A retailer’s 2022 growth strategy: more online sales, without Amazon
Three years into a pandemic, a B2B seller has become convinced that digital commerce is the top priority and the way forward.
Industrial goods distributor Sustainable Supply generates a significant portion of its revenue through its e-commerce websites, which the company uses as a lead generation tool for its full suite of distribution services, CEO Brian Fricano said. “Although we are primarily e-commerce, we are still a distributor,” he says, saying Sustainable Supply provides extensive services and expertise to B2B customers that go beyond simply offering a wide range. of products.
Sustainable Supply is an online distributor of over one million products ranging from building materials and plumbing supplies to equipment businesses use to maintain, repair and operate their facilities.
The company is doubling down on its e-commerce-focused strategy with a multi-pronged approach to standing out as a distributor. To generate growth in 2022, it is refining its inventory with more related products and services that its customers need, introducing more useful website features, such as more payment and financing options, and accentuating its digital marketing efforts. And it stopped selling on Amazon.com, Amazon Business and other marketplaces, allowing it to focus more effectively, according to Fricano, on sales through its owned-and-operated e-commerce sites: SustainableSupply.com, EyewashDirect.com, TotalRestroom.com and PortableHandwashing. .com.
Sustainable Supply believes a new approach will differentiate it from competitors and avoid relying solely on selling basic items commonly sold by other distributors. “We really try to build a moat around our businesses and protect ourselves from access to raw materials,” Fricano says. “Instead, we focus on specialization.”
Over the past few years, Sustainable Supply has worked with its suppliers to identify complementary products to enhance its cross-selling strategy. If a customer is looking for an eyewash, for example, the website can list all the other necessary accessories as well as other products that complement the purchase, including explanatory documentation in PDF form written by a team of technical writers. The marketer has found that providing helpful product descriptions and easy technical PDF downloads is helpful to customers and helps drive repeat business.
Reduce “noise” for customers
In 2021, Sustainable Supply reduced the number of products offered to its customers. “We wanted to ‘reduce noise’ for customers,” says Fricano. “We were adding 20,000 to 30,000 product SKUs per year, in line with our competitors, but last year we fell back.”
This withdrawal allowed Sustainable Supply to analyze what customers were buying and use that knowledge to differentiate its inventory from that of its competitors. Instead of focusing on commoditization, Sustainable Supply has focused on the quality and speed of its technical and sales support teams to help customers buy the products they need or get the help of ‘seller.
However, after reducing inventory in 2021, Fricano says 2022 is a year of product expansion. “But we’re looking to grow in a different way,” he says.
The distributor adds SKUs to specific divisions, such as commercial construction, where demand is on the rise.
“There are different specialties in each vertical. Along with new construction, there are toilet partitions for commercial restrooms, flag poles, billboards or visual billboards, wall panels; we offer products that complement these projects,” he says.
Focus on useful website functions
Sustainable Supply has also made strategic changes to its website, which runs on the Shopify e-commerce platform. Shopify, a “unified” e-commerce platform designed to provide a consistent checkout experience across a seller’s multiple channels, has made shopping online easier for the retailer’s customers, Fricano says. “Shopify has a very simple flow for customers to checkout,” he says. “It’s a payment process they know.”
Sustainable Supply focused on removing underperforming website functions and invested in personalization, cross-selling and up-selling. It is also working to improve the search on the site. But after analyzing website user data, the retailer decided to remove other features, including subscription and automated ordering, and international shipping plug-in calculators. “These features just didn’t work,” Fricano says. “There was a low adoption rate, and that created more confusion for customers.”
“We were able to determine which features weren’t really effective and likely created more distraction on the website, which hurt the user experience,” he adds. “2021 has been a year for us to get back to basics, and we’ve had great success with that and good customer feedback so far.”
However, features that come in handy include credit checks for customers interested in financing a purchase. “They can open an account and make a purchase themselves without having to call,” he says. “Perhaps a customer wants to finance a piece of equipment like a new freezer for a large restaurant – the customer should be able to choose their payment terms.”
Another appeal is splitting purchases into two or four payments over a three to six month period. On the Shopify platform, Fricano says, it’s relatively easy to offer flexible payment options to customers. “Buy now, pay later (BNPL) is popular with B2C, and it’s starting to gain traction in B2B,” he says. “We already have a robust open account system here, and it automates it right on the website, where customers can auto-complete it at checkout. We are delighted with that.
Leaving Amazon, increasing sales
By emphasizing personalization and brand loyalty, Fricano argues that selling on marketplaces no longer aligns with the retailer’s goals. “We’ve had significant challenges on Amazon, particularly around supply chain issues,” Fricano says.
However, exiting markets has led the retailer to build stronger relationships with suppliers and customers, he says. In turn, Sustainable Supply has gained market demand insights to help build the right inventory that customers want to buy, which has led to increased sales through its e-commerce sites.
The increase in business from loyal customers recouped all revenue lost by leaving Amazon and other marketplaces. As Sustainable Supply has focused more time on existing customers, they have increasing order volume, says Fricano.
He adds that Sustainable Supply was not building customer loyalty by selling on marketplaces. “Nearly 100% of Amazon shoppers were one-time buyers,” he says. “Buyers are loyal to the platform, not the seller.”
Logistics and supply chain issues have also made it difficult to manage sales on Amazon and other marketplaces, he adds. “By the time we sent a purchase order to our supplier, there was no more stock,” explains Fricano. Sustainable Supply should then cancel the order.
“Managing expectations in marketplaces and on our own website has become a logistical nightmare,” he says. “The amount of effort we put into these transactions drove us out of the marketplaces. The chain will always be there if we want to get back to it.
Refine a digital marketing strategy
In addition to improving its customers’ shopping experience, Sustainable Supply will invest in digital marketing this year to drive more traffic to its websites, Fricano said.
Pay-per-click advertising in Google and Bing, however, has grown exponentially, he says, resulting in high ad rates. “It has become more expensive to acquire customers through paid search,” he says. Additionally, privacy updates limiting third-party data after Apple’s iOS 14 update and Google’s plans to block third-party cookies in 2022 make it more expensive and less useful for businesses to acquire customers through paid search, says Fricano.
As a result, Sustainable Supply reduced its advertising spend in the fourth quarter of 2021 by 10%. “The return on ad spend wasn’t there,” he says.
Instead, Fricano says, his company reallocated that ad spend to hiring writers who develop more engaging and relevant web content designed to improve search engine optimization and organic search rankings. “We offer selected products for different market parameters,” he says. “If you own or manage a campground or RV park, we have a section on the website that caters to that. If you are a restaurant chain, an office building or a retail, there’s a section for that.”
The distributor is actively working with customers in sectors where demand is increasing. “This year, sales of our facility security products, which were down nearly 25% last year, are up 25% this year,” he adds, noting that during the pandemic, factories were not operating at full capacity but have since resumed again.
Pandemic-related challenges remain, Fricano says. But Sustainable Supply’s combination of e-commerce, personal service, and digital marketing features will help it stand out in a commoditized industry.
Sign up for a free subscription to Digital Commerce 360 B2B News, published 4x/week, covering technology and business trends in the growing B2B e-commerce industry. Contact the editor-in-chief Gretchen Salois at [email protected] and follow her on Twitter @GretchenDC360.
follow us on LinkedIn and be the first to know when new Digital Commerce 360 B2B News content is released.