How Should Distribution Respond to Amazon Business? - Modern Distribution Management

Log In

How Should Distribution Respond to Amazon Business?

Amazon Business represents more than a new competitor its an entirely new business model. To address new rules Amazon continually rewrites for traditional channel competition, distributors need to develop new strategies. This article, part 4 in our series, outlines key response alternatives for distributors and the industry collectively to define value, keep customers engaged and avoid displacement.This article includes:

  • Compete or capitulate?
  • Is there an alternative?
  • Adaptive strategies for distributors

Subscribers should log in below to read this article.

Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • MDM-Baird Distribution Survey: Storms Stunt Distributor Growth
  • Distributors Up Search Marketing Efforts
  • Amazon Business: The Burning E-Platform
shopping cart on tablet
Author
Date

Amazon Business represents more than a new competitor – it’s an entirely new business model. To address new rules Amazon continually rewrites for traditional channel competition, distributors need to develop new strategies. This article, part 4 in our series, outlines key response alternatives for distributors and the industry collectively to define value, keep customers engaged and avoid displacement.

In October 2017, Spend Matters surveyed 100 procurement professionals. In this research – sponsored by Amazon Business – “tail spend improvement was the top priority heading into 2018.” Spend Matters defines “tail spend” as the “85 percent – 90 percent of the suppliers that represent less than 5 percent – 10 percent of spend.” (Download the research report here.)

We believe Amazon Business was developed, in part, to capture these purchases, which are difficult, time-consuming and expensive to execute. Since launching in 2015, Amazon Business has become an enormous competitor to traditional distribution – from nibbling at the edges of many product portfolios to an increasingly expansive existential threat. Its value proposition, fueled by massive data analysis, has enticed one million purchasing organizations – as of July 2017 – to become customers. What’s next in 2018?

To read the rest of this article plus much more analysis of the threat distribution faces with Amazon Business, click here to download our free report, Your Amazon Business Playbook.

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!

2

articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events

1

article
left

You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.