COVID-affected UK Businesses Turn to Digital Selling

By Valerie Howard, Solution Strategy Director at PROS

While ‘digital commerce’ isn’t a new concept, the pandemic created an explosion of online buying. As lockdowns commenced, many businesses were forced to make their entire workforce remote, and the way sellers interacted with buyers changed dramatically. So much so that businesses that aren’t able to quickly adjust for this shifting buying behaviour will struggle to survive.

The buying and selling shift

For the past several years, procurement and purchasing leaders have steadily been shifting purchasing from traditional face-to-face sales representatives to self-serve ordering through digital channels, but the pandemic turned this buyer convenience into a buyer need. According to our recent COVID-19 B2B Buying Trends Report, 37% of businesses have been primarily purchasing through digital channels since the start of COVID-19, a 29% increase from prior to the outbreak. That figure is expected to rise to 40% post-pandemic. However, not all business suppliers were prepared for this fast shift and two-thirds of buyers expressed that they faced challenges in working with at least some of their vendors through COVID-19.

This is a major issue, especially in an environment where delivering on B2B buyer demand for digital has become not just a nice to have, but now, a vital necessity. The three challenges that B2B buyers identified as most problematic for them include slow and inefficient responses; inconsistent, highly variable pricing; and a lack of transparency into inventory.

For many businesses, COVID-19 had a direct and immediate impact on product demand. Many saw demand shrink for certain product lines, but shift to other areas of their business, and some saw demand for their products skyrocket. This had upstream impacts on the supply chain. Businesses had to quickly adjust their purchasing to accommodate this fast change in customer behaviour, but only select suppliers offered transparency into inventory and pricing that allowed business buyers to transact through digital channels.

The knock-on effect of this is that seven in ten buyers have changed their vendor preferences, as a result of challenges in working with their existing vendors through the pandemic. The top drivers of buyers shifting their vendor preferences were: Competitive pricing (40%), supply availability (39%), and a better digital purchasing experience (35%). This sizable wallet share shift creates an opportunity for vendors who have delivered on digital channels and dynamic pricing, but also drives an urgent need for businesses that have hesitated in their digital transformation efforts to accelerate the pace.

The technological application

Enabling digital channels and self-serve interactions requires a clear understanding of customer expectations and behaviours. While many buyers changed their buying habits overnight, this change often required learning new systems and tools. Buyers were more willing to complete transactions with vendors who had already demonstrated a high level of trust that their desired goods or services would be delivered as communicated.

Delivering on this level of trust and transparency requires underlying technology well beyond just the completion of a digital transaction. Buyers are increasingly demanding responsiveness, transparency, and proactiveness. They want fast responses to their inquiries, they want immediate transparency into inventory and pricing, and they prefer vendors that proactively share opportunities for them to gain more value through the supplier.

Valerie Howard

Delivering on addressing buyers’ explicit and implicit needs requires deep levels of understanding that can often only be achieved through detailed and deliberate buying behaviour analysis. Every unique interaction is a combination of distinct variables that can be used to interpret what drives customers value perceptions and preferences – for example: What channel did the customer use to complete the purchase? Did the volume discount motivate them to purchase more? How quickly did they complete the order?

Data driven analysis of these variables can help businesses to better understand their customers. With this understanding, businesses can proactively personalise their responses in context of their customers’ unique needs. Taking this personalisation one step further with artificial intelligence, suppliers can begin to predict and anticipate customers’ needs so that they can meet those needs across any channel the customer chooses to engage through.

The coronavirus pandemic has eliminated any opportunity for hesitation in meeting customers’ needs for self-serve buying. Businesses that have fallen behind need to commit wholeheartedly to their digital transformation with vigour and spirit. Amongst those businesses taking on the challenge, we see the following trends:

1. Increased customer loyalty:

Many business leaders feared that digital interactions meant that they’d lose an element of personal touch that made their company distinctive from the competition. However, as suppliers were forced into enabling self-serve buying in the pandemic, they were surprised to see that many buyers actually expanded wallet share and became more loyal. Allowing customers to make the choice of how, when, and where they want to buy means that your business is exponentially increasing the likelihood that buyers will choose you.

1. Improved focus to address complex customer needs:

Enabling buyers to easily reorder their last purchase or complete a simple sale frees up salespeople from repetitive, administrative tasks. Most importantly, this freed up time allows salespeople to be able to address their customers’ most complex needs with care and consideration.

1. Greater willingness to pay:

When businesses can rapidly respond to requests, meaningfully personalise offers, and anticipate customer needs, buyers will have a higher willingness to pay for their products. In fact, one in two buyers said that they would be willing to pay as much as 5% more just to receive pricing information instantaneously. It’s obvious that buyers value saving the time and haggle of chasing down pricing information enough to pay for it.

A lot of change has been pressed upon us all in a short amount of time. But businesses that rise to the challenge of this new environment and accelerate their delivery on digital selling will be rewarded.