eBusiness - today and tomorrow

Customers need assistance on the ground as well as an online presence from their suppliers

W eb access at work has grown to a staggering 70% of busi- ness employees, and busi-

ness-to-business ecommerce is projec, ted to reach $6.3 trillion by 2005. What does this mean for the pump industry? At the moment, probably, not very much.

A recent report claimed that

industrial, ‘shopping cart’, on-line

transactions accounts, at best, for only

2% of total sales. In the US, the

much-vaunted Grainger - distributor

of maintenance, repair and operating

supplies - only managed 5% of its

sales through the Internet. The

experience of the world’s first AC

drives on-line purchasing tool -

www.comp-ac.com from ABB, also

shows similar figures.

Great revolution

But it would be a mistake to believe

that this means ecommerce has been a

failure. The introduction of the Inter-

net is one of the great revolutions of

our time and its importance can only

grow. What must be appreciated is that

it is a new innovation. The recent

bursting of the dotcom bubble merely

represented a shakeout of the market,

30 WORLD PUMPS November ZXI 0262 1762/01/$ - see front matte1

not a failure of the technology or its

applications.

One of the shortcomings of the dotcom

companies was a failure to realise that

people do not want a pure electronic

relationship with their suppliers.

People, is what drives business and the

[nternet can only be a tool, among

others, to bring people and products

together. What customers really want

is help in choosing the right products

for their applications and delivery in as

short a time as possible. They want a

personal relationship, in which techni-

cally competent personnel is available

to help. ‘Clicks-and-mortar’, i.e. com-

panies with a presence on the web as

well as on the ground, are the winners

of the future. This should come as no

surprise; customers want options.

There is no single way of ordering that

will satisfy a customer all the time.

ABB’ Camp-AC ecommerce site is

based around a network of suppliers,

ensuring that the customer always has

help within approximately 50 miles of

his plant.

Intermediary role

While many industry pundits and

government reports were proclaiming

the ‘death of the middleman’, as a

result of the Internet, ABB believes

that the role of the intermediary - or

distributor -will play an even greater

0 2001 Elsevier Science Ltd. All rights reserved

part in delivering to the customers

precisely what they needed. To

reinforce this belief the company has

invested heavily in building what is

arguably the strongest, most technically

competent distributor network for AC

drives and motors on the ground.

With such a network in place, the role

of the manufacturer becomes that of

the facilitator, helping the chosen

distributors and channel partners with

technology and ensuring that the

appropriate infrastructure is in place.

This is the principle of wwwcomp-

ac.com: the product master is generated

and managed by ABB, freeing the

distributors’ business system to plug in

to ABB’s back office for the required

data.

For many, access to this technology

may still be some way off. But that

should not stop distributors from taking

action today to harness the technology

to maximise customer relationships and

lowering the cost of doing business.

Serving the customer better

While customers may nor be ready to

buy online, because, for example, fax,

ing is easier, there are always ways to

streamline other kinds of transactions

or communications. For example, can

customers sign up to attend training

courses on-line or answer a customer,

satisfaction survey? The point is that

manufacturers should use all e-comm,

unication tools to serve customers

better, not necessarily taking the

experience all the way to an order.

The Internet also provides directories

of products from different manufac-

turers, on third party sites. For instance,

the European Commission’s provides a

database of manufacturers of high

efficiency motors at http://iamest.jrc.it/

projects/eem/eurodeem.htm. It is im-

portant for manufacturers to ensure

their products feature on such sites, to

maximise customer choice.

Another reason why industrial BZB

sites, in general, may attract only 2% of

sales is, very often, due to their poor

design and user-unfriendliness. Compa-

nies need to ensure that product

www.worldpumps.com

categories are how the customer

perceives them, not how your company

understands them. Again, the customer

needs to be in focus. Extensive type

codes are of no use unless you have

been working with that manufacturer

for 10 years.

Industrial companies need to take a

look at the sites of some leading PC

companies. Looking at these sites re-

veal a few basic elements that are sim-

ply missing from many of the

industrial sites. Compared with these,

many industrial sites tend to be slow to

respond; product descriptions revolve

around convoluted type codes, often

with no photos; there is no additional

product information; and easy-access

hotlines are generally non-existent.

Now we start to answer why many

industrial sites make very few sales on-

line.

Simple test

Like it or not, electrical and

mechanical products tend to be very

unglamorous - unlike books, CDs and

PCs - and as such the customer wants

to get the purchase over with quickly.

So with this in mind, try a simple test.

Is it quicker to order your components

by telephone or fax or is it quicker by

Internet? Therefore, to attract custo-

mers to your site it needs to contain

great information about all aspects of

products and applications. This will

prime the customer so that they can

order by phone and fax.

The signs for eBusiness are certainly

encouraging. Three million people

used the Internet in 1994. Now over

377 million worldwide use it. We are at

risk of drowning in email - 6.1 billion

electronic messages are sent daily.

While on-line sales are 2% in the

electrical channel today, they could be

over 24% by 2005. For distributors

selling to large, technical customers it

could be well over 50% when ED1 is

considered as well. Ebusiness has a real

future. Do not be caught off guard by

shelving your eBusiness initiatives.

Stick with it. n

CONTACT ABB Automation Ltd 9 The Towers Wilmslow Road Didsbury Manchester M20 2AB Tel: 0161 445 5555; Fax: 0161 434 9317

Email: enquiries@gb.abb.com; Web: www.abb.com/motors&drives

ABE’s Comp-AC ecommerce site is

based around a network of suppliers,

ensuring the customer always has help

within approximately 50 miles.

WORLD PUMPS November 2001 3l