Surely you have already thought about or are already in the process of digitizing your products, services or processes, right? Because you realize that you, too, must digitally transform in order to endure in the future. As a B2B retailer, you’re probably wondering what the hell digital transformation means for you and how you’ll be able to survive next to the top dogs of the digital world Google, Amazon, Facebook and Apple – GAFA for short…
Change in trade patterns
First of all, let’s take a look at the trade structures and what they looked like until 2010. From the manufacturer via the importer and wholesaler, the products ultimately ended up at the specialist retailer. In the last 10 years, digital transformation has changed that, and you’ve probably noticed it firsthand. Instead of being sold by specialist retailers, products are nowadays predominantly sold via platforms such as Amazon, and the players involved in the retail structure have become fewer in number.. We say by 2030 this trend will continue to aggravate! There will then no longer be any classic “dealers” between the manufacturer and the platform. They become the service provider between the manufacturer and the platform. As a result, the revenue streams of retailers are increasingly coming from services such as logistics, consulting, customizing, etc., rather than from traditional retail.
Positioning as a B2B dealer
To answer that, you need to look at your value creation from your customers’ side: Are you adding value for the one who pays for it? So the starting point is that you have to be very clear about what your value creation looks like and whether it will still be in demand in this form in the future. Because one thing is certain, guaranteeing access to products or offering supposedly better purchasing conditions is not sustainable value creation and is not enough to survive in the platform economy. If you know your value proposition, then you’ll probably automatically know whether you’re going to be a manufacturer, a service provider, or a platform. Would you like a few examples?
The company Klarstein achieves its added value by designing and manufacturing innovative products in the household segment. The added value is therefore in the production, whether Klarstein then sells its products in its own online shop, via amazon, on another platform or even with everything is then rather secondary. So Amazon is not the enemy -on the contrary-, after all, you can hardly find a sales channel with such a large reach. Thus, Klarstein is a manufacturer’s dealer for platforms.
EURONICS, a NETFORMIC customer since 2013, on the other hand, positions itself as a platform. The value creation is therefore the operation of the direct platform with better service than comparable competitors and with a large brand reach. This means that the platform is not an online shop in the general sense, but a separate marketplace solution for the cooperative members of the association group. Participating retailers are connected to the marketplace with their own merchandise management systems and can thus play out individual prices and inventories, providing customers with regional offers that are offered “drive-to-retail”.
DEKRA acts as a service provider between the manufacturer and the platform whilst the added value is the provision of services for platform operation. These can be e.g. repairs, customer service, etc.. For example, DEKRA takes care of the collection, charging and placement of the e-scooters for e-scooter platforms such as LIME.
The examples show that despite and often with and because of GAFA B2B traders can exist and be successful. EURONICS has even shown that it is possible to build up its own platform alongside GAFA. The success of the existing platforms is not set in stone, here too the change is dynamic – because actually the term could already be extended by Ali Baba to GAFA “A” and don’t forget, 15 years ago there was apparently no way around AOL, Yahoo!, Microsoft or Ebay…
So for you, all of this means that your next step is to look at your own value creation. So our advice to you:
Find out where you position yourself as what, because doing a little bit of everything is not a model for success – if you do something then please do it right!
We facilitate the entry into our clients’ digital transformations with strategy workshops and market analyses as well as develop successful, scalable and future-oriented digital solutions and individual developments for them.