Article: Satisfying Your Sales Channels with Collaborative eCommerce

As a manufacturer, importer or distributor, you are facing today’s difficult business challenge in how to compete and succeed in the Internet economy. Your traditional channels of sales and distribution are being or should be recast to take advantage of the Internet and this implies new ways of utilizing your reseller or channel assets.

While you and many other companies feel the pressure to sidestep competitors with a first-to-market advantage, there is little benefit in aimlessly building and implementing e-commerce systems. Many companies are taking a haphazard approach to the Internet, trying to shoehorn existing business practices into simplistic e-commerce capabilities or worse, drastically changing current effective business practices.

A more sensible approach is to determine how to use the Internet to optimize and extend your company's established sales methods and align your e-commerce strategy with your company's overall goals. The question is not whether you should utilize Internet sales channels, but how can you do so in a profitable way without alienating your existing distributors, resellers, dealers and clients.

But where do you start and what are the essential elements of a collaborative commerce solution? Before embarking on an e-commerce strategy you need to ask yourself a few important questions on how you will relate your business needs with those of your reseller partners.

The Gartner Group estimates that over 90% of manufacturers, importers or distributors do not sell their primary branded products online. Why? The primary reason is channel conflict; fear of the consequences of going into business against your own selling partners.

Therefore, typically many manufacturers or primary distributors establish a website that simply helps customers gather product information and build a shopping list, which they can then take to the nearest physical store. Ultimately, your website does not close the sale and has no visibility into whether these customers actually purchased your products from your reseller.

Not only do you give up the rights to a new revenue stream, but you also lose control over, and insight into, the commerce activities within your own customer base.

But, what if you could provide customers with a unified and guided selling experience across your sales channels by presenting a seamless selling experience to your customers and site visitors while integrating the value-add of your reseller network? Your customers could access real-time product information including pricing and availability through resellers directly from your web site and their respective web sites.

And what if your e-commerce system could ensure that products were properly configured and orders routed to the appropriate sales partner? This way you would remain intimately involved in the e-commerce activities of your resellers, while maintaining influence over the sales process and customer experience.

You must determine which of your sales channels to take to the web. You may presently utilize multiple channels to respond effectively to your customers' needs such as your direct sales teams plus a mix of resellers, retailers, OEMs, and dealers who deliver value to your customers and strategic value to you by providing you with global and vertical reach, logistics and additional value-added services.

It will be necessary to formulate an integrated strategy that provides a common infrastructure for all of these sales channels that you take to the web and then provide an e-commerce infrastructure that integrates all of them within a single cohesive system.

This online collaboration will allow your active participation in all aspects of your customer's sales and marketing experience, from shopping and product configuration to fulfillment and feedback. Short-term rewards include reduced costs through process automation and efficiencies. Long-term rewards include increased revenue, greater customer and partner loyalty, and the ability to create strong sell-side partnerships that help differentiate products.

Your resellers want to work with you, yet an Internet business strategy that does not consider all your relevant sales channels, including their sales and distribution models and related business processes is a recipe for failure. - John Shenton - July, 2002