McKinsey: How COVID-19 has changed B2B sales forever
While governments and organisations still work to contain COVID-19 and stem the growing humanitarian toll that it is exacting, the effects on customer behaviours are rippling across the B2B landscape. The pandemic has forced a dramatic increase in digital adoption. The revolution of B2B buyers and sellers whole-heartedly embracing digital has presented a massive opportunity for B2B organisations.
McKinsey has been decision makers globally across industry since the crisis began. What we have discovered in our recent research on decision makers’ behaviour globally across industries is that the big digital shift is here to stay.
Digital is overwhelmingly what B2B buyers and sellers prefer
Although the abrupt pivot to digital sales in the early stages of the pandemic may have caught some B2B organisations off guard, in the months since, decision makers have become steady converts. More than three quarters of buyers and sellers say they now prefer digital self-serve and remote-human engagement over face-to-face interactions. This pattern held true for SMB and enterprise decision makers alike—with the level of acceptance rising steadily since April 2020.
Safety is one reason, of course. But self-serve and remote interactions have made it easier for buyers to get information, place orders and arrange service. And customers have enjoyed that speed and convenience. Only about 20 percent of B2B buyers say they hope to return to in-person sales, even in sectors where field sales models have traditionally dominated, such as pharma and medical products.
Far from a local phenomenon, decision makers worldwide have embraced the shift to digital and remote engagement. From being “forced” to adopt digital in reaction to the widespread COVID-19 shutdowns in the early stages, B2B sales leaders are only becoming more convinced that digital is the way to go.
Customers are buying big online
The most notable sign that digital sales have come of age is the comfort B2B buyers have with making large purchases online—whether for new products or reorders. The prevailing wisdom used to be that e-commerce was mainly for smaller-ticket items and fast-moving parts. Not so anymore. Notably, 70 percent of B2B decision makers say they are open to making new purchases in excess of $50K in a fully self-serve or remote fashion, and 27 percent would spend more than $500K.
B2B decision makers globally say that online and remote sales are as—or even more—effective than in-person engagement. It’s not just selling to warm leads either. Sellers believe digital prospecting is as effective as using in-person meetings to connect with existing customers. And according to our survey respondents, these pandemic-induced patterns are likely to become permanent. Close to nine in ten decision makers say that new commercial and go-to-market sales practices will be a fixture throughout 2021 and possibly beyond.
New ways of working can drive exponential performance
What started out as a crisis response, has now become the next normal with big implications for how buyers and sellers will do business in the future and the dramatic increase in digital adoption presents seminal opportunities for B2B players:
- Lower cost-per-visit: For instance, it’s faster and easier for reps to organise digital demos than travel to specific locations. Less time on the road means more time in front of customers, which data show translates to more sales.
- Extended reach: Untethering reps from specific territories or verticals can allow organisations to prospect more broadly, giving them greater scale and flexibility to serve new markets more effectively.
- Flex the talent base: If selling can be done from home, new geographic pools of talent are now open, allowing organisations to tap retirees, stay-at-home parents and other non-traditional profiles to augment their staffing.
- Innovation: Smarter resource allocation can lead to smarter customer solutions. It’s far more feasible for B2Bs to bring a “dream team” of product specialists, solution architects and other subject matter experts together in virtual settings than it is to coordinate travel. In addition, digital interactions also leave a data trail that’s easier to capture and share than is true for notes and debriefs from the field. Those insights can be pooled with other customer and market data to help feed sales analytics, surface important buying patterns and behaviours and drive ROI.
Ultimately, while the opportunity is significant, so is the pressure to capitalise upon it. The acceleration of digital adoption has raised the stakes. Some B2B leaders will seek to exit the crisis period at “PE speed,” digitising their go-to-market models in order to optimise their revenue and cost structure. And those innovators that take that approach should derive competitive advantage by gaining more customers and a greater share of loyalty.
G7 Summit guide: What it is and what leaders hope to achieve
Unless you’ve had your head buried in the sand, you’ll have seen the term ‘G7’ plastered all over the Internet this week. We’re going to give you the skinny on exactly what the G7 is and what its purpose on this planet is ─ and whether it’s a good or a bad collaboration.
Who are the G7?
The Group of Seven, or ‘G7’, may sound like a collective of pirate lords from a certain Disney smash-hit, but in reality, it’s a group of the world’s seven largest “advanced” economies ─ the powerhouses of the world, if you like.
The merry band comprises:
- The United Kingdom
- The United States
Historically, Russia was a member of the then-called ‘G8’ but found itself excluded after their ever-so-slightly illegal takeover of Crimea back in 2014.
Since 1977, the European Union has also been involved in some capacity with the G7 Summit. The Union is not recognised as an official member, but gradually, as with all Europe-linked affairs, the Union has integrated itself into the conversation and is now included in all political discussions on the annual summit agenda.
When was the ‘G’ formed?
Back in 1975, when the world was reeling from its very first oil shock and the subsequent financial fallout that came with it, the heads of state and government from six of the leading industrial countries had a face-to-face meeting at the Chateau de Rambouillet to discuss the global economy, its trajectory, and what they could do to address the economic turmoil that reared its ugly head throughout the 70s.
Why does the G7 exist?
At this very first summit ─ the ‘G6’ summit ─, the leaders adopted a 15-point communiqué, the Declaration of Rambouillet, and agreed to continuously meet once a year moving forward to address the problems of the day, with a rotating Presidency. One year later, Canada was welcomed into the fold, and the ‘G6’ became seven and has remained so ever since ─ Russia’s inclusion and exclusion not counted.
The group, as previously mentioned, was born in the looming shadow of a financial crisis, but its purpose is more significant than just economics. When leaders from the group meet, they discuss and exchange ideas on a broad range of issues, including injustice around the world, geopolitical matters, security, and sustainability.
It’s worth noting that, while the G7 may be made up of mighty nations, the bloc is an informal one. So, although it is considered an important annual event, declarations made during the summit are not legally binding. That said, they are still very influential and worth taking note of because it indicates the ambitions and outlines the initiatives of these particularly prominent leading nations.
Where is the 2021 G7 summit?
This year, the summit will be held in the United Kingdom deep in the southwest of England, with Prime Minister Boris Johnson hosting his contemporaries in the quaint Cornish resort of Carbis Bay near St Ives in Cornwall.
What will be discussed this year?
After almost two years of remote communication, this will be the first in-person G7 summit since the novel Coronavirus first took hold of the globe, and Britain wants “leaders to seize the opportunity to build back better from coronavirus, uniting to make the future fairer, greener, and more prosperous.”
The three-day summit, running from Friday to Sunday, will see the seven leaders discussing a whole host of shared challenges, ranging from the pandemic and vaccine development and distribution to the ongoing global fight against climate change through the implementation of sustainable norms and values.
According to the UK government, the attendees will also be taking a look at “ensuring that people everywhere can benefit from open trade, technological change, and scientific discovery.”