More manufacturers are moving their business online than ever before and the pandemic has accelerated that timeline. Jeff and Carman present eight different ideas on how you can stand up an ecommerce platform relatively quickly without a large budget and use of resources.
Eight Ways to Get Started With Ecommerce Transcript:
Here are eight ways B2B manufacturers can begin building an ecommerce presence, from the podcast episode:
- Give your top orders and customers an opportunity to do ecommerce-based reordering
- Build an ecommerce platform to serve smaller clients
- Create a storefront for your top 100 products
- Create a storefront for your “gateway”/most popular products
- Create a merchandise platform
- Explore a clearance ecommerce platform
- Leverage existing marketplaces
- Build your own marketplace
Announcer: You’re listening to The Kula Ring, a podcast made for manufacturing marketers. Here are Carman Pirie and Jeff White.
Jeff White: Welcome to The Kula Ring, a podcast for manufacturing marketers brought to you by Kula Partners. My name is Jeff White and joining me today is Carman Pirie. Carman, how’re you doing, mate?
Carman Pirie: I am doing good as always. Good as always. You know, I very rarely choose this show to complain.
Jeff White: When there’s so many other outlets for it, especially these days.
Carman Pirie: Yeah, exactly. Exactly. I think I saw a meme going around the other day about how are you different in real life than you are on Twitter. And I thought, “Well, I’m actually much more cantankerous and argumentative in real life.”
Jeff White: Fair enough. Fair enough. I’m not agreeing that you are cantankerous in real life, because I certainly haven’t necessarily always found that to be the case, but I think we both present a fairly accurate persona on Twitter. But-
Carman Pirie: Maybe. Perhaps. But nevertheless, let’s get into it. I think today we’re hoping to chat about basically… We wanted to talk about ecommerce, and it’s through the lens of people moving their business more online than ever before. Clearly the pandemic has accelerated that conversation. Many people have found themselves in the place where the first, best time to have done this was five years ago, and the second-best time is like now.
And frankly, for B2B manufacturers wanting to stand up ecommerce for the first time, respectfully, it’s a little different than your local craft brewery or restaurant that’s getting their head around a small ecom presence in order to bridge this COVID gap.
Jeff White: Quite right.
Carman Pirie: So, I guess that’s what we’re looking to attack today, is really work through it and give manufacturing marketers kind of a lens through which to look at this decision point, and maybe a couple of different options that they would have in front of them for how they might be able to dip their toe in the ecommerce waters. Did I do a decent job of teeing that up, Jeff?
Jeff White: Yeah, I think you’re completely right. A lot of people are looking at ecommerce at this point in time, and they haven’t necessarily been preparing for it, or it was a project that was in the offing, but it was a ways down the road, and they didn’t necessarily have the intent of moving ahead with it, and it wasn’t potentially as important to them as it may be now. And we’ve designed and built a lot of ecommerce stores in the B2B space, and we know just how complex that can be for marketers and for logistics teams, and for others, so if there’s different ways that we can be looking at this that don’t require an 18-month time horizon to assemble your tens of thousands of SKUs and get everything ready, then what could you do? And where can you take that in a way that’s gonna see you getting some experience in ecommerce, seeing some feedback from your customers, and beginning to learn from that, and grow it, and kind of eventually turn it into potentially a full ecommerce platform for your B2B manufacturing business.
Carman Pirie: Well, and Jeff, I think you kind of touched on it there, so I want to just be very explicit about it, that really a lot of the complexity associated… Well, if we had to chunk up what are the buckets or the areas of complexity, if you will, that a manufacturer might have in building out an ecom presence, one of it certainly is around the checkout process and how B2B transactions are conducted, versus say just a consumer-level transaction with a credit card. We certainly know that the levels of integration with an ERP or other toolset is going to be most likely decidedly more complex for a manufacturer than some others may experience.
And then third and perhaps almost most important is that so much of it comes down to the number of SKUs, isn’t it? When we talk about these products being very configurable often for B2B manufacturers, and just the sheer heavy lift associated with trying to get all of the digital assets and content associated with a product, so that that information is actually ready to be populated into a store, that is not an easy thing. So, I guess the rest of this conversation is against that backdrop, where we’re saying, “That’s the heavy lift, should you choose to take it. Here are some other options that might carve off parts of that and allow you to get going faster.”
Jeff White: Absolutely. Yeah. No, I think that’s the right way to approach it, and we’ve got a bunch of ideas about how you might go down that road and begin to experience the wonder that is a functional ecommerce store.
Carman Pirie: Indeed. So, what’s the first one that you had in mind?
Jeff White: Well, I think one of the places that you can really look to is at some of your top orders and top customers and give them an opportunity to do ecom-based reordering. So, you’re looking at 5% of your total product mix, and you’re carving that off, and making those items available for people who were already doing fairly consistent ordering before, and bringing that onto the site in some way, providing a username-password type login, so that those customers can actually get in there and do that. And there’s probably a decent chance that your ERP has that capability built in, even if you don’t have it turned on right now.
Carman Pirie: I was trying to think through. I mean, that notion of going deep with your top clients, and if you’re a marketer, maybe considering which of these strategies we’re going to detail might be right for you, I’m thinking in that instance, one of the great things about that from a… I guess political management, internally, perspective is that inside of organizations, it can also be an easier sell to sell investing in supporting and better serving your top customers. For many manufacturers, that feels right, and it feels smarter and better than building for prospects, oddly.
So, I think if you find yourself in that kind of an organization, this might be an interesting move. It’s also one that would make sense if of course you know that there’s a lot of lifetime value in those existing customers that you haven’t been able to tap into yet. Maybe you’re having difficulty fully cross-selling into those customers or what have you. What am I missing there, Jeff?
Jeff White: Not a heck of a lot, I don’t think. The one thing I do think about is that it potentially gives you a way into ecommerce that doesn’t require the typical store build side of things. I mean, you can probably get away with something like this with simply designing custom forms for your top customers. You know, where you have the ability to go in and list products, add or remove the ones that aren’t going to be necessary perhaps on that monthly order cadence, or quarterly cadence, or whatever that order cadence happens to be. And simply providing a way, because these are existing customers, maybe you don’t need to have any kind of payment processing gateway. You just have them enter the purchase order number and then contact the right person.
So, it’s a way of smoothing out that order process, making it easier lifting for your logistics folks, and simply getting something up there and working. It’s a nice way to get a taste of ecommerce without having to build a full-on platform for that experience.
Carman Pirie: And like a lot of things, the opposite is also an option here. If we’re not going to go deep with our top clients, one of the things that we could do is build an ecom platform to maybe serve smaller clients that it’s maybe not as cost effective to give them a one-on-one personal sales treatment. We certainly see that a lot.
Jeff White: Yeah. We do. I mean, we’ve built a couple of ecom platforms for this exact purpose, where for smaller lots, for individual sample purchases and things like that, providing a smaller set of your SKUs or smaller packaged versions of those SKUs for those customers that don’t necessarily spend, don’t have the huge lifetime value of your biggest customers, but are a considerable… time suck is such a horrible word, but they can really take up an awful lot of time for your salespeople, your CSRs, when in reality the profit isn’t necessarily there. But if you can streamline the process of how they purchase an order from you, then that’s a real win, and then that can be extended later on to a broader catalogue and the rest of your customers.
Carman Pirie: Look, in this one area where I think the people that I’ve seen do this really successfully and to really prove the ROI of their platform, it seems like they’re the ones that are most able to realize the administrative efficiencies and savings associated with that, i.e. those manufacturers that are maybe best able to redeploy those sales resources that were being absorbed by these nuisance orders, if you will. Because some organizations are just more I guess capable of realizing those administrative efficiency savings than others, you know?
Jeff White: Yeah.
Carman Pirie: One thing that kind of nags me about this strategy is that it takes a really great tool for serving clients, it takes the development of a tool that is actually more aligned with how buyers are wanting to buy these days, and it relegates it to, “Oh, it’s used to serve the people that we otherwise just don’t want to talk to.” It’s never really sat well with me. I guess I understand why people do this strategy. It’s not like I’m completely against it. But I always feel like just building an ecom platform to serve the underserved just seems like you’re missing a big chunk of the why there.
Jeff White: Yeah. I do wonder though with those larger order values for your biggest and best clients, the logistical side is probably a bit more difficult maybe, and requires more effort to stand up from a technology perspective to kind of get to that scale. I don’t know. I mean, maybe you find as you get into it, you find that it really could apply to everyone, even though you thought that you’re only going to serve those underserved customers.
Carman Pirie: See, folks? This is how it works. I get annoyed, and then Jeff’s inevitably a little bit more reasonable.
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Carman Pirie: So, there’s two. We could go deep with top clients. We could serve the underserved. What’s the third one on your mind?
Jeff White: I think the third one that I’m thinking of, and we see this often when we’re speaking with prospects who are considering implementing an ecommerce store. Maybe they’ve got tens of thousands of SKUs, they have lots and lots of different configurations of potential products, and they don’t necessarily have, to our point as we kicked off the podcast, content about each one of those, so maybe you look at examine your financials and figure out exactly what are the top 100 products that you could make available? And can you quickly prepare the content, the product descriptions and all of that, and stand up a store for those products that are most commonly purchased, and make that the thing? Because the technology side of it is going to be what it’s going to be, but it’s the population and the preparation of content that is going to take the vast majority of time. So, what can you get off the ground quickly with your most popular products?
Carman Pirie: And maybe another way to look at it, which is maybe the same thing but maybe isn’t, is I think you could look at, “Okay, what are our most popular products?” There’s gonna be some overlap with what I’m about to say, but I don’t think it’s exactly the same. You could also look at what are those products that tend to be the gateway products? The products that lead people to discover our brand for the first time. What are the products that are the first products that people typically buy from us? And maybe those are the ones that we put on an ecom platform initially.
Jeff White: Yeah. I think that there’s a real opportunity to kind of make available to consumers those top products that maybe are the ones that are most likely to be available and of interest to actual consumers. We’ve certainly seen some of the guests that we’ve had on The Kula Ring before who have a lot of crossover between their B2B customers and prosumer consumers, who want to use the stuff that the professionals use. And I think that gives you an opportunity to kind of understand exactly what’s expected of an ecommerce store from a consumer sense, and anything you learn there that you can apply to your B2B ecommerce platform is going to ensure that it’s an improved experience over what you might have done if you were simply just turning on your ERP’s ecom functionality.
Carman Pirie: We’ve certainly seen that folks have found that as a way of managing some potential channel conflict with an ecom presence, as well. Sometimes they don’t make their distribution channel quite as angry if they think that they’re only going after like a prosumer buyer, versus a B2B buyer.
Jeff White: Yeah, and I guess that way too, especially if you do have that kind of brand appeal, you could also use it as a merch platform, too, to just sell branded merchandise as an opportunity to begin to understand the logistics and the flow of exactly how that works without impacting your true products.
Carman Pirie: I’m reminded of Klein Tools doing that, actually. The only ecom I think available on Klein Tools’ site isn’t for their pliers, which everybody would gladly buy online, but they actually send you to Home Depot or whatever to do that. But if you want to buy the Klein Tools swag, you can do that on their website.
Jeff White: Yeah. Exactly. So, I think that actually… That’s our fifth one, if we consider merch as its own category.
Carman Pirie: Nice. Well, one of the other areas we had talked about is looking at it from a point of view of clearance. In some ways, that takes some of the complexity out of it. You know, you’re not so much looking at something that’s custom or configurable when you’re saying, “Look, this is what we have. Do you want to buy it or not?” And I find too, clearance ecom platforms, they don’t carry the same service expectation, potentially, so maybe people feel sometimes a little bit more comfortable with that being their first foray in?
Jeff White: Yep. No, we found this at the back of the warehouse, and we really just need to get rid of it to make room.
Carman Pirie: Yeah.
Jeff White: Only one.
Carman Pirie: And we’re being honest about that, and you know exactly what you’re buying, and everybody knows what this is.
Jeff White: Yeah. Exactly. No, and I think that’s certainly, again, a great way to learn from this. And I think that one leads a bit into our next thought, which is just around this idea of what can you do from leveraging existing marketplaces for the kinds of goods that you manufacture and sell?
Carman Pirie: Yeah. I’m really of a couple of different minds here. I think it can be helpful in the short term, and people certainly do get that kind of taste of ecom, but it’s also in an environment that you really can’t control, or iterate, or improve upon, so I don’t know how much it teaches you. I mean, it teaches you about the logistic side of it maybe a little bit, but even that’s kind of unique in that situation. And then I find inevitably it’s like… Okay, the minute that that starts really kind of working for you is the minute you want to start weening yourself off of it, because you’re tired of giving up the profit, right?
Jeff White: Yeah. Fair enough.
Carman Pirie: You’re tired of giving up that margin. It’s like geez, just when the drug starts working it’s when you have to start trying to kick the habit.
Jeff White: Well then, I guess the corollary to that, of course, is to build your own marketplace, where you don’t necessarily provide all of the product that goes in it, but you provide the platform for doing it. And I mean, that’s certainly what we saw from Lisa Butters and Honeywell, who was on the show a couple months ago, and I mean we’re supposed to be talking about things that are light lifting, or light-ish lifting, and that certainly isn’t necessarily the case there, but-
Carman Pirie: To be fair, they had a fairly small team if you recall, and I think they got that started up pretty quick.
Jeff White: Yeah, it was 12 weeks, 16 weeks, something like that. So, I mean-
Carman Pirie: Yeah, so depending upon, like you say, if you’re creating your own marketplace, the big benefit of that is you… It’s those people who are listing their products on that marketplace that have the kind of the product-level information lift, if you will.
Jeff White: Yeah. The onus is on them to make sure that the product information is good. I mean, I think that’s eight separate ideas about how you can relatively quickly stand up an ecommerce platform and learn from the experience and get something in play without having to make your entire 100,000 SKU library of products available and write descriptions for each. So, I think that’s… There should be something in there that a lot of manufacturers can find of interest, that they may be able to experiment with and try without expending a ton of budget in order to do it.
Carman Pirie: Yeah. I think this is like the… I don’t know, this feels to me like the Morgan Freeman strategy or something here, where we’re telling Tim Robbins to get busy living or get busy dying or whatever. Like these are the get busy living strategies, right? These are different ways that you can start down this path, and you should… For anybody doing it, you should really check out one of our early episodes. I’m trying to remember, Jeff. Talk to me here. She was with GE.
Jeff White: Oh, Monica.
Carman Pirie: Monica. About not thinking about your ecom initiative as a project, but rather as a product. So, maybe I’ll leave you with that kind of thought if you are going down this road and are going to pick one of these on ramps into ecommerce, think of it as a product that you’re going to be enhancing and developing over the long haul.
Jeff White: I think that’s great advice. Thanks a lot, Carman.
Carman Pirie: Been a pleasure.
Jeff White: Cheers.
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