Last week, the World Health Organization announced the novel coronavirus (COVID-19) to be a global pandemic. Since, businesses worldwide have been hit economically and are scrambling to find ways to continue to conduct business. For one, their consumers’ behaviors are drastically changing. Additionally, companies worldwide have to deal with the economic impact on their industry. In many ways, the full effects of COVID-19 on the B2B market in the coming months is still unclear. However, as worldwide governments try to contain the virus, we are aware of some ways in which B2B space will feel the impact:
1. The virus will have serious impacts on supply chains.
Governments all over the globe are issuing “shutdowns” and quarantines of their citizens, including workplaces. As a result, plants, factories, and manufacturing companies are halting production. This is resulting in a dramatic slowdown or stoppage to supply flow for many B2B companies. For instance, as China – the epicenter of the virus – shut down manufacturing plants, big tech companies in the U.S. almost immediately felt the impact.
According to the Institute of Supply Chain Management, 75% of companies experienced some sort of disruption in their supply chain. 80% predict they will see disruption in the coming weeks and months. As more and more suppliers shut down manufacturing efforts, B2B companies will be cut off from deliveries. This will impact revenue in some capacity.
2. With various in-person interactions banned worldwide, companies will depend on e-commerce to maintain growth.
“Normal” in-person interactions of all types have been banned in countries worldwide – from travel, to conferences, to visiting brick-and-mortar shops. According to Technomic, 52% of consumers are avoiding crowds and 32% are leaving their house less often because of coronavirus. Additionally, Coresight Research reported that almost 75% of U.S. consumers will avoid shopping and/or doing business in person. They will instead resort to online buying and web interactions only. These numbers are expected to spike in the coming days, weeks, and/or months. This is giving B2B businesses one option – selling online.
While many B2B businesses are well-equipped to manage online sales, others may not have a digital sales strategy. This will make it difficult for these businesses to adapt and keep revenue up.
Even if businesses are well-equipped to rely on e-commerce for the coming weeks, remember that inventory will be impacted by a strained supply chain. Additionally, businesses might experience a “bottleneck effect” in their delivery capability, since the volume of online orders is projected to spike.
Without in-office presence, many B2B products and services will see a drop in sales. Additionally, certain B2B services (ie. coffee and water services) that operate via delivery will have to compete with Amazon, the delivery powerhouse that many businesses default to in a time of need.
3. Marketers will have to adjust their strategies to hone in on digital marketing.
If they haven’t already, live marketing events worldwide will either be canceled or postponed. In fact, according to eMarketer, the total loss from canceled events in the U.S. will surpass $500 million. Many companies will undergo a net loss in terms of their travel expenses vs. expected new client and revenue growth from these events.
In-person events and trade shows made up almost 40% of engagements and 53% of conversions for B2B marketing teams as of January 2020 – just before the virus spread to the U.S. Companies will obviously have to rethink this to make up for the loss.
Digital marketing efforts will have to take the place of live events, trade shows and conferences. In other words, marketing teams will have to adjust their projected revenue from each channel and redirect into digital channels. They will also have to collaboratively plan with sales teams more actively in order to meet their goals during this difficult time.
One thing that will hopefully benefit these B2B digital marketing efforts is the fact that more consumers will be online in the coming weeks. For instance, our week over week nationwide demand on 360connect.com for commercial water delivery increased by 74% just last week. As more people spend time at home, avoid social contact, and set up home offices, consumer usage of digital marketing channels – such as social media, paid search, and webinars – will likely increase. This is a perfect time to amplify your non-branded strategy to attract new customers online.
Consider that many people will turn to social media to stay connected with friends, family, and colleagues as they quarantine at home. Your sponsored and paid ads have the potential to get a wider viewership than normal. Hopefully, this will lead to unprecedented revenue for your team in these channels.
4. B2B salespeople will have to think on their toes and sell on-the-go.
Many salespeople have a “selling system” ingrained into their everyday routine. Although these systems may differ from company to company, salespeople stand by them and they work. Now many employers are sending salespeople to work from home, which is throwing off millions of salespersons’ routines. These salespeople are going to have to find a way to adapt to being cut off from team collaboration, and selling from the comfort of their workplace. They will have to integrate on-the-go selling systems that facilitate mobile lead capturing and calling quickly. To learn about how 360Connect’s model can help during this time, take a look at our supplier page and ROI guide.
Additionally, salespeople need to keep in mind that first of all their business is likely operating entirely digitally. This means their consumer base is finding their company online, and are utilizing digital methods to get in touch.
Secondly, national sentiment is in a state of panic. Given that consumers are driven by emotion not logic when they buy, salespeople will have to adjust to capture buyer demand right as it happens. They will have to call more quickly, place customer pain points at top-of-mind, and focus on their value prop to keep closing sales.
B2B salespeople should also keep in mind that an effective nurture strategy may save their annual goal this year. If sales are slow in the coming months due to the coronavirus’s economic impact, focus on filling the funnel now. Then, keep nurturing those prospects as the year progresses. When businesses are in a better position to buy, you will those close sales.
Actions to Take
If you work in the B2B space and are concerned about the health of your business during this difficult time, know that there are ways to combat the situation and keep selling. Remember that your target market is spending more time online, which you can use to your advantage. For instance, delve into digital marketing strategies and amplify your e-commerce plan. If you continue to struggle with sales, this is a great time to work on your nurture strategy and set yourself up to close sales in the coming months.
There are also lead generation services that can help you find new customers and keep closing sales. Take a look at our model at 360Connect. We continue to see a demand for B2B products and services during this time, and we’re here to help. We are focused on your success!
Wishing you the very best during this difficult time!