Linking the Physical to the Digital
Chemical Companies Should Be Preparing for Next-Generation B2B Marketing
In the chemicals industry, electronic business-to-business (B2B) interactions between buyers and sellers typically rely upon tried-and-tested tools and techniques. These approaches have brought greater efficiency and speed to transactions between companies and their business customers. However, evolving technology and business practices, along with the changing expectations of chemical company customers, are changing the industry's B2B practices.
Soon, electronic commerce interactions in the chemicals industry will need to be richer, offer broader functionality, and encompass the end-to-end process of selling products. To move to this next generation of B2B, chemical companies must adopt a broad range of digitally enabled processes and practices. We anticipate, in fact, that nearly all B2B processes will be digitized, enabling companies to sharpen their marketing efforts and reach customers more efficiently.
Our research shows that a number of chemical companies - particularly high-performing companies - are already pursuing this next generation of B2B capabilities. In a recent Accenture survey, 94% of chemical companies said that they expect to increase their investment in digital capabilities in the next three years, and 58% said that they are embracing digital to gain a competitive advantage over industry peers.
To do this the right way, however, we believe that chemical companies need to master three key capabilities in digitizing business-to-business marketing:
1. Building stronger and deeper customer relationships.
With current B2B processes focusing on the purchase transaction, chemical companies have been missing a tremendous opportunity to find and nurture customers leading up to the sale. Chemical companies can take advantage of packaged solutions - already used by many online consumer retailers - to link product finders and catalogs to broader digital commerce capabilities. All of this can add up to a better customer experience and larger sales. For example, by implementing an intuitive, more comprehensive customer portal, a leading materials and life sciences company expects to increase online sales from 10%-20% to at least 40%.
Traditional channels are by no means dead. Rather, chemical companies need to bridge the physical and online worlds. This will entail tying contact data management into digital prospect profiles, and taking a more systematic approach to feeding leads from trade shows, sales calls and other person-to-person interactions into the digital pipeline.
2. Extending the company's reach.
While chemical companies realize the value of reaching not only their own customers - such as major suppliers and original equipment manufacturers (OEMs) - they also realize that they have not been so effective at reaching their customers' customers. To a large extent, that is because their content is not differentiated for various audiences. Instead, they often take a one-size-fits-all approach.
Today's online tools make it possible to provide different experiences for different audiences. Using customer research, audience analyses and journey maps that track movement through e-commerce sites, companies can develop "personas" that represent different types of customers, and then deliver tailored content designed for each persona. Thus, OEMs could be guided to one set of tools and information, while end-customers could be guided to another set - allowing the chemical company to communicate with each group in the most appropriate way. Over time, companies can use analytics to track the effectiveness and accuracy of these personas, and keep adjusting them to better reflect the customer base.
3. Streamlining lead qualifications.
Until recently, online B2B efforts have had a narrow focus on sales transactions, making the ability to understand the potential value of leads, and pursuing them accordingly, largely a manual process. Using today's technologies, chemical companies can automate these efforts and seamlessly collect and feed high-value leads into the sales pipeline.
Companies can begin by defining the behaviors that make a good digital prospect. For example, a company may determine that customers who download a cost calculator or view a certain product video have high potential. These actions can be automatically tracked, scored and weighted to identify the best leads, which can then be routed via workflow software to the sales force or the appropriate online sales channel. Progress with these leads, as they move through the sales process, can then be tracked automatically as well. Overall, this type of approach means that fewer leads fall through the cracks, and sales efforts are systematically focused on the right opportunities.
Digitization can do more than help companies keep up; it can enable them to get ahead. Several years ago, for example, a specialty chemical company established a website to efficiently handle the sale of commodity silicones at a discount. This channel was designed to reach cost-conscious customers who wanted to buy products, but who were not interested in associated services. This allowed the company to expand into this customer segment, extend the business into new countries and cut logistics costs by 60%. The investment in the online channel was recouped in just three months. Since then, the company has continued to add products and customers. Now, the website is a true customer-focused portal where customers can tailor their product requirements.
To make an effective transition to digital B2B, companies need to define a digital operating model and strategy. Typically, they will have to make changes in the organization, as well. As a rule, a next-generation B2B approach will require working across functional silos.
Next-generation B2B will also require a different perspective on technology itself. Chemical company IT groups have traditionally focused on reducing costs, moving all processes onto enterprise systems for efficiency, and "bleeding" technology assets for as long as possible - often, well past their intended lifecycle. But with customer-focused B2B, the IT departments will need to look beyond those goals, and factor in the larger benefits of value creation, growth and delivering the right customer experience. To help, companies should consider establishing a separate group within IT that is not part of ongoing enterprise system operations, but is instead charged with agile development in the support of B2B commerce.
Developing the capabilities needed for next-generation B2B will take time, and customer expectations for a richer digital experience are rising rapidly. Chemical companies that seek to meet these expectations will be in position to stay close to their customers, which is an increasingly critical asset in an ever more competitive industry.