B2B companies need to understand the value of digitisation
Dr Venkatesh Shankar, Mays Business School feels that B2B companies are often unable to leverage digital platforms due to various reasons, including lack of time, apprehensions on the day-to-day resource requirements, and wrong perceptions. But he feels that online presence is unavoidable in the post-pandemic scenario, and suggests ways in which these companies can embrace and leverage digitisation.
IBT: What benefits does establishing a virtual presence entail for brands planning to advance their business (both B2B & B2C) in a post-covid world?
Dr Venkatesh Shankar: A strong virtual presence is a necessary condition for brands to move forward. Many of customers’ online habits (e.g., browsing, interacting, ordering, returning) that accelerated during the pandemic will likely stick post-pandemic, so a healthy virtual presence is table stakes in the competitive game. Successful brands will be those that go beyond and maintain a vibrant and engaging digital presence.
IBT: How can SMEs leverage the power of the online platforms to grow their business? What organic and inorganic tools can be deployed for the same?
Dr Venkatesh Shankar: SMEs can unleash the power of online platforms in a number of ways. First, they can use established ecommerce platforms for transactions. Second, they can establish a vibrant presence in social media platforms (e.g., Facebook, Instagram, Twitter, Linkedin, Pinterest). Yet about half of the SMEs don’t leverage social media well. Third, they can use mobile platforms to their advantage as they could use them to create sticky behavior. Fourth, they can use search engine optimization as an organic tool for boosting visits to their websites. Finally, they can use as paid search tools such as Google Ads to attract prospects to their sites.
IBT: What are the reasons & constraints why SMEs are reluctant to use virtual platforms to advance their business?
Dr Venkatesh Shankar: About two-thirds of US SME owners oversee at least three business areas, including marketing. As a result, they may not devote sufficient time and efforts to get on to digital platforms. Many SMEs are not savvy about virtual platforms. Some are apprehensive about managing digital communication tools on a daily basis. Some may be unsure about the return on investments (ROI). Some SMEs even think that because their target customers may not use digital platforms, they also don’t need to use those platforms.
IBT: What can be done by governments to encourage more brands to start using online platforms to promote their business?
Dr Venkatesh Shankar: Governments can encourage brands and SMEs to use online platforms and tools more widely and frequently in a few ways. First, they can set up different facilitating websites and apps, connecting buyers and sellers. Second, they can educate SMEs through training programs, webinars, and tutorials. Thirdly, they can provide financial incentives for greater use of digital communications and transactions. Fourth, they can enlist digital companies to set up and sponsor programs aimed at promoting digital platform use.
IBT: Please give us examples of companies that you think managed to use social media/online channels successfully to advance their B2B goals. What can Indian SMEs learn from them to replicate this success?
Dr Venkatesh Shankar: The US has about 30 million SMEs, while India has 42.5 million SMEs. That works out to be 1 SME for every 11 persons in the US and 1 for 33 people in India. SMEs in both countries can enhance their business efficiency by leveraging digital platforms. As such, there are several thousands of US SMEs that have used digital channels and platforms to successfully advance their B2B goals. Indian SMEs can apply some valuable lessons from their US counterparts’ experience:
- Listen to customers on both the digital and offline media
- Set clear digital goals (e.g., lead conversion, web traffic enhancement, brand engagement, revenue support)
- Choose the right digital channels, platforms, and tools (e.g., website, email, social media, mobile) for the right task by constant experimentation;
- Spend and bend (adjust, making course corrections).
IBT: What inhibitions can brands have while doing B2B marketing on digital platforms?
Dr Venkatesh Shankar: First, B2B brands have to fully understand the value of digital platforms and choose the right platform. A major obstacle for a B2B marketer in using a digital platform is inertia and resistance to go beyond status quo. Sometimes, the fear of using a new technology and the perceived downsides (often exaggerated) of transitioning to a new system that acts as a stumbling block. Some B2B brands may not feel the need to use digital platforms if their main customers do not use digital platforms.
IBT: From a customer’s perspective, what could be the challenges in ordering products online from an SME through virtual apps?
Dr Venkatesh Shankar: The main challenges for app-based ordering for SMEs are product complexity, sales cycle, payment systems, and post-purchase service. The more complex the product, the harder it is to design a user-friendly app and persuade customers to use it. If the sales cycle is long, involving multiple interactions with sales reps, ordering through the app may be tougher. Most SMEs work on credit terms with their suppliers whose systems should be in sync with the app to verify and process payment. Finally, some orders of SMEs may involve post-purchase services that need to be built in the app for ease of follow through.
Venkatesh (Venky) Shankar (http://www.venkyshankar.com/) is Professor of Marketing and Coleman Chair in Marketing and Director of Research at the Center for Retailing Studies, Mays Business School, Texas A&M University. His areas of specialization include Digital Business, Marketing Strategy, Innovation, New Product Management, Retailing, Services Marketing, Pricing, International Marketing, Branding, Mobile Marketing., and Artificial Intelligence. Shankar has a Ph.D. in marketing from the Kellogg Graduate School of Management, Northwestern University and has corporate experience in the areas of marketing and international business development. He has been recognized as one among the World’s Most Influential Scientific Minds by Thomson Reuters and one of the Top 10 experts on innovation management worldwide. Shankar has consulting or executive teaching experience with organizations such as Allstate, Cap Gemini Ernst & Young, Colgate Palmolive, Deloitte, GlaxoSmithKline, Halliburton, Hewlett Packard, HSBC, IBM, Intel, Lockheed Martin, Lucent Technologies, Marriott International, Medtronic, Microsoft, Northrop Grumman, PepsiCo, PNC Bank, Philips, and Volvo.