Rob Saltiel, president and CEO, MRC Global Inc.

“Our revenue grew for a third straight year in 2023 to $3.4 billion, and we generated $181 million of operating cash flow, resulting in our lowest net debt level ever as a public company,” president and CEO Rob Saltiel said in a statement on the company’s fourth quarter and fiscal year ended Dec. 31.

MRC Global, which launched in 1921, emphasizes its global supply chain expertise and its “robust digital platform” for its ability to offer over 300,000 SKUs from over 8,500 suppliers for approximately 10,000 customers worldwide. Its ecommerce site, MRCGO, processes orders for products ranging from steel and polyethylene pipe to related valves and fittings.

In the fourth quarter, MRC reported a 12% year-over-year drop in total sales to $768 million. MRC said ecommerce accounted for 65.5% of U.S. orders and 53% worldwide. That’s up from 50.2% of worldwide orders in the year-earlier quarter.

Ecommerce drives a big share of sales

MRC didn’t break out the percentages of Q4 2023 U.S. of sales transacted online. Based on its reported figures for 2023 and 2022, Digital Commerce 360 estimates ecommerce accounted for about $340 million in Q4 2023 sales.

In its 2022 annual report, MRC said ecommerce accounted for 41% of total Q4 2022 revenue, or $356.3 million out of total sales of $869 million, while accounting for half of customer orders.

For the full year 2023, MRC said total sales grew 1% year over year to $3.41 billion. Saltiel noted on an earnings call today that, despite the drop in Q4 sales, “we maintain strong profit margins and cash generation that exceeded our expectations.”

He added, “We have seen a meaningful improvement in our backlog of new orders over the first few weeks of 2024. This gives us optimism that our business is stabilizing, and we expect to return to growth in the coming quarters.”

For the fourth quarter ended Dec. 31, MRC reported:

• Gross profit of $153 million, down 3.2% from a year earlier. But a sharp drop in the cost of sales led to a gross profit margin of 20.0%. That’s up from 18.2% a year earlier.
• Net income of $21 million, unchanged.

For the full year, MRC reported:

• Gross profit of $690 million, up 13.1%.
• Net income of $114 million, up 52%.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s MRC Global report.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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WD-40 fiscal 2022 revenue

For the fiscal year 2022 ended Aug. 31, WD-40 Co., manufacturer and distributor of  WD-40, a highly known penetrating oil on store and distributor shelves since 1953 reported a steep decline in ecommerce sales.

Steve Brass, president and CEO, WD-40 Co.

“In fiscal year 2022, global ecommerce sales were down 8% compared to the last fiscal year, partially due to the continued rebalancing of sales toward brick-and-mortar locations. Despite our slow results this fiscal year, there is a significant opportunity ahead of us in the digital commerce space,” CEO Steve Brass told analysts on the company’s year-end earnings call. “In the Americas, digital commerce sales rolled back in the latter part of the year, which gives us great confidence that we’re through the worst of the downturn.”

WD-40 doesn’t break out specific ecommerce sales, but for fiscal 2022, total revenue grew 6% to $518.2 million. Net income was $67.3 million.

Ecommerce is an important channel to WD-40, which also manufactures other lubrication and cleaning products.

“Despite our slow results this fiscal year, there is a significant opportunity ahead of us in the digital commerce space,” Brass said. “Our vision for digital commerce is to engage with end users at scale, making it easier to access, learn about and purchase our brands.”

Ecommerce at WD-40

Digital commerce is now on the rebound, the company says. For the first quarter of fiscal 2o23 ended Nov. 30, sales decreased year over year to about $124 million while net income was about $14 million.

Ecommerce sales rose 51% in Q1 fiscal 2023, the company says, but did not break out specific numbers.

“We expect ecommerce would be the fastest-growing retail sales channel globally for the duration of fiscal year 2023,” Brass said. “We see a world where almost every transaction in the future will be influenced by a digital touchpoint somewhere on the path to purchase, and we believe we’re well-equipped to thrive in that world.”

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The expansion will give Target nine of the mini-warehouses in the U.S., and more are planned for the coming years, according to a company statement Monday. The hubs, which receive goods from stores and forward them to customers, are designed to speed local deliveries and cut the shipping costs that typically make online orders less profitable than in-store sales.

For Target ecommerce, fulfilling online orders from stores yields savings of about 40% per package compared with shipping them from big distribution centers. Using sorting hubs eases the burden even more, and surging digital sales since the start of the pandemic are pushing the retailer to add more of the facilities as it vies for online orders with the likes of Amazon.com Inc. and Walmart Inc.

“The biggest part of fulfillment costs is shipping,” Target COO John Mulligan said at a recent briefing for reporters. “Stores are the asset, they’re close to consumers. We continue to believe they are the fastest way to fulfill, and the cheapest.”

Target Corp. ranks No. 5 in the Top 1000, Digital Commerce 360’s ranking of online merchants in North America by web sales.

Increasing pressure on Target ecommerce

Paring costs is increasingly important as ecommerce becomes more popular and accounts for a larger part of revenue. Target says it recorded an increase of almost $13 billion in digital sales from 2019 to 2021. While growth has slowed this year as more customers shop inside stores, the Minneapolis-based company is preparing for a continued long-term shift online.

But shipping orders directly to customers from the stores themselves clutters back rooms and leads to an inefficient use of space, said Mark Schindele, Target’s chief stores officer.

Thus, Target is focusing on local hubs to support ecommerce, such as a 170,000-square-foot sorting center in Minneapolis. The warehouse receives merchandise from 43 stores and one dedicated fulfillment center, said Doire Perot, the site director. It opened in October 2020 and can now handle as many as 50,000 packages a day.

Inside, employees disassemble pallets of packages and put the parcels on a conveyor belt. Some will go to the United States Postal Service, FedEx Corp. or United Parcel Service Inc. Target’s last-mile delivery service will handle others, which typically arrive a day after a customer places an order.

At 10:30 a.m. on a recent Wednesday, the sorting center’s outer doors opened and about two dozen automobiles entered a staging area. Their drivers were gig workers for Shipt, a delivery company Target bought less than five years ago. Warehouse employees arrived with packages that were loaded into the vehicles. The drivers then left to make their rounds.

On average last year, Shipt shoppers and drivers made $25 to $35 an hour including tips and bonuses. Drivers have to pay for gasoline and provide vehicles. At the Minneapolis hub, Shipt-delivered packages are currently averaging about 12,500 a day.

Target is also working with Shipt at the sorting center to pilot the use of larger delivery vans, which can hold up to eight times more packages per route. That will help make room for growing order sizes, the retailer said.

Recent acquisitions

In addition to Shipt, two other recent acquisitions play a key role. Target uses software from Grand Junction, a startup it purchased in 2017, to determine which goods can be efficiently handled by its own delivery service and which should go to outside transportation providers.

Target also bought technology assets from Deliv, another startup, in 2020. That software helps the retailer optimize delivery routes so that each driver has as many stops as possible on a given course.

“Density is what creates efficiency,” Mulligan said. “And efficiency is what takes out cost.”

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The world’s largest athletic-wear maker halted sales in Russia earlier this year, telling customers it couldn’t guarantee product shipments. The Beaverton, Oregon-based company had more than 100 stores in Russia.

“Our priority is to ensure we are fully supporting our employees while we responsibly scale down our operations over the coming months,” the company said in a statement June 23.

Hundreds of multinational businesses across industries have curtailed or shut down their operations in Russia this year. U.S. companies including McDonald’s Corp., Starbucks Corp. and HP Inc. have all made full exits.

In May, Nike said it wouldn’t renew an agreement with its biggest Russian retail franchisee, which managed dozens of Nike stores. It also said it would not make any new business commitments.

Less than 1% of Nike’s total sales come from Russia and Ukraine, Chief Financial Officer Matt Friend said in March. Revenue from its Europe, the Middle East and Africa region accounted for $11.5 billion in 2021. That’s about 26% of total sales.

Nike Inc. ranks No. 10 in Digital Commerce 360’s database of Top 1000 e-retailers. It ranks e-retailers based on web sales.

Big tech also gets caught in Europe’s politics, specifically with energy

Luxembourg, the Netherlands, Belgium, Germany and Denmark have teamed up to propose stricter efficiency measures at a meeting of European Union energy ministers on June 27. The aim is to get all 27 member states to sign up to the same rules on big tech to protect the European Union’s green energy targets. That means putting a tighter rein on the facilities that handle everything from social media posts to apps for businesses. With a squeeze on energy supplies because of Russia’s war on Ukraine, the political metrics are now changing for tech giants’ facilities.

Policy makers’ push to green up the tech industry comes as the EU debates a package unveiled last year that would implement an ambitious objective to slash greenhouse gases at least 55% this decade. Then came President Vladimir Putin’s invasion of Ukraine in February. In response, the EU announced it would phase out fossil fuels imported from Russia and proposed increasing the renewables and energy efficiency targets for 2030 even further.

Data centers require massive energy consumption

Tech giants running data centers in Europe say they already abide by their own high green standards. Microsoft Inc. is aiming to reduce the consumption of water, used for server cooling systems, in its operations by 95% by 2024. Meta said its hubs have achieved net-zero carbon emissions and are supported by 100% renewable energy.

Meta’s Netherlands center was to be “one of the most efficient in the world.” Nearly every watt entering the data center was to be used to run the computing equipment, according to local authorities. Still, it was expected to use 1,380 gigawatt hours of energy. That’s comparable to twice the total consumption of Zeewolde, a Netherlands town of about 23,000 people, development plans showed.

Reducing dependency on Russian oil and gas

That highlighted the scale of the challenge for Europe when energy is more scarce, said Guus Dix, assistant professor at the University of Twente. He is also a climate activist who participated in a campaign against the Zeewolde data center.

“We only have limited energy available,” Dix said. “And we have other needs as well, like greening our houses and becoming less dependent on Russian oil and gas.”

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For the year ended Dec. 31, Houston-based MRC reported that ecommerce accounted for 42% of total sales, compared with 35% of total sales in 2020.

In 2021, MRC Global posted total sales of $2.66 billion, up about 4% from $2.56 billion in 2020. Based on ecommerce shares of 42% and 35% of total sales in 2021 and 2020, respectively, Digital Commerce 360 estimates that ecommerce in 2021 grew 23.9% to $1.11 billion from $896 million in 2020.

Net loss was $14 million vs. $274 million in 2020. “We began to see an increase in maintenance and turnaround spending for the petroleum refining and chemical industries in the fourth quarter of 2021, much of it previously delayed due to the pandemic,” CEO Rob Saltiel told Wall Street analysts. “In 2022, we expect more significant improvement with our U.S. diet sector up double-digits.”

MRC carries and inventory of 250,000 SKUs, including an array of pipe valves fittings (PVF), oilfield supply, valve automation and modification, measurement, instrumentation, and other general and specialty products from a global network of more than 10,000 suppliers. “We serve approximately 10,000 customers through digital commerce applications and approximately 210 service locations, including regional distribution centers, service centers, corporate offices and third-party pipe yards, where we often deploy pipe near customer locations,” the company says in its recently filed annual report with the U.S. Securities and Exchange Commission.

MRC also will continue to invest heavily in ecommerce in 2022, Saltiel  told analysts. “We expect our full-year 2022 capital spend to fall within a range of $10 million to $15 million as we continue to invest in ecommerce and system upgrades,” he said.

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And Dover—which manufactures products for engineering, fueling, imaging and identification, pumps and refrigeration, and food equipment—plans another big push for even more digital commerce in 2022.

In 2021, Dover, based in Downers Grove, Illinois, posted total sales of $7.907 billion, an increase of 18.3% from total sales of $6.684 billion in 2020.

Last year, digital commerce accounted for about $1 billion in sales, or about 13% of total revenue, CEO Richard Tobin told Wall Street analysts on a recent year-end earnings call.

With momentum building for digital sales, Dover is aiming to double its ecommerce business this year, Tobin said.

“We invested over $14 million in digital products and digital and ecommerce, which allowed us to reach our goal of over $1 billion in ecommerce revenue last year with no touch by customer service,” Tobin said “This represents over 10 times the volume we processed in 2018. And our 2020 goal is to double our 2021 volume.”

The company also is looking to ecommerce to help its internal diversification and efficiency, Tobin says.

“I think clearly the real benefit of moving to [an] ecommerce platform is the S&OP (sales and operations planning) process gets a lot slicker, inventory management gets a lot better, and you can centralize pricing rather than having distributed pricing around the world,” he told analysts. “So, yes, it’s a bit of cost savings, but the real benefit is operational over time and it’s not a kind of go-to-market platform and we expect to continue to sell through distribution.”

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Francesca Novelli, customer centricity and international key account senior manager, Prysmian Group

As more cable buyers flocked during the pandemic to the B2B ecommerce sites of Prysmian’s distributors, the distributors needed more and better product data to effectively sell online. And Prysmian, with its product data scattered across multiple data repositories, realized the time had come to eliminate those data silos and deploy a new product information management (PIM) system to consolidate its product data in a single database. The targeted result: helping Prysmian’s distributors run more efficient and effective B2B ecommerce sites and increase sales of Prysmian Group’s product brands, namely Prysmian, Draka, and General Cable.

Distributors increase their digital presence

“Our distribution channel—mainly, electrical distributors—are increasing their digital presence with ecommerce sites,” says Francesca Novelli, customer centricity and international key account senior manager for Prysmian. “Increasing PIM coverage as well as enhancing enriched content—including sustainability data like CO2 emissions, packaging, recyclability information, etc.—can support us in enhancing the business accessibility to our distribution channel. Our expectations, therefore, are to gather better visibility at our customers’ ecommerce sites and improve sales of our brands.”

Prysmian is known as the world’s largest manufacturer of cables for the energy and telecommunications industries. The company operates more than 100 plants in more than 50 countries, and it produces energy, telecommunications, submarine, and high-voltage cables. With millions of different products and hundreds of sales and distribution channels, Prysmian needed a technology platform that allowed them to manage both technical data and commercial data, such as short descriptions, long descriptions, certifications, videos, pictures, and branding.

In addition, with rapid growth in digital commerce, Prysmian’s business-to-business customers had new requirements. They were asking for clarity of data, completeness of information, and fresh, usable product information to run their ecommerce sites efficiently.

The Milan, Italy-based cable manufacturer, which reported 2020 sales of 10.016 billion euros (US$11.6 billion), opted to install a product information management application from inRiver Inc. that would integrate with its entire information technology stack. Prysmian will leverage on BB ecommerce technology from Salesforce.com Inc. and uses Salesforce.com’s MuleSoft data integration technology to integrate its PIM. “Leveraging on our web catalogues and on data coming from our ERP/SAP 1 Client will allow our distribution channel to place orders via the new B2B platform, which is kicking off by Q4 2021 and will roll out during 2022,” says Beatrice Boldrini, IT Business Partner on Customer Centricity initiatives.

The ability to consistently manage product data is critical in the electric cable industry, as regulatory requirements for product data typically vary by country. PIM technology is a crucial pillar to meeting B2B buyers’ needs, the company says.

Managing product information worldwide

“Cable markets are different across the globe, and regulations are specific to markets, so there are many different variants and usages of product information,” Novelli says.

While the company does have a research-and-design system that contains product data, that information is mainly used to support product design, not serve as the basis for the product descriptions that distributors need, Novelli adds.

Because Prysmian is heavily focused on data governance, one of the priorities for its PIM implementation is to streamline product information across the entire company to ensure proper, accurate and consistent data distribution as it expands sales operations globally.

“Without proper data governance, it is impossible to manage the consistency of data across geographies,” says Novelli, who oversaw Prysmian Group’s PIM business implementation. “A distributor relies on product data to sell products, and it is best when that data comes directly from the source. We are the cable experts, and we can help distributors to enhance their selling proposition on Prysmian Group products by providing them the most accurate and reliable data. It is important to help customers onboard information they need to sell effectively.”

In addition to providing distributors with more accurate product data that meets local regulatory requirements, the Prysmian Group is also seeing an increasing demand for data syndication to third-party ecommerce sites to generate new leads from prospective customers.

Syndication “is another reason product data should come from the supplier, as requirements vary by country and customer,” says Novelli. “The syndication part, which today is the most complex challenge, is still a work in progress, but we are making huge strides as we do feed our web catalog data directly from our PIM, with full integration.”

The benefits of deploying a professional PIM team

The Prysmian Group has also created a professional Central PIM team (CPT) that the company says is part of the core business operations to support implementation, “including product mapping and fit gaps, to manage the Prysmian Data Model accordingly to be in line with business requirements and outputs,” the company says. The professional PIM team also provides training to an extended PIM team, including product and marketing managers, to reinforce processes as well as governance at scale, Prysmian adds.

The benefits of the PIM implementation include fully integrated web catalogs to the PIM, product consistency throughout all channels, a common layout, and a branding approach for catalogs and datasheets. The implementation also provides the ability to better manage the more than 500 features for more than 40,000 products, and the ability to share key performance indicators with customers. The shared performance indicators include a product data quality assessment. In addition, it provides flexibility in sharing data with key customers or national data pools, such as BMECat, Eplan or CableBase.

“We enhanced our brand awareness on the market, and overall, we were able to increase the loyalty of our customers and improve the customer experience for customers who are dealing with Prysmian Group and its commercial brands.”

InRiver is live in 20 countries in Europe and in 2021 Prysmian is running an expansion in North America across main products lines and commercial brands, the manufacturer says. As part of the implementation, Prysmian established a local PIM Team closely supported by CPT to run the project, building up digital competencies that will allow the North America organization to reinforce Prysmian commercial effectiveness in the local market, the company says.

The rest of the world will follow in 2022 in terms of geographies and businesses.

‘Digitalization is within the DNA of Prysmian’

“Thanks to the PIM, now we have a single source of truth, a single platform that collects all our product information so now we can talk the same business language. With inRiver, we can now apply best practices to our product data to drive our business,” says Stefano Brandinali, chief digital and information officer at Prysmian Group.

“Digitalization is within the DNA of Prysmian,” adds Rob van Veen, Prysmian’s senior vice president, energy and infrastructure. “PIM is one of the key pillars to fulfill all the demands and wishes from our customers on how our products and concepts will be found in all their ecommerce platforms and systems.”

Aside from using its PIM solution to provide richer and more accurate product data, Prysmian also is leveraging the application by including sustainability data as part of product data. Sustainability data includes a product’s carbon footprint, recyclability and environmental benefits, as well as listing any hazard materials used to make the product. The company has also embedded eco-friendly cable information in its PIM Data model and expects to embed additional sustainability data in its PIM model in the future.

“Sustainability is a key component of our core values,” Novelli says. “As a result, we want to help our customers make buying decisions by providing access to sustainability data.”

Having successfully completed its PIM solution in Europe in 2020, the Prysmian Group is rolling it out in North America and will introduce it other regions of the world in 2022. The company is also working to develop an enterprise manufacturing PIM use case.

Peter Lucas is a Highland Park, Illinois-based freelance journalist covering business and technology.

This article is part of the DC360 special report Technology Roadmaps for Digital Growth.

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But if the path to rollout already includes a mandate for change from key stakeholders such as top management and employees, traversing the terrain is less of a challenge.

A case in point is Alaska Rubber Group, a 41-year-old manufacturer and distributor of industrial and hydraulic hoses, fittings, and related products. The company also sells additional product lines for custom wire rope, chain and nylon sling assemblies, and other rigging supplies.

Alaska Rubber sells to customers in Alaska and Washington State in the agricultural, marine, oil-and-gas, construction, mining, and fishing industries and to various original equipment manufacturers and government agencies.

Today, the Anchorage-based manufacturer and distributor sells primarily to customers through a network of nine branches, including four in Alaska and five in Washington. Alaska Rubber, which is an employee-owned company, is an established business and actively involved in industry affairs, such as membership in a distributor cooperative.

Enriching online displays of products

It is that type of relationship with other partners and customers that is facilitating Alaska Group’s fast approaching launch into B2B ecommerce. For example, rather than do everything entirely on their own, Alaska Rubber is working with two members of its cooperative—Tipco Technologies Inc. in Owens Mills, Maryland, and Western Hose & Gasket Co. (Westflex Inc.) in National City, California—to develop a common website taxonomy and digital product enrichment tools specific to their respective markets.

“We partnered with Tipco and Westflex because we all have similar businesses in the same industry and sell many of the same products,” says Alaska Rubber CEO Mike Mortensen. “It didn’t make sense for each of us to pay to enrich the same group of products, so we partnered on the cost of enrichment for those shared products.”

Mike Powers, director of ecommerce and digital marketing, Alaska Rubber Group

Alaska Rubber has plans to launch B2B ecommerce as soon as the end of March or early April, says director of ecommerce and digital marketing Mike Powers, who previously worked in a similar position at Hill & Markes Inc., a distributor of industrial, food-service and office supplies.

A big emphasis at the launch of the ecommerce site will be giving digital buyers comprehensive information to research and find specific products—fast, Powers says. “We will have approximately 26,000 SKUs available on our website at go-live,” he says. “Our site will display rich product information for the various industrial and hydraulic products we carry including hoses, adapters and fittings, as well as rigging and lifting equipment.”

Live chat and customer text messaging

The new site will operate on an ecommerce platform from Unilog Inc. linked to an enterprise resource planning (ERP) system from DDI System Inc. When the ecommerce site is operational, Alaska Rubber also will deploy live chat from LiveChat Inc. and add business customer texting messaging from Moblico Solution LLC.

Alaska Rubber has ambitious plans to make ecommerce a bigger part of total sales—and sooner rather than later, Powers says. “Our annual revenue is between $35 million and $40 million,” he says. “Our goal in the first year of being live is to implement a customer adoption strategy that will result in approximately 25% of our customer base ordering online.”

Alaska Rubber envisions a fast-track rollout for ecommerce mainly because, in the wake of accelerating change for more digital customer technology brought about the global coronavirus pandemic, the company did not want to risk being behind the times, Mortensen says. “We understand that there are moats around our current business model with assembly, and custom application engineering, local stock, and customer support and relationships,” he says. “We also understand that the buying behavior of many of our customers is rapidly changing due to what has been referred to as the ‘Amazon Effect’—people want to buy for work in the same way they buy in their personal lives.”

Going forward, Alaska Rubber will make ecommerce a fundamental sales channel that fits with the company’s existing business model, Mortensen says.

“We stopped thinking about ecommerce as a standalone project where we needed to compete with everyone on the web and instead started to view our investment in terms of a fundamental transformation of industrial distribution in our space,” he says. “This vantage point allowed us to evaluate the investment not only in return on investment (ROI) terms, but in opportunity cost—we needed to allow our customers to access us the way they wanted.”

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“Our service is not to a distribution yard—it’s to the oil-drilling rig,” says Alejandro Lammertyn, chief digital and information officer. “It’s clearly a disruption from the way this market has been.” The Rig Direct service includes help in planning oil well projects, integrating supply chains and what Tenaris describes as “well integrity” support to deliver the exact products and services customers need.

Faced with fluctuating demand for oil—which was down earlier this year from overproduction before the coronavirus further lowered demand—“the oil companies are trying to reduce their costs, they’re trying to simplify their processes,” he adds.

Going more digital

Now, going more digital is a crucial strategy Tenaris is deploying to better serve customers and build stronger relationships with them. The strategy is designed so that Tenaris will use its digital platform to keep learning how to better interact with customers over the long term and address their needs.

In the past two years, the company has updated the Rig Direct business model with a digital transformation strategy that is moving many of its customers into online ordering and providing operational efficiencies for Tenaris and its customers alike, Lammertyn says.

“We have a direct relationship with all of our customers, but we wanted to enhance our long-term relationships,” Lammertyn says, adding: “We needed to enhance the customer experience. We had the physical relationships with customers in terms of delivering the pipes, but we were not integrating the administrative part—how customers place orders, how we trace materials, track invoices, expedite commerce documents and certificates for proof of delivery.”

To provide that higher level of administrative service while building a whole new kind of customer experience, Tenaris launched two years ago a digital platform that lets Rig Direct customers place orders and manage them through the Rig Direct Portal ecommerce site and a related web app.

The Rig Direct mobile app.

Transforming business

“We are making investments in digital technologies to transform the efficiency of our operations and provide customers digital integration efficiencies under our Rig Direct program,” Paolo Rocca, the chairman of Tenaris, said in a letter to stockholders in the company’s 2019 annual report. “These investments are contributing to lower industrial and supply chain costs and closer collaboration with key customers.”

The digital platform is quickly gaining adoption among customers, Lammertyn says. The full Rig Direct program, which launched four years ago, accounts for about 70% of Tenaris’s sales in the United States, where about 50% of Rig Direct customers place orders through the Rig Direct Portal, which debuted in early 2020, he says.

In the Permian Basin region in Texas and New Mexico—known as the largest petroleum-producing basin in the United States—customers use the Rig Direct Portal to manage more than 90% of their orders of casing pipe used in oil rig construction, Tenaris says.

The Rig Direct Portal is integrated with Tenaris’s enterprise resource planning system, which has enabled the manufacturer to increase the efficiency of managing customers’ online orders, it says. Tenaris developed the portal in-house on a digital commerce platform based on .Net technology, Lammertyn says. Initially launched for the U.S. market, the portal is now also available to Tenaris customers in Colombia, Argentina and Mexico.

The digital platform is also bringing other benefits, he says. “We’re now reducing a lot of our customers’ back-office work. And we’re reducing the total cost of operations for our customers and for us.”

From Permian Basin to Indonesia

In the big oil-and-gas companies, saving administrative steps and time in the purchasing process makes a big difference for them, Lammertyn says. Many companies have reduced their back-office work and are moving their administrative operations to shared services. “For a purchase transaction happening in the shale oil sector in the U.S. Permian Basin, they may have a back-office in Indonesia,” he says. “Their process of approval may go to Indonesia to get an invoice approved for it to be paid to us.”

But by putting everything on a digital commerce platform, that oil company’s personnel in the U.S. and overseas can view the same updated information on orders and invoices. As a result, companies using the platform are expediting invoice approvals. “The shift can be from 20 or 30 days to one hour,” Lammertyn says. “Big difference.”

The new ecommerce portal and app, he says, were customer-driven in their design and purpose. “It’s all about enhancing the customer experience,” he says. “Every solution we develop and every digital tool we deploy aim to simplify the administrative process for customers. Our measure of success is how much time we’ve been able to save for operators running the rigs.”

Learning every day what customers need

In addition to expediting business transactions and approvals, Tenaris’s digital strategy is also to use cloud-based digital applications to share more information with customers. “We’re learning every day what our customers need,” Lammertyn says.

‘Our measure of success is how much time we’ve been able to save for operators running the rigs.’ — Alejandro Lammertyn, chief digital and information officer, Tenaris

One critical area is in tracking the movement of steel pipes and other products from production through shipment to customers—a service Tenaris provides customers through its tracking and traceability application, PipeTracer®, which customers can view from a mobile device. The app stores the pipe’s unique manufacturing history, raising product reliability, and offers customers access to technical specifications and running guidelines that simplify downhole operations, Tenaris says. The app also generates digital tallies, improves accuracy, and enhances safety at the rig site through less pipe handling, the company says.

With tracking codes placed on each product, Tenaris scans them from production to delivery, making their dimensions and order status available online. “We track every step in the manufacturing process, from the rolling of pipes from steel bars until the pipe is finished and arrives at the customer. This information is then available at the customer’s fingertips,” Lammertyn says.

While the Rig Direct Portal primarily serves large accounts, the portal is one of several digital offerings in what Tenaris calls its Digital Box, including PipeTracer, digital datasheets for the company’s pipe and products, and sets of application programming interfaces for integrating the digital platform with customers’ ERP systems.

Spot-buy marketplace for small orders

In addition, Tenaris is developing as another Data Box service a spot-buy online marketplace designed for non-contract small customers, including construction companies and distributors, who need to place occasional orders for one or more pipes.

The spot-buy marketplace is available in Argentina and Mexico, where for now it’s serving fewer than 100 companies. But Tenaris expects to open up the marketplace to U.S. companies within a few months, Lammertyn says.

The spot-buy marketplace, he adds, is another example of how Tenaris is continuing to use digital commerce technology to learn what customers need, such as online workflow on the marketplace to expedite how off-contract buyers get approval for their purchases.

Tenaris has also upgraded its corporate information site at Tenaris.com, where it worked with MediaMonks, a digital agency, to make it easier for customers to access digital assets like product demos and connect with salespeople. For now, Tenaris.com runs on a separate platform from the Rig Direct Portal, but Tenaris says it may consider integrating them to further build on customer service.

“We’re learning and always adding new features to Rig Direct Portal and spot-buy,” Lammertyn says. “It’s a process where we learn their behavior and their needs, what their pain points are, then focus on how we can reduce them.”

(This article is part of a broader report, “Standing Out Amid Disruption,” recently published by Digital Commerce 360.)

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A little more than half of zMax’s customer orders—mostly from larger retailers—run through electronic data interchange, but it recently began building out its digital channel to deploy more effective marketing and selling operations to better attract and engage a wider range of both B2B and business-to-consumer customers, including retailers, auto dealers, engine builders and consumers involved with motorsports. Its roots in lubricants for race cars, zMax maintains affiliations with eight major speedways but now also sells lubricants used in aviation, large trucks, firearms and homes.

EDI, of course, is a proven technology for B2B suppliers and buyers to transact with one another, especially for large recurring orders. One of the drawbacks to using EDI, however, is that when a customer doesn’t have an EDI connection, ordering becomes more labor-intensive.

To support clients that do not have EDI connections, many B2B suppliers like zMax recognize they need an ecommerce channel to better serve this customer segment.

But that does not mean that EDI and ecommerce are mutually exclusive; the two technologies can co-exist as complementary channels. EDI is an excellent channel for buyers that know exactly what they want before ordering, while ecommerce is a channel that B2B marketers can leverage to attract new customers, cross-sell and upsell buyers, and communicate with buyers throughout the purchasing process.

Integrating order data from multiple channels

ZMax set out with a two-part goal for a new ecommerce platform. It wanted a digital sales channel that would provide a rich user experience for auto dealers, engine builders and other motorsports customers—and that would exchange data with its EDI platform and order processing systems for other customers—zMax worked with TrueCommerce, its EDI provider, to deploy its Nexternal ecommerce platform.

“Our long-term goal is to integrate order data from multiple sales channels, including ecommerce and EDI to create a one-stop-shop to place orders for our dealers,” says David Coughtry, production and operations manager. “TrueCommerce Nexternal supports that long-term vision. Plus, we are a long-time TrueCommerce EDI customer.”

ZMax uses EDI to receive purchase orders from 12 of its largest customers and to send them advance shipping notices (ASNs) and invoices. ZMax processes 30-50 inbound purchase orders per week and sends out about 50 to 85 invoices and ASNs. ZMax’s EDI platform can scale to handle any jump in sales.

Automotive and general retailers such as Walmart, Menards, AutoZone and NAPA sell zMax products, which include aerosols, sprays and racing oils.

Some big buyers prefer ecommerce over EDI

While about 60% of the company’s B2B transactions are completed through zMax’s EDI platform, several large retail chain customers, such as Pep Boys and Auto Zone, do not use EDI, which prompted the need for an ecommerce store.

“Our goal is to make it easier (for non-EDI customers) to order,” Coughtry says. He adds that auto dealers are also not interested in ordering through EDI. “When there is no compatibility with our EDI platform, these customers order manually.”

In addition to B2B, zMax also sells to consumers.

One advantage of adding TrueCommerce Nexternal is improved reporting capabilities that simplify analysis of ad campaign results. That information can then be used to tweak existing ad campaigns. ZMax advertises to consumers and professional mechanics on network television.

A dashboard to track sales and marketing

Diane Mohundro, art director, zMax

“The TrueCommerce Nexternal dashboard allows me to quickly see what was sold and where, and identify our top-selling products,” says Diane Mohundro, art director for zMax. “We use TrueCommerce’s MailChimp integration to send out email blasts with coupon codes and other offers, and the dashboard shows us at a glance how these offers perform, which determines what our next coupon code or product giveaway will be.”

For example, the marketing department can use the dashboard to track different versions of offers, such as one for a free product and one for 15% off, and see which performed better and by how much. “That data can help direct our marketing for months to come and is key to driving our advertising campaigns,” Mohundro says.

In addition to seeing what products are selling and how marketing offers are performing, the Nexternal dashboard also displays items frequently searched for on the site, which allows zMax to develop ads for those items. The company also uses search results analysis to determine if it needs to add more information to a product description to improve search results and rankings.

“I can also change featured products on the website to keep our search rankings up and the website fresh,” says Mohundro.

Improving shipping and inventory

Since installing Nexternal, zMax has improved its shipping process, typically shipping orders now twice per day. “Our shipping desks check for new orders in the morning and in the afternoon,” Coughtry says. “We batch process the orders, then batch print the labels and the packing slips.”

Inventory reconciliation has also improved. ZMax checks inventory against ecommerce transactions at the end of each month, then performs one batch order labeled “ecommerce” to update inventory in their Traverse ERP system.

In addition, zMax is using TrueCommerce Nexternal’s built-in subscription features to offer customers automatic replenishment on some products. “This makes reordering very easy for customers and helps increase sales,” Mohundro says.

Peter Lucas is a Highland Park, Illinois-based freelance journalist covering business and technology.  

Sign up for a complimentary subscription to Digital Commerce 360 B2B News, published 4x/week, covering technology and business trends in the growing B2B ecommerce industry. Contact editor Paul Demery at paul@digitalcommerce360.com and follow him on Twitter @pdemery.

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