Almost 90% of manufacturers say their business has been negatively impacted by the COVID-19 pandemic (revenue decreases, price increases, supply chain issues, etc.), according to a recent state of manufacturing survey of 215 senior leaders in manufacturing and related companies. Yet 97% of those respondents also said the pandemic has created opportunities.
The pandemic has led to extensive economic consequences and significant shifts across every facet of manufacturing, from disruptions in supply chains to cancellation of trade shows and an expansion of online research for an unsettled buying process.
However manufacturers go about seeking those new opportunities, you can be sure it won’t be with the same strategies and tactics they employed even a year ago. Too much has changed.
Here are five of the most important industrial marketing and sales trends we’ve seen in industry reports — ones that also resonate with our personal experiences as strategic thinkers who are passionate about helping our clients thrive in these uncertain times.
1. Digital Advertising Is on the Rise
The industrial B2B sector was the second fastest to shift more of its spend to online from March 15 to July 1, trailing only health care, according to MediaRadar. Digital ad spend among industrial websites such as Equipment World, Aerospace Manufacturing and Design, Industrial Equipment News and Engineering360 increased 44% YOY.
Research firm eMarketer documents that while many B2B companies have reduced their overall marketing budget, paid digital channel spending has surged 22.6% YoY in 2020. Strategic marketers are making these moves because:
- Live event budgets must be reallocated; manufacturing has seen its marketing and sales disrupted as much as any sector with the cancellation of annual trade shows and disruptions in on-sight sales calls.
- Digital ads are an important touchpoint with buyers who are spending more time working on computers at home.
- Cancellations have opened up ad inventory and reduced prices.
2. B2B Digital Sales, E-Commerce Are Here to Stay
Two-thirds of B2B decision-makers believe self-service options for customers — such as e-commerce sites — are more important at this stage than traditional sales interactions, according to a recent survey by McKinsey & Company. As a result, only 21% now depend on in-person selling, preferring digital modes of customer engagement.
Moreover, 89% of those who are developing new digital selling models are “very likely” or “somewhat likely” to retain them after the pandemic ends.
In other words, COVID-19 has tipped the scale for digital selling, including e-commerce, and signs say the changes are here to stay. For organizations whose business model is compatible with digital approaches to sales, the time to invest in digital infrastructure is now.
3. Certain Manufacturing Sectors Are Booming
Manufacturing continued to grow in September 2020 at a slow rate overall in the U.S., according to the Institute for Supply Management (ISM) Manufacturing Report On Business. But it was the fourth consecutive month of growth, and there are other signs that point to a manufacturing rebound. (For example, household customer inventories are at their lowest collective level since 2010.)
Certain manufacturing sectors in our reconfigured economy already are booming as businesses pivot to respond to shifting demand:
- Food, beverage, and tobacco companies lead the pack.
- Fabricated metal product and chemical companies are “growing strongly” according to ISM president Timothy Fiore.
- Transportation is booming as supply chains scramble to adjust and demand grows for light and heavy vehicle production and civilian aircraft, such as regional jets.
Businesses that do business in these or adjacent sectors could position themselves to find new opportunities in the near term.
Perhaps the most sustainable robust growth is in medical disposables (a medical device or equipment for one-time or temporary use). The global medical disposables market is expected to grow at a compound annual growth rate (CAGR) of 16.7% from 2020 to 2027.
Other growth sectors in manufacturing include packaging (think of all those cardboard boxes and containers used in shipping and deliveries) and mining production.
4. Manufacturing Content Marketing Is Maturing
Industrial content marketing was a growth area prior to the pandemic as younger engineers and purchasing managers were doing much of their pre-purchase research online. Nearly three-quarters of respondents in a survey this past summer say they are conducting more than half of the buying process online before choosing to speak with someone at a company. Prospective customers are researching and evaluating manufacturers before they ever contact them.
The good news is that industrial marketers have been aware of this shift and were responding prior to the pandemic. Two-thirds of manufacturing marketers are “much more successful” or “somewhat more successful” with content marketing than they were a year ago, now spending an average of $285,000/year on content marketing, according to a content marketing industry report.
However, only 29% feel like they have a “mature” or “sophisticated” program. This means there is opportunity for companies that take content marketing seriously to pull ahead, particularly in underutilized areas that extend beyond bread-and-butter content channels such as websites/blogs, email, and social media:
- Speaking opportunities (primarily virtual at this stage).
- Media/influencer relations.
- Articles in third-party publications.
5. Many Job Shops Are Investing in Marketing
In his September 2020 memo, “10 Things We Are Seeing in Machine Shops Right Now,” Modern Machine Shop Editor in Chief Peter Zelinski observes that “Machining businesses are catching up with other types of companies in terms of business development. In the past, MMS’s readers have been weak in this area — local or regional connections got them much of their work. Now, shop owners are more likely to be serious marketers.”
This small sample of anecdotal evidence mirrors the findings of a Thomasnet survey conducted in July. It found that due to the in-person limitations of COVID-19, manufacturers adjusted their approach to generating new customers by increasing their use of:
- Webinars and virtual events 20%
- Search and social media 14%
- Website 12%
The survey recap report stated, “As expected, companies are 21% less likely to invest in trade shows.”
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These are trends INDUSTRIAL has envisioned — and in some cases facilitated — since our founding in 2003. We’ve helped scores of job shops and smaller manufacturers achieve growth through marketing, even during trying times such as the Great Recession.
At INDUSTRIAL, we believe that marketing is a growth strategy that can help organizations of all sizes generate opportunities — especially during changing times when industry landscapes, buyer needs, and customer expectations are in flux.
See more of our insights on how to thrive in your industrial marketing in uncertain times.