The Buyer-Seller Disconnect, Part 217 May, 2006 By: Jeffrey Rowe
New GlobalSpec survey adds more clout to claim that industrial distributors' Web sites are missing the mark with customers
Last week in MCAD Tech News, we featured the article, "The Buyer-Seller Disconnect," about the results of a joint study by ThomasNet and Google that attempted to explain the disconnect between the many potential buyers searching the Web for industrial products and why sales ultimately do or do not occur. The theme of this article is important because of its potential influence on how we conduct business. Namely, although it’s true that industrial buyers are shopping more on the Web, suppliers and distributors often miss out on sales for a variety of reasons. It's one thing to get customers to a Web site, but quite another to get them to buy once they arrive.
What makes some distribution companies successful in connecting buyers and sellers? They eliminate obstacles to sales and continually move the buying process forward. This week, I'll share information on this subject from GlobalSpec, the online engineering search engine developer. GlobalSpec Distributor Buying Trends Survey, released last week, includes feedback from engineers, technical buyers, scientific professionals and other members of the engineering, industrial and technical communities. It outlines and analyzes buying behavior, what buyers are really seeking and why some distributors are more successful than others.
Searching for a Solution
It's no secret that a vast majority of buyers today use Web search engines and online directories as primary tools for finding industrial product distributors. Almost 75% of survey respondents said that using search engines or online directories is their first step in finding new distributors. This fact alone dictates that creating and maintaining a strong Web presence in the engineering community is a vital strategy for increasing a distributor's visibility and sales to a targeted audience. Distributors be easy to find on the Web to be successful.
Surprisingly, although price is certainly an important factor in choosing a distributor, it isn't the primary factor. According to the GlobalSpec survey, product availability and delivery are the major reasons for choosing a distributor. Customer service support was next, followed by price. Near the bottom of the list was the location of the distributor and a buyer's proximity to a shipping location.
Unlike many aspects of past product distribution, geography plays a smaller role in the minds of buyers and the prospects for distributors. Also, unlike real estate, where everything is tied to “location, location, location,” many buyers who increasingly rely on the Web regard a distributor's location as fairly inconsequential. As a matter of fact, location is virtually a nonfactor for the majority of buyers when seeking and choosing a product distributor, according to the survey.
Also a relatively minor consideration for most buyers is a distributor's e-commerce capability. I was very surprised to see that the survey found online ordering and online order tracking capabilities to be near the bottom of the list of important reasons for choosing a distributor.
Dissatisfaction in the Ranks
The survey found that the biggest area of dissatisfaction among buyers is what they don't find online. A big gap exists between the features buyers want to find online and the actual features offered by distributors. This gap was significant in areas such as up-to-date content, comprehensive technical specifications for products offered by the distributor, and a searchable online catalog that can be readily navigated and includes the distributor's complete standard product line and customization options.
Filling the Gaps
Merely having a Web site is not enough for conducting business today. Having a strong Web presence has become vital for distribution companies to connect and succeed with industrial customers. Not coincidentally, companies such as GlobalSpec can assist in this endeavor, analyzing Web sites of industrial product distributors and helping fill the gaps so sites are more visible, relevant and useful for buyers.
One of the central issues that has long been espoused by the Web’s proponents is that it should level the playing field between large and small companies. Has that really occurred? A few will say, "Yes," some will say, "No," but most would probably say, "It depends." A company has to make money to be deemed successful, and many are doing that, but a large void seems to exist between getting by and truly succeeding. More than anything, a strong Web site makes a distributor of any size look like a bigger part of a buyer’s solution, not part of the problem.
In the next issue of MCAD Tech News, I'll delve into the similarities and differences of the ThomasNet and GlobalSpec survey results, which offer some interesting insights.