Even though chemical output in the United States is projected to grow by 4.1% in 2022, the highest growth seen in more than a decade, according to the American Chemistry Council, chemical suppliers can’t afford to rest on their laurels when it comes to the digitalization of their sales channels.
Driving the need for digitalization is the growing number of millennials that are becoming purchasing decisionmakers, according to a report from chemical marketplace Knowde.
Millennials already make up the largest segment of the workforce and by 2025, are projected to be 75% of the global workforce, according to Deloitte. “As millennials, the first digitally native generation, mature into key decision-making positions, a digital-first buying posture will become the norm,” says the report.
In addition, legacy customer expectations are shifting as they become more comfortable with digital interfaces and virtual sales interactions. For suppliers of chemicals, polymers and ingredients, the payoff from investing in digital sales tool is a 20% uptick in return on sales investment, according to Bain & Company. In addition, chemical suppliers can see a 40% gain in sales and marketing efficiency, according to Deloitte, and $200 billion in new value by reducing costs and increasing market share, according to McKinsey & Company.
Meeting buyers’ digital-first preference means leveraging such tools as online marketplaces, sales automation solutions, customer relationship management (CRM) and lead management systems and live chat on their web stores. Such tools can help suppliers attract more millennials to their online stores, which are twice as likely to start their buying journey online, according to TrustRadius, a research and review platform for businesses.
When it comes to the online buying experience, personalization based on a buyer’s purchasing habits and movement through a marketplace or supplier’s webstore has become table stakes for suppliers. According to the Knowde, 73% of millennials prefer a personalized buying experience. Millennials are also comfortable with companies using personal data, such as online search history and digital interactions to personalize sales outreach, ads and direct communications.
As suppliers grow the reach of their digital channels, their sales representatives can expect less face time with buyers, especially millennials, 44% of which prefer no interaction with sales representatives during the B2B purchasing process. Although many millennials prefer not to involve sales reps in the purchasing process, that does not mean the digital channel will be the only sales channel. Rather, it means suppliers need to start preparing for this shift now, the report says.
One way for suppliers to prepare for B2B buyer’s shift to online channels is to open a store on a marketplace. Knowde customers, for example, see the online marketplace as a critical part of their digital strategies and omnichannel customer experience, as they offer a single platform to share information, discuss product applications, order samples, and even purchase online, the report says. Data gathered through online marketplaces, such as search history, product page views, documentation or technical data sheet downloads, and quote sample requests can provide sales teams insights into customer journeys. That data can be used by suppliers to anticipate what customers are looking for and proactively upsell during an ongoing sales conversation, or cross-sell afterward.
While integrating digital sales tools and processes will require significant organizational changes and investment, chemical suppliers that are slow to jump on the bandwagon risk getting outmaneuvered by more agile competitors. “Suppliers can adapt to emerging customer expectations and buying trends by embracing digital sales strategies, technology and channels,” the report says. “We believe the companies that make these investments will ultimately be the long-term winners in the digital age.”