What manufacturers need to know about digital transformation

1. © 2017 Dakota Systems, Inc.
www.daksys.com
What B2B manufacturers need to know about digital transformation
Preparing for the B2B digital revolution
Paul Wlodarczyk, PIM Practice Lead
March 2017

2. © 2017 Dakota Systems, Inc.
www.daksys.com
THE SUPPLY CHAIN IS
GOING DIGITAL
How we discover
How we explore
How we compare
How we price
How we transact
How we support
Print  Web  Mobile
Stores  Print Catalogs  e-Catalogs
Samples  Site Search
Bids  e-Auctions  Marketplaces
Orders  EDI  e-Commerce
Phone & Manuals  Web  Apps

3. © 2017 Dakota Systems, Inc.
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Source: Forrester/Internet Retailer Q1 2015 US B2B Buyer Channel Preferences Online Survey
B2B BUYERS EXPECT
A B2C EXPERIENCE
B2B buyers’ prefer researching products online
with rich content and effective search / SEO.
B2B buyers prefer buying online for most
purchases –via distributors & marketplaces.
B2B buyers prefer buying from salespeople for
complex or expensive purchases, or those
requiring service and installation.
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93%
Prefer to buy online once they’ve
decided what to buy
74% Think buying online is more convenient
71%
Value a convenient purchase process
over loyalty
59% Prefer not to interact with a sales rep
53% Prefer gathering info online on their own
82%
Prefer a sales rep when purchase is
complex
67%
Prefer a sales rep when product requires
installation or service

4. © 2017 Dakota Systems, Inc.
www.daksys.com
“Going digital” requires retooling
IT platforms, and reengineering
sales and marketing processes.
Because the change is sweeping,
digital transformations are
complex, costly, and time
consuming.
It can take years and cost millions.
Website redesign & replatform
Site search
Analytics
e-Commerce implementation
PIM implementation
Product data remediation
Product content syndication
Customer self-service
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MARKET LEADERS INVEST
IN TRANSFORMATION

5. © 2017 Dakota Systems, Inc.
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“Going digital” requires retooling
IT platforms, and reengineering
sales and marketing processes.
Because the change is sweeping,
digital transformations are
complex, costly, and time
consuming.
It can take years and cost millions.
$3B distributor
From $0 to $1.6B online revenue
>1M products
>5 years
>$50M invested
>$5M on product data alone
5Source: MSC Direct website
MARKET LEADERS INVEST
IN TRANSFORMATION

6. © 2017 Dakota Systems, Inc.
www.daksys.com
“Going digital” requires retooling
IT platforms, and reengineering
sales and marketing processes.
Because the change is sweeping,
digital transformations are
complex, costly, and time
consuming.
It can take years and cost millions.
$10B distributor
$4.1B online revenue
>1.5M products online
700% increase in marketing spend
over 5 years
4X increase in talent for digital
6Source: Grainger 2015 Fact Book
MARKET LEADERS INVEST
IN TRANSFORMATION

7. © 2017 Dakota Systems, Inc.
www.daksys.com
Source: Practical E-Commerce, October 2016
AMAZON & OTHERS WILL
DEFINE THE MARKET
$855B in B2B commerce happened
online in 2016. Much of that is shifting
to marketplaces.
Amazon and other B2B marketplaces
are creating an existential threat to
traditional industrial suppliers.
Marketplaces create value for B2B
buyers (convenience and low price).
Marketplaces can diminish the value of
manufacturers’ brands when they
restrict availability of product content.
7
30K Amazon Business vendors in year 1
9M Amazon Business items in stock
$1B Amazon Business Year 1 Revenue
20% Amazon’s MoM sales growth rate in 2016
400K Amazon registered buyers in 2Q 2016
$49
Amazon Business free shipping order
size
5M
Amazon Business items with quantity
discounts

8. © 2017 Dakota Systems, Inc.
www.daksys.com
Source: Amazon annual report 2016
AMAZON CONTINUES TO
DEFINE ECOMMERCE
Amazon accounted for 43% of all online
sales in 2016, and over half of all
ecommerce growth.
Amazon continues to innovate
technology that makes it easier for
people to shop and transact online.
Our on-line behavior as consumer
extends to our work lives.
This trend is often called the
“consumerization” of B2B commerce.
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43%
Amazon’s share of ALL US online
commence in 2016
53%
Amazon’s share of US 2016 online sales
growth
~90% researched products on Amazon for work
~80% bought products on Amazon for work

9. © 2017 Dakota Systems, Inc.
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THE ONLINE CATALOG IS
YOUR NEW FRONT DOOR For manufacturers with an online
product catalog, as much as 80% of
their website traffic enters through
the catalog.
The majority of that traffic lands
directly on product detail pages.
The product detail page is the digital
front door to your business.
Through it, prospects learn about you.
Shoppers become customers.
Customers get support and buy
related products and supplies.
How well is your front door working?
How do you know?

10. © 2017 Dakota Systems, Inc.
www.daksys.com
Despite the digital revolution,
B2B manufacturers’ sales &
marketing communications still
rely heavily on printed catalogs,
datasheets, and brochures,
especially in Europe.
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THE CONTENT SUPPLY
CHAIN REMAINS ANALOG
Source: Worldwide Business Research – B2B Online Europe 2016 Survey

11. © 2017 Dakota Systems, Inc.
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RICHER CONTENT
MEANS 5-15%
MORE REVENUE
Google Manufacturer Center
before/after studies illustrate the
value of more detailed product
information.
Increase in conversions after adding
rich product attributes:
• JanSport backpacks – 13%
• Speakman – 8%
• Bosch Power Tools – 4%
11Source: Google Adwords Blog, April 2016

12. © 2017 Dakota Systems, Inc.
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LEADERS GROW FASTER
There is a payoff for
migrating product
content to digital.
The best grow 5x
faster than the rest
in B2B.
12
(based on the McKinsey Digital Quotient® of 18 management practices related to
digital strategy, capabilities, culture, and organization that correlate most strongly
with growth and profitability)

13. © 2017 Dakota Systems, Inc.
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B2B manufacturers know
what to do for digital.
They need help on how.
B2B manufacturers have become aware of
the importance of customer experience and
winning approaches to digital
transformation.
The challenges are closing gaps in digital
leadership, governance, suppliers, process,
technology, and skills.
We suggest adding digital product content
and data to the list of gaps.
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14. © 2017 Dakota Systems, Inc.
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WHAT B2B MANUFACTURERS NEED
Digital
Transformation -
now!
Ability to
perform new
work of digital
Digital content
to power new
experiences
New sources of
product
differentiation
Insight and
ability to adapt
quickly
(without time
& expense)
(with current
staff & skills)
(using existing
content)
(for today’s
products)
(within existing
processes)

15. © 2017 Dakota Systems, Inc.
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Total Product Experience
The Total Product Experience
encompasses product information in
all its various forms and languages,
digital and analog, interactive and
static.
It includes product catalogs, web
pages, brochures, pricing, availability,
user guides, service manuals,
knowledge bases, schematics,
drawings, models, images, videos, UI,
help, training – at every stage of the
customer lifecycle.
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16. © 2017 Dakota Systems, Inc.
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Total Product Experience
The Product Experience touches every
customer interaction with your
products, at every stage of the
customer lifecycle.
Your company’s customers – in all
their roles – engage it in every
product-centered transaction.
As more of the Product Experience
becomes digital, you have the ability to
make it more engaging, and measure
it.
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17. © 2017 Dakota Systems, Inc.
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Total Product Experience
Individual prospects & customers
engage in “micro-journeys” – brief
interactions with the product
experience.
Applying the best practices of user-
centered design (e.g. personas,
journey mapping), multi-channel
publishing, search, and web analytics,
manufacturers can observe and
analyze these interactions.
Product-centered analytics provide
insight into customer needs, and the
basis for continual improvement.
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18. © 2017 Dakota Systems, Inc.
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Total Product Experience
You can accelerate your Digital
Transformation using your existing
product content – in all of its formats,
whatever the system.
You can create compelling digital
experiences – in a fraction of the time
and cost.
You can measure the ROI of your
product experience, and gain insights
into customer needs.
And – you can do this with your
existing staff and skill sets.
Let Dakota show you how.
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19. © 2017 Dakota Systems, Inc.
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DAKOTA CAN ACCELERATE YOUR TRANSFORMATION
Digital
Transformation
Strategy &
Planning
Change
Management,
Training & Staff
Aug
Information
Architecture &
Content
Transformation
Product
Experience
Design &
Optimization
Product- and
Content-
Centered
Analytics
Your plan. Your team. Your content. Your brand. Your results.

20. © 2017 Dakota Systems, Inc.
www.daksys.com
Pathway to PIM: A Program for Success
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• Pain points
• Objectives
• Gap analysis
• Baseline & KPIs
Audit &
Baseline
0100110101
• Legacy data ETL
• Legacy data
cleanup
• Data extraction
• Attribute data fill
• Data normalization
• Data migration to
PIM
Product Data
Cleanup &
Migration
PIM Deployment
• Define roles, work
process, business
process, policies,
organization structure
• Integrate with product
lifecycle management
(PLM), search,
commerce
• Actionable Product-
centered Analytics
• Plan for new product
categories & product
acquisitions
PIM & Data
Governance
• Market research:
competitor &
distributor product
hierarchies for print,
web & PIM
• Design PIM hierarchy
• Define category
attributes &
inheritance
• Style handbook
Product Hierarchy
& Attributes
• Data & taxonomy
audit
• Product UX audit
• Cross-functional
team established
• PIM requirements
• Deployment
roadmap
• PIM technology
selection
Requirements
& Roadmap

PIM Readiness

21. © 2017 Dakota Systems, Inc.
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Information Architecture &
Content Transformation
Case Study: The PIM-free
Product Catalog
A manufacturer of specialty valves &
controls must deliver detailed product
specifications in electronic and print
catalogs for 600 base products with
over 10,000 SKUs.
Over 5000 documents related to
these products need to be accessible
for buyers, end users, installers, and
service technicians.
Before:
• 90% of the content is in engineering
PLM system
• Rekeyed and redrawn by tech pubs
team to create static web catalog pages
& print catalog
• Time consuming & error prone
After:
• Automated publishing of datasheets and
digital catalog from engineering data
• “One source of the truth” for product
specs & docs
• An integrated product experience
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22. © 2017 Dakota Systems, Inc.
www.daksys.com
Information Architecture &
Content Transformation
Case Study: Product Data
Clearinghouse
A manufacturer of commercial and
residential plumbing fixtures must
deliver detailed product specifications
for 5000 base products and 100K
SKUs in datasheets, on their website,
and to distributors and retailers.
Product teams needed one place to
maintain and publish product data,
documents, & digital assets.
Before:
• Product specifications and documents
stored in multiple systems with no
single point of access.
After:
• All product data and documents in a
single clearinghouse
• “One source of the truth” for product
specs & docs
• Publishing from one source to
documents, global website, distributors
& retailers
• Employees & partners can access
complete & authoritative product info
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23. © 2017 Dakota Systems, Inc.
www.daksys.com
Product- and Content-
Centered Analytics
Case Study: Product
Experience Optimization
A high-tech equipment manufacturer
needed to understand if their online
catalog was effectively servicing
prospects & customers.
The digital team needed to
demonstrate the ROI of digital
marketing investments to their
leadership.
The analytics team needed to “level
up” their skills.
Before:
• Used Google Analytics (GA) to track traffic
to website.
• Had high-level stats for visits, downloads,
and pageviews, but couldn’t track journeys.
After:
• Track personas on journeys, e.g. architects
designing a facility, engineers buying
individual units, and installers seeking
manuals & support.
• Report journey success rates by persona,
and measure ROI in terms of leads
converted, revenue, and self-service. Can
track trends over time and identify issues.
• Analytics team now has a playbook for how
to improve results through UX, search, IA,
and content projects.
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24. © 2017 Dakota Systems, Inc.
www.daksys.com
Dakota Systems, Inc. is a privately-held
corporation headquartered in the heart of
downtown Chicago, specializing in digital
communication solutions. Since 1999 we’ve
been a trusted partner for globally recognized
engineering-driven and content-rich brands.
Our consultants and developers help digital
marketers and technical communicators
improve the quality, speed, and business impact
of their digital communications. Whether
working with digital product catalogs, technical
manuals, or scientific journals, we maximize
technology ROI.
Using proven analysis, design, and development
methodologies, we quickly and cost-effectively
integrate business intelligence and digital
communication strategies for our customers.
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25. © 2017 Dakota Systems, Inc.
www.daksys.com
Services
Strategy & Roadmap
Information Architecture
Digital Analytics & Optimization
Content & Data Transformation
System Deployment & Integration
Custom Development
Staff Augmentation & Training
Change Management
PIM Taxonomy & Deployment
Product Data Normalization
Digital Product Experience
Product Content Syndication
Technical Documentation
Electronic Data Interchange
Knowledge Management
XML Standards Compliance
(DITA, S100D, SPL, XBRL, etc.)
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Solutions

26. © 2017 Dakota Systems, Inc.
www.daksys.com
Contact us
Paul Wlodarczyk
Product Information Practice Lead
Office: (585) 598-6050
Email: paul.wlodarczyk@daksys.com
Skype: paul.wlodarczyk
Twitter: @daksyspaulw
LinkedIn: /in/paulw
Dakota Systems, Inc.
35 E. Wacker Drive, Suite 1970
Chicago, IL 60601
+1 888-834-2152 (US toll free)
+1 312-263-4400 (International)
Email: info@daksys.com
@daksys /company/dakota-systems-inc
www.daksys.com
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Adaptive Content. On Demand.