The past year has left most of us feeling numb as we deal with the pain, fears, and frustrations we have suffered. The phrase “COVID has changed everything” and words like “unprecedented” were used so often in 2020 they have become meaningless dribble. Ever since the first stay at home orders were issued last year, soothsayers have been making predictions about the “new norm” we will all have to adapt to after the pandemic.
By: Ric Neeley
Since the virus reared its ugly head, credible sources like McKinsey and our own Trendicators surveys reveal some dramatic changes in the B2B world.
- Up to 40% of US employees are currently working remotely
- Traditional in-person sales calls have dropped by over 50%
- 70% of B2B buyers are willing to spend $50,000 through ecommerce or with only remote contact with salespeople
- 27% would spend $500,000+
- And 70% - 80% of B2B buyers prefer remote human interactions or digital services
These numbers may appear shocking at first, but the fact is the B2B world has been trending toward more ecommerce purchases, more digital B2B interactions, fewer in-person sales calls, and utilizing more remote workers for years. The pandemic did not create these trends. It did, however, shift them into overdrive forcing more organizations to change faster.
Consider the story of the endangered Outside Sales Reps in the distribution industry. In 2013, a series of Harvard Business Review articles highlighted the industry’s shifting focus from Outsides Sales Reps (OSRs) to Inside Sales Reps (ISRs). Distributors are always under severe pressure to reduce prices, so they are constantly looking for ways to increase efficiency and reduce costs. This pressure led distributors to rapidly develop B2B ecommerce platforms. They also aggressively sought tools to lower sales costs like use of video conferencing. These tools also demonstrated the effectiveness of ISRs for the informational and transactional aspects of the sales roles. The cost-of-sale can be 40% - 90% lower using an ISR compared to an OSR. Knowing this, many started ramping up ISR staff while cutting OSRs from their ranks years before anyone ever heard of COVID-19.
The Transition to Digital Interactions was Already Underway
The industry soon discovered customers’ expectations were changing as well. Transactional portions of the sales job were expected to be handled quickly and efficiently…skills embodied by their ISRs. However, customers also wanted suppliers to offer new ideas, bring a deeper understanding of their business and provide creative solutions to problems. These were exactly the competencies of their best OSRs. Ultimately this led to a clear separation between the jobs of the OSR and the ISR to best fit customer expectations. Teaching OSRs the skills to leverage their digital sales tools helped reduce their sales costs and allowed them to work with more customers productively, too. So, many industries and organizations have been transitioning to digital interactions to improve their business and services for years.
The generational shift is also a contributing factor to changes in B2B. Since 2017, Millennials have been the largest generation in the US workforce. Research conducted by Merit in 2019 found that up to 73% of B2B buyers are now Millennials. This transition is changing the B2B sales landscape. According to the IBM Institute, Millennials prefer to engage B2B sales through email or phone nearly 3-to-1 over face-to-face meetings. This means the past years’ forced move to Zoom calls and a distance economy is not only more comfortable but welcomed by most of today’s B2B buyers. That fact will not be lost on businesses looking for more cost-effective ways to manage sales interactions post-pandemic.
What about the COVID-19 surge in remote workers? Our Trendicators report, Rethinking Remote Work, found 64% of all US salaried employees were working from home immediately after the pandemic began. This was certainly a dramatic surge compared to the 5.2% of US full-time remote workers the US Census bureau identified as working remotely in 2017. But over the past decade, the remote workforce has been growing steadily. A 2019 Gallup study found 43% of Americans work from home at least occasionally. So, once again, the pandemic simply accelerated a steadily growing trend. The bigger news on this front is the number of companies seeing the value of remote workers in terms of employee satisfaction, increased productivity, and in expanded recruiting. Benefits that will likely make remote work an important option for business and employees for the foreseeable future.
COVID-19 shocked the B2B world. Mitigating the spread of the disease has caused all of us to adopt revolutionary change. But these changes have been part of the B2B evolution for years. The trendlines have been clear. B2B has been moving toward more ecommerce technology, fewer face-to-face sales calls, more digital communications, and more predictive customer relationship management tools. Teams have been working remotely from greater and greater distances even before the internet was ubiquitous. The pandemic simply accelerated the need to embrace those changes at a revolutionary speed rather than through a slower evolutionary transition.
Sales leaders today must rapidly restructure their teams. Individual contributors must learn new skills quickly to master this brave new world of selling. Those who do not adapt quickly will find themselves competing with more agile and more efficient competitors with lower overhead and operating costs. They will also face competitors able to draw from a much broader base of both prospective customers and employees as distance and geography will become secondary to digital services and the skills required to deliver them.
The real race becomes creating a future vision for your business
That means examining your customer needs, understanding what customers see as table stakes, and which services they value most. Then melding these customer insights with learnings from this years’ revolutionary experiment in digital social distancing to create a new, more nimble approach to B2B sales. It means helping your team members understand the vision and creating a path to teach them the skills they will need to thrive in this new world.
The question for you today is not what others think the new normal will look like in a post-pandemic world. The real questions are: What will a post-pandemic world look like for your business? And what steps are you taking today to create your own new normal?
Ric Neeley is a Director of Marketing for Hinda Loyalty Group, a US-based loyalty solutions provider that helps engage, inspire, and reward the people most important to your business.