Importance of eCommerce for Manufacturers and Distributors

The world of business has seen a dramatic shift in recent years as more manufacturers and distributors recognize the potential of ecommerce. In particular, ecommerce has become an increasingly important channel for manufacturers and distributors to reach customers and increase their profits. Launching an ecommerce channel not only provides direct access to customers but also offers several other benefits.

Let’s have a closer look at the growing importance of ecommerce for manufacturers and distributors, its benefits, and how it can be used to gain a competitive advantage.

Benefits of Ecommerce for Manufacturers and Distributors

• 1. It gives Direct Access to Customers
  One of the most significant benefits of ecommerce for manufacturers and distributors is the direct access to customers it provides. In the past, these businesses relied on distributors to reach their customers. However, with the rise of ecommerce, manufacturers and distributors can now sell their products directly to customers. This direct access to customers allows them to preserve higher profit margins, strengthen customer relationships, and capture data about their needs and preferences.

• 2. Manufacturers can Retain Higher Profit Margins
  Another significant benefit of ecommerce for manufacturers and distributors is the ability to preserve higher profit margins. When businesses sell their products through distributors, they must share their profits with them. However, by selling their products directly to customers, businesses can avoid these extra costs and retain more of the profits for themselves.
• 3. Strengthening Customer Relationships
  By selling products directly to customers, businesses can build relationships with them and gain a better understanding of their needs and preferences. This data can then be used to personalize marketing and offer better products and services.
• 4. Allows Greater Control over Branding
  When businesses sell their products through distributors, they have less control over how their products are marketed and presented to customers. However, with ecommerce, businesses can control how their products are presented and marketed, ensuring that their brand is accurately represented.
• 5. Ensuring Optimal Pricing and Discount Strategies
  Businesses can avoid the price markups that occur when selling products through distributors. This allows them to offer better prices to customers and compete more effectively in the market.
• 6. Collecting Customer Data for Personalization
  Businesses can access data about their needs and preferences, which can be used to personalize marketing and offer better products and services. This personalization can lead to increased customer loyalty and improved sales.
• 7. Increasing Customer Loyalty through Brand Retention Campaigns
  Ecommerce also offers manufacturers and distributors the opportunity to increase repeat purchases through on-brand retention campaigns. By selling products directly to customers, businesses can create a more personal connection with them and offer loyalty programs, discounts, and other incentives that keep customers coming back.
• 8. Opportunities to Innovate
  Ecommerce also provides manufacturers and distributors with opportunities to innovate.
  • a. By knowing how their customers shop and what they value in their suppliers, businesses can develop unique value propositions.
  • b. Customer feedback can provide valuable insights into which add-ons or modifications to prioritize.
  • c. Procurement data can suggest when certain parts are due for replacement so that businesses can pitch an early delivery to the buyer.
  • d. Feedback from sales reps and support agents can suggest how businesses can improve after-sales services, such as introducing better delivery schedules, improving warranties, or expanding the scope of installation and training services.
• 9. Scalability
  Ecommerce greatly increases the scalability of manufacturers and distributors. With ecommerce, businesses can process orders without the need to attract more distributors or hire extra sales reps. This means that they can sell their products to customers around the world without the need for physical locations or sales teams. What’s more, they can seamlessly tap into new markets and attract new customers.
  “Considering that increasing number of B2B buyers prefer to conduct research online rather than speaking with a salesperson, search engines play a huge role in how new customers will find your website. Thus, enhancing your SEO and having a strong online presence is crucial to attracting new customers and establishing a competitive advantage.”
• 10. Improved Efficiencies
  By using an ecommerce platform, businesses can automate time-consuming manual processes, such as checkout, billing, and inventory management. As a result, they can devote time and resources to other core business activities, such as marketing and customer support.
• 11. Sell Your Complete Catalog
  As a manufacturing or distribution company, businesses likely have a large number of products, including personalized products, that vary in price depending on the customer and segment. Plus, they’ll want to offer personalized product suggestions to prospective customers to help increase conversions. With an ecommerce platform, businesses can cover both of these bases, syncing their entire catalog to their website and configuring prices as needed.
• 12. Brand Awareness
  Increasingly B2B industrial manufacturer buyers start their research online with a product, then follow up with a brand. You can SEO-optimize your ecommerce website to receive traffic from search engines for both types of queries — product and brand-name ones — so that more buyers get familiar with your brand and full product range.
• 13. Data Analytics to boost CX & drive Sales
  With full access to customer data, businesses can employ an array of ecommerce analytics solutions to boost CX and increase sales. This includes personalized product recommendations, real-time pricing for different customizations and order volumes, relevant up-sell/cross-sell positions, and best-suited warranty, servicing, or customer service packages.

Seven Best Practices for Manufacturers and Distributors to maximise eCommerce

To implement ecommerce strategies effectively, manufacturers and distributors should follow these best practices:

• 1. Use a user-friendly ecommerce platform that is easy to navigate and optimized for search engines.
• 2. Offer a wide range of products with personalized product suggestions to increase conversions.

• 3. Automate time-consuming manual processes, such as checkout, billing, and inventory management.
• 4. Use ecommerce analytics solutions to boost CX and increase sales.
• 5. Offer loyalty programs, discounts, and other incentives to retain customers and increase customer loyalty.
• 6. Provide excellent customer support and after-sales services, such as warranty, servicing, and installation/training services.
• 7. Continuously monitor and update the ecommerce platform to ensure that it is meeting the needs of customers and providing a competitive advantage.

FAQs on Importance of eCommerce

• 1. What are the benefits of ecommerce to merchants or organizations?
  Answer : Benefits of eCommerce to merchants/organizations:
  • Wider customer reach
  • Lower operational costs
  • Increased sales and revenue
  • Easy market expansion
  • Improved customer data analysis
  • 24/7 availability
  • Simplified inventory management

• 2. Why is e-commerce important in supply chain management?
  Answer : Importance of eCommerce in supply chain management:
  • Real-time inventory tracking
  • Improved efficiency and speed
  • Enhanced supplier and customer relationships
  • Better demand forecasting
  • Reduced costs
  • Streamlined order processing and fulfilment
• 3. Why e-commerce is playing an important role in retail industry?
  Answer : Role of eCommerce in the retail industry:
  • Convenient shopping experience for customers
  • Increased sales channels
  • Expanded customer base
  • Competitive advantage
  • Ability to adapt to market trends quickly
  • Personalized shopping experiences
• 4. What are the benefits of e-commerce for retailers and customers?
  Answer : Benefits of eCommerce for retailers and customers:
  For retailers:
  • Lower overheads
  • Easy scalability
  • Access to customer data and insights
  • Targeted marketing opportunities
  For customers:
  • Convenience and ease of shopping
  • Access to a wide range of products
  • Competitive pricing and discounts
  • Personalized recommendations
  • Quick and easy product comparisons
  • Access to customer reviews