American Supply Association members are predicting an increase in 2023 eCommerce sales, that coming from a recent study ASA participated in with the Distribution Strategy Group (www.distributionstrategy.com), the Colorado-based firm that offers strategic guidance for distributors in the face of disruption, including insights, consulting and analytics.
The overall survey queried sectors such as industrial, electrical, safety, HVACR, plumbing, building materials, safety, hardware, chemical and plastics, oil and gas products, JanSan and several others. The survey featured an 85-15 percent split between distributors and manufacturers.
In its findings, Distribution Strategy Group notes the JanSan category has the highest adoption and highest maturity among sectors, while oil and gas has a higher maturity level. Electrical has high adoption and low maturity, while building materials has the lowest adoption. DSG defines eCommerce as transactions including website, mobile and app, but excludes EDI, punchout, email and fax. Respondents identified what percent of total revenue went through the eCommerce channel.
In terms of eCommerce growth, 26 percent of ASA respondents are forecasting eCommerce growth of more than 10 percent in 2023, while 74 percent of ASA respondents noted a predicted increase of up to 10 percent.
Among some of the other survey highlights, DSG asked respondents to rate their satisfaction of their eCommerce investment. Fourteen percent of ASA respondents rated their satisfaction as very satisfied, while 45 percent said moderately satisfied and 17 percent stated they were not at all satisfied. In terms of the overall survey response, DSG noted those companies that are highly satisfied with eCommerce are much higher in average eCom revenue (31 percent vs. 18 percent overall) and in a significant leadership position with 45 percent in the greater than 20 percent in eCommerce revenue compared to the 25 percent overall survey total.
To that point, DSG said when looking at the overall survey results, those companies that are highly satisfied with eCommerce are higher in customer-focused objectives, lower in ERP integration (already completed) and are much higher in increasing efficiency and productivity.
When it comes to what is most effective to drive eCommerce demand, 41 percent of ASA respondents said field sales reps, while 17 percent stated email marketing. Inside sales rep and SEO/organic search each had a 7 percent response from ASA survey participants.
The survey also asked about the financial objectives that are driving eCommerce investments. In terms of ASA respondents, 44 percent rated growing revenue with existing customers as a highest priority compared to the overall survey average of 28 percent.
Importance of product data
Additionally, the survey tackled the subject of product data as it relates to eCommerce with one question asking how satisfied companies are with the quality and completeness of their product data. Only 3 percent of ASA respondents reported they were extremely satisfied with it, while 37 percent said somewhat satisfied and 27 percent said they were moderately satisfied, while 10 percent said they are not at all satisfied.
What means of obtaining product data also was asked with 37 percent of ASA respondents saying they very heavily rely on in-house sources, 30 percent said they very heavily rely on third-party associations.
According to the survey, the average ASA member has 47,945 SKUs, while the median for ASA respondents was 20,000.
In terms of the percentage of SKUs that have complete product data, including full attributes, at least one photo and a complete description, the average for ASA member respondents was 41 percent while the median was 30 percent, both below the overall survey averages of 45 and 50, respectively.
For the percentage of product data that includes application or context-specific information (i.e. a control valve used in a food processing application will have a different description vs. the same product used in a commercial building), the average ASA company response was 19 percent, while the median was 5 percent. DSG notes there is a major opportunity for distributors to better serve customers and to differentiate from competitors in this regard.
How can I receive the full report?
Contact ASA Manager of Data and Market Intelligence Bri Baresel at email@example.com to receive a free copy of the 2023 study, which features nearly 30 pages of data.