The 2020 Mid-Year Economic Update_long

Pandemic Shines Light on a Distributor’s Need for E-Commerce 

Digital offering for customers is one of the four levers that distributors can pull to help them take share during the pandemic — or amid any disruption.
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Myriad challenges have emerged across distribution in recent years, including how to compete with Amazon, how to meet evolving customer expectations and how to pivot to digital capabilities in today’s rapidly changing business landscape. 

But with the coronavirus crisis ravaging the U.S. economy over the last six months, those problems have hit distributors harder than ever before. And they all hit simultaneously. 

“What’s happened in the last few months with this pandemic has accelerated all of those trends into a trifecta of a perfect storm,” Ranga BodlaVPfield engagement and marketingNetsuitesaid on the recent MDM Spotlight, Levers to Create an Agile Distribution Team. “But the distributors that are thriving during this are the ones that were already paying attention to those trends and have started executing on those plans to meet today’s challenge.” 

Bodla joined MDM CEO Tom Gale on the latest installment of MDM’s popular video series to discuss how distributors can build a more agile organization to leverage the disruptive market conditions that the pandemic has accelerated in 2020. 

The levers that any distributor hoping to take share during this crisis must pull include a cloud-based system to allow teams to work remotely; analytics to react quickly to changing trends; and the right talent to take companies to the next stage. 

But one essential lever that the pandemic has exposed is the need for a robust e-commerce offering. Many distributors told MDM in our recent trends survey that they are either adding or bolstering e-commerce capabilities amid the pandemic, and Bodla explained why during the Spotlight. 

“Five years ago, e-commerce was a ‘nice to have,’” he said. “Three years ago, it had accelerated past ‘nice to have’ and you needed to have a phase one website. Two years ago, you started to get into ‘musthave’ territory. Now, you’re not going to be able to survive if you don’t have an e-commerce presence.” 

‘Win the Day’ with Your Customers 

E-commerce is one of the critical levers for distributors during the pandemic — or, really, any economic disruption — because many B2B buyers are working from home and need to get product delivered quickly. If they can’t peruse your site and place an order, they’ll quickly look elsewhere for their product needs. 

“Right now, that loyalty aspect has gone out the window,” Bodla said. “They just need product. And in the industrial distribution space, in particular, buyers are going to go wherever they can get the product. E-commerce demand has surged.” 

But e-commerce is about much more than just ordering via an online portal. Customers now expect to engage with their distributors in all ways digital, Bodla added, from digital marketing to social media to online delivery tracking. 

“It’s not just the expectation of your consumers or your buyers,” he saidIt’s one of the only ways in which they can interact with you and get product. And there’s an expectation from an inventory perspective, so it’s a little broader than just ecommerce. It’s everything around it — not just how do you sell to customers, but also how do you acquire them? It’s about email marketing, how you store and deliver your productswhether you have your own physical warehouse versus thirdparty logistics. All of those are big topics that we’re seeing, and all of that together is ecommerce.” 

What’s more, he added, a company without that e-commerce lever to pull is vulnerable to a competitor. In today’s competitive landscape, that could mean an existing company or an emerging one. 

“It’s not just Amazon,” Bodla said. “It’s going to be somebody else you’re not even thinking about today. And so, you have to have people who can move and pivot quickly and adapt — because that is what’s going to win the day.” 

Learn much more about creating an agile distribution team — through e-commerce as well as the cloud, analytics and other levers — in the latest MDM Spotlight, sponsored by Oracle Netsuite, which you can watch by clicking here. 

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