The company that kills you doesn’t look anything like you. That’s the title of our keynote speech next week at MDM’s 2019 Digital Distributor Summit by Justin King of B2X Partners. King’s point is that the qualities that have built a successful distribution company up to now are the exact things he thinks can prevent them from being innovative and able to adapt to changing customer demands. In an MDM podcast, King talks about the change management required beyond technology that includes people, strategy, process and planning. Listen to the 14-minute podcast now, and take in the highlights below.
Nothing like a provocative keynote title to stir the pot, is there? MDM asked King to expand on what he means by that message. “It’s been an interesting evolution over the past few years,” he said. “We started realizing that where distributors need the most help in digital transformation projects is not specifically in technology, but in change management. So many people are concerned about the competitor up the street, or larger national competitors.”
But what King sees emerging is a new breed of digital competitors that have very different cost structures and value models. Beyond that, they are digitally native, and therefore able to build some powerful and flexible tools. Often, King notes, distributors are wrestling with legacy technology systems that are not as adaptive or flexible to build strong customer-centric experiences.
A Broader Conversation
King (and our other speakers) will have digital front and center in their presentations, but there is a broader conversation necessary that we’ll be having around a deeper business model innovation, where digital is an integrated part of it — but not the endgame.
To use an analogy from our specialized media industry, it’s a transition from print-focused publishing to digital-first, where customers increasingly use mobile devices to access news and information services (don’t worry, we’re not retiring the print edition option for MDM Premium, yet). We are still an information provider, but we have to adapt to the way our customers want to consume our products and services.
As King put it, “What does it mean for digital to be strategic inside of an organization? It goes beyond a transactional website. Think of all the knowledge and expertise in the heads of the baby boomers and older generations. How do you transfer that to the new blood coming onboard, so they can leverage that expertise on behalf of your customers?
“It’s this idea of how to take some of that information and translate it into an online experience for customers that distributors can actually monetize. A great example is cross-selling and up-selling information, where customers can self-serve and average order size and revenue increases.”
I’m also excited that we will have a panel discussion at next week’s conference that includes two companies that are examples of the types of emerging digital distributors that threaten traditional distribution models. One sells material handling equipment parts, and the other is an irrigation/sprinkler parts seller. Both panelists came out of traditional distribution companies, and recognized an opportunity to leverage digital to create a very different value proposition for the markets they are targeting.
There’s still room to join us June 19-20 for a solid day-and-a-half focus on the latest distribution digital best practices — great content, networking and a chance to challenge your thinking. Here’s the agenda. But we only have enough room for distributors and manufacturers — no seating is left for service or technology provider companies (sorry, let’s talk for next year’s event!). If you can’t make it, we’ll have some follow-up coverage for our Premium members.
Justin King will also be leading a four-hour pre-con workshop on the afternoon of the 18th– A Digital Action Plan for Distributors. It’s a hands-on session where attendees will leave with a workbook, digital planning tool downloads to customize you own buildouts, and an actual plan template that you will start to work on in the session (bring a laptop). Here’s more on the workshop agenda.
See you in Denver!