In the age of industry 4.0, it’s obvious that not only the environment of the industry as such is changing, but also the individuals behind it.
As a B2B marketplace which is aiming at one of the main aspects behind industry 4.0, digitalization, it is important for us to know our userbase. We want to understand them and their needs, and as a result offer the best possible service for them. That’s why we did some research about the changing face of B2B buying teams, and how it affects the respective sales teams. By including both points of view on PINPOOLS, our goal is to reshape the transaction process according to what our users desire and industry 4.0 expects.
It does not come as a great surprise that the overall workforce consists of more and more young professionals. These so-called millennials are the first generation of digital natives; even the oldest ones (born in 1980) never knew a world without modern-day internet. That being said, these employees are obviously very prone to using online tools or digital technologies at work as they do in everyday life.
When considering buying teams, this development becomes especially clear in a study by Google published in 2015. According to the representative study including approximately 3000 members of various B2B purchasing teams, the share of millennials in these purchasing group increased from 27 % in 2012 to an astonishing 46 % in 2014. At the moment, however, these young professionals occupy mostly research and other preparation positions while the C-Suite has the final say in most purchasing decisions. Still, there are two aspects to be considered. The first one is the gatekeeper principle. While researchers may not ultimately decide on which product to buy, they do collect all the information and create a shortlist for their supervisor to choose from. According to Google’s study, 81 % of those involved in purchase decisions are not C-Suitors. In other words, if the selling company fails to convince the researcher, they will most likely never even be seen by the decider. Secondly, the millennials’ careers are only now beginning. In a few years, these young professionals will be the ones taking over the C-Suite, thus not only shaping the research and preparation process, but also decision-making as such.
However, not only the workforce has changed, also the general purchasing process is developing. The average number of people involved in one purchase process has increased to 5.4, making it even more difficult for the sales teams to address the different levels and profiles included in one buying center. Also, the overall process has lengthened. This, in turn, is mostly due to an increase in research. Especially young researchers take advantage of the unlimited access to information on the internet. 74 % of all respondents stated to carry out online research before the first contact with the opposite sales team; twelve searches being the average. While an online search is among the three top research tools, an astonishing 94 % of all respondents state that they carry out an online search at some point during the purchase process. In searching the internet, most respondents (71 %) begin with a generic search. This matches the overall findings that purchasers look for a solution to their problem, not a specific brand, when they first conduct their research.
Another highly important aspect for the young generation of purchasers is social media. According to a recent IBM study, 53 % of the sample incorporate social media into their research process. LinkedIn is ranked highest among professionals; YouTube is becoming increasingly important, though. Videos about product features and customer interviews are examples of how to effectively use videos for digital B2B marketing. Comparing the years 2015 and 2016, a third of all respondents state that they now spend more time on social media for research purposes.
On the other hand, it is critical to highlight the disadvantage of procuring in industry 4.0. The main aspect is that the process has not only become more time-consuming but also more complex, as stated by 48 % of respondents of a study by CEB. The unlimited access to information can result in an “overload” which in turn leads to confusion and frustration rather than clarity. The increasing size of buying centers further enhances this effect, finally leading to the necessity of simplifying and complexity-reducing structures within the industry.
On the sales side, it is crucial to adapt to these new procurement processes. Because the buying team is informing itself about a purchase that the sales team does not even know is happening, the power is shifted to the purchaser. By the time that the personal sales process begins, the purchaser is already well-armed with information and now only needs the sort of information which was not available before. Generally speaking, the purchaser takes over a good portion of what used to be the supplier’s value. For the supplier, this means that he needs to find other values to present to his customer. For example, it is crucial for the sales and marketing team to work together in order to facilitate the research process for the purchaser. Recent studies state that it is very important that e.g. prices and information on products can be easily found on the company’s website. Also, to provide information that was not accessible before, the supplier’s customer service must be knowledgeable and equipped to answer specific and technical questions. It is critical that the customer is convinced that his position and problem are understood and that he will be offered a personalized solution.
In summary, there are many different aspects to be considered when speaking about procurement processes in industry 4.0. The environment is constantly shifting and it is crucial for all players to adapt to these shifts in a timely manner so they can benefit from all the perks that the newest generation of trading offers.