Boosting e-commerce is key for B2B companies, and not just to increase online sales—customer value rises online and off when customers buy multichannel, says Devashish Saxena, group vice president, global e-commerce and multichannel convergence, at electrical equipment distributor Rexel. Saxena will speak at B2B Next, the conference and exhibition that launches in Chicago September 24-26 under a partnership between top B2B e-commerce analyst Andy Hoar and Vertical Web Media, the publisher of B2BecNews and Internet Retailer.
His session, “Causation Beats Correlation: Quantifying the Real Impact of Cross-Channel Influence,” will address making a direct connection between actions and outcomes to drive organizational change supporting e-commerce.
Q: What is driving B2B companies like Rexel to expand online?
Saxena: I see three key factors, starting with evolving customer behavior. Customers are relying more and more on online interactions. We found that many of our different personas were using the online channel to get information they needed to complete key tasks across their journey, especially early on when they are looking for product information, stock availability and pricing data. We continue to see a higher preference to buy online as well, though that varies by market, product category and the dollar value of the transactions. In larger or industrial customers with centralized procurement professionals, we see a heavy appetite to conduct transactions digitally whether on web, through punchout from their procurement software or EDI.
Secondly, multichannel or omnichannel customers generate higher value than an offline-only customers. When we flip an offline-only customer into a multichannel customer, we see an increase in their spend with us, and they are less likely to churn (sometimes by percentages that are quite high.) This increase in spend doesn’t just happen in their online sales. In fact, the increase is largely reflected in their offline purchases.
Finally, competitive forces are at play. With the emergence of third-party marketplaces, pure players such as new websites and apps and the continued evolution of many of our traditional competitors, there is a desire and a need to stay at par with the tools and services we offer to our customers.
Q: What are some of the biggest challenges?
Saxena: Culture/mindset shift and a change in many of the business processes. Building digital capabilities such as web sites and apps is not that difficult as compared to helping business leaders understand why that alone will not do the job.
Even when business leaders understand and want to evolve business processes, these processes often are archaic. Surround that with a plethora of outdated IT systems, and a significant portion of the people who do not understand why to change, or just plain don’t want to—well, that’s where the fun is!
Q: What are the biggest gains you’re realizing?
Saxena: I look at two KPIs: Our rate of growth continues to increase year after year on both online sales as well as in the percentage of our customers who are multichannel. We can now create a visual map of a given customer base to see “how connected” that specific group of customers is online. The degree of connectedness ranges from zero—being offline only—all the way up to the 6th degree—highly connected customers demonstrating high-value online behaviors. This allows us to quickly and visually judge the “connected state” of any group of customers and easily compare to another set; for example, a country vs another country.
Q: What is the biggest thing B2B companies still need to realize about e-commerce?
Saxena: In my interactions with peers in the B2B space over my career, I think many B2B companies fall into a few common traps. First, they assume because they are B2B, they may not have to do certain things. But customer behavior evolution toward e-commerce in B2B is no different or slower than in B2C. I sincerely hope there are fewer and fewer organizations in this space!
Secondly, I have seen organizations fall into the trap of technology. I suspect focusing too much on the technology aspect is also the case with some B2C companies—do I have the latest shiny new thing. Focusing on customer behavior and driving business value requires more focus on the business evolution side vs. just pushing out new technology.
Q: What is your most valuable piece of advice for B2B companies looking to add online sales or increase them?
Saxena: Identify opportunities where you can solve your customers’ problems. Where are the friction points and how can you remove them? Our approach is to really build multichannel relationships with our customers. The focus is not just to grow online sales—but to grow total share of wallet with our customers. That comes by engaging them in a multichannel way, both digitally and at our branches and with our sales people.
But don’t assume that just building an e-commerce site drives online sales. Once you have a platform it has to be activated both online through digital marketing and analytics as well as offline through the evolution of key business processes and the adoption by key organizations, especially sales.
Through my career I have seen a lot of anecdotal opinions about what customers want, but it is difficult to build a scalable strategy from opinions that are contradictory. So investing in understanding the customers’ journey has been an incredible tool in aligning internal voices.
Registration for B2B Next is open. The conference features:
- 38 Sessions
- 44 Speakers
- 28 Exhibitors
- 9 Networking Events
Learn more at B2BNext.net.Favorite