CASE STUDY
HOW THE SURF INDUSTRY IS REVOLUTIONIZING B2B ECOMMERCE WITH ELASTIC SUITE’S DIGITAL TECHNOLOGY
Brands and Retailers Lead Transition to more Standardized and Sustainable Wholesale Purchasing
Success for both brands and retailers depends largely on their ability to adapt to uncertain, changing market conditions. By pursuing a streamlined, sustainable wholesale purchasing process with their retail partners, manufacturers are not only reducing costs but also preserving or enhancing revenue through a more strategic, environmentally sustainable approach to commercial sales. No other market sector exemplifies this ability more than the surf industry, as leading brands and retailers are setting a trend toward B2B ecommerce standardization that is likely to spread across multiple manufacturing verticals.
This case study overviews how surf brands and retailers are finding success through B2B ecommerce standardization based on the following four factors:
Industry Leadership: Endorsement of B2B digital merchandising by surf industry trade group SIMA.
Retailer Adoption: Providing a digital merchandising platform based on retailer needs.
Cost Savings & Sustainability: Process efficiency and sustainability through print-free B2B sales.
Sales Revenue: A more strategic approach to preserving and growing sales revenue.
Surf Industry Leadership
The rapid adoption by leading brands of a more streamlined approach to B2B ecommerce is being driven in large part by the bold leadership of the industry’s leading trade group. Under its mantra of “reducing and eliminating,” the Surf Industry Manufacturers Association (SIMA), through its Business Sustainability Alliance working group, has endorsed the use of digital merchandising technology through a partnership with Emerald, which utilizes its Elastic Suite B2B ecommerce platform.
In 2021, SIMA and Elastic will continue their partnership to further B2B standardization, build relationships with retailers, and help brands meet their sustainability commitments through print elimination.
“When considering the need for greater sales process efficiency in response to growing marketplace challenges, we as an industry cannot continue following a business-as-usual path. Taking on this challenge and helping both brands and retailers make this transition to more cost-effective and environmentally friendly B2B ecommerce is directly aligned with the values and vision of surf manufacturers, retailers, and consumers.”
Sean Smith, | Executive Director, SIMA
SIMA Partnership
Industry manufacturers and retailers are driving the evolution from traditional ecommerce to a sustainable and profitable wholesale purchasing process. Brands like Billabong, Hurley, Jetty, O’Neill, Quiksilver, RCVA, RipCurl, Roxy, and Volcom have introduced modern b2b tools to retailers.
The digital merchandising revolution in the surf industry affects everyone, from large manufacturers like Volcom and Quiksilver to small and specialty brands. Large brands lead and pave the way for broad industry adoption of B2B ecommerce technology. This speaks to the scalability of digital merchandising, which can flexibly adapt to the needs of both large and small brands while providing a consistent, standardized wholesale purchasing experience for retailers.
Retailer Adoption
The challenges retailers face in the marketplace are accelerating the trend toward more efficient, cost-effective B2B processes. Retailers need a simpler, cost-effective, and more standardized process for acquiring inventory that seamlessly interfaces with their in-store merchandising. Brands that respond by providing their retail partners with a more efficient, collaborative digital merchandising experience can help lead and define this evolution toward the streamlined wholesale purchasing process retailers desire. The dynamic change currently underway is strengthening and deepening brand-to-retailer relationships through a purchasing solution that can be prioritized based on buyer preferences.
By serving their retailers with a simpler, more standardized approach to B2B ecommerce, manufacturers are better positioned to address the challenges of a changing marketplace and benefit from stronger brand value that flows all the way through to retail customers. This is accomplished by enhanced management of the entire product lifecycle. This includes a higher level of brand-to-retailer collaboration from product inception and development, wholesale purchasing, in-store merchandising, and into the hands of the consumer. A B2B ecommerce platform with rich digital merchandising capability serves as the central platform for strategically managing this process. And retailers are taking notice of the benefits as the most progressive shops begin to embrace and fully utilize the technology.
For example, leading Southern California retailer Huntington Surf & Sport (HSS) has transitioned from printed product catalogs and the traditional paper-based wholesale purchasing process with multiple brand suppliers. HSS is now fully vested in the latest B2B ecommerce technology, with a strong preference for buying from brands that have adopted it. The key benefits of the change to digital merchandising have been saving both time and resources through enhanced process efficiency, and by adopting a much more strategic approach to both inventory acquisition and in-store merchandising, better aligned with the preferences of their retail customers.
The flexibility of digital product assortment planning across the many brands carried at HSS allows merchandising managers to easily create the “look” they desire for in-store merchandise displays in advance of seasonal buys, something that was very difficult, if not impossible, with traditional merchandising methods. With real-time digital product catalogs that are not printed months in advance, seasonal buying has become much more strategic, enabling purchases closer to the actual season when products will be introduced. This enables wholesale purchasing to better align with trending consumer preferences.
HSS is also benefiting from a much more collaborative relationship with the many surf brands they feature. As a result, they are interacting with their suppliers on a much higher level of efficiency than before. Time and resources dedicated to both the initial purchase and the reorder process have been cut dramatically. This allows merchandising managers to focus on delivering even greater value directly to their customers, given the array of brands and product lines featured in the store. Also, the sustainability of a print-free B2B purchasing process aligns strongly with the core values of HSS and their customers, as the company pursues environmentally responsible business practices
“The move to digital merchandising has really improved our wholesale purchasing process and made the buying experience much more collaborative with the many surf-related brands we work with. This transition is not only saving us time and resources but is making it easier for us to more seamlessly align our product curation with seasonal trends and the preferences of our retailer customers.”
Samantha Hernandez
Director of Women’s Buying, Huntington Surf & Sport
Global Reach
As the surf industry has progressively embraced the transition to next-generation B2B ecommerce, brands have introduced digital merchandising solutions to their retail partners worldwide. More than 11,500 surf retail outlets in 69 countries, spanning every region of the world, are using Emerald’s Elastic technology platform to purchase wholesale from multiple brands. This rapid adoption is indicative of the growing, accelerating trend of manufacturers and retailers seeking a more streamlined, collaborative, and cost-effective approach to B2B sales.
Surf industry market research firm ActionWatch also sees the migration of surf brands and retailers toward a more streamlined, standardized approach to B2B ecommerce as a positive response to challenging marketplace conditions. According to estimates from ActionWatch, retailers are rapidly adopting next-generation digital merchandising solutions as surf industry brands roll out the technology. This is especially true in certain regions of the world. For example, surf brands in Australia on the Elastic platform alone accounted for more than 60% of the 2019 core surf shop sales volume, according to estimates from the ActionWatch Oz panel. Estimates from the US ActionWatch panel show a 36% and growing sales volume share for the brands that utilize Elastic.
While consumer support for local and specialty retail has been strengthening in the current market environment, according to ActionWatch, retailers can collectively help the surf industry better respond to shifting consumer trends by more actively sharing sales data with brands. The transition to a more data-rich B2B sales process, along with the accompanying technology adoption, is expected to help improve this front.
“We are seeing a tremendous acceleration in the number of brands and retailers that are recognizing the need to have standardized point-of-sale information at their fingertips to support their decision-making in a highly volatile marketplace. Many of the brands that have adopted the Elastic B2B ecommerce solution also use the ActionWatch platform to inform their go-to-market processes. In addition, many retailers are recognizing that sharing sales data back with the brands ultimately benefits their bottom line. Among many other things reinforced by challenging business conditions is the need for collaboration, especially digitally, so brands and retailers can successfully navigate the ever-changing market environment.”
Patrik Schmidle | President, ActionWatch
Cost Savings and Sustainability
Surf brands transitioning to digital merchandising are realizing measurable cost savings by eliminating printed product catalogs. Printing B2B sales materials is a significant line item in the sales and marketing budgets of leading manufacturers, and it can now be eliminated entirely. Both brands and retailers also benefit from the efficiency-driven cost savings of a much more strategic, streamlined, and paperless wholesale purchasing process.
Cost savings associated with the B2B sales process are taking on added importance in the current economic and marketplace environment. Through the vision and leadership of SIMA, the surf industry is making a collective effort to bring both economic and sustainability benefits to brands and retailers. And the impact is significant. SIMA member brands collectively spend an estimated $1.95 million annually on both printing and shipping product catalogs. Eliminating this cost directly benefits manufacturers’ marketing and sales budgets.
In addition to the cost savings, the positive environmental and sustainability impact is significant and is among the highest priorities for SIMA and its Business Sustainability Alliance. Collectively, the industry is eliminating an estimated 177,000 product catalogs, each averaging 143 double-sided pages. The measurable positive impact of eliminating these high-end color catalogs extends across many aspects of the environment, helping improve the health of our planet.
Next-generation B2B ecommerce and digital merchandising technology also helps surf brands reduce costs in multiple other ways across the entire commercial sales processes. Addressing inefficiencies and generating measurable cost savings in manufacturers’ budgets for B2B sales, marketing, and customer service is a major benefit of the transition. Overall cost savings are achieved by:
- Eliminating printed sales and marketing materials
- Creating more accurate orders and reorders
- Improving speed to market
- Streamlining inventory management
- Providing integrated online payment functionality
- Reducing product sample portfolios
These process efficiency gains can reduce manufacturers’ combined sales, marketing, and customer service budgets by an average of 10.3%. Cost savings in this case are represented by the average reductions in sales, marketing, and customer service budgets experienced by manufacturers using Elastic. The potential to fully realize this level of efficiency-driven cost savings requires 100% implementation of the solution and complete deployment of the technology across all aspects of the B2B sales process, as well as the marketing and customer service functions.