What a Changing Buyer Demographic Means for Manufacturers
The manufacturing industry has undergone a lot of changes lately. Whether it’s a global pandemic, resource shortages, or supply chain disruptions, manufacturers have shown their resilience toward whatever’s thrown their way. But there is still one major change that is looming—a changing buyer (customer) demographic. As the current generation of purchasers heads toward retirement, they will be replaced by buyers with different expectations.
Being proactive in adapting to this shift will be critical for attracting and maintaining customer relationships and ultimately impact long-term profitability. That’s why we’re going to explain the impact this change will have on manufacturers and how to prepare for it.
An Aging Generation of Buyers
The current buying positions are typically held by baby boomers, but last year 6 million more of them retired than the year before. It won’t be long until those positions are all held by a new generation, and the way business is done will need to change along with them. Traditionally sales are done over the phone, in person, and were aided by an extensive physical parts catalog. Those methods will have to evolve as younger buyers begin filling those positions.
The retirement of baby boomers also brings with it a loss of massive amounts of tribal knowledge. Tribal knowledge isn’t easy to transfer and will leave companies scrambling once those employees are gone. It generally consists of technical, process, or product information that’s only stored in someone’s memory. Being proactive in combating this means there needs to be a process put in place to record the information, and younger workers need to be phased in, so they gain some of that knowledge as well.
The New Buying Preferences
So as the baby boomers retire, their positions will be filled predominantly by millennials and Gen Z buyers. This younger generation brings with them new expectations and preferences. For most of their lives, they’ve had the internet and tend to lean towards digital experiences when making a purchase. In fact, 50% of the labor pool is projected to be millennials by the end of this year, and 20% will be Gen Z by 2025. And nearly half of millennials say they prefer no sales rep interaction when making a B2B purchase, but there are still many manufacturers who don’t have digital capabilities enabled. Or if they do, they offer a subpar experience that doesn’t meet the expectations of these younger buyers.
Manufacturers will need to take a look in the mirror and determine if they are ready for this new generation buyer. These digital natives have grown accustomed to online purchasing in their personal lives, and they bring those expectations to work with them. Not providing them with an optimized digital sales channel can result in a big missed opportunity and will make it hard to grow as a company.
What this means for the future of manufacturing
Digital transformation is a buzzword that gets thrown around a lot, but it’s crucial to think about what it means for manufacturers. Digital sales continue to grow, and that’s a trend that will only increase as more and more baby boomers age out of the workforce. Investing in eCommerce and other digital solutions now will pay huge dividends down the line. Making the online purchase experience efficient and easy is the best way to not only increase sales but also garner loyalty from these new buyers. The world is changing, and it’s time for manufacturing to change with it.
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