ABB recently launched a new initiative, eFinder, that enables visitors to its website to purchase material online. But they are not disintermediating the channel. Instead they are providing distributors with the opportunity to generate incremental business online. And at the same time they are generating leads.
The eFinder tool enables distributors with a commerce-enabled website the ability to upload their inventory and applicable pricing to a website. Visitors to www.tnb.com, tnb.abb.com or http://www-public.tnb.com/pub/en will find a search bar where they can enter a part number and then find a list of distributors that carry that SKU. The customer then chooses which distributor to purchase from and is taken to the specific SKU on the distributor website to place their order. And, since the customer is then going to the distributor website, they have the ability to purchase additional items from the distributor.
Some distributors we’ve seen participating on the site include Graybar, Standard Electric (WI), State Electric, Allied Electronics & Automation, Newark element 14, Anixter, Gexpro, Rexel, Anixter and United Electric Supply.
We’ve heard that some of these distributors have generated some online business due to referrals from ABB.
While the concept is good and can be beneficial to distributors, (and this model is used by a number of electronic distributors, so it does work to benefit all parties), some challenges are:
- The user needs to know what they are looking for and type in the exact part number. No partial numbers. No natural language search capabilities
- If no participating distributor carries the desired SKU, the customer is left with a poor experience
- The ranking, according to sources, is based upon the most recent distributor upload rather than ranking tied to customer locality as determined by IP address
eFinder is an interesting concept.
They are also trying to generate leads on a number of their website pages which then, for distributors, begs the question of how the leads are disseminated and how quickly (and then a distributor needs to determine how they disseminate the lead internally for follow-up and feedback to ABB).
Some other manufacturers reportedly are following the ABB implementation and considering adopting the same system to serve the needs of their end-user customers (and yes, it is a whole different discussion about why these end-user buyers don’t know what lines their electrical distribution sources carry and the fact that buyers will be taken to the public side of the distributor site where inevitably the pricing is higher than for the distributor’s ongoing customer…and the “new” customer will be paying via credit card.)
Another strategy some manufacturers are taking, and it’s more prominent in the industrial automation space is the usage of online configurators that can be lead generators. Cadenas’ Part Solutions, https://partsolutions.com, offers an interesting solution to the configuration challenge that manufacturers typically have. The configurator goes on the manufacturer site and is used to support end-users with product selection as well as spec sheets. It can also generate leads. Further, the configurator can be embedded into distributor sites and on specific web pages. Their “community” page, https://b2b.partcommunity.com/3d-cad-models, shares a number of the manufacturers who are currently using their service.
These supplier initiatives add another element to the distributor question about “the ROI of having an eCommerce site” as many distributors continue to say “I’m not generating much but have invested much.”
Thoughts on the ROI question
- It’s about customers wanted to be self-sufficient
- It’s about customers wanting access to information, when they need it, especially spec sheets, installation information, their pricing, inventory, etc
- It’s about “keeping up with the Jones’”
- It’s about being able to compete for industrial and institutional business when eProcurement is a requirement to do business
- And it\’s about manufacturer perception of a distributor
Manufacturers are developing more eContent (product and marketing) and are seeking distributors to integrate with. If, as a distributor, you do not have an eCommerce site, you’re not part of the equation. Are you willing to be left out of services from a manufacturer or potentially willing to move your business?
Does this mean companies only want to do business with larger distributors? Possibly, but that decision would be made even without eCommerce. They are seeking to identify companies that will help them “move the needle” and are progressive.
Smaller distributors need to decide if want to play
If you\’re a smaller distributor but want to play, you need an eCommerce solution, but one that is affordable. Our advertiser, EvolutionX has an electrical offering that is powerful, loaded with features inclusive of some designed specifically for the electrical industry, and cost effective. They operate over 350 distributor websites and have served distributors for over 15 years. They\’ve \”evolved\” their system and, due to their technology, serve distributors from $5 million to over $500 million. (And a small distributor can be online, in less than 120 days, with a comprehensive catalog powered by Distributor Data Solutions, cost-effectively (give me a call and I can share more) and if integrating to an ERP system is a challenge, EvolutionX has \”workarounds\” or can launch a site solely with an eCatalog to help you serve your customers.
Manufacturers are investing more into their websites, their eContent and their eMarketing efforts. Distributors who want to take advantage need to engage with the manufacturer marketing departments and, in some cases, digital / eCommerce departments. Manufacturers are making these investments due to requests from other channels and in some cases due to their vision. They\’ll migrate to those who want to work with them, but distributors need to \”raise their hands\”.
Will this create a distribution divide? A criteria for where manufacturers will spend their time? Their resources? How they will direct their salesforces? Their monies?
As can be seen by the ABB initiative and the suppliers investing in the Parts Solution configurators, they\’re looking to drive business (sales and leads) and provide website content (and we know others with good eMarketing content). They are looking for distributors who will utilize these tools to collectively drive business.
Which suppliers are you seeing more, and better, digital initiatives from?