The 2020 Mid-Year Economic Update_long

Texas A&M Distribution Students Visualize Industry’s Digital Future

In a recent virtual conversation with a few hundred Texas A&M Industrial Distribution students, the next generation had a lot to say about what changes they see in B2B distribution after the full impact of COVID-19 becomes clear. The future of distribution is moving faster than any of us thought possible, and its looking brighter with the talent coming online.
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In speaking with students enrolled in Mark Johnson’s industrial distribution class at Texas A&M each year, we at MDM have long talked about the coming digital tipping point for B2B distribution sales models. During this year’s (virtual) discussion, the future leaders made clear their opinion that the tipping point is now behind us, thanks to COVID-19.

The B2B distribution market went over the digital falls in February 2020. Let’s quit talking about a tipping point. The students can’t imagine being a modern distributor without digital sales augmenting and improving the distributor sales effort.

They asked great questions about the industry’s preparedness, such as:

  • What actions can a traditional face-to-face selling distributor do now to adjust?
  • How can you change your model (mix of inside, outside and digital sales) quickly to deal with the new reality?
  • How are distributors using data (customer share, customer potential, website interaction) in an integrated sales approach to revamp a new sales coverage plan?
  • How are manufacturers looking at their distribution channel differently now? Are they going to choose distributors with a digital, inside and outside sales coverage plan over distributors who are just counting on their outside sales team to solve all the sales issues?

The Digital Revolution is Here

My first thought in talking with these future leaders was that they are being taught well to help the industry after graduation. (Purdue, Nebraska-Kearney, and many other great university education industrial programs are also leading the way).

My second thought was these students believe all distributors can embrace a foundation of data, digital automation and new sales coverage plans to grow share. I am seeing leading distributors do this already, creating digital sales coverage plans by building an inside sales development team that can onboard and grow high-potential accounts. The marketing department and web team then grows and drives remaining accounts into the sales funnel.

Also see: “Support Your Customers: Don’t Stop Selling Because of Coronavirus, Part 2.”

Already keen digital consumers, the students understand that any digital interaction counts as a customer call — that digital searches and interactions need to be treated with the same respect as inbound phone calls. For example, there are B2B distributors now who immediately notify the appropriate sales team when a customer searches on their website for a part, conducts a price check, looks at an invoice, checks delivery, etc. Many have already established automatic immediate response email programs that are triggered by these digital interactions.

I hope that leading distributors will hire these young leaders to help them find new ways to serve their customers. Meanwhile, consider joining us Tuesday for our first MDM Sales Transformation Roundtable, where many of these concepts will be discussed. The roundtable is open to attendees of MDM’s upcoming Sales GPS conference in September, which we are expanding to include a series of monthly virtual meetings, the latest insight and ongoing support on building stronger sales teams and processes now, including revised sales compensation plans. Email me at john@mdm.com for more information.

\"JohnJohn Gunderson is vice president of analytics and e-business for Modern Distribution Management. Prior to joining MDM in 2018, he held senior management roles for 20 years, leading sales, category management, marketing, pricing, analytics and e-business with leading North American electrical, industrial, construction and electronics distributors.

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