Your Customers Have Already Reset Distribution’s Value in the Channel
By James Dorn, President
This article was originally published by Modern Distribution Management (MDM) and is used here with permission. For more than 50 years MDM has provided industry leading content for B2B Manufacturers and Distributors. We highly recommend becoming an MDM Premium subscriber.
Demonstrating unique value has never been more difficult for distributors and manufacturers. The channel is changing and in need of new infrastructure.
Recently, we had a manufacturing executive pose an interesting problem and question for our consideration. She talked about how it is so much more difficult to get meaningful time with end customers for both them and their distributors. The feedback they were receiving was that meaningful time with end customers was declining.
Was it the pandemic in-person sales shutdown that caused this decline in customer availability? Will it ever get back to the pre-pandemic times?
So, we set out to get the answers to these questions by interviewing B2B end customers across Industrial and Construction markets.
At our session at MDM’s upcoming SHIFT 2022 conference — to be held Sept. 25-27 in Broomfield, Colorado — we will be presenting the full results of this research, and also provide strategies and tactics to help address the problem.
The four key factors making it more difficult to get time and meaningful attention from your end customers are as follows:
Talent Shortages — End customers, manufacturers, and distributors all have faced labor shortages over the past few years, which have reduced the number of in-person interactions.
Decision Making is Becoming More Distributed to Teams Versus Individuals — The distributor, manufacturer, and end customer monarch model with individual authority over many decisions is moving towards a team decision making unit.
Self-Service Mindset — Increasingly, more end customers desire a self-service digital experience over the in-person call experience.
Organizational Change — Organizations have evolved how they communicate. End customers and your organizations have instituted some major changes that have been accelerated by the pandemic. The old culture, where everyone shows up to the same office, has been changed to the age of Zoom and Teams meetings.
For most distributors, these changes are leading to a decline in the effectiveness of relationship selling and requiring new ways to build value with end customers beyond the relationship.
For manufacturers, these changes affect your brand position and preference. This reduction in direct access to drive your brand and value proposition erodes your brand and position with end customers.
These new realities require that distributors and manufacturers work closer together to reinforce their collective position in the market by providing compounding value.
In our speaking session at SHIFT, Dorn Group will provide insights on how manufacturer and distributor leaders are jointly developing innovation and modern sales & marketing programs.
We will also present findings from our recent Dorn research on the state of manufacturer-direct channels. The new selling realities create opportunities for nimble distributors and manufacturers to create value-based programs that drive market share growth in 2023 and beyond.
John Gunderson is a senior leader at Dorn Group with more than 20+ years experience leading category management, sales, marketing, pricing, analytics, and ebusiness with companies such as Crescent Electric Supply Company, HD Supply Power Solutions, White Cap Construction Supply, Anixter/WESCO, Modern Distribution Management, and EIS-INC. You can reach John at john.gunderson@dorngroup.com