What manufacturers must learn from online retailers
By Andrew Krasner
While retailers have created a flexible, targeted, and often captivating sales channel through their web sites, most manufacturers are lagging in their use of the online channel to connect with consumers. But by taking a page from retailers and offering a more complete user experience, manufacturers can improve brand image, sales, customer satisfaction and loyalty.
Consumers today are turning to manufacturers` web sites for product information before they even begin thinking about where to buy something. They return to the manufacturer`s site during and even after the sales cycle for support, related purchases and information. According to Forrester Research, 77% of consumers expect manufacturer web sites to have the best product information and 75% say they should be useful for post-purchase information. Suddenly, manufacturers find themselves in a position to influence sales and customer satisfaction in a way that never has been available to them before. Yet, the majority of their sites do not take advantage of the opportunity to interact directly with consumers.
Why they come
Initially, consumers visit manufacturers` sites to find detailed product information with which to make a purchasing decision. After the sale, consumers return for support, accessories, and opportunities to get the most from the product they`ve purchased. Meanwhile, manufacturers are looking for ways to establish stronger relationships with those consumers to build their brand and to influence the decision. Later, manufacturers want to extend the relationship that has been created by the purchase, foster loyalty and better understand the consumer`s needs and preferences.
In short, what the consumer seeks is a perfect complement to what the manufacturer desires: interaction. They want to talk with each other. This type of organized--often personalized--dialogue happens frequently and naturally for retailers, but not for most manufacturers. Whether manufacturers sell only via retail partners or also directly to consumers, they stand to learn a considerable amount from retailers about connecting with customers.
Before the sale, manufacturers have a number of advantages over their retail partners and dealers to support the consumer`s needs. They can provide deeper knowledge about a specific product than a mass retailer can. A big-box store--or online mass merchant--is unlikely to spend hours preparing expansive data about just one of the items on its shelf, but the product`s manufacturer does. Manufacturers can also provide a much richer experience than they currently offer, similar to those of specialty retail sites, incorporating product reviews, user ratings, virtual tours of products and enhanced imagery.
Presenting comparisons
Manufacturers should also present product comparisons within their lineup, laying out all the models and options in an attractive and easy-to-use manner. Properly constructed, these comparisons can help the manufacturer guide consumers to the value and benefits of the products that best meet their needs.
While some manufacturers sell directly to consumers, others prefer to use the online channel to generate leads for their dealers and retail partners. Many of these sites, however, don`t compel the user to take the actions necessary to generate a lead. They may lead the visitor through online product configuration, option selection, and rendering of a customized image but then that`s it--a dead end. Retailers know when to present the call for action, and manufacturers need to do the same. They can show consumers which retailers have the product in stock and the price at each location, provide a printer-friendly tear-sheet, ask the online shopper to submit a quote request or even offer live chat with a customer-service representative.
Knowing that consumers visit their sites to explore product lines, manufacturers should provide useful navigation and search options. The best retail sites offer multiple ways to move from the home page to the product page, allowing the user to browse by price range, color, occasion and other criteria. They also leverage advanced search capabilities on their sites to merchandise more effectively to consumers. These options are less common among manufacturers` web sites, but consumers appreciate them and are more likely to find the products they want with the help of these tools.
Like retailers, manufacturers should take advantage of promotions. Consumers often find discounts, rebates and other special offers in newspaper flyers, magazines, direct mail pieces and in-store displays, but manufacturers frequently neglect to include them on their web sites. Consumers expect to find these promotions and rebates at the manufacturer`s site; companies that fail to provide them online are missing another opportunity to relate to the consumer before the purchase decision is finalized.
To conflict or not?
A principal concern among manufacturers and retailers conducting commerce on the web revolves around channel conflict. Should the manufacturer sell direct to consumers or, instead, refer them to retail channel partners?
Manufacturers are resolving this issue in several ways. Those with very strong brands like Sony, Life Fitness, Bose, and Timex sell direct, confident that their retail partners will still want to carry their products and that both channels will flourish.
Other manufacturers offer web-only product lines. Nike allows consumers to customize and then purchase products online, such as shoes, gear, and golf balls. Customization not only offers a way around channel conflict (retailers generally don`t have the resources or time to offer customized products), but also helps manufacturers prevent commoditization of their products.
Manufacturers with licensed dealers may choose to sell direct but then credit local dealers with the sale based on geography. Snap-on Tools is a successful example of this model.
Whether or not a manufacturer chooses to sell products directly, it certainly can offer parts and accessories in its online store, items that retailers don`t want to carry or cannot provide efficiently. Manufacturers can use their web sites to save the cost of a call-center transaction, and at the same time use the online parts and accessories store to merchandise additional products to the consumer. Because the chance to initiate (or alienate) a customer relationship is so strong during this sales process, manufacturers must provide an attractive, comfortable and satisfying customer experience online and not relegate parts sales to a dingy corner of their web site.
Once manufacturers decide to sell direct to consumers, they need to recognize that their customers will expect the same level of purchase experience that they enjoy when shopping at retail sites. Useful content, navigation options, personalization, and streamlined checkout are just as important to manufacturers selling direct as they are to retailers.
Generating leads
Some manufacturers are selling direct and at the same time offering consumers the option to purchase from retail partners, with visibility to product availability and prices. The manufacturer`s own price--usually the MSRP--may be displayed as well in the comparison, all the more reason to offer exceptional customer service, support and environments online to overcome price differentials with discount retailers.
A few manufacturers are beginning to leverage their consumer-oriented sites to sell wholesale to small and mid-sized retailers. Since these smaller operations usually receive only a catalog and fax order form once a year, the manufacturer`s consumer web site, with some extra fulfillment and payment features, can open tremendous opportunities for additional business orders every day.
Another area where manufacturers can have a leg up on retailers is the ownership experience. After the sale (whether direct or through retail partners), a manufacturer`s web site should encourage continued contact from the customer for service and owner resources. This ongoing relationship can increase satisfaction and stimulate interest in other products.
After their purchases, customers regularly return to the manufacturer`s site to obtain an owners manual, browse through accessories or even validate their original choice. This return flow can become a current of ongoing contact with customers. The site should allow the visitor to opt-in for an online newsletter or other communications from the manufacturer, gaining their permission to market to them. Capturing the consumer`s e-mail address and opt-in permission allows the manufacturer to compile a list of pre-qualified prospects who have demonstrated their interest and confidence in the brand.
The site also can be used effectively for product registration. During the registration, visitors can be exposed to the opt-in features, the content of the newsletter or testimonials from other opt-in customers. Rebates are an effective way of encouraging consumers to visit the manufacturer`s site and register their products. Manufacturers should also offer customers the chance to buy an extended warranty, return products for repair, or schedule repairs with a local technician. All these points of contact are opportunities to market, inform and up-sell.
The right people
The development of a useful, content-rich and compelling site can enhance the manufacturer`s brand and sales dramatically. It`s important, however, that manufacturers adopt one final practice from retailers: they must dedicate personnel to manage the consumer experience on the site and to decide how the online store is designed, the features that will be offered and the overall depth and convenience the site will offer. Most retailers would never (at least, any more) consider turning over management of their online channel to their information technology departments, yet many manufacturers do. Individuals with marketing and merchandising expertise should guide the site`s look, feel and content.
Manufacturers make the retail experience possible, but a retail orientation can make possible new sources of customer satisfaction and revenue for smart manufacturers who are adept at providing a superb online experience.
Andrew Krasner is director of strategic services at Fry Inc., an e-commerce design, development and managed services provider. He can be reached at akrasner@fry.com.
A manufacturers` web site to-do list
- Provide in-depth product information, comparisons, search and navigation options, promotions and
a compelling call to action.
- Recognize channel conflict, but don`t let it block all direct sales opportunities.
- Foster the relationship after the sale with product
registration, rebates, owner`s resources, services,
newsletters and content for enthusiasts.
- Make sure the right people are responsible for the user experience.
