B2B executives are facing unprecedented pressure to drive digital growth. Tasked with managing mandates aimed at both acquiring new customers and increasing the lifetime value of existing ones, practitioners are looking to refocus their digital commerce strategies by answering two questions:

• How can I maximize growth from our existing digital efforts?
• How can I generate more growth by expanding the distribution of the products that I already have?

In both of these cases, the key is to take advantage of the long-tail distribution strategy - investing in the 80% of products that are under-serviced instead of focusing on the 20% of products that already sell well. When thinking about a long-tail distribution strategy, B2B companies must consider three separate factors:

• Revenue
• The velocity of the inventory turns, and
• The profitability of the products.

Companies willing to invest in the 80% of their products that are under-serviced can take advantage of a significant profit opportunity.

In an upcoming webcast presented by MasterB2B in partnership with VTEX and VML, panelists will dig deep into the challenges of re-focusing business toward long-tail products and distribution. The panel features Nathan Schatz, Head of eCommerce at SHI International. The panel will discuss how to decide between a “bottomless bin” and an “endless aisle” strategy, while addressing how to make peace with channel conflict, invest appropriately in data normalization, and enforce service-level agreements to improve customer experiences.

Embrace the Bottomless Bin and Expect Channel Conflict

To unlock growth from the long tail, companies must embrace both the bottomless bin and endless aisle marketplace models to expand their product assortment without paying to store and manage inventory. A bottomless bin refers to the idea that for a given SKU, there are multiple suppliers who can fulfill the order if the primary seller is out of stock. Rather than broadening the assortment, B2B marketers can add additional suppliers for products they already sell.

However, there are many B2B companies that aren’t ready to expand their assortment because of channel conflict concerns. Digital executives at manufacturers are wary about allowing other companies to sell products on their website, but allowing other sellers to backfill their products does not require compromising on price or customer experience. As Daniela Jurado, North America Executive Vice President at VTEX, notes, “Marketplace operators have more control over price and customer experience than they often realize.”

To avoid channel conflict, it’s as simple as accepting that there will always be channel conflict. There are clear reasons why a company might want to sell products at different prices in different channels, such as geographic price differences, different service levels, and customer size. As companies broaden their distribution strategy, the price doesn’t need to be the same across channels, but the price differences need to make sense to their customers.

Conflict is just inherent — it doesn’t make it bad or good. There are complex dynamics when fulfillment costs differ between suppliers.

Normalize Data to Unlock Opportunities

Key to every successful long-tail strategy is normalized data, which ensures product names are the same industry-wide. This is true whether adding new suppliers to build out a “bottomless bin” strategy on a website, executing on an “endless aisle” strategy, or expanding distribution with new distributors. Normalized data can then be used to capture demand from competitors’ products.

To make normalization work at scale, ask these three important questions before beginning the process of normalizing data:

• How is a product normalized to go into the marketplace?
• How does the customer view the product in the marketplace?
• How does the product supplier see its products and inventory levels in the marketplace?

These considerations are vital because there is almost no way to scale a strategy without a foundation built on normalized product data.

Another common concern for B2B sellers when taking a long-tail approach is losing some control over the customer experience. Avoiding this scenario requires clear communication and holding new partners to a higher standard. This may be uncomfortable for some B2B companies but having clear guard rails in place and consistently enforcing them will keep customers satisfied and engaged not just for this sale, but for the long tail.

Clients often go with whoever they trust will fulfill the order quickly and reliably, not who says they can do it the absolute fastest — or cheapest.

Tune into the upcoming February 11th webcast presented by MasterB2B in partnership with VTEX and VML to hear from industry experts about how they’ve developed an effective long-tail strategy for their digital business and consequently uncovered new opportunities for meaningful growth.