Friday, August 29th, 2014

Elastic's COO talks Digital Transformation of the B2B space

by John Stern on July 29th 2014

Have you ever seen an incredibly inefficient and time-consuming process, one that is ripe for digital disruption, and thought, “I should do something about that“?
The founders of Elastic Suite, Inc. recognized just such an opportunity, and acted on it. They built a Cloud-based B2B platform that “injects digital” all the way to the heart of the relationship between brand manufacturers and retail buyers in the apparel industry and as a consequence are now a solution provider entirely disrupting the traditional order of things in this space. Specifically, they targeted the role of the catalog and how the communication between brand and buyer is transformed when going from paper to digital.

We talked with Elastic Suites, Inc., COO, Mike Mougin about the transformation to digital in this specific field, and in so doing uncovered a number of very telling insights into the power of the eRevolution.

eCommerceCIO: Where did the idea for Elastic Suites originate?

Mike: From a process perspective, one of my partners had gone to a lot of tradeshows and saw how this B2B exchange between Brand Manufacturers and Retailers was happening. He saw reps with big boxes of catalogs, writing things down on paper or in excel order forms, and all sorts of piecemeal processes that were just really inefficient. He looked at it and realized there had to be a better way to do this. Taking some cues from the consumer side, we asked why doesn’t this look more like consumer ordering? And then from there we started building out the early prototypes with use case studies out in the market to see what would be beneficial, and how this process could operate more efficiently.

eCommerceCIO: When Elastic Suites started, did you foresee the disruption this digital transformation would provide?

Mike: At my former company, I was an early customer and adopter, and felt it very clearly from that perspective. Fundamentally, yes, we saw the opportunity to digitally transform this part of the sales cycle, this relationship between Brand and Retailer, and understood it would represent a disruption that would lead to a healthier, more efficient relationship.

eCommerceCIO: As you know we maintain that traditional channels are crumbling due to digital disruption, and companies who do not properly respond may not survive. You and other digital solution companies present a real threat to older establishments, for instance, the paper and printing industry, which is evident if you look at the company consolidations and plant closings in that industry.

But perhaps less noticeable but equally interesting is that even IT enabled modes of eCommerce in the B2B space seem ripe for innovation, with the opportunity for companies who leverage digital solutions to gain a competitive advantage. What do you see happening in the B2B space?

Mike: Change is happening rapidly, and specifically in our case, in the past two years the concept and benefit of digital disruption and transformation has gone from something that we need to explain to our possible customers to them coming to us, seeking us out and saying “Hey, we want to start down this path.” They are waking up to what a digital B2B solution can do for them.

eCommerceCIO: Elastic Suite is a B2B platform that enables a digital commercial relationship between Manufacturer and Retailer. Manufacturers can load their line, and Retailers can View, Filter, Favor, and Order. What do you do differently than other B2B platforms, and why is that important?

Mike: When we look at the B2B space, there are a lot of players. Many of them do various things pretty well. At a high level, we differentiate ourselves from our competitors in three very important ways.

First, the approach we take to on-boarding our clients is fairly consultative. We have found that adopting our software is really a lot more transformative than slapping some images on a website, and it changes how our customers operate. They need some help and guidance in moving through the transformation, assembling their team, organizing their processes in order to make the end-state successful.

Second, this is behind the last part of our name “Suite”, we built a pretty broad suite of tools. We see our solution handling the sales process from the end of CRM to the beginning of ERP, which before Elastic came along was basically a manual activity. In a product based sales process where you have catalogs, products, samples you want to show, and those sort of processes, we are able to digitally enable the process pretty far upstream, and then carry it down all the way through the traditional order taking processing downstream.

Third, and this is behind our name “Elastic”, is our technical architecture. We are a cloud-based solution that can support customer-specific modifications and enhancements. We jokingly like to think of ourselves as “stretchy” because of our ability to support unique customer requirements on a customer-by-customer basis. In the B2B cloud world, this is an architectural advantage of our platform.

eCommerceCIO: With regards to the processes and the work you find you have to do in helping your customers adapt to your solution, specifically what changes do your customers go through?

Mike: There are various shifts, but the biggest is how to get the sales force to operate their sales processes digitally when they have been operating with catalogs and workbooks for 20 years.

If all we did was turn on a website, many of them would struggle to adopt it. But because we understand their world, we are able to help them navigate those waters for successful implementation and adoption.

eCommerceCIO: How do you enhance the customer’s competitiveness?

Mike: We have some feedback from our customers on that question.

The first benefit is around efficiency. From reps,  we hear about the decrease in data entry and order processing times, giving them more time to open new doors or expand orders, things like that.

Then there is the benefit of visualization and a “quality” buy. If you think about the difference between looking at an order visually rather than looking at a list of part numbers, you can understand how reps and buyers make less mistakes.   Also, because they can see the order, the order itself tends to make more sense, how it holds together, what will work, what will not. This means the parties involved put together the right order, which results in a quality buy.

A third and very important benefit is related to the core concept of the retail buying game, which is how much of the open-to-buy can you consume and how quickly can you do it. With Elastic Suite, our customers and their buyers get all the information needed to make the buy much, much faster, it can be a competitive advantage against the other brands that are still using the old method.  Because of digital, the parties involved very quickly get to the point where they say, “Well, that’s all the information we need. What are we waiting for, let’s close this deal right now”.

The last big piece – and this is really blowing up some of the old ways of doing things – is the brands now are becoming much more engaged in pre-planning the order. The retailers appreciate and are coming to expect the reps to come with a plan rather than starting from a blank sheet.

With Elastic Suite, our customers go to their buyers saying “Hey, I know the size of your shop, I know the general buyers that you have, and what you have bought in the past and what has been successful, let me propose your order right here.”

This is a very competitive position to take, and it makes the process better for everyone.

eCommerceCIO: Given how Elastic Suites was originally conceived, do you see the line between B2B and B2C blurring, and are there certain distinctions that remain?

Mike: On the engagement side where you are trying to inspire the consumer, whether it be a dealer or an end consumer, those lines have been completely blurred if not eliminated. The people on the buying end are expecting the rich full experience whether they are a dealer or a consumer, but on the purchasing side I think there are still some important distinctions.

A dealer typically isn’t buying two items in a cart. They are buying for a store or a department, and so the process by which they go about visualizing their buy and organizing their buy, and reviewing it, is much different than what a consumer does.

In this context, it does not work really well to just turn on your consumer site and let your dealers log into it to conduct ecommerce with you. The prospect of ordering five hundred units for a number of stores is very different than an end-user ordering two shirts for home-delivery.

To elaborate, consider the aperture of a consumer site: select a product, drop down, pick a color, pick a size, add a quantity, add to cart, and then add another one. Now, as a buyer for a retailer with broad merchandise selections and numerous stores, consider how going through that process four hundred or more times would be accepted? Things like that make using a pure consumer site ineffective for a dealer order.

Our ordering process is very much built around ordering for stores,  so we have concepts like duplicate orders, orders with different delivery dates, etc. You can visualize the order all in one spot. We can do visual merchandising, so not only can you see what you have, but you can also coordinate it and put a plan together for how it will work on your shop floor. So all those kinds of aspects are how we make the buying experience better and more likely to be successful which all translates to positive impact on sell-through for the dealer.

eCommerceCIO: What does eCommerce mean to Elastic Suite?

Mike: I have been thinking about that over the last few months. We are trying to take the sales process and infuse digital concepts to it all the way through. And so, this starts very early in the process even at the point of conception of these retail products. If you think of conceiving a line that you then want to communicate globally, review the line with certain partners anywhere in the world, and evaluate it even before you have gone too far down the road, how do you do that?

You do it by bringing in the digital aspect from start all the way through to what would be viewed classically as eCommerce where a web ordering tool is finally employed.

So that is sort of how we visualize the commerce process digitally, not just focusing on online web-based ordering, but enabling the entire effort from conception to transaction.

eCommerceCIO: What do you love about what you are doing now?

Mike:  Our customers are taking our solution and running with it. It is really rewarding to see them doing things with the tool that we had not even necessarily thought about doing. But they are taking it, and they are innovating with it in their own companies, and using the platform to really propel their brand. It is really cool to see, and when that happens we all sort of high-five.

eCommerceCIO: In closing, is there anything you would like to add?

Mike: Honestly, I am interested to see what your other interviews on reveal about digital disruption. We talk about it a lot, and its fascinating how much change and benefit a digital tool can bring.

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