How Shops In finding (And Will In finding) New Distributors
Social media is beginning to play a bigger part in how retailers and vendors are finding each other, but it’s still far down on the list of preferred channels. The top methods for retailers? Trade shows, online research and individual meetings. For vendors, it’s trade shows, individual meetings and agents.
According to our industry benchmark report, Retail Insight: The Impact of Omni-Channel Trends for 2014 and Beyond, retailers and vendors seem to be ships passing in the night on occasion, putting more energy into different channels as they search for different suppliers or retail partners. Here are a few important findings from the report:
- Trade shows: This was one of the closest differences between the two groups, with 72% of retailers using trade shows to find new partners, while 77% of vendors use them. This was also the highest ranked channel for each group.
- Online research: This one came in second for retailers at 55%, while only 44% of vendors said they availed themselves of this channel.
- Social Media: Came in at sixth for both retailers (17%) and vendors (29%) While social media may be small, it’s still growing and getting bigger. You can’t discount it as a viable solution, especially when you combine it with…
- Online communities: Seventeen percent of retailers use it, while 24% of vendors do. This can include LinkedIn or other tools like EDI’ Retail Universe
There are a few important takeaways from this data, depending on which side of the table you’re on.
Trade shows are widespread but inefficient
We don’t have to tell you how expensive trade shows can be — booth rental, display costs, hotels, meals, and travel. They’re a big hit to the budget, so you’d better hope you’re generating a positive ROI. Since both retailers and vendors are still going to trade shows, they’re worth continuing.
Online research (i.e. Google searches, websites) has staggering potential
When you look at the number of Google searches performed — 5.9 BILLION searches per day— it’s surprising this channel didn’t have more usage.
Given that 55% of retailers find partners through online research, but only 44% of vendors take advantage of it, vendors are missing a valuable opportunity. Content marketing, search engine optimization and social media marketing are less expensive than trade shows, and you can easily track your ROI.
Social media, and online communities for the win
Vendors are taking social media and online communities more seriously than retailers, but it’s still a low number. This means there’s still time for both groups to enter this world and dominate before everyone else shows up.
It’s also more efficient than a trade show, because it doesn’t have to happen in real time; everyone can be asynchronous, meaning you can post a message, and someone can reply to it three hours later, rather than being in the same place at the same time.
Because we believe in the power of social media and online communities, we created our own professional social network, Retail Universe. It lets retailers and vendors identify ways they can work together and develop a relationship from there.
Not only can a retailer specify a product they’re looking for, they can learn more about the vendor selling the product: Do they drop ship? Is e-commerce a major part of their business?
We expect some of these numbers to grow in the coming year, especially the online numbers, while others, like trade shows, to stay the same or decline. But will it always be this way? Will trade shows always be at the top and social media at the bottom? We’re betting they won’t, and we’re going to keep an eye on the industry to see how things change over the coming years.