If you’re a manufacturer, chances are you’re constantly looking for new ways to drive growth, diversify, and stand out from your competition. What company isn’t? Right? With the expansion of the Internet and technology over the last decade, this has completely transformed how many manufacturers are doing business today.
But many manufacturing companies and manufacturing industries as a whole are caught in the old-school way of doing business and this has caused many to lose market share, be forced to reduce the quality of their products to stay competitive, or sadly go out of business.
As a top digital agency that has been helping manufacturers scale on the web and marketing front for two decades, I can tell you that making some fresh new changes to how you do business can be the catalyst that takes your manufacturing company to that next level.
Below are three marketing strategies that any manufacturer can implement in a reasonable amount of time that can completely transform their business. Our team at Hudson has been helping our clients in each of these areas and I’m happy to share them with you, so you can implement them for your own organization. Ok let’s get right into it...
Add eCommerce Functionality to your Website
One of the biggest ways we’ve helped our manufacturing clients explode their sales is by getting them into the ecommerce game. If you’ve been operating your business offline and having success, chances are you can increase that success by adding ecommerce functionality to your website.
Now, I know there is not a one-size-fits-all and many manufacturers receive big purchases from their wholesale buyers. So, I’m not necessarily saying you need to add the ability for a customer to pay with a credit card on your website (as you will have to pay credit card transaction fees). I’m fully aware that manufacturers charge their customers in various ways and that doesn’t need to change. In some instances, yes, adding the ability to pay with a credit card makes a ton of sense for a manufacturer. But on the other hand, just having the ability for a wholesale buyer or dealer to login to their account on your website and seamlessly place an order, which you can then invoice to their account, will streamline the ordering process for your customers.
Setting up ecommerce functionality on your website could also allow the end-customer to buy directly from you as well. I’ll get into that a little further down in this article.
Below are some of the Pros and Cons of adding eCommerce to your manufacturing company’s website:
- Your business can stay open 24/7 so you never miss a sale
One of the best things about selling products off your website is that your business is open all hours of the day and night. When potential customers come across your business website they will be able to transact on their own time - allowing you to gain business you wouldn’t have if you required them to call you during normal business hours.
- You can simplify the ordering process and make it easy on your customers - No more faxing or using EDI to submit a PO.
The other day my wife and I ordered furniture directly from a reputable manufacturer and we needed to call in our order, wait for an emailed PDF, which we then had to print, sign and scan back to them. My first thought was, are you kidding me? My second thought was this is beyond frustrating and I’m sure they are missing out on new business and bogging their internal team down with unnecessary workload. This is something that can be completely automated if they simply added the ability to place an order directly through a public facing or back-end section of their website.
- New customers can find your business online, register for an account, and easily place an order.
If you position and market your website properly, potential customers will come across your digital ads, social media posts, or other marketing campaigns as they are searching for a product like the ones you offer. Now a new customer can register for an account and simply checkout - easing the ordering process for a new customer.
- You can now offer specials, closeouts, or clearance items.
In dealing with manufacturing companies over the years, one of the biggest areas of concern was their inventory control levels - sometimes they had too much stock of a product, other times they had older versions they didn’t know how to get rid of. With the simple addition of a closeouts or clearance page on their website, their customers would be able to locate these products and receive a nice discount for buying a product the manufacturer no longer wanted in inventory. Offering deals or specials with automated discounts or promo codes is another simple strategy that can be added to your ecommerce website.
- Upselling your customers with related or ancillary products is a piece of cake and will offer various ways to increase your customer Average Order Value (AOV).
Have you ever been on a company’s website to purchase a product and either on the product page or during the checkout process, the company presented you with other products which other customers purchased together? Of course you have because Amazon does this perfectly with their “Frequently Bought Together” feature on each product page. This is a great feature that can get additional products in front of the customer at just the right time they are thinking of making a purchase.
- Setting up your website with all of your product’s details will take time
Like I’ve mentioned before, our agency has been working with manufacturing companies for two decades and have been working with them to set up their ecommerce storefronts. One of the areas which can slow down the process is waiting for all the proper product details including product names, descriptions, pictures, dimensions, and other important product features that need to be added to the website. But chances are, you’re a manufacturing company who has their product details in order. So if that’s the case, having this information makes you one step ahead as you go to add your products to your ecommerce website.
- It’s also another system you need to maintain.
Yes, setting up an ecommerce website can be considered another system because not only will you need to have the website setup properly, but you’ll also need to figure out how to not create duplicate work, like taking a website order and entering it into your ERP system to process. But, if it’s set up correctly, you can tie your website into your ERP system through an API, which our team can develop for you, to make things seamless so there’s no double entry of orders needed.
- If you accept credit cards, you will pay transaction fees between 1.5% - 3.5% per order.
Yes, the credit card processing companies need to make money on each ecommerce transaction, so if you accept credit cards to allow customers to pay for purchases on your website, then you need to pay these fees. But we also set up some of our manufacturing companies with the ability to have their customers billed to their account, invoiced upon shipment of the order, or any other way that you transact business with your customers.
In my humble opinion, when comparing these pros and cons, I think there’s no comparison on the time and financial investment that’s needed upfront to experience the lifelong positive effects that your manufacturing business will receive by adding ecommerce functionality to your website. I’ve seen it first hand by what we’ve done to digitally transform our manufacturing clients over the years.
Use Alibaba to Sell to More Business Buyers
This one is another one of my favorite things that all manufacturing businesses should be doing in 2022 and beyond. If you’re not on Alibaba.com, then it’s something you should investigate with your team this year.
Alibaba.com is the largest B2B marketplace, which connects business sellers with business buyers. Now, there are a lot of misconceptions out there about what Alibaba is or is not. I actually wrote about that in another article, Why U.S. Businesses Need an Alibaba Marketing Strategy. As you’ll see, Alibaba is a powerful B2B marketplace that will allow you to get in front of and sell to many new business buyers that don’t know who you are, but are looking for a product that you offer. Alibaba is a global platform that allows you to maintain one Alibaba storefront that provides you with global exposure - targeting business buyers not only in the U.S but around the world.
One great thing about Alibaba is the fact that you can actually do business on your own terms. Unlike Amazon, you don’t have to pay any transaction fees on each sale. You also get access to the customer data and contact information and transact business off the Alibaba.com platform. What we’ve seen by getting our clients on Alibaba is that they’ve actually been able to become more profitable and scale their business in ways they’ve never thought possible.
Here are some of the Pros and Cons of listing on Alibaba.com.
- Alibaba.com has 0% commissions
Unlike on Amazon.com and other marketplaces, Alibaba does not take a commission on each order that happens because of their platform. Once you pay your Alibaba annual membership fee, you’re entitled to transact as many orders without paying exorbitant fees.
- Manage orders on your own terms
At the end of the day, Alibaba.com is a lead generation website that will connect you with business or wholesale buyers looking to purchase your product. How you decide to transact with them is entirely up to you - you can use the Alibaba.com marketplace or you can bring them off the platform and allow them place orders through any other means that you are already doing today. This gives you the complete control to transact with these new business buyers on your own terms, so there is no disruption to your business on trying to manage these new customer leads and opportunities.
- Alibaba.com is built for B2B
Alibaba.com is strictly a B2B marketplace. Any buyer that contacts you through the Alibaba platform has been vetted and approved by Alibaba to be listed as a business buyer. Unlike on Amazon, you’re not going to be bogged down with end consumers trying to purchase one product. In fact, on your Alibaba.com store, you set your Minimum Order Quantities (MOQs) - whether that’s by the number of units, case packs, or pallets - you have the complete control to let potential customers know how much of a product they will need to purchase in order to do business with you.
- Alibaba is NOT a retailer
I don’t know about you, but the fact that Amazon has Amazon Basics frustrates me beyond belief. Amazon is so reliant upon their Amazon Sellers and what do they do to thank them? They create a competing product in a top selling category and call it an Amazon Basics product. Sure, that is a great benefit to the end-customer, but that is a stab in the back to a manufacturer or Amazon Seller, who’s trying to run their business and compete against the company that is trying to drive them new business in the first place. To make this long story short, Alibaba will not do this to compete with their Alibaba.com Sellers.
- One storefront, global exposure
One of the best things we love about setting up our clients with an Alibaba.com storefront is the fact that we instantly help them gain worldwide exposure. Now, I’m fully aware that not every business can sell in the U.S. and easily sell in other parts of the world as well - but many of you manufacturers can. If your business does not have any potential regulation and security concerns, then you can simply have a global presence by having one Alibaba.com storefront.
- It’s not easy to setup your store and list your products
There is a lot to the Alibaba.com platform and if you don’t know all the ins and outs of the platform, it can be a little cumbersome to figure it out yourself. However, because our agency is an Approved Alibaba U.S. Channel Partner, our team has been fully trained by the Alibaba team and have direct relationships needed to support the client onboarding and ongoing account management processes for you.
- You will get many new leads that you need to weed through
I know this sounds too good to be true but the fact is Alibaba.com has about 200,000 sellers and over 20 million active buyers on the platform. An active buyer is defined as a business buyer that has transacted on the platform in the last 30 days. So as you can see, there are a ton of buyers on Alibaba.com looking for manufacturing companies and products and a limited supply of Sellers selling those products.
- Your response rate replying to these leads will score you as a seller, which can positively or negatively affect how well you rank organically.
One of the ways Alibaba.com marketplace determines what product to recommend to a Buyer who’s searching, is by understanding what Sellers have good customer service and respond to their leads in a timely manner (within 24 hours). If you can find someone on your sales team that can fulfill this role, then you’re already a step ahead of your competition.
One last Pro I forget to mention - Hudson can setup your Alibaba storefront and run your advertising campaigns to target new business buyers. As I mentioned above, we are an Approved Alibaba U.S. Channel Partner and can manage this entire process for you, so you can focus on managing the leads and selling more products.
Consider Selling Direct to the Consumer (D2C)
In the traditional B2B world, manufacturers sell to distributors, who sell to wholesalers, who sell to retailers, who sell to the end-customer. But now, because of technological advancements and the global expansion in the eCommerce supply chain, manufacturers are selling directly to the consumer and cutting out the middleman, bringing greater competition, pricing, and profitability to the B2B landscape.
Are you currently a manufacturer who sells to distributors or wholesalers? If so, have you ever thought about selling directly to the consumer? As an agency, we’ve worked with and have helped many manufacturing businesses flip their business or even industry on its head and have figured out how to cut out the middle person and sell their product directly to the end-customer. In 2022, you need to start thinking about this for your business because, chances are, your competition is already doing it.
For many manufacturers, working with dealers or wholesalers was generally the only way to sell products to the end-consumer. Distributors and wholesalers typically provide the operations and logistics needed, which many manufacturers can’t afford to do on their own. But now with the expansion of the Internet, technology, and available partner resources, having manufacturers sell products directly to the customer is more common today than it once was - and that will just continue to grow.
Here are some of the Pros and Cons of selling directly to the end consumer:
- Increased profitability
This is pretty easy to understand. If you’re no longer selling to the distributors and wholesalers in certain cases, then you can sell your product directly to the customer and make more per each unit sold.
- Lower price points for the end consumer
If there’s greater profitability on each sale, then there’s also the ability to reduce the price point for the customer, while making you more competitive and putting pricing pressure on your manufacturing competition.
- You can communicate directly with the people who want your products
Just like any retailer experiences by selling products to the end-consumer, you’re now able to do the same thing. This can help foster innovation and drive new products or features with your new product line.
- You become a leader in your industry.
With all of the Pros listed above, you’re now becoming a stronger leader in your industry and your competition will either be forced to follow, reduce overhead in other important areas, or be left in the dust.
- The logistics will now fall on you.
Any warehousing or shipping that was managed by your distributors, wholesalers, or retailers will now become the responsibility of you. However, perhaps your current warehouse or shipping partners can be leveraged to help manage this transition. Many new fulfillment and warehousing companies have launched over the recent years to serve the growing need for Amazon FBA and other storage and shipping needs required by the expansion in the eCommerce landscape.
No matter where your manufacturing business is at, there are various marketing and business strategies that can help drive sales, increase profitability, and streamline operations. If you’re looking to take a digital approach to finding ways to help scale the business, reach out to us at Hudson and we’ll be happy to share what we’ve done for our other manufacturing business clients to see if there’s a fit to help you.
Wishing your manufacturing business all the best on a successful 2022!