In the research we performed with over 3500 customers of distributors, we learned that three methods for purchasing (email, web, phone) were significantly more frequently used than other methods including in store, at job site, mobile, EDI, punchout, text, and fax. At the top of the list was ordering by email where about 74% of end users very frequently or frequently order by email, sending order details in the email body itself or as a PDF, Word document or Excel file attachment.
Surprisingly, this trend was most pronounced among the under 35 age demographic with about 71% of buyers under age 25 and 52 percent from ages 26 to 35 send orders via email very frequently. It was a surprise because the private persona of that demographic is extremely reluctant (to put it mildly) to use email. Yet, in their professional persona they are very willing. By contrast, only 37% of respondents over 55 very frequently use email to submit orders.
Perhaps the popularity of this trend is best explained by a very good CIO at one of our clients who said “When I come to your website and purchase via e-commerce, I have to do order entry. But if I send you an email, you, the supplier, are doing order entry.” So, the customer is shifting the order-entry monkey from his/her back to your back. Very simple.
This emergence of email ordering explains another phenomenon that some of our customers have been seeing which is it appears that website conversions to orders are going down. This recently came to light very clearly with a very large electrical distributor whose e-commerce strategy we created. They thought there was something wrong with their content because conversions were diminishing on the web. Indeed, they found that many orders are now coming in electronically via email or EDI. Discussions with other distributors have revealed similar dynamics of customers who prefer email ordering.
This creates a problem for distributors who have invested significantly in e-commerce with the expectation that they will see an operating efficiency with web ordering. These distributors are now faced with entering orders from email into an ERP system. This can consume 20% to 40% of the time from multiple CSR’s. However, we have good news: we came across a solution that will automate the receipt of orders for high volume customers who prefer ordering by email. (See Conexiom for more details.) The order goes directly into the ERP system without human intervention and generates an acknowledgement to the customer within 5 minutes. Time is freed up, errors decrease, and customers are happier with the faster response.
Here is our recommendation for distributors:
- Find out if your customers really prefer ordering via email, even if they shop on the web.
- Know that there are solutions to automate this process.
To learn more about the full research, see What Customers Want: A Distributor’s Guide to Customer Buying & Shopping Preferences.
Jonathan Bein, Ph.D. is Managing Partner at Distribution Strategy Group. He’s
developed customer-facing analytics approaches for customer segmentation,
customer lifecycle management, positioning and messaging, pricing and channel strategy for distributors that want to align their sales and marketing resources with how their customers want to shop and buy. If you’re ready to drive real ROI, reach out to Jonathan today at
jbein@distributionstrategy.com.