For our latest edition of "Digital Leaders View" Dialog Series, we sat down with Quentin Clair, Head of Digital Marketing at Elkem to discuss the digital transformation of specialty chemicals customers and suppliers.
How do you see customer behavior changing with digitalization?
Customers don't want to hear from suppliers for a long period of time in their journey. They don't want to be chased by sales agents. They want to access the content with as little friction as possible. They want to click and consume the information. But when they do get in touch, they expect a reply within 24 hours. So, they will contact several suppliers, and the fastest one to answer has the highest chance of getting the deal.
In our industry, tons of documents exist on the journey—from the moment a customer shows interest, requests a sample, orders, or gets the delivery—which drains the energy from stakeholders on both sides. Sending and answering all requests manually is just inefficiency at its core. Our customers don't want to be limited by the working hours to get the information.
What are the most important digital changes that you see on the suppliers’ side?
To give customers the freedom to find all the information they want for their education, suppliers now recognize the need for a rich product catalog with technical data. This often implies structuring the data or, better yet, implementing a PIM and, even further, digitalizing the ordering process and sample tracking.
This is why leaders now invest in self-service platforms, whether on suppliers’ websites, a dedicated customer portal, or via collaboration with a third-party partner. They seek to seize digitalization as an opportunity to simplify business. Let's face it, easier relationships mean more customers to attract and retain, which benefits both sides.
Recently, we also see a clear acceleration of digitalization related to sustainability trends. This is a real change in society, driven by end-users who ask for more transparency from manufacturers, who then turn to their suppliers and producers.
Because in many material companies, business and growth teams are still disconnected from sustainability or regulatory teams, they are not always equipped to answer all the questions and don’t know how to drive the sustainability dialogue with customers.
These factors make centralized product master data the first big challenge in the chemical industry. Having a central system to manage your product data is not yet mastered enough. Only the bigger manufacturers have a PIM system in place, and now companies will need to not only incorporate the “historical” product data but also urgently think of the sustainability product passport, whether it's including a basic CO2 score or a full lifecycle analysis of the product.
That's the expectation of the market now.
At Elkem, for example, the first evolution we plan for in the coming months is enriching our product finder to add a carbon footprint score on every product page. Nobody would have talked about it ten years ago, but today it needs to be clearly displayed and communicated.
What will the digital landscape look like 5 years from now?
As the industry continues to consolidate, we see larger companies occupying more space in various segments and already heavily investing in digitalization. Like Elkem, where we developed our own PIM and customer portal, the leaders will continue creating their own proprietary ecosystems.
Meanwhile, as a global business with many stakeholders, including formulators who work with thousands of materials, there will soon be a clear need for simplification. On the customer side, having a galaxy of proprietary ecosystems from different suppliers is too complex to cope with. Interconnectivity becomes key to everything, and it will enable real progress of omnichannel strategies.
As a result, we can expect sort of friction between producers and their customers where both sides “don’t want your system but want you to connect to their system”.
Therefore, companies like SpecialChem or UL, which are niche and more specialized third parties, help simplify the process by having platforms and marketplaces that connect all offerings in one place, representing a significant potential for the future.
Especially for companies that recognize SpecialChem as unavoidable channel but don't want to over complexify their data management.
To navigate these complexities and fully leverage digitalization, AI emerges as a crucial tool, although many companies have not structured the way they want to approach it.
This is a particularly big question when we talk about product data and product finders. We see some competitors that decided to make their data very structured, particularly everything related to technical data, AI could ease that process. I think that is also the approach of ionicPIM, where each technical piece of information is an attribute with a unit of measurement and a test method, which requires a process of organization before implementing.
At Elkem, we don't have that structure, thousands of our TDS are unstructured. Instead, we want to leverage AI to supplement our product finder with chatbot that will analyze our unstructured data and pinpoint specific products.
The choice of approach really is about your systems and organizations in place and what are your global business needs.
E-commerce is the second discussion in the chemical industry right now. Chemical companies have prevented themselves from moving toward online selling with the mindset that it would kill the personal relationship a company could develop with its customers.
However, one of the use cases I see for digital transactional platforms is sampling. Spending a significant amount of time managing small requests from early-stage prospects is inefficient. Suppliers prefer to give customers freedom to buy their test products online and then return to human interactions when they are ready for the industrial-scale purchasing.
I don't see the chemical industry going 100% online without human interaction. The specialty chemicals business is value-based selling. Bigger manufacturers, like Elkem, rely on global distribution networks to handle parts of their business and 100% digital selling could potentially impact distributors if producers, instead of expanding networks, suddenly take the value directly.
On the other hand, distributors could use this transformation to transform and become partners or enablers for smaller companies that are far from e-commerce capabilities.
"As I see digitalization today, we are out of the game of marketing the products, we are entering the game of making it work for the business with a more holistic approach."
