Trends and Opportunities Affecting the B2B Shipping Landscape

The growth of the e-commerce industry is changing the way businesses of all types operate. As younger generations come into leadership positions and begin dictating purchases, traditional models and operational practices are shifting.

This growth and change is most often discussed in terms of B2C e-commerce brands, but B2B businesses are feeling it, too. The B2B e-commerce market in the U.S. reached the $1 trillion mark for the first time in 2018 and projections show that the $2 trillion milestone could arrive in just a few years.1 That means B2B shippers will need to stay on top of what’s changing and know when to adjust.

In our recent white paper, The Latest Trends in B2B E-Commerce & Shipping, we dig into actionable learnings to help your B2B business do just that. Here, let’s take a high-level look at some of the key trends and opportunities at play in the market.

Key Trends

Here are the latest developments in the B2B shipping market.

Half of all B2B buyers are millennials.2

This generation has had a huge effect on almost every piece of the economy. Now, they are growing into decision-making roles at businesses and have expectations about what a strong, positive B2B relationship looks like.

What this means for you:
Look to B2C shipping and e-commerce practices for inspiration. Millennials grew up with tailored, targeted and increasingly simple buying and shipping experiences. It is likely that, as B2B buyers, they will look for the same standards and values in the businesses from which they buy.

Smart, connected technology is transforming logistics.

As e-commerce evolves, so too does shipping technology. While autonomous vehicles for shipping are further from adoption, others, like Internet of Things devices, are already being implemented. Gartner predicts there will be around “20 billion internet-connected things by 2020. These ‘things’ are not general-purpose devices, such as smartphones and PCs, but dedicated-function objects, such as vending machines, jet engines, connected cards and a myriad of other examples.”3

These devices can help with tracking, optimization, efficiency and more, and they communicate with each other to make automatic adjustments.

What this means for you:
By using technology to optimize your logistics, you can better scale your B2B shipping business and continue to impress clients with fast, informed deliveries. Find ways to incorporate new technologies to assist in scaling operations and potentially cutting down on costs. We suggest specific tools in our white paper on the topic.

Top Opportunities

Keep your eyes on these opportunities to continue your business’s growth.

Develop a sustainable omni-channel strategy

Tackling omni-channel sales and distribution is an important step toward minimizing waste and maximizing flexibility. Research shows that many B2B companies plan to use online channels for sales and cut down on other methods.4

Once you open your business up to online channels, prepare your operations to answer the potential demand. Make sure you’re ready to fulfill additional orders by evaluating your network of distribution centers and finding ways to streamline logistics concerns.

Build loyalty with an easy returns process

In the B2C e-commerce world, returns are seen as an invaluable place to build loyalty. Companies that make returns easier, simpler and more convenient for customers can win more repeat sales. This is no different, and may even ring truer, in the B2B world.

When a business needs to send something back, it is most often because of a fault with the product, so it matters how quickly the issue can be resolved. Clearly articulate your return policy to avoid unwelcome surprises. Maintain strong communication with your customer. Make it simple to initiate a return, then proactively share information with your customer about the order’s status.

Conclusion

This high-level peek at some of the defining trends and opportunities in the B2B shipping market can help you see how your company could grow in the e-commerce space. Get a more in-depth and actionable look at the market by downloading our white paper, The Latest Trends in B2B E-Commerce & Shipping.

How Customers Shop Online for Health and Beauty Products

Health and beauty retailers are seeing a trend toward online sales: 18% of total U.S. spending on beauty and personal-care products occurs online, to a price tag totaling $12 billion.1 These items—which include makeup, razors and contacts—are small personal necessities, meaning the orders are inexpensive to ship and get repeated consistently.

By understanding who is buying what in the health and beauty categories, which types of businesses they turn to for these products, and how often they shop, you can confidently plan to start or enhance your online store presence. Read on to see how three of the biggest health and beauty categories are performing online, and how you can leverage their growth to help your business.

Skin care, cosmetics and hair care

This is the largest category for online sales: It saw a boost in web sales of almost 29% last year.1 This growth can be attributed to the availability of specialized products online that can’t be found at drugstores, as well as the convenience of ordering online.

Who is shopping online?

Makeup and skin care sites are especially appealing to younger shoppers.

Millennial (24%) and Gen-Z (14%) shoppers account for the largest group of buyers.1

Where online are they shopping?

These products are being bought from a variety of sites online.

26% web sales growth for brand and manufacturer websites1
19% web sales growth for online-only merchants1
18.4% web sales growth for brick-and-mortar retail chain websites1

Men’s hair care is also a growing market.

Online-only subscription shaving services are booming, and men’s personal-care items are top sellers on popular online marketplaces.1

Vitamins and supplements

The personal nature of vitamins and health supplements makes them strong candidates for online success. In the last year, web sales grew by 20%, powered mostly by online-only retailers.1

Who is shopping online?

The bulk of purchasing power lies with men and women ages 35 and up.


Where online are they shopping?

Most of the category’s growth (43%) came from one online-only merchant that has led web sales for years.1

Brick-and-mortar vitamin and supplement stores are also beginning to use online marketplaces as an additional branch of their store.

They list the same prices and run the same promotions in-store and online, which allows the company to find revenue wherever customers are buying.1

Contacts and eyewear

This category sees frequent shopping. Customers reorder contacts regularly and are often looking for new frames for eyeglasses. This helped lead to its 15% web sales growth last year.1

Who is shopping online?

A majority (63.7%) of online buyers are between the ages of 25 and 54.1


Where online are they shopping?

Consumers helped an eyeglasses retailer that started online-only and offered free at-home try-ons grow its web sales by 30%.1

After rebranding, which included improved free-shipping offers and reordering processes, an online-only contacts retailer also saw web sales grow—by 145%.1

Key Takeaway

The online market for health and beauty products continues to grow. Customers flock to online shops because of quick and efficient shipping, as well as the ease of reordering or subscribing to products online. Take advantage of this growth to develop an optimal experience for your customers online and watch your business boom.

The Next Generation of Catalog

In an age of digital distraction and ever-shorter consumer attention spans, the catalog is reemerging as a powerful way to engage customers to interact with brands on a deeper level—and it’s not in the traditional format you expect. It’s smarter, smaller, and less expensive to produce. It can deliver big impact by supporting digital experiences while still giving your customers the physical, tactile experience they crave in the virtual world. Experiences that can help your brand cut through all the digital clutter and stand out from the crowd.

Traditional catalogs have a reputation for being time consuming and costly to create. That’s why retailers and e-tailers are now turning to shorter, lifestyle catalogs. This new generation of catalog is timely and relevant. And it’s helping marketers in business of all shapes and sizes bridge the gap between offline and online communication, giving their customers the best of both worlds.

New catalogs are:

  • Smarter. They are driven by consumer data gathered through multiple marketing channels, helping you target the right customers at the right time.
  • More economical. New production and printing capabilities have taken the cost and complexity out of tailoring versions of a catalog to individual customer segments.

“Catalogs may seem old school, but their increased capabilities and the brand-building potential suggest they’ll remain a staple in retailers’ toolboxes – and consumers’ mailboxes.” —Denise Lee Yohn, Harvard Business Review1

New Catalog Formats: Inventive, Inexpensive, and Easy to Produce

Micro-catalogs

When your budget for direct mail is limited, using a bi-fold or tri-fold postcard mailer as a type of catalog is a great way to start experimenting with direct mail. That way, you can see if it’s an effective marketing effort worth growing and investing more in. By including personalized URLs (PURLS) or QR codes in your mailpieces, you can more easily track results. Micro-catalogs are also a perfect vehicle for featuring a specific selection of your products that you want to promote.

Magalogs

A compelling mix of magazine and catalog, magalogs combine product information with editorial content. This innovative concept is taking the traditional catalog to a new level while helping to reduce production costs. Magalogs have become popular because they allow retailers to express their brand personality through storytelling about their product alongside compelling images—without sacrificing informational content. All of these factors are making the magalog an attractive option for marketers.

Mini-catalogs

The mini-catalog delivers big impact in a smaller package. Many marketers are finding that supplementing full-sized catalogs with this new category of “mini-catalogs” can help them do business more economically while improving key metrics such as response rate. Mini-catalogs mail at approximately the same cost of a standard automated letter and can provide up to ten pages to promote products which can help cut mailing and production costs. At the same time, they can be as effective as larger catalogs in driving customers to company websites.

“Traditional” catalogs with a digital twist

For businesses with a larger budget or extensive product line, the classic catalog style is still a viable option. However, these aren’t your grandmother’s catalogs. Today’s longer-form catalog has evolved from mainly being a direct sales tool, to being a mobile, website, and in-store traffic driver. They have become digital enablers—supporting innovative technologies such as augmented reality (AR) which bridges the gap between our physical and digital worlds. For example, a popular catalog created by a major furniture company uses AR to bring their pages to life; customers simply hover over the page with their smartphones to place a 3D image of the product in their space.

Catalogs add value to the omni-channel experience

Marketers who take advantage of the full range of marketing channels available are better positioned to enhance brand awareness and reach their target audiences. Leveraging more than one marketing channel helps deliver a diversified, connected, customer-centric strategy that increases the chances for successful customer acquisition. With their ability to bridge physical and digital channels, catalogs can play an important role as part of an omni-channel campaign.

Today’s smarter catalogs can deliver big impact because they:

  • Cut through the digital noise yet enable digital experiences.
  • Enable personalized messaging and targeted outreach.
  • Support storytelling, the new gold marketing standard.
  • Offer a platform for bold visual images.
  • Can cost less to produce and are easier to create.

5 Myths about Millennials and Mail

With millennials poised to become the dominant force in the economy, companies must learn how to reach this demographic. U.S. consumers ages 18 to 34 engage with brands far more extensively than their older counterparts.1 It’s natural to assume this generation is only susceptible to digital media. It was born and raised on the Internet. But studies show, millennials engage with multiple marketing channels, including direct mail.2 In this article, we’ll dispel the biggest misconceptions about millennials and their relationship with mail. Plus, helpful tips for building a millennial-friendly direct mail campaign.

Myth 1: Print marketing is dead with millennials.

On the contrary, millennials value print.3 Research shows that these digitally engaged consumers are suffering from digital fatigue.4 Print marketing, on the other hand, has the ability to stand out. While millennials receive hundreds of emails every week, mail comes less frequently.5 The age group doesn’t have to tune out the messaging. According to a Gallup Poll, 95% of adults between 18 and 29 feel positively about receiving personal mail.6 They enjoy the tactile experience, use it to link to video content or promotional offers, even share it with friends.7

Ideas Worth Implementing: Studies show direct mail elicits a stronger emotional reaction than digital advertising.8 Use shaped mail to create more memorable, visually appealing content.

Myth 2: Millennials are digital addicts who only engage online.

Millennials are digital natives, but they’re not constantly connected. Millennials make up 31% of U.S. magazine readers and 20% of newspaper readers.9 And when they are online, they’re not always responding to digital marketing. Nearly half of millennials ignore digital ads. Pop-ups, banner ads and emails are also lost in the clutter of the Internet.10 Direct mail has the ability to cut through the noise. 88% of millennials see print on paper as more official than digital.11 With the right content, direct mail can be engaging.

Ideas Worth Implementing: Attendees of a USPS® focus-group study revealed they would be more likely to read direct mail if it had a message around an issue they cared about.12

Myth 3: Millennials do not see mail as relevant.

Though this demographic has grown up in a digital media landscape, they still interact with and enjoy direct mail. Studies have shown that 90% of people ages 25 to 34 find direct mail reliable, and 87% like receiving it.13 Opt for a cohesive omni-channel experience. By mentioning social media in direct mail copy, brands can bridge the gap between the print and digital worlds. Allow consumers to connect with your brand on your strongest social media channels.

Ideas Worth Implementing: Amplify your direct mail by tying in your social media accounts. Adding a social media brand icon to a mailer can lead more of your customers into your omni-channel experience.

Myth 4: Millennials do not trust the messages in direct mail.

Studies have shown the opposite to be true. Millennials do trust the messages in direct mail. 75% of millennials believe that direct mail is valuable.14 This age group actually trusts the information they receive in the mail over other media. 82% of millennials view messages printed on paper as more trustworthy than digital messages.15 When considering all the players in an omni-channel marketing campaign, mail can be used to deliver the most valuable messaging.

Ideas Worth Implementing: Use direct mail in conjunction with your digital marketing to highlight the most important product information and promotions associated with your campaign.

Myth 5: Millennials are not responsive to direct mail.

Wrong. Direct mail has been a successful sales driver for this demographic. In 2014, 28.9 million millennials made a purchase from a catalog.16 Because this age group isn’t as frequently exposed to direct mail as it is to other digital content, it hasn’t grown hardened to its effects.17 A truly potent marketing campaign incorporates both digital and print tactics, allowing mail to garner interest and move consumers closer towards a purchase, be it in-store or online.

best direct mail ideas18

Ideas Worth Implementing: Incorporate an offer millennials will respond to, but don’t stop there. Personalize the messaging for an added touch.

In Conclusion

Though millennials are the generation of the future, it doesn’t take futuristic marketing to drive sales. Digital advertisements have a limited effect on this age group. As the media landscape changes and millennials come into their own, companies will have to become more attuned to the most potent marketing tactics, direct mail included.

Understanding the Real Millennials: Facts and Statistics

The millennial generation is unique, diverse, and often, can be difficult for businesses to understand and market to. Numerous factors, ranging from age, to demographics, location, political and social views, can make the category difficult to pin down and have a catch-all messaging approach. To complicate things, old-school thinking sometimes mislabels millennials as entitled or lazy because they value experiences over financial security.
To effectively communicate and serve millennial customers, business owners should understand the unique characteristics, motivations and behaviors that drive them. In this article, we’ll parse millennials into two groups (by age) in order to examine differences and similarities across a number of factors. While the full breadth of this group is much more complex than differences in age alone, this example will demonstrate the need to consider custom-tailored content, whether digital or physical, and marketing strategy, to your specific target customer.

Unpack the Demographics

The real picture of the millennial population is clearer once we look at the demographic makeup. Millennials are the nation’s largest living generation1, surpassing baby boomers by half a million. People who were between 18 and 34 years old in 2015 define this generation. They’re more ethnically and racially diverse than past generations and account for one in five same-sex couples. They marry later and are the most educated generation in history, with nearly a quarter of them having at least a bachelor’s degree.

Nielsen2 sorts millennials into two categories: younger (ages 18 to 26) and older (ages 27 to 34). The median income for a younger millennial is $25,000, while an older millennial makes nearly $48,000. According to a Zogby Analytics poll3, only 48% of millennials ages 18 to 24 are employed, compared to 69% of millennials 25-34 who report working full or part-time.

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Who Are the Real Millennials?

Reaching this target population requires an understanding of who millennials are—and aren’t. They aren’t entitled, self-absorbed or unfocused, but their work ethic is different from generations past. Work-life balance from them is crucial. They aren’t living to work, but working to live. They’re products of the digital age, and as such, they expect expedience and self-service.

At the same time, millennials crave authenticity, transparency and personalization from the businesses they patronize. They view commerce as opportunity, not obligation. They swear loyalty to brands based on the experiences the brand provides and the principles they value. It takes more than a good sale to bring a millennial to your door—they’re more likely to set foot in your store for a good cause. Consider The Odyssey article4 on the success of some charitable companies, which operate using a “buy one, give one” model. When they buy something, millennials want their purchases to contribute to the greater good.

“…millennials want their purchases to contribute to the greater good.”

This generation loves activism, sharing and self-expression. They believe that the buying choices they and their peers make say a lot about them. Some apparel and footwear manufacturers today have taken advantage of personalization, with customers being able to customize everything from colors and fits to adding their own text.

According to research by The NPD Group5, which analyzed the buying tendencies for these two age groups, the results are unsurprising: older millennials spend more on child care, home improvement and appliances. While younger millennials are far less likely to be married with children, both age groups contend with student loan debt, which impacts their spending habits.

Tap into Millennial Buying Power

Millennials represent a large sector of the market, and they’re expected to account for about $200 billion in purchasing power by 20176.

Reaching these purse strings requires a basic understanding of their attitudes. Millennials want to feel connected, both emotionally and digitally. Many of them have grown up with social media and want to be “in the know.” They adopt technological innovations more quickly than past generations, and they expect you not only to keep up, but to also dazzle them. But again, those that are in their teens have different priorities than those over 30, and they consume media differently. Their employment, family or income situations may greatly differ, as well. So while there is content and messaging that may be engaging and relevant to a wider audience, consider a more bespoke approach in terms of identifying purchase motivators or behaviors, in order to strike the right chords.

“Millennials want to feel connected, both emotionally and digitally.”

If companies want to reach millennials, they may need to keep both overall similarities across the board and unique differences across a number of factors in mind when addressing a sales or marketing strategy. These efforts should be driven and supported by the latest data and trends, as the landscape constantly evolves. A one-size-fits-all approach isn’t likely to work, and as tastes and behaviors shift over time, having a pulse on what’s relevant right now can effectively help keep your messaging and business results.

Why Personalization May Help You Win with Millennials

Personalization is the act of leveraging data and personal information to deliver individualized messages to prospects and current customers. As a marketing tool, it’s obviously not new; it’s been a driving force in promotion for years. However, millennials are changing the way we think about personalized marketing.

Personalization can be an effective method for drawing in and retaining millennials. This generation grew up in the digital age, curating its own content on social media platforms. They love DIY curation websites, where they can scour the web for ideas and contact a merchant to help them bring custom creations to life.

For millennials, personalized marketing can help drive loyalty and purchasing decisions. In fact, a survey by Access Development1 found only 12 percent of millennial respondents had an active dislike for marketing communications, which is unlike previous generations of buyers. An NPD Group survey2 showed that while older millennials use more loyalty apps and shop at big-box national retailers, younger millennials prefer specialty stores and buying wholesale.

Millennials are also more open to giving out personal information—especially if they get something in return. According to research from Aimia3, half of millennials would share personal details to join a rewards program, while 36 percent of millennials would do so to gain access to a website.

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The information age makes personalization even more personal. It seems a fair trade-off; if someone offers a business their personal info, the business should use it with care and specificity. Here’s what marketers should keep in mind to meet millennials where they are—and where they’d like to be:

Market with Personalization in Mind

Personalizing goods and services for the millennial crowd takes more than just attaching a name to an email or a direct mail flier. If we examine the rise of customizable menus in fast-casual restaurants, which allow its patrons to craft their own custom food creations, we see that many customers enjoy having more personalized options. A survey from Bond4 found that 55 percent of U.S. millennials would like access to personalized experiences and services that huge companies don’t have the bandwidth to provide.

Small and medium-sized businesses can take these lessons and apply the strategies to their own marketing campaigns. To entice the millennial consumer, customization may be the key. Companies can present options, though not too many, to appeal to the principles this value-driven generation loves. This is a shared trait between younger and older millennials; a Cone Communications poll5 showed that 92 percent of 18- to 24-year-olds and 91 percent of 25- to 34-year-olds would be willing to switch to brands associated with good causes.

The rise in popularity of curated subscription box services – from makeup to collectibles to pet supplies – is a perfect example of successful personalization in marketing. A beauty company has subscribers fill out a profile that asks basic questions about skin tone, type, and personal style. Based on the answers, it mails out five samples on a monthly basis. Subscribers try them out and have the option to buy full sizes of items they love.

Enhance Your Strategy

Small and medium-sized businesses should consider weaving personalization into their marketing, from the services they offer to their direct mail campaigns. Remember, what worked in the past may still be effective, but you may have to rethink your strategy and focus on tailored, individualized content for a crowd that expects customization and big value.

Consider what happened not too long along when a late night comedy host was taking potshots at politicians who sent mass emails with the respondent’s name in the tag. It pretended to be personal, but once you read a line or two, it was obviously just another form letter. Don’t fall into the trap of pretending to be personal—it’s important to actually engage with your consumer on a personal level.

Are you ready to personalize your direct mail for millennials? Check out “Reaching Millennials: The Role of DM.” It’s an informative guide that may help businesses bridge the communication gap—and generation gap—with millennial consumers.