Highlights from the 2021 Manufacturing Trends Report.
The pandemic had a severe impact on manufacturing, forcing many businesses to adopt digital alternatives before they were ready. The 2021 Manufacturing Trends Report shows how the top-performing companies managed to outmanoeuvre their competitors over the last year.
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Digital channels promise new growth.
Over the second half of 2020, manufacturers had to work quickly on a digital-focused response to protect their competitive position. More than half reported unusual buying behaviour from existing customers, while 56% experienced unusual growth in digital visitors. Most agree that digital will remain a key part of their strategy for 2021.
The crisis caused a digital reboot.
In 2020, the talk of digital transformation finally turned to action. As the pandemic caused havoc across the industry, businesses were forced to adapt almost overnight. From the US-China trade war to social restrictions and changing customer expectations, firms raced to find new ways of doing business. This pushed many manufacturers into the world of digital before they were fully prepared. Managing these competing priorities will be a challenge for those who need to strengthen their business in 2021. This year’s results show that 59% of manufacturers are heavily focused on driving savings during the coming 12 months. The short-term focus is to protect profitability while also growing market share in a landscape where traditional ways of doing business have broken down. It’s therefore unsurprising that 45% of manufacturers regard consistent experience across channels as a key priority for the year ahead.
Our top recommendation for 2021:
Businesses need to focus on delivering an integrated customer experience. However, we can expect to see more focus on analytics, automation and the Internet of Things (IoT), all being used to increase productivity and innovation for the ‘factories of the future’.
Finding a balance between digital and offline.
The pandemic has accelerated the industry’s move towards digital, but businesses must strike a balance between online vs. offline. In manufacturing, the traditional sales routes are still dominated by offline channels and will be in the near future. However, buyers are increasingly doing research online before making a purchase. The 2021 Manufacturing Trends Report reveals that 40% of manufacturers are working on research aids such as online videos, and 49% plan to develop such offerings. The results also show that a third of top-performing manufacturing companies believe they will generate at least 50% of their sales through digital platforms within the next two years. These trends towards digital could catch some businesses off-guard, giving agile firms an opportunity for competitive advantage.
Our top recommendation for 2021:
Connecting with customers and prospects online will help manufacturers address their two main priorities: driving customer experience (CX) improvements and generating savings. But this will only be successful if approached strategically, with the right platforms and resourcing.
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Three challenges firms must overcome.
The 2021 Manufacturing Trends Report uncovered three challenges for businesses: a lack of digital leadership, a poor understanding of their customers and a shortage of digital skills. For example, 60% of executives admitted that their digital initiatives weren’t always clear, and 55% agreed that they lack valuable consumer-centric digital skills such as design thinking and journey mapping. When we asked about digital illiteracy, 38% considered this a barrier to improving marketing and CX capabilities. In the context of CX maturity, over a third of manufacturers consider themselves to be ‘not very advanced’ and very few have aligned their marketing activities and data on a unified, cloud-based platform. Manufacturers aren’t always in a position to start from scratch and ‘reboot’ with a new, unifying platform. Even for businesses that are advanced in these areas, the exploitation of digital capabilities can still be daunting.
Our top recommendation for 2021:
Having strong digital technology foundations in place is key to handling high-velocity and high-volume data. It’s also behind CX excellence through capabilities such as real-time and personalised interactions, digital self-service and a single customer view.
Lessons from top-performing companies.
Even after a year of disruption, some manufacturing companies managed to come out ahead of the competition. In the 2021 Manufacturing Trends Report, we identify the characteristics of organisations that significantly outperformed their competitors in the last six months of 2020. We found that 64% of leading companies are using cloud-based data management platforms compared with just under half of the mainstream. Executives at the top organisations are more likely to claim significant insight into the journeys of new customers and how marketing actions relate to business behaviour. This level of understanding gives them a much clearer picture of how customer behaviour has changed as a result of the pandemic. However, one of the key discoveries from the report is that employees at top-performing companies are more optimistic about the outlook of their careers and the company’s corporate strategy. It’s likely this confidence comes from more than just a healthy balance sheet – the investment in digital and the focus on data is helping them to make decisions quickly and capitalise on new opportunities.
Our top recommendation for 2021:
The behaviours of top-performing companies are feeding a virtuous circle. By investing in digital transformation, executives have access to critical insights that give leaders the confidence to take quick, decisive action and push home their advantage over competitors.
Three insights from top-performing manufacturers.
of top-performing companies believe they will generate at least 50% of their sales through digital platforms within two years.
said they experienced unusual growth in digital visitors in the last six months including changes in buying patterns and levels of churn.
of leading companies reported having ‘significant insights’ into the journeys of new customers compared with 16% of mainstream competitors.
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