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Modern Commerce: The Key to Revitalised Sales for Food Manufacturers

Food manufacturers need to focus on new ways of attaining revenue growth as the “Amazon effect” takes hold, and more customers demand a frictionless, personalised sales experience.

Selling in the food manufacturing industry is becoming more sophisticated year on year, as the volume of data available to companies enables increasing levels of precision. Despite this, many food manufacturers find themselves facing shrinking margins, thanks to persistent market forces such as escalating sales costs, global competition, low switching costs and evolving sales channels.

To achieve a modern sales process, food manufacturers must look to new technologies to help circumvent these challenges. Dynamic pricing science, which can help pinpoint buying patterns that are so precise and accurate that customers become a so-called “segment of one”, are propelling businesses towards more strategic decision-making.

What is the “Amazon effect”?

The Amazon experience has led to an increased expectation of immediate responses in the buying process. This trend, once unique to the B2C sector, has become pervasive in the B2B sector.

While price is still an important aspect of the selling process, today’s buyers are demanding a new approach – one that’s frictionless, personalised and delivers a precision-based sales experience. Food manufacturers are feeling the pressure of satisfying these new and emerging requirements, and companies that don’t move to provide their customers with frictionless interactions will be left behind.

How dynamic pricing can deliver a frictionless B2B experience

One of the major sources of friction in today’s buying process is the internally focused approval cycle. Traditional manufacturing commerce models are characterised by intuition, opaque pricing, delays and inconsistencies across channels. In many instances, food manufacturers bring a “company in control” mindset to their interactions with customers, requiring all deals – large and small – to go through an extensive approval process, largely centered on the financials and with pricing as the long pole in the tent. Negotiation is measured all too frequently by how low a company is willing to slash prices.

To meet the evolving expectations of B2B customers, manufacturers can leverage dynamic pricing technology, which is powered by algorithms and context-aware, machine-guided learning. Dynamic pricing science can help the food industry respond to real-time shifts in supply vs. demand, commodity pricing and hiccups in the supply chain process.

Take for example volatile weather patterns, which can have a huge impact on crop availability. The resulting supply shortages leave the food industry scrambling to source crops from other regions and adjust pricing. Dynamic pricing science provides the food industry with actionable insights to adjust to these disruptions in the supply chain in real-time and inform strategic pricing strategies, which in turn helps companies maintain revenue streams and keep the sales process moving.

Real-time selling based on market prices and fluctuations also enables food companies to respond quickly and with pricing precision so they are more likely to win business. According to Forrester Research, 50 percent of deals are won by the vendor that responds first. Quoting practices that were once designed to protect margins can today appear static, outdated and can lead to lost revenue.

Modern commerce is rapidly emerging as the key strategy for responding to customer expectations: dynamic pricing science delivers a sales experience that accelerates deals, increases win rates and improves customer satisfaction and loyalty.

To learn more about modern commerce for the food industry, click here to download the eBook, Is Modern Commerce on Your Menu?

 

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