Digital technology has radically transformed business over the past two decades. B2C firms have leaped onto new paradigms such as social media and native advertising to reach global consumers. However, B2B firms also stand to benefit substantially from thinking digital. Whether it’s in terms of augmenting supply chains, delivering remote services, or optimising decision-making, more and more B2B firms see the wisdom in digital. Let’s have a look at some of the key benefits of thinking digital:
Digital lets B2B firms leverage direct access to global suppliers to rationalise costs. Enhanced access to global supply chains is a key advantage for B2B firms that go digital. Rapid economic development over the past two decades has shifted the fulcrum of manufacturing eastwards. Suppliers in China, India, Vietnam, and Thailand deliver quality components at low rates. However, a challenge, until recently, has been finding effective ways to build direct relationships with international suppliers. Intermediaries and intermediary services add to both logistics cost and time.
Digital marketplaces like Aliexpress and Taobao give businesses direct channels to international suppliers. By cutting the intermediary out of the picture, these channels enable businesses to rationalize supply costs by sourcing straight from the originator. While platforms such as these cut costs substantially, they still charge commissions. International suppliers themselves are increasingly putting in the effort to connect with buyers abroad. By translating websites and product listings into global languages and by establishing a presence on international social media platforms, they make direct connections easier than ever. By leveraging the power of digital platforms, B2B firms can source high volume, quality suppliers at extremely competitive rates.
Digital enables remote service delivery on a much wider scale. A closely related digital opportunity is remote service delivery. In much the same way that manufacturing shifted to the east, so, too, have services. Traditionally, business process outsourcing (BPO) was limited to lower-order functions like call center operation. It was possible for B2B firms to cut costs through BPO, but only with respect to specific verticals. There was a limit on what could be outsourced, and to what extent. Technology was the key limiting factor. In the here and now, digital has radically transformed the nature of remote service delivery. This creates immense opportunities for B2B firms. Service vendors can leverage digital to reliably deliver a wider range of remote services. Moving beyond the call center paradigm, just about every service: from learning to security, can be delivered remotely. Firms in need of these services benefit too, in the form of reduced expenditure. For example, remote cybersecurity SOC operations cost considerably less than building that infrastructure locally.
Digital enables sound, data-driven decision making. Rather digital means data. In today’s digital world, B2B firms are empowered by ready access to vast quantities of data pertaining to every facet of their business. Traditional estimates for production and purchase requirements often carried significant caveats in terms of reliability and their scope of validity. Digital solutions enable B2B firms to easily analyse years’ worth of internal and external data to come up with optimal figures. Exactly how much of a marketing budget, targeting which geography will yield the best returns? How much of a certain product should be available in stock for the holidays? Digital enables B2B firms to access larger volumes of better quality data. This helps enable reliable, data-driven decision-making processes.
Digital marketing opens up new channels for outreach and communication. For B2B firms, digital has opened up entirely new channels for marketing and promotion. B2B digital marketing is an emerging field unto itself and offers B2B firms a whole host of ways to reach out to their clients and stakeholders at large. As clients increasingly turn to the web for solutions, search engine optimization plays the role of product placement, positioning a firm’s solution quite literally above the competition. Professional networking platforms like LinkedIn enable business leaders to connect, share ideas, and build a worldwide client base. Digital advertising breaks down the barriers of distance: it allows Shenzhen manufacturers to connect with American retailers selling products in the South Asian market. New paradigms such as VR and AR offer even more untapped potential. For firms in fields like construction, where project duration can extend for years, an AR experience could show clients final outcomes, to scale, and on the ground, something that’s just not possible with floor plans or CAD renders.
With the immense opportunities on offer, it’s no surprise that B2B firms are increasingly thinking digital. As the internet shrinks our planet to a global village, digital allows firms to reach out to more clients and vendors, across more geographies, for a greater range of products and services than ever before.
-The author is co-founder, chief business and operating officer at Blink Digital. Views expressed are personal.
March 07, 2020