Why do manufacturers go to eCommerce

We have long been accustomed to the fact that in an online store you can buy a phone, a book, or a sweatshirt in a couple of minutes. But how about ordering a car via a smartphone, or carrying out a wholesale purchase of equipment for your enterprise? Online trading is taking on a whole new dimension today.

Many manufacturers, a couple of years before the start of the pandemic, realized the importance of online to reach their end consumers. And it’s not just the consumer goods segment, heavy industry giants have burst into e-commerce. Every company wants to get closer to its client, be it ordinary buyers or legal entities. Manufacturers create their own B2B and B2C platforms or try to enter existing sites.

As many studies show, the vast majority of manufacturers today are working to digitally optimize their supply chains, integrate technology, and drive B2B and B2C sales through eCommerce platforms.

Why are manufacturers no longer content with traditional distribution channels and leaving sales issues at the mercy of distributors and retailers? What are they expecting from online?

Online store or marketplace?

Practice shows that the development of an online store for a manufacturer is most often justified and justified. Developing products, companies learn from their own experience that e-commerce can open up new growth prospects even for traditional market leaders.

But not all manufacturers find it profitable to invest in the creation of a separate online store – it all depends on the scale of the business and the specifics of the market. Sometimes entering the marketplace may be a better solution.

Marketplaces deprive the supplier of the benefits of ‘exclusivity’, but are focused on the client as much as possible. They offer consumers a wide range of products and the ability to visually compare offers from different manufacturers. Additional services and a customer ecosystem are being formed around the marketplace, which benefits the entire market.

Today, in industries with complex logistics, even competing manufacturers have incentives to cooperate. For example, a metallurgical company can put the products of other enterprises into its online store, turning it into a marketplace.

In the coming years, we can expect the emergence of new B2B marketplaces for different industries and markets. Their users will eventually get used to making bulk purchases with the same ease with which they order pizza on a smartphone today.