Now is the time to take plunge into digital – SalesOut’s Vallance
SalesOut’s Head of Wholesale Marcus Vallance says it’s time for wholesalers to end the well-intentioned chat and dip their toes in the water
A new year brings a fresh perspective for all of us. And a fresh perspective within wholesale needs to be applied to how both wholesalers and suppliers utilise the true effectiveness and potential of online-ordering channels.
It’s great to see the market finally start to catch up with our friends over at the mults (and within the wider context of the world, most other B2C consumer businesses too) when it comes to making the most of the online opportunity. And with our market still operating in fairly uncertain times, I think we’re all looking to jump at the chance to drive further sales growth for 2022 by making the most of the new online-centric mindset that more and more of us are taking.
To make the most out of the digital opportunity however, we first need to review how the digital side of our market is performing before we get to how we do so. Without knowing what is currently happening, you can’t engage your customers and ultimately sell them more.
Other learned commentators around the online channel in wholesale have been right – the channel has seen strong growth in recent years. Based on our extensive pool of sales data from some of the market’s biggest wholesalers, we can verify this – sales via online channels were up 14% in 2021 vs 2020. Stepping away from this KPI that could be impacted by recent inflation volatility, other underlying metrics like number of buying customers (+10%) and average customer spend (+4%) are also up on a year-on-year (YOY) basis.
Clearly, there is real momentum already. But we shouldn’t be taking a broad brush approach to expecting all customers within wholesale to be moving along at the same pace when it comes to an online mindset.
For example, online performance metrics for the foodservice sector have posted stronger results than their retail counterparts where the in-person experience of a cash and carry or depot visits may be much more important. When breaking retail activity down further, the biggest challenge for a true digital rollout will come from independent store operators as the YOY metrics among these customers performed way behind the rest of the retail sector – pointing to a need for clear reasoning as to why these customers should engage with digital selling channels.
We also see from our data that while sales via online channels are growing faster YOY than other channels, online still only accounted for 23% of overall sales. While it’s true that this isn’t a figure to be sniffed at, a sense of perspective is important amongst all the clamour.
Below I have shared some of my thoughts and recommendations on making the most of the digital shelf opportunity:
- Optimise stock availability: treat both offline and online channels as one harmonised opportunity to ensure availability is high for whichever channel your customers choose to buy through
- Monitor pricing: transparency in the pricing and promos offered to customers in the digital sphere is a must to drive further engagement and sales
- Clear and robust strategy: a clear digital strategy that takes best practice learnings from how our Mults friends and other B2C operations do things is a must
- Win share of search: benchmark search visibility and placement vs competitors to know where you rank in the digital space in the market
- Message effectively: check your key messages and call to actions are visible and media opportunities (both organic and paid) are being maximised
- Continuous testing: constantly challenge how your digital space performs by working your on-site analytics to drive further conversions down the sales funnel
The opportunity around digital has been talked about within our industry for years. There has to be a point when we start to move from mere adoption to a digital focussed selling mindset… so why not let it be 2022 where we all make that giant leap at last?
Categories Thought leadership