By Ryan Skinner (email)
Remember how the Internet was going to introduce a whole new level of competition and accountability to business transactions? Suddenly, anyone could do business with anyone.
Did it happen? Sort of. Like Knock Nevis, purchasing organizations don't turn on a dime. Even if they could theoretically find ten suppliers in every port, they weren't quite sure what to do with these suppliers.
A survey I completed together with ShipServ and their CMO John Watton last year identified trust as one of the biggest sticking points for shipping e-commerce. Who is this supplier? Is it reliable? Will it deliver? Can it work with my ERP? Serious questions.
ShipServ's probably the only true shipping e-marketplace worthy of the name today; it's by far the biggest. And - when it comes to trust - they've grabbed the bull by the metaphorical horns. How so? Watton told me about the three basic mechanisms:
1) Trading history - Every time someone does business with a supplier they effectively score points. You earn credibility as a supplier.
2) Ratings & Reviews - Crowdsourced buyer feedback. Even if it's been tough to win the time and attention of buyers for this, ShipServ's smartened up its timing, and gets feedback closer to point of sale. This kind of content is golden (more below).
3) OEM authorization - The last brick in the trust defence, ShipServ recently allowed brands to indicate whether a specific supplier of their products is authorized or not.
These add up to what they call TradeRank. This is their special sauce. Like Google's PageRank, which gives a web-page authority every time someone links to it, TradeRank gives a business authority every time someone engages with it. Smart.
I'm going to share briefly what this means to suppliers, based on two crucial observations.
First, the concept of the perfectly open and objective market I opened this piece with, is a fallacy. Yes, the Internet has changed how we do business, but it will always be mediated by people and relationships, not technology. In fact, ironically, social media and social commerce technologies are putting people back in the centre.
Second, as recently reported by Forrester, 92% of buyers trust peer recommendations, while 24% trust brand advertising. The era of pushing your business while staying cloaked behind glossy corporate literature, huge stands at conferences and full-page ads is collapsing.
What does this mean to you, supplier? It means your buyers are going to increasingly talk to one another, openly and online. It means you'd better start spending more time thinking about how to start valuable and public conversations with buyers, not ad salesmen and printing houses. It means you'd better stop listening to the guy in your office who says social's a fad. It means you'd better start thinking more broadly and more digitally about influence and new business.
I didn't ask Watton to tell me how a few good recommendations changed a supplier's business. I didn't need to. I don't ask suppliers whether they're getting explicit about their strategy towards social media. I don't need to.
[In order not to leave you hanging, here's one thing that you need to do now: Identify those people inside and outside your organization who burn for something, who have a vision and who don't hesitate to talk about it. Start talking to them, brainstorming with them and sharing stories. It will pay off.]