Survey reveals opportunities for growth through e-commerce.
A new purchasing study recently found a growth opportunity that industrial suppliers can pursue: buyers are using the web to expand their supplier bases.
Learn what 1,500 U.S. industrial supplies purchasers said about five key areas of the purchasing process.
The UPS B2B Purchasing Insights Study, conducted by TNS, a global market research firm, surveyed 1,500 industrial supplies purchasers in the United States to learn more about their preferences in five key areas of the purchasing process:
- Researching and selecting suppliers
- The purchase transaction
- Suppliers' websites
- Shipping, delivery and returns
- Postsales service and support
Here are three top findings:
1. Customers want to order online. The survey found a shift toward web-based research and purchasing. More than 63 percent of industrial supply buyers said they made purchases online, and half of those purchasers spend at least 50 percent of their annual budget with e-commerce suppliers.
"One of the most important findings is that buyers prefer online channels, not only to research but to purchase and to do follow-up. That's what they are doing, and that's what they want to do," says Simon Bhadra, a UPS senior marketing manager.
Buyers expect quality in their e-commerce experiences, and most sites are delivering it. The majority said their experience with their vendors' e-commerce sites was the same (56 percent) or better (37 percent) than the consumer sites they used for personal purchases.
"They want a rich experience," Bhadra says. "The online bar is set high. They want detailed product descriptions and tons of functionality – embedded shipping capability, rating, transit times and returns. They want shipping information embedded into the online store."
When asked what features were important when making purchases online, customers said:
- Shipping costs prior to placing an order
- Real-time product availability
- Purchase history
- Estimated delivery date
2. Ability to buy online is key, but still just one part of buyers' overall experience. Buyers of industrial supplies want a better online experience, but that's only part of the many ways they want to connect with the distributor. There are situations where they need more personal service, such as by phone. And online purchasers still want catalogs and access to a sales representative. As a matter of fact, the study indicated that 47 percent of buyers still used catalogs in some cases. Therefore, it is important for distributors to provide a rich online experience as part of their broad omni-channel strategy.
3. Online buyers are open to new suppliers. Another interesting finding is that not all online buyers are loyal to their existing suppliers. Thirty-three percent of online buyers didn't have an offline relationship with their current online distributor. Industrial supply distributors who can reach these online buyers can tap into this growth opportunity by catering to online buyer preferences.
"B2B buyers are very sophisticated and have high expectations. A distributor can't just throw up a static web page with a web form that gets printed somewhere in the distributor's back office. That's not going to fly anymore," Bhadra says. If buyers can't find the product, price and delivery date they need, they can easily click to another vendor's website.
UPS can help industrial supply distributors compete and make their online presence comparable to leading online sites. "The UPS Developer Kit allows you to embed shipping, rating, transit time and returns functionality into your online platform or you can use one of many UPS Ready® solutions providers to provide you with a turnkey solution," Bhadra says.
UPS offers specialized services that are the backbone of great e-commerce sites, including:
- Contract logistics, including inventory management
- Shipping, visibility and returns solutions
- Online service and support solutions
Get more information on the survey findings or download a white paper of the complete survey results.