A recent survey from McKinsey & Company, a global consulting firm, uncovered some fascinating trends in the response of B2B decision-makers to the COVID-19 crisis. The respondents included 3,600+ B2B decision-makers at global companies in industrial manufacturing, energy, pharma & medical, finance, and more. A few findings stand out:
- 96% of respondents have shifted their GTM (go-to-market) strategy in the wake of COVID-19.
- 55% of respondents depended on in-person sales reps before COVID-19. That number is now down to 21%.
Most telling of all, perhaps, was this: Among companies which adopted a new selling model due to the pandemic, 80% of respondents plan to retain that new model 12+ months after COVID-19.
Clearly, we’re experiencing a sea change in how companies do business with each other—one that will last beyond COVID-19.
So what do these findings mean for manufacturers in particular? Here are 4 takeaways.
1. Digital commerce = the new normal in B2B
Historically, not all manufacturers have had an incentive to move to digital commerce. Phone, fax, and email have served these companies well for order placement and account management. Since business processes weren’t broken, there was nothing to fix.
COVID-19 has changed that, as sales and customer service reps have encountered friction in doing their jobs remotely.
Other manufacturers are reevaluating their existing digital commerce solutions. Lack of real-time SAP ERP integration means customers can’t conduct complex transactions online. These manufacturers (and their customers) have tolerated lackluster digital experiences, often with cumbersome workarounds and a re-platforming project on the horizon.
For these manufacturers, COVID-19 has exacerbated the pain of non-integrated eCommerce.
2. B2B buyers would rather buy online through self-service anyway
Several of McKinsey’s findings are directly applicable to manufacturers:
- When asked what kind of interaction was most helpful in choosing a supplier, 47% of respondents preferred some form of online self-service. 25% chose “supplier website,” while 22% said “online material from supplier.”
There’s an insight here for manufacturers: In the post-COVID world, B2B buyers are turning to digital as their primary means of researching products. That means that manufacturers should provide eCommerce catalogs with rich content, photos and videos, documentation, product comparison, and more.
Yet rich content alone isn’t enough, as another finding from the McKinsey survey shows:
- When asked what ordering method they preferred, 46% of respondents chose “using a supplier’s website.”
In other words, if you’re going to give customers a product catalog online, you should allow them to place orders, too. Not only do customers need rich content for product research, but they also need the power to complete the purchase online after browsing—ideally with all their personalized business rules enforced from SAP.
For manufacturers grappling with the COVID-19 crisis, this is actually good news. Not only is digital self-service the most feasible selling method now that sales and customer service are working from home, it’s also the ordering method which customers prefer.
But how should manufacturers approach their first eCommerce channel (or the replacement of an old platform)?
3. Agile is the way forward, both during COVID and after
In an article on Agile in the midst of COVID, Forbes says: “Companies that embrace agile most comprehensively throughout their organizations are the most successful… When situations change—as they do regularly through the coronavirus crisis—agile allows for easy shifts because work has been planned in smaller portions and over shorter time horizons.”
McKinsey echoes this thought in another article, drawing attention to the fact that companies which took an Agile response to the 2008 financial crisis are currently performing far better than competitors who didn’t take an Agile approach. McKinsey puts it this way: “Companies that move early and decisively in a crisis do best.”
The key is for manufacturers to take the Agile approach and apply it to self-service digital solutions for customers.
4. Apply the Agile mindset to digital customer experience
In the world of COVID-19, waterfall methods of transformation may be too slow, too risky, and too expensive to meet the rapidly shifting needs of customers. As we covered in our article, Right-Sized Digital Transformation In The COVID-19 World, manufacturers should strive to improve customer experience incrementally. The Agile methodology should be applied at two levels:
- A high-level plan for Agile digital transformation. Across the transition project, manufacturers should strive for quick wins which offer real customer value. In the COVID-19 world, that can take many forms—for example, launching a self-service order tracking portal first, then growing the platform to include self-service browsing and purchasing after you’ve successfully onboarded customers to the order tracking portal.
- An Agile approach to each step in that transformation. Manufacturers should incorporate the voice of the customer into each incremental rollout. In our example, if an organization is starting with online order tracking, it’s critical to put that software in front of your real customers and ask why it can’t be launched today. This will uncover mission-critical requirements which might not have surfaced until after launch if customers weren’t given a voice during the implementation. With this information, you can pivot to address customers’ concerns before the solution is launched.
With full application of the Agile methodology, manufacturers can meet customers’ digital needs, plus prepare themselves for future disruption. The key is to prioritize customer value, then design transformation projects to deliver that value fast.
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