To understand the opportunities in front of us, we need to understand the dollars. And according to Mark Simoncelli, Global Vice-President of Growth Implementation for Frost and Sullivan, the dollars are staggering.
“The market opportunity in B2B retail is nearing $1.8 trillion in 2020,” Sullivan told his audience during the National Association of Electrical Distributors’ Eastern Regional Conference in Tampa, Florida. “Because of connected marketplaces, its starting to change the ecosystem of doing business. You need to really understand technology and the way it impacts you,” Simoncelli added.
Simoncelli added the time has come to look at the B2C side of selling, because it continues to filter through to the B2B side. “That customer experience is filtering into B2B, which I think is a good thing. Looking at multi-channel engagement with the customer is important,” Simoncelli said. He added distributors will face serious consequences if they do not begin to increase their spending on digital offerings, because right now their customers are spending a lot more than them on technology. “Distributors are spending between 2-10% on digital, as opposed to the construction industry which is around 15%. They are spending money on drones, real-time data, service robots, Artificial Intelligence, and work to create the construction site of the future,” Simoncelli added.
Simoncelli and NAED teamed up to create the recently produced Connected Business research that is now available through the association. The Executive Summary of the research is free, and members of NAED can contact the NAED Member Engagement Team to buy the entire report. Connected business found 21 digital opportunities, some with clear benefits others focusing on basic requirements and costs.
“You need to assess where you are now, and where you aspire to be over the next 3-4 years.,” Simoncelli said about the research. “There are immediate needs, and then horizons over the next 4-6 years to be a fully connected business.”
The Connected Business research found 21 digital opportunities, most with clear benefits while others focus on basic requirements and costs. “If you are not gathering information and if you don’t have the platforms, you can’t optimize your digital transformation.”
Simoncelli did offer some first steps for distributors to begin the effort to become a more connected business. He pointed out that this remains a “radical change” in our industry, and you need to make a change assessment. “Are you ready for this?” Simoncelli asked. “Can you change your hearts and minds?”
Suggested changes include:
- Invest in future rolls that include the skills and people necessary for the future
- Create a full IT and systems assessment. What are you willing to invest to get your distributorship up to speed?
- Get your data right and become a data drive business
- Staff a Center of Excellence, which is a team for data management and infrastructure
- Partner with an outside agency to fill any gaps
- Bring together technology and your business
You can download an executive summary of the Connected Business research here. Or, contact the NAED Member Engagement Team to purchase a full copy of the research.