Kibo recently hosted a fireside chat that dove into the challenges B2B organizations are facing post-pandemic. And how these changes will affect the way they do business going forward. We invited three industry experts to talk about how they weathered the accelerated shift to digital experiences. And to share what plans they have to future-proof their businesses.
Martin Turner, the Digital Marketing Lead of Brakes, Mark Leach, the Managing Director of User Conversion, and John Godwin, the Digital Director of Travis Perkins provided unique insights they gained during the pandemic and what other companies can learn from their digital innovation.
The Great Shift in B2B Organizations to Digital Experiences
60% of companies have altered their digital transformation plans due to COVID. Basically, the whole operating environment changed overnight. In some industries, digital channels accelerated years ahead of forecasts. So, we asked our experts how this period manifested itself at their B2B company.
John Godwin noted, “Digital participation has improved and increased during COVID to a level that we’d never seen before. Online was approximately 1.5% of total business before COVID. We reached around 10% during COVID and we’re now back to about 4% of total business. So we have seen a spike. And it’s now starting to settle back down but at a higher level than it was before. Because I think customers are now seeing it as the new normal.
However, unless it is better to do it online, customers will revert back to offline where it’s a better service. And my analogy has been to my board: unless it is better and easier and faster to do it online, customers will revert back to type and go back to the way they used to work with us. So we need to really challenge ourselves going forward into 2021 to look at where there are gaps between offline and online and make sure that we are addressing them.”
Mark Leach said, “Early on, you saw a lot of businesses freeze. Not really know what to do cause everything was so unpredictable. Once that was over, we saw demand was outstripping capability of the operation. We saw some ONS data recently that said the percentage of sales of non-food items jumped to 60% during that first lockdown where it’s normally about 30%. So even if you take an average, that’s every online business having to double their capability. And things were a little bit more tactical in the short term to make sure that operations could just carry on. I think what we’ve now seen recently is there’s a more sophisticated approach to how a business wants to shift to digital experiences to make sure it’s sustainable. But also to make sure that March, April shock doesn’t happen again.”
The Speed of Transformation
The group also dove into the speed by which B2B digital transformation is happening—or not. Even before facing the challenges presented by the pandemic, transformation was never exactly easy or quick. But now many businesses are finding themselves caught in a race they can’t win.
McKinsey notes that “those who were ahead on the digital curve before the pandemic are bouncing back faster and better.”
But as Brake’s Martin Turner notes, there’s still a lot of trepidation to change.
Turner said, “You see some companies doing this at speed and they’re doing it really well. I think some smaller organizations have got a real opportunity to think about the way they set themselves up. And then you do see some that just aren’t responding quickly enough. And unfortunately, if you kind of hesitate with making those decisions, then it can be too late. You need to move on, and make those decisions. If you’re thinking about whether it’s the right time, there are options out there and people that can support you.”
B2B Digital Transformation Versus Migration
With so many added challenges, Kibo discussed if it would be worth more to spend outside of an organization’s core value proposition and build new business models to stay relevant and capture new growth opportunities through things like digital migration. Mark Leach noted that he’s focused on picking apart new customer behaviors and looking at new ways the business can meet expectations.
For instance, are businesses who have a transformation program delaying the inevitable? And does the change have to happen at the very core of the business?
On this note, John Godwin’s shared, “At Travis Perkins, the kind of business and the systems that we have won’t allow us to change direction quite as quickly as we’d like. So what we have started to do is look at how we can both transform what we already have. To make the interfaces we give to our customers easy to use and to be able to push and pull that data from those systems in the way that our customers and that us, as a business, needs to happen.”
When confronted between the choice of transformation versus migration, Godwin expounds on why migration made the most logical sense.
Godwin continued, “There’s this transformation angle which we’re looking into and probably going to discount. The second option is to become a greenfield digital stack that will allow us to become more aggressive and progressive. And actually what we’re looking at doing is building a whole new digital stack. “Digital first” is what we’re calling it. It will allow us to migrate our customers over rather than getting our existing business and try to transform it, which we know will take five to 10 years.
So the digital migration we believe will happen in around six to 12 months. And therefore, once we offer a compelling proposition for our customers, we believe the migration to the new stack and the new business will be exponential.”
Next Up: How Businesses Can Personalize CX
In our next post on B2B digital transformation, we’ll dive into ways businesses can become more agile. As well as how they can create omnichannel experiences that encompass both online and offline elements of their customer journeys. By bringing data and insights together, B2B businesses can better personalize their customer experience to drive higher value transactions.