Nearly 45% of holiday shoppers peruse options serendipitously—both online and offline—to decide what to purchase for friends and family. Forty-eight percent of shoppers still frequent physical stores for the ability to easily see and touch products. If you are a brand manufacturer, if your products are not there—where they can be seen, touched, and clicked—you can be almost certain that you are losing sales and possibly customer loyalty.
So, what can you do?
Streamline product management to get to market faster
Having a central product information management system makes it easy to bring products to market quickly. Your central store of product information can be the home base for the product story, along with all the details and imagery, tagged and categorized according to its place in the assortment. Product and marketing managers can have a single source of the truth and don’t have to waste time compiling information—that may be inaccurate or inconsistent—from disparate sources. They simply share information and export what they need—to every channel where it is needed.
When you have a product information management (PIM) solution, taking a product to market can takes days or weeks instead of months. Your new products can be on the shelf in-store or live on a website and ready to order in hours—and you can scale volume based on demand.
Help customers make purchase decisions
Sometimes it feels like a “race to the bottom.” Your retailers are asking you to lower your prices because they are feeling squeezed by Amazon, online competitors, and other retailers in their quest for market share.
However, you can work with your retailers to help your customers make purchasing decisions. When you have high-quality product information categorized and tagged, it’s easy to show customers how to combine complementary products, select replacement products, or compare products across price points.
You gain a competitive advantage and increase revenue because you and your retailers are providing product information that guides the customer toward the ideal, comprehensive solution.
Build a reputation for reliability
It is common knowledge that keeping a customer is cheaper than acquiring a new one. So, while your sales team is busy getting new business, you can use your product marketing process to ensure that you satisfy the customers you already have.
If the product information that you have provided to your retailers is accurate and complete, your end-customers will know that they can trust that information when they are making purchase decisions—time and again. You will build a reputation for authority and knowledge by providing enriched product stories across channels and markets.
When you have a central source of enriched product information, you have a goldmine of unique and flexible content that’s easy to optimize into product stories for each channel and market. You will rise above the industry standard to achieve a competitive advantage that will serve you well and build brand loyalty and customer satisfaction.
Kathryn Zwack, Senior Marketing Manager, inRiver
Not long ago, a major focus of marketers was on brand—brand loyalty, brand positioning, the “brand promise.” Numerous books were written on the subject—each claiming to be the “brand bible” for communicating effectively to target markets.
We would argue that brand loyalty and the importance of brand, in general, is diminishing. According to McKinsey Research only 13% of customers are “loyalists” who do not shop around.
Sure, there are Apple aficionados who will never buy a Windows PC. There are folks who continue to drive the same brand of car for decades. And there are businesses with brand preferences due to corporate policy or hardware and software compatibility challenges. However, with the ubiquity of online shopping and buying, brand-based selection is falling, time and again, by the wayside.
Why is this?
When seeking a new product—especially a product with which a buyer has had little previous experience—buyers most often rely on the opinions of family and friends, or complete strangers. In fact, in one study by Signpost, they found that 90% of people consult online reviews when making purchase decisions. With the anonymity afforded by the Internet, purchasers of a product can be completely frank about their opinions and experiences with a product. As a result, buyers frequently trust those opinions more than corporate advertising or “brand communications.”
Not only is UGC an influential factor, but so are third-party reviews. How frequently do you make a major product purchase without consulting Consumer Reports, Edmunds, CNET, or the like? Buyers are relying more and more on the expert evaluations of third-party reviewers for three main reasons: 1) they can be accessed from our desk or mobile phone; and 2) these folks do this for a living and are experts; and 3) it speeds our research and decision processes.
What is also common is for buyers to be surprised by what they read. According to the same McKinsey Research study, nearly 60% of customers switched brands once they began “shopping around.”
Ability to Compare Products
Now that consumers and business buyers can easily shop around and compare products—on price, features, and form factor—at the click of a button, they are not restricted by brand. Online users can find the product that most closely meets their needs—whether the purchase transaction occurs online or in-store. Again, this may mean that they consider or purchase a brand that was not originally top of mind. However, after validating their purchase through user and third-party reviews, this previously unknown brand or product may indeed end up the winner!
What Can You Do?
As a manufacturer or distributor, the most impactful thing that you can do is portray your individual products in the best possible light. If you are no longer able to attract customers based solely on your brand, then you need your products to be able to speak for themselves and tell their own unique stories. This requires compelling, well-crafted product descriptions, accurate and interesting imagery, and insightful product testimonials and reviews. Let inRiver and our extensive PRIME Partner Community help!
Kathryn Zwack, Sr. Content Marketing Manager, inRiver
Digital has evolved from simply enabling the business strategy to actually driving business strategy. One of the reasons is that digitization simplifies the removing of intermediaries from the traditional supply chain—one that typically consists of a manufacturer selling to a distributor that, in turn, sells to a retailer that sells to a consumer. This phenomenon of removing intermediaries in the supply chain—such as manufacturers selling direct to consumers by cutting out distributors and retailers—is called disintermediation. Simply put, disintermediation eliminates intermediaries whose cost to service has become greater than the value they provide.
I believe that disintermediation is, to a large extent, a consequence of the transparency that the vast amount of readily available product information creates. It empowers the end-customer and makes it fast and convenient to compare offerings by product properties and price—regardless of seller. By removing actors from the supply chain, disintermediation decreases cost and allows the manufacturer to both increase margins and, at the same time, create a direct relationship with the end-customer.
However, it is not only the manufacturers that are taking advantage of disintermediation. Retailers like WalMart and marketplaces like Amazon are also working on reducing the number of intermediaries in the supply chain. There are even credible rumors that Amazon plans to launch a global shipping and logistics operation that will compete with UPS and FedEx, thus creating disintermediation in the logistics industry itself.
In some cases, it is more efficient to use a distributor for shipping smaller orders than going direct. The economy of scale makes certain products and order types hard to manage without the services and facilities that a distributor provides. However, in most cases, it works fine to ship direct or use drop shipping, resulting in distributors being bypassed by manufacturers and retailers. However, in the transparent marketplace, brand value is rapidly diminishing, making it easier for a retailer's private labels to compete with the well-known brands from the manufacturers. Diminishing brand value coupled with disintermediation creates a threat for the branded manufacturers that they need to acknowledge and address if they want to earn the consumer’s business.
I think it is safe to say that disintermediation is affecting distributors more than manufacturers and retailers. However, all actors can and will be affected and need to rethink their value proposition and strategy. Disintermediation is eventually inevitable for all intermediaries whose cost becomes greater than the value they provide, and a big part of the value is the customer experience. As one of the key drivers for disintermediation is information transparency, it is crucial to provide more and better information than your competitors in the supply chain. There is, of course, more to it than that, especially with respect to organizational and logistical challenges. But if you are not getting found and providing a stellar product and customer experience, nothing else will matter.
Johan Boström, Co-founder and Evangelist, inRiver