Industrial Buyer Pulse: The Promise and Risk of AI for ManufacturersIndustrial Buyer Pulse: The Promise and Risk of AI for Manufacturers

Industrial Buyer Pulse: The Promise and Risk of AI for Manufacturers Transcript:

Jeff White: Welcome to The Kula Ring, a podcast for manufacturing marketers brought to you by Kula Partners. My name is Jeff White. Joining me today is Carman Pirie. Welcome to The Kula Ring, Carman.

Carman Pirie: Yeah. Good to be recording this one. I think it always a fun episode when we every once in a while don’t have a guest on the show and we decide that we’re going to talk about something I guess that just Jeff and I want to talk about.

And yeah Jeff, in this instance it’s a great opportunity to dig into the latest research we’ve done on the Industrial Buyer Pulse.

There, there’s some interesting intersections of inside of that research that I think point to it being certainly an interesting time for manufacturing marketers, for industrial marketers, and how they reach industrial buyers and create a marketing ecosystem that works for today’s buyer.

It’s not necessarily straightforward.

Jeff White: No it really isn’t, and I think a lot of marketers at manufacturing organizations likely are, quite aware of what’s going on in the world of AI and all of the things that are being impacted within their organization, but maybe not to the extent that perhaps some of their buyers are thinking about in terms of how they use those tools and perhaps how it might impact how an organization goes to market these days.

Carman Pirie: Yeah. Yeah, I think that’s fair to say. And like certainly on the more small to mid-sized side of the equation, it can be easy to have a lot of the AI focus be really about how it can drive efficiency and scale on the marketing function for those small to mid-size industrials, right? I can it’s easy to focus on that, and there’s lots there…

Jeff White: There’s a lot to be done.

Carman Pirie: On. Yeah. But it maybe distracts from some of the larger issues and the notion of skating to where the puck is going. So I guess folks, there’s a bit of a spoiler alert. We’re going to probably tell you how we think everything’s incredibly disastrous.

And then,

Jeff White: And then tell you how to make it better.

Carman Pirie: And point to I think there’s some hope in all of it and some ways to think about it that that are instructive. Yeah.

Jeff White: Yeah, cool. But before we dive into that, just for those that haven’t had a look at Kula’s Industrial Buyer Pulse, this is the fourth edition of the research that we’ve done. 280 industrial buyers surveyed across the US and Canada, and it’s been a really interesting project for Kula, for our clients, for those that have been downloading and taking in the research and learning maybe from a side of things that they hadn’t thought of.

Before we get into the findings of this particular buyer pulse this was a bit your baby. I’d love for you to tell our audience about your thinking behind it and what you think it brings to the manufacturing marketing space.

Carman Pirie: I don’t know if it was my baby or not, but I guess it, it was born a bit out of frustration in that I, I found that so much of the conversation about industrial marketing and trend spotting that was happening or that type of content that you would see, seemed like it was mostly about what are marketers’ preferences in this space.

And those preferences often aren’t informed by any kind of leading success metrics. Those trends can be born out of just, what the marketers are interested in not so much what buyers care about or how buyers buy. Now, there’s an awful lot of good industrial marketers out there and I’m, I don’t wanna suggest that it’s not helpful to understand more about the tactics that they are excited about or what have you.

That, that’s not entirely unhelpful, but it, I guess it just seemed to me like we were missing something bigger in that conversation, which was: how are buyers changing and how are they thinking about their job? And what ought marketers know about that? And it seemed to me to be more important now than ever, Jeff, because it seems that the industrial buyer, — we’ve had an awful lot of people both on the podcast as well as prospects, clients, et cetera, in the manufacturing space talk about how there’s been a sea change in the who’s buying. It’s no longer the people that are, 50s and early 60s or whatever that are their main buying contacts.

So many of the main buying contacts now are in their 30s and 40s and, it’s cliche, I know, but they bring with them a completely different set of expectations about how this ought to work

Jeff White: I think one of the, the other things about this generational change within manufacturing buyers and, manufacturing sellers as well is this notion of incumbency. Something that we saw in the report and one of our team members wrote a point of view on, is this notion that the higher up in the chain you are, the more likely you are going to be to prefer a few consistent primary suppliers.

And that if you are trying to find a way in as a seller, oftentimes the – your best choices are going to be trying to target from managerial positions and on down, who are going to carry the recommendation to the executive who maybe can make a change when something goes sideways or something like that.

Carman Pirie: Yeah it’s really interesting to try to unpack the – what that’s trying to tell us or what insight is underneath that incumbency data. Cause it certainly seems as though if you’re looking for a way in it’s the, on the more plant level manager side, like plant floor level ground floor managers that are getting their hands a little more dirty those are the folks that seem to be more aggressive in trying to broaden their supplier network and have options and are interestingly more, more open to that.

And I just can’t help but think about how that butts up against so many manufacturers who are thinking the real secret is if we could just talk to the C-suite, right? And it’s like, man, the C-suite’s actively involved in a mission to try to limit the number of suppliers, and they’re quite happy with the incumbents.

But I guess I don’t really have any data to support that the m-management function’s necessarily aging out faster or being replaced faster than the C-suite function.

Jeff White: They’re probably younger.

Carman Pirie: That’s just where my gut tells me that is a bit true. And we know that the people, to your point, Jeff, the people selling into them are younger too.

So that kind of points a bit to that generation divide that we were talking about that’s sitting in part of this data.

Jeff White: Yeah and still, even though executives may be involved in fewer deeper relationships, there are still three in five buyers who’ve replaced a primary supplier because they messed up. There was a quality issue or a reliability issue or a delivery issue. So there are wedges that can be used to arm the shop floor manager or the others with this kind of data about how you provide that consistency or on-time delivery guarantees, those kinds of things.

Carman Pirie: Yeah, the proof points that are reasons to switch. They are still open to switching, and the record shows that they are switching. And that is a bit of, I think, frankly, I think a lot of people in the industrial space can get a bit lazy and feel like they have they have a right to the business.

They’re very sensitive to service quality, but it doesn’t necessarily mean that they feel that they will, they should lose the business if service quality takes a downturn or something. I find, I don’t know. It’s a… So it is a unique environment we find ourselves in.

And I guess, Jeff, the thing that was really driving us to record this episode is that the, with these changing expectations is an evolution in the types of information that these buyers want from the digital experiences that manufacturers provide. And there’s an intersection between that and AI.

Jeff White: Mhm.

Carman Pirie: That and frankly, AI fueled cybersecurity issues.

A, bunch of things happening all at the same time that I think we’re gonna try to unpack in some coherent way here.

Jeff White: Yeah, and I think, this is all coming at a time and maybe some of this is generational to our earlier points, but the expectation around the quality of a digital experience that a buyer has from another industrial or another manufacturer, it’s not that it needs to be 10% as good as the e-commerce experiences they have in their personal lives.

It needs to be 90% as good.

Carman Pirie: Yeah I might argue in the data what they’re telling us is it needs to be better.

Jeff White: Even better.

Carman Pirie: Yeah now they’re not as concerned it’s funny, they’re not as – it’s not about a gorgeous aesthetic or let’s make sure the brand comes forward. What’s, what s- the data says loud and clear, it’s about the functionality that they desire from those digital platforms.

And I, the reason I guess I said it was maybe higher, Jeff, is that it’s more complicated.

Jeff White: It’s way more complicated.

Carman Pirie: Yeah, even if we were just talking about checkout and the notion of buying on account and things of that nature versus just transacting with a credit card, that in and of itself speaks to a higher level of complexity in industrial digital experiences versus what may happen on the consumer side.

But then, spider that out even further to all the other bits of information that buyers are telling us they expect. Compliance documentation, availability from distributor partners and things of that sort in real time, pricing from those partners in real time, or at least pricing guidance.

Jeff White: Like 85% said they’d be happy if they just got a starting- at price. Starting at MSRP, something that points the way.

Carman Pirie: Give me something to work with. Yeah.

Jeff White: Yeah. No, and, and then going from there, we haven’t gotten to the full e-commerce checkout part of the discussion, but going from simply having lead time information, having stock information, distributor information if you can, the ability to build things, to configure and, you know, order multiple parts that work together as part of an overall system, that’s not a simple thing.

And I think that’s where, as you mentioned, this notion of a B2B digital experience has to be better because those components are so complex, you don’t want to make that hard on a buyer. You want that to be understandable and guided in some way.

Carman Pirie: Yeah. And so n-not many manufacturers have that on their websites today. The buyers are telling us in the bu-Buyer Pulse research that this is what they expect. And then it’s operating within a environment where AI is teaching everyone to expect an awful lot. You can you can fire up Claude Code and get some pretty interesting 3D modeling happening pretty quickly from CAD drawings and things of that sort.

AI is currently as bad as it’s ever going to be. So the way it fuels the expectation of what is possible I don’t think I don’t think you can really overestimate it.

Jeff White: No I think creating a decent digital experience that has all the hallmarks of and complexities of an industrial buying experience is currently easier than it’s ever been in terms of creating all of the proof points and telling, as you mentioned, Claude Code to build these things out.

But man, this is also coming at a time when AI from the other side is being used to conduct very complex hacks into architectural foundations of the internet. We’re just a few weeks past the the PHP exploit that came out that nearly disabled 75% of the internet. Thankfully you’ve also got, that, that was not a malicious hack, but it could be used in a malicious way.

It was actually found by people using AI to try to find these foundational problems with the internet and make it stronger. But it does point to how these platforms can very easily be used to get into and subvert the security of just about any system.

Carman Pirie: Yeah. Yeah. And now we’re, this, we’re really getting to it now because this is the reality you find yourself in. A manufacturing marketer serving industrial buyers that have an incredibly demanding sense of what they want from a digital experience, fueled by what the buyers may even think can, stuff that can be just vibe coded without any recognition of the complexity of what it takes to deliver that kind of experience.

Happening at a time the demand is that your digital ecosystem be more deeply integrated with your business systems than it’s ever been before.

Jeff White: ERP, CRM, inventory, everything.

Carman Pirie: And it’s never been a more dangerous time to have an incredibly integrated digital system. Or say it’s never been a more dangerous time.

But yeah, no, it’s, there’s never been a more dangerous time. We, these are threat actors that are… It’s unknown what what is possible in some respects.

Jeff White: What they’re capable of and they continue to grow. Part of the danger of models like Fable and things like that is marketing in and of itself to drive interest in the platforms. But also, they are truly advanced in terms of how they’re able to solve problems and find holes in security.

Carman Pirie: So I’m just imagining inside of a smart manufacturing organization and you have a, a m- a marketing team that recognizes or a single marketer, it’s not always a team we recognize who knows that they need to really up their digital experience game in order to meet the demands of tomorrow’s and even today’s buyer. And they’re going to be thinking about that and h- and facing that reality at the exact moment that probably the IT department is going to be so risk-averse.

Jeff White: So it’s almost a, you have to expect a stalemate, in some of these situations just because they’re not necessarily going to be allowed to connect to those things. The IT teams are overwhelmed in a lot of ways with, managing security for the organization writ large.

And the, the buyer’s expectations still aren’t changing.

Carman Pirie: And you could afford a stalemate if you were a manufacturing organization 10 years ago, and you were like, “Yeah, I don’t really necessarily need to compete on the internet at that level. I can be a laggard in my digital experience.”

Jeff White: Mhm

Carman Pirie: A, vast majority of your business relationships were being fueled by offline relationships, right?

There was an impact to not getting with it, but it was masked to a large extent.

Think the manufacturers can afford that stalemate that you just mentioned now. It just, it’s the, the buyer has moved on. We’re seeing that the power of incumbency is not all-powerful, that it can be overcome. So I guess, if you’re gonna if you’re going to live in that stalemate.

Jeff White: You’re just going to get passed by manufacturers who are providing this information, even at a high level.

And I think that’s where the research is pointing, if there is a silver lining, I think what you’re probably hearing both of us say is that, don’t just storm ahead with an AI-generated vibe-coded platform that tries to get all of this data out there.

Slow the roll, sit back and think about it, and pick off the things that are the most secure. So if that’s being able to pull data from your distributors so that you can get some of that stock information, at the very least, be integrated well with your distributors and be able to point your buyers to those sites with ease so that they can find particular product lines or line cards within their region, whoever is going to be best located to serve them.

Those are the first steps.

Carman Pirie: Yeah, SKU level compliance documentation, things of that nature is fairly low risk. And I think that is the silver lining. And I’m not I guess I wasn’t necessarily even saying, Jeff don’t vibe code those things and slow your roll. But I guess we are because I’m like, you can’t…

I’m actually saying don’t vibe code them because it’s an incredibly dangerous thing to do. You probably, maybe there was a brief window where you could have gotten away with some of that, but now, to create the kind of enduring digital systems that are going to win in a world that’s powered by both agentic and human search and all the expectations that come that we’ve been talking about to build an environment that wins there it, it isn’t about under-investing in it.

Jeff White: And I think, we’ve talked many times and we mentioned it just a few moments ago with that single marketer within one of these organizations now effectively for $26 a month being given tremendous power, the power of a designer, a developer, a QA person, all of that, but not necessarily having the deep understanding of the security posture that’s needed there and leaning on what is provided by the AI platforms and expecting it to truly meet the level of security that you think it does.

Like these are deeper issues.

Carman Pirie: Yeah, I think it’s fair to say I’ve been terrified of some of what I’ve seen from the more small and mid-size side of the equation for AI usage. Just the lack of security consideration in connecting up some of the tools.

Jeff White: The flippancy?

Carman Pirie: Whew, like it’s just, it’s an accident looking for a chance to happen.

But so the, but the, I guess if we’re staying future-focused here in terms of if you’re listening to this and you’re thinking, “Man, okay I wanna get with religion. We need to improve we wanna begin to meet buyers where they’re at and what they expect of us.” What does that roadmap look like going forward to do that and to do it in a way that is actually secure and safe?

And I think what you’re hearing us say is it doesn’t have to start with a checkout. It doesn’t have to start with having people’s financial information and all that goes with that. You, there’s some certainly some formative steps that can be taken, like we said, around compliance documentation, CAD drawings, or other documentation that might be also part of that.

Pricing and availability that does not have to create pricing issues and arguments amongst your distribution network. There’s ways to do this to begin to give buyers what they seek and and to do so without having to put yourself at risk. And I think that’s the good news in this research.

Probably for the marketers listening, the research really does help make the case around the functional improvements that are required and get, gets the marketer maybe out of talking about just brand-level design considerations. So if you do download the latest Industrial Buyer Pulse, I hope you’ll be able to use that information to your advantage in making this case.

Jeff White: Yeah, I think so.

We don’t wanna put any more things in the way of people being able to serve buyers the way that they want to be served. But it certainly paints the way for the need for a digital governance model within an organization for understanding all of the different components of that structure.

And I think developing some of that understanding and the documentation level and the the model level and all of that will help you to see what the steps are towards a more deeply integrated, complex digital checkout-based system. Because as you move down through those levels, that’s where the risk really needs to be analyzed, and you need to work with, IT and other professionals in order to ensure that what you’re building is safe and secure.

Carman Pirie: Yeah, it’s gonna be interesting to see how the IT departments react to all this. I, they’re just so risk-averse in so many manufacturing organizations, and the larger the manufacturing organization, in some ways it seems the more risk-averse the IT department is. That seems like it’s really bashing up against reality right now.

Jeff White: Especially with very AI-forward marketers at the helm.

Carman Pirie: Yeah. And and organizations that desperately want to take advantage of the promise of AI beyond the marketing function. But to do so in a secure way is certainly the challenge that they’re living. And that’s why I guess it’s just we should probably – we should try to find a CIO of … bring them onto the podcast.

Jeff White: Yeah, if so if you work in IT at an industrial manufacturer, get at us. We would love to have you on the show.

Carman Pirie: Especially if you were listening to this thinking, “This is the most excruciating crap I’ve ever listened to. I’d love to argue with these guys and tell them exactly how wrong they are.” That would – You’re exactly the kind of person we would love to have on the show.

Jeff White: Yeah. Cantankerousness loves cantankerousness. Yeah.

Carman Pirie: It’s been fun to kick this around, Jeff.

Look the, the good news is buyers are changing opportunities to unseat incumbents are there, and buyers are making their expectations clear. We know what we need to do manufacturing marketers. It’s just, it’s not going to be a snap the fingers and get it done type of thing.

We’re gonna have to work at it.

Jeff White: Absolutely. And if you wanna have a look at the Industrial Buyer Pulse, the URL is kulapartners.com/industrial-buyer-pulse

Carman Pirie: A pleasure as always.

Jeff White: Indeed. Thank you.