked for the top five factors that are most important when purchasing industrial supplies from buyers’ preferred distributor size. Though “best prices” was a top contributing factor across the board, as you can imagine, other answers varied from small distributors to large.
For those purchasing from smaller distributors, 58% of customers ranked personalized service as most important. Among those preferring large distributors, 61% of buyers wanted a wide selection of products.
Takeaway: There is a strategic opportunity for mid-size distributors to cater to both types of buyers. Mid-size distributors focusing on larger selection with personalized service can offer customers the best of both worlds.
2) Friends stick with friends
Word of mouth is still the top tool buyers use to research a new distributor. Studies have shown that consumers trust recommendations from people they know more than any other form of advertising, and the same is true for distribution. Personal references and word of mouth are heavily influencing buyer trends.
Takeaway: Distributors need to have their ears to the ground and really focus on what buyers are saying. If the word on the street is that your company needs to make changes, make them. You want to consumers raving about your company, so others will follow suit. Also, consider the value of review sites.
3) Internet is king
The importance of the internet is old news. But UPS’s study found a substantial jump in buyers’ going online to purchase industrial supplies. In 2013, 57% of buyers were hitting the web, and that number grew a significant 9% in just four years.
Takeaway: Suppliers need to make sure that their websites are a one-stop shop for customers. Buyers need to be able to find answers about products, confirm product details, and access their negotiated prices all online. Spending the time and money to update your website is key to giving buyers a preferred way to make purchases.
4) User-friendly everything
Along with wanting to make purchases online, industrial product buyers want the ease and convenience of user-friendly websites. 72% of buyers said they would shift their spending to a different distributor with a more user-friendly website, and that number increases to 85% with buyers age 21-30. These findings confirm the shift from relationship-based buying to the experience-driven trend.
Takeaway: Brand loyalty is no longer based solely based on product quality and personable sales staff. Distributors need to take into account convenience, speed, and a good customer experience. What appeals to customers is the ease of their online service. Staying ahead of trends will involve constant maintenance of your website and its usability.
5) Cross-channel consistency
Industrial product buyers may be making most of their purchases online, but they are definitely checking in with friends and social media before making any decisions. Oftentimes websites don’t provide enough information, and, by default, they rely on other channels to confirm details before making purchases.
Don’t let users find conflicting messages from different resources. Cross-channel consistency will give your company an edge on the competition.
Takeaway: Make sure that your off-site and onsite messages are clear across all channels. Examining the buyer experience on and offline — and making sure that all channels are communicating the same message — can elevate your company’s position among your competitors.
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by Fronetics | Apr 19, 2017 | Blog, Logistics, Supply Chain, Talent
Looking for talent? Try recruiting from these top-rated supply chain management MBA programs and schools.
We have written before about the importance of recruiting and strengthening the relationship between academia and the supply chain industry as means to solve the growing supply chain talent gap. If your company is looking to hire, consider strengthening your rapport with schools that offer supply chain programs or specialties.
Recently U.S. News & World Report released its annual rankings, including the top supply chain and logistics MBA programs. Of course, U.S. News is not the be-all end-all. But this list gives companies in the supply chain and logistics industries an idea of where some of the brightest graduates, who will be seeking employment in the upcoming months, will be coming from.
U.S. News’ top 10 supply chain management MBA programs 2018
- Michigan State University (Broad) – East Lansing, MI
- Massachusetts Institute of Technology (Sloan) – Cambridge, MA
- Arizona State University (Carey) – Tempe, AZ
- University of Michigan—Ann Arbor (Ross) – Ann Arbor, MI
- Ohio State University (Fisher) – Columbus, OH
- Pennsylvania State University—University Park (Smeal) – University Park, PA
- Stanford University – Stanford, CA
- University of Tennessee—Knoxville (Haslam) – Knoxville, TN
- Rutgers, The State University of New Jersey—Newark and New Brunswick – Newark, NJ
- Carnegie Mellon University (Tepper) – Pittsburgh, PA
See all 23 ranked schools.
Recruiting and retaining new talent
We’ve been writing a lot lately about the supply chain talent gap and ways to recruit and retain millennials. Here are 3 must-read articles for companies looking to hire young talent this year.
3 Ways to Attract Millennial Talent for the Supply Chain
By the year 2020, millennials are estimated to make up a majority of the workforce. In addition, a 2014 study found that 46% of B2B buyers were millennials, and that number is on the rise. This seismic shift in workplace demographics calls for a new approach to attracting and retaining talent. Read
Supply chain companies want to find talented employees that can succeed in junior-level positions now but that also could move into management down the road. “Soft skills” like creativity and problem-solving are crucial to both roles — not to mention, every role in between. Liberal arts graduates bring these abilities to the workplace. Supply chain companies could be actively recruiting these qualified and eager graduates to fill open junior-level positions now, and then groom them to become future leadership. Read
Rodney Apple, founder and president of SCM Talent Group, has almost 20 years of experience as a supply chain recruiter. He has filled more than 1,000 supply chain positions ranging from executive-level at Fortune 500 companies to leadership and staff-level roles across large networks of manufacturing and distribution facilities within the United States. In this interview, Apple discusses the supply chain talent gap and advice for overcoming it. Read
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by Fronetics | Apr 14, 2017 | Blog, Content Marketing, Marketing, Social Media
Social media gives you access to aspirational customers and their networks, a benefit that can’t be quantified in dollars.
One of the trickiest things about implementing a social media strategy is that success can be difficult to measure. While most professionals acknowledge that a social media marketing presence is important, it’s hard to make a case for resources when you can’t precisely quantify the value in terms of dollar amount.
This, however, shouldn’t stop your business from recognizing the importance of social media as part of a robust marketing strategy. You need to start thinking about value in terms of potential, rather than the immediate sale.
“It’s important that we continue to shift our focus from the short-term sale to the long-term value of social media,” says Emily Teele, loyalty and retention marketing manager at West Elm. “Part of our willingness to make this shift comes from trust that our efforts will pay off, even if not immediately, and part comes from finding new ways to measure results over time.”
Tomorrow’s customers
One of the most valuable and exciting aspects of social media is that it allows business to discover and engage with a new segment of the B2B community: aspirational customers. In the past, businesses haven’t had access to these customers. Now that we can find out who they are, their long-term value cannot be overstated — both as buyers, and in building brand loyalty and an engaged customer base.
According to a recent study published in MIT Sloan Management Review, aspirational customers are likely to follow multiple brands on social media sites. Over half follow at least one brand that they haven’t made a purchase from. But, “our data suggests that they do plan to purchase in the future,” say the study’s authors. “Today’s followers are very likely to be tomorrow’s customers.”
The social network = social media success
There’s another factor to consider regarding the value of social media marketing. At its core, these are networking platforms. That means you not only have access to a new customer base, but to their connections as well.
Your followers’ engagement on social media can expand your reach, as they engage with their own networks. Putting a dollar value on such social reach is fairly meaningless — but it has the potential to add to your bottom line both now and in the future.
What’s more, a recent McKinsey study attributes word of mouth to be the primary influence for up to 50% of all purchase decisions. The study authors go on to say, “Followers who are not yet purchasers can share their experience with the brand, and deepen their commitment to the brand, even prior to that first purchase.”
It’s time we start thinking about social media success in this new way: in terms of potential and expanding value, rather than just immediate dollar amounts.
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by Fronetics | Apr 12, 2017 | Blog, Content Marketing, Marketing, Social Media
Interesting, original content is central to brand building for the supply chain and beyond.
What do Donald Trump, Kim Kardashian West, and Dan Rather have in common? Like ‘em or hate ‘em, they’ve each amassed an enormous organic following on social media. It doesn’t matter when or where they post it; these celebrities have proven that people will go out of their way to receive their content.
I came across an article the other day about the rising importance of the content creator that got me thinking about this. Joe Hyrkin, CEO of media company Issu, believes the age-old marketing debate about content vs. distribution is now a moot one. “Media consumers will change their behavior and go where a creator has produced interesting content,” he writes.
So many companies — supply chain, B2B, B2C, and beyond — spend an enormous amount of time and money trying to figure out the best places to distribute content and the best times to post. Don’t get me wrong: Those are incredibly important pieces of the puzzle. But I don’t think we can overemphasize the importance of the quality of your content and building a brand that reflects thought leadership.
In short, if you produce the kind of content that your target audience finds compelling, entertaining, and/or interesting, then you’re going to be successful.
“Interesting” is a matter of taste
You may roll your eyes at the idea that any of the above mentioned personalities qualify as “interesting content creators.” But that doesn’t matter — because a whole heck of a lot of people think they do.
The key for the content creator is, of course, inventing and creating for your specific audience.
Probably for your B2B business that doesn’t involve a scantily clad selfie or inflammatory tweet. But if you can be on the cutting edge of what does matter to your target audience, you’ll begin to build a brand that followers feel compelled to watch.
Speak your truth
We live in an interesting time for words like “true” and “fake.” But what I know to be important in content creation is authenticity.
Dan Rather offers an interesting case study. The 84-year-old veteran broadcaster’s rapid rise to social media stardom began with his candid election commentary on Facebook last November. Fans and critics alike have continued to engage with him via this platform. The resulting discussion can only be attributed to Rather’s authenticity — he shares what he truly thinks and feels, and encourages his followers to do the same.
Companies that use content and social platforms as an outlet for their missions, interests, and passions find greater success than those that are trying to be something they’re not in these spaces. For examples of companies who are doing it well, think of Coyote Logistics, Whole Foods, GoPro, Nike, Oracle, and Lowe’s.
Takeaway
The takeaway for the supply chain and other B2B companies is this: If you can build a brand with a reputation for creating really interesting original content, things like distribution, posting time, and posting frequency become less important.
People will know you as a source for cutting-edge ideas and thought leadership. People will be looking for your content. People will follow you because they care about what you have to say.
Don’t underestimate the power of quality original content.
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by Fronetics | Apr 11, 2017 | Blog, Content Marketing, Marketing, Social Media, Supply Chain
Create videos that provide answers and convey your mission, and viewers will come.
I know what you’re thinking: Videos are a great marketing tactic for certain niches, but not the supply chain. Who would want to watch my videos? What would I even make a video about?
Here’s the thing. Video is the most popular form of content being consumed online. As such, YouTube has become the second largest search engine in the world, with more than one billion users conducting over 3 billion searches per month. And YouTube isn’t just for funny cats and cover artists anymore. Businesses are using the video-sharing website and social media platform to engage customers and prospects.
Why? YouTube reaches more adults ages 18-34 in the U.S. than any cable network. Users browse the platform for entertainment purposes, but also for tips, information, and ideas. And anywhere people are seeking solutions, businesses should be providing answers.
Provide answers with video
Your first tendency when creating video content might be to promote your products. But if people wanted to watch commercials, they’d turn on the TV.
Instead, ask yourself: What are your customers’ pain points? What expertise and information do you have that is valuable to them? What industry topics interest you most, or what do you like best about working in your field?
YouTube has proven that ordinary people demonstrating and discussing their interests is of great value to a wide range of people. Consider formerly starving artist Leonardo Pereznieto, for example.
After struggling to make ends meet by selling his art, Perznieto began his YouTube channel Fine Art-Tips. Initially the goal was to make his drawings and sketches accessible to a wider audience. It was pretty unsuccessful.
Then Pereznieto began uploading sketching demonstrations to his channel, describing exactly what he was doing or how to get a certain effect. Fine Art-Tips grew like wildfire. To date, he has over 780,000 subscribers and more than two million views monthly. His step-by-step tutorial on how to draw a water drop has nearly 9 million views alone.
Aside from plenty of ad revenue to cover his living expenses, Pereznieto’s YouTube celebrity has advanced his reputation — and success — as an artist. His story is a testament to the power of informational video content in brand building.
Convey your mission
Video is a highly visual way to engage your audience. The combination of images, music, and narration can provoke emotion unlike any other media form. This makes it an ideal way to convey what you stand for — be it a safer workplace, higher quality components, or green living.
Chipotle’s 2013 integrity campaign offers a great example. The fast food chain partnered with Moonbot Studios to produce a video, The Scarecrow, which brought consumer awareness to issues within the food industry. Now with over 17.8 million views, the video has helped demonstrate Chipotle’s commitment to anti-factory farming and wholesome, sustainable food.
Videos are an excellent way to engage and enlighten customers and prospects without being overly promotional. Over one billion people are seeking answers and joining causes on YouTube — will your business create the content they’re looking for?
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