Dealing With B2B eCommerce Channel Conflict

Written May 23rd, 2011 by
Categories: CEO's Blog
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There is a right way, and a wrong way, for a Brand Owner to deal with channel conflict.

The right way delivers a win-win-win solution to the entire demand chain.

The Manufacturer drives traffic to their website and educates their potential customers 100% in accord with their brand promise.  If the consumer chooses to buy the product right then and there, the Manufacturer makes sure their distribution channel gets the order and fulfills and services it according to their contractual agreement.  In return, the distribution channel gets to “own” the customer and receive fair compensation in return for their services.  The consumer gets the right product at the right time at the right price.  Everyone plays their role like a fine tuned orchestra.

Perfection.

The wrong way makes the end consumer pay the price for harmony in the distribution channel.

Unfortunately, I find myself on the receiving end of this lesson as I write this blog post.  It concerns my grandson, a missing key to a Thule car carrier, and the upcoming Memorial Day holiday.

It started innocently enough last Thursday with a call from my daughter.  She and her family live outside of Philadelphia, PA and I live in Raleigh, NC.  Since we were going to be meeting in Arlington, VA (exactly half way between us) over the weekend, she suugested that I bring our Thule car top carrier and give it to her as discussed weeks ago.  That would make it easier for her to pack all of the paraphernalia that a young family of three (and their dog) would need to spend the Memorial Day weekend with us the following week.

“What a great idea” I thought.

I went to retrieve it from the attic, the Thule’s resting place for the past 7 years since our last documented camping trip.  It was just where I’d left it, with all of the hardware required to mount it to a car roof, safely locked inside of it.  Unfortunately, I had no idea where the key was so, off to the web I went.

A quick google search revealed that I wasn’t the only person on the planet in this predicament.  This truly is a great use of social media!  The solution to my problem was just a click away at the Thule website.  Armed with the serial number engraved on the lock, I was able to place an order for a replacement key.  Unfortunately, I was only given one shipping method to choose from and that was for the painfully slooowwww 3-7 business days.  No overnight or express!  I placed the order nevertheless and received the following order confirmation moments later.

That’s when I started to understand what was going on with my order.  It wasn’t being managed by Thule at all!  It was being managed by a company called Shopatron who supposedly was doing Thule and their dealers a favor.

Not!

Here is a part of the order confirmation that I received:

ShopatronConfirmation2

There are two immediate problems with the order.

First of all, the order total is only an “estimated” total.  It could go up based on taxes.  (Never mind that I’m already paying $4.95 to ship a $2.75 part…I would have paid more to get it quicker if it could keep the peace within the family!)

Second, only “standard shipping” was available…and noone to talk to, or write to, to inquire!

The bottom half of the order confirmation was even more confusing:

ShopatronRules2

  1. They left a space for other items that I might be interested in but there weren’t any?  Aside from selling me a new lock if the key didn’t work, if it was me, I would have tried to sell me an updated carrier.  Mine had to have been 15 years old!
  2. Who am I really buying this from?  Thule?  Shopatron?
  3. Better yet, who is going to support me?  There are two different phone numbers and a website to call.  I’m hoping I get the right key the first time around.
  4. Lastly, just in case things really go bad, I can always write a letter to Shopatron Order Support at the PO Box given.  Really?

So what’s going on here?

Back in 2000, when the whole eCommerce industry was abuzz about “disintermediation” Shopatron had a brilliant idea.  They went to major Brand Owners and simply said, “Keep your distribution channels happy.  If you are going to take an order on your website, pass it on to your distributors/dealers to fulfill.  This will keep them happy and they will continue to sell/support your products”.

Seriously.  My order gets posted to a website, where Thule’s dealers get to log in at their leisure to decide whether or not they want to fulfill it.  The one lucky dealer who services my zip code is usually the one that is given first dibs.  Meanwhile, since I placed my order on Friday, three days have already passed.

Wouldn’t it be easier if Thule took my order, shipped it out of their warehouse, and passed the commission to my local dealer?  I know I’d be happier.

According to the Shopatron website over 1000 brands and 12,000 of their retail partners have signed up in the ensuing years.  But that doesn’t make them right.  That just makes them behind the times.

Unfortunately, the bar has risen in the last decade.  With free 2 day shipping from Amazon and unquestioned returns processing by Zappos, I really don’t think that waiting a week to “maybe” get a replacement key will cut it.

If Thule doesn’t want to take orders on their website (which might make sense for their business model), they would be better served to help me find an online dealer that can take my order in real time.  All they did with the Shopatron process was delay my order, give me confusing information and potentially inaccurate processing.

Thule and their dealers may be living in peace, but I have a locked car top carrier that will not be adding any value to my Memorial Day holiday!

SamDealing With B2B eCommerce Channel Conflict, 5.0 out of 5 based on 1 rating