In this article, contributing editor Gina Roos investigates the birth and evolution of mobile apps and website technologies for the electronics purchasing sector
The electronic components distribution industry has long touted the capability to provide its customers with the ability to access component data and make purchases 24/7, from anywhere, thanks to their online purchasing tools and global locations. But that wasn’t exactly true since buyers were still tethered to their desktops up until a few years ago when smart phones and tablets started to permeate the supply chain.
With the development of mobile apps and mobile-optimized or enabled websites in the electronics distribution channel, buyers now can make purchases and review their supply chain activities virtually from anywhere 24/7 as long as they have a mobile device and a wireless connection. The question is will buyers embrace mobile apps as they become available from their distribution partners.
The debate among many in the channel centers around the need to provide a mobile app that is created for a specific device and operating system such as the Apple iOS for iPhones or iPads and Android smart phones and tablets, and mobile-optimized websites that are user friendly for tablet and smart phone users.
Today, only a handful of the largest distributors offer mobile applications that allow buyers to access supply chain tools and make purchases on-the-fly. But not all mobile apps are equal. Some apps allow buyers to search and buy parts as well as check inventory and lead times, while others enable users to access customer-specific supply chain data and perform day-to-day procurement tasks such as checking order status and tracking shipments. The latter is typically tied to a distributor’s supply-chain program and requires customer registration.
In some cases, the mobile app directs buyers to the distributor’s mobile-optimized site to complete the transaction or task.
We surveyed 25 of the top North American electronics distributors to find out how important it is to provide their customers with mobile apps that allow them to make purchases from their mobile devices. Interestingly, of the 16 respondents, only five offer mobile apps for making purchases or checking supply chain activities via tablets and/or smart phones. These include Avnet, Digi-Key, Heilind (part of DAC), Mouser and TTI.
Of the 11 distributors that said they do not offer a mobile app for procurement only two (Electro Enterprises and Genie Group) said they have plans to offer an app and one is in process. Electro Sonic expects to offer Android and iOS apps in the second quarter of 2013. The distributor may develop Windows 8 and Blackberry apps later in the year.
Distributors that said they don’t offer apps include Allied Electronics, Century Fasteners, Future Electronics, Hughes-Peters, Newark element14, PEI-Genesis, Sager Electronics, and USI. Arrow Electronics did not respond to the survey.
Two of the key drivers behind the decision to develop a mobile app include how customers are accessing a distributor’s website, and how many customers use the website for transactions. For example, it makes sense for TTI to invest in mobile apps due to the number of customer engagements on the web. Of the 50 percent of TTI’s North American customers who engage with the distributor on the web, 10 percent of buyers use the mobile apps compared to a little less than 20 percent of designers.
In comparison, PEI-Genesis, as an example, has a good reason to take a wait-and-see approach. Based on the company’s web analytics, less than one percent of all of its web traffic comes from customers using mobile devices.
However, PEI-Genesis has seen a 20 percent growth in unique visitors to its website, which means the distributor “will continue to look at ways to better satisfy those customers,” said Colleen Ciak, director of marketing, PEI-Genesis, Philadelphia, Pa.
Some of those tools include a parametric search, the addition of different languages, and a redesigned shopping cart. As a result, Ciak said the company saw a 60 percent increase in e-commerce sales in 2012.
Limited mobile apps
The availability and use of mobile apps in the distribution channel is in its infancy. But there are signs that buyers will make more use of them as they become available and offer higher functionality, which includes access to purchasing history and other supply chain data.
“Honestly, within our space there aren’t a ton of apps,” said Kevin Schubert, TTI’s vice president of global Internet business, Ft. Worth, Tex. “There are a lot of mobile-optimized websites and functionality, but there aren’t a lot of true mobile iOS and Android apps, although we do see that expanding as we move forward.”
“Parts search is the driver on our website and mobile application,” said Shubert. But he believes that using apps to place and track orders is where the industry is headed.
“We’re trying to engage with our customers in a variety of platforms,” said Schubert. “Ultimately, the customers decide how they want to engage with the distributor and the supply chain and we want to be wherever they are. This means by phone, email, conversation with a sales rep, or self service on the mobile device, mobile website, or full website,” he added.
TTI recently added a barcode scanning feature to its Android app that allows customers to search parts by scanning the part number barcodes by TTI’s part numbers and manufacturer
part numbers. Customers who are registered for TTI’s ezBuy Web service can use the app to scan customer part number barcodes.
Taking the barcode scanning feature one step further, Heilind Electronics offers tablet-based kanban programs. Currently, about 150 to 200 customers use the program.
“Kanban and JIT programs have been part of our industry for many years. In the 1990s we started giving customers barcode scanners that could communicate to home base via a modem hookup, which was very popular,” said Paul Burkholder, director of marketing and communications, Heilind Electronics Inc., Cleveland, Ohio. “The semi-intelligent scanners allowed customers to walk through the stockroom, scan barcodes and send a replenishment order to Heilind via the barcode scan.”
“We’ve replaced those barcode scanners with tablets,” said Burkholder. “While most any web-enabled device with a camera could perform this task, our preference is to provide the customer with a tablet already configured to scan barcodes using the camera on the back of the tablet.”
Looking ahead, Burkholder agreed that providing supply chain data will be the next step in the evolution of mobile connectivity in the distribution channel. “We are as much a distributor of information as we are a distributor of components. Both our customers and suppliers rely on us for information that matters to them,” said Burkholder.
“Our challenge and task is to make sure that the information they want is available how they want to collect it, whether it’s from a smart phone, tablet or PC,” he added.
Distributors see value in allowing their purchasing customers to monitor their supply chain activities from mobile devices. Avnet Electronics Marketing, for example, is one of the few distributors that allow purchasers and procurement professionals to monitor their day-to-day supply chain tasks via mobile apps. The key drivers were to provide its customers with more options, speed and convenience.
“We wanted to give them the ability to self-serve. The new generation is processing a little different than when I grew up,” said John Sanders, vice president of supply chain management at Avnet Electronics Marketing Americas, Phoenix, Ariz. “They are really on the fly; tablets are everywhere. It made sense to give them a tool where they can get information on the go.”
Avnet offers mobile apps for its Supply Chain Central (SCC) and POURS supply chain management services. The SCC mobile application allows users to check on their supply chain activities including open order status, past promised dates, cancelled orders, closed orders, in transit, recently shipped, shipped within thirty days, upcoming orders and potentially delinquent.
POURS, which is Avnet’s point of use replenishment system, is available as a web-based inventory management app that allows customers to access their POURS account without logging into a PC. Users can receive notifications on their mobile phone and have access to their replenishment database so they can approve orders, track shipments or take other action.
“The apps are more customer specific and for day-to-day supply chain management such as what’s on order, what are the promised dates, what’s in transit, what’s the waybill number, can I trace it, and what is potentially coming due,” said Sanders.
“Where we differentiate our app is that it’s just not pointing to our website,” said Sanders. “Many apps that I see — not only from distributors in the electronics industry — point you to a website. It opens up the browser and the transaction is done on the website. It’s not a true app designed for mobility.”
However, creating a mobile-optimized website for Avnet Express, which allows buyers to search, buy and research parts, is part of the distributor’s ongoing conversation about mobile strategies. “We do plan to continue to increasingly address mobile devices as we move forward. This will definitely be a big consideration in our redesign,” said Beth Ely, senior vice president, Avnet Express.
Mobile-optimized websites have an edge
Many distributors continue to see mobile traffic as a percentage of their overall web traffic increase, and are in the evaluation stage in terms of choosing the right mobile solution for their customers.
For example, Allied Electronics is looking at it from two different routes — how to make its website more friendly for tablets, and how to create a good experience for customers who are using mobile phones.
“We’re leaning more towards keeping our normal site for tablet users, while continuing to refine the user experience to make sure that it’s friendly for tablets,” said Dan Stewart, director of e-commerce, Allied Electronics Inc., Ft. Worth, Tex. “We’re also looking to create a second website that is just for handheld phones like iPhones and Androids, which will be a completely different experience.”
Stewart said Allied doesn’t see that much value in a mobile app particularly since any task that a buyer wants to accomplish can be done at a mobile website. The other issue is that multiple apps have to be created for the different operating systems — iPhone, Android phones and Windows devices.
Allied’s parent company Electrocomponents plc also has the same view about mobile apps. “They certainly see the strength of mobile in our future and are working toward it in the same way,” said Stewart. The RS mobile site allows users to search for parts by keyword, manufacturer part number, brand and RS stock numbers; check live stock availability and pricing; access product image and tech data; place orders and receive order confirmation.
Similarly, Mouser Electronics has focused on its mobile website, although it offers a mobile app for Apple iOS. Part of the reason for the strategy is because most customers who are using mobile devices are primarily checking for stock, pricing, and technical information.
“Since you have to be connected to the Internet to have real-time inventory and pricing, we thought the web browser was more important,” said Hayne Shumate, vice president of Internet business, Mouser Electronics, Mansfield, Tex.
“But there are some things you can do with apps that you can’t do with the mobile website like barcode reading,” he added. While Mouser offers a basic barcode scanning function for its mobile app, it hasn’t tied it into a customer’s purchasing history yet. Shumate said that enhancement will make it more effective for customers.
Mouser’s mobile-enabled site is available in 16 languages and 16 currencies and can run on virtually any device. “In the last month, we had 400 different mobile phone models or tablets hit our website and more than 1,000 transactions, and more than half of those weren’t from the U.S.,” said Shumate. “That would be hard for us to do if we had a separate app for all of the operating systems that hit us.”
Mouser is working to add new features to the mobile site including project management and sharing shopping carts.
One issue distributors agreed on is that they have to be very careful in terms of how they develop their mobile websites because they can easily burn customer relationships by having a website that doesn’t work properly.
“On the mobile device, we boil it down to what the customer wants to do; what transaction they want to perform; and give them the most direct path to do it,” said Schubert. “Currently, it’s the transaction piece — searching for a part, purchasing a part or looking at a datasheet — but going forward the second piece will be more analytical type of information and more supply chain reporting.”
“The main thing that drives our decisions is that we want to create a user experience where the customer can come in and completely self-serve if they prefer to do it that way,” said John Gilligan, senior web developer at PEI-Genesis. “We also want to make it very easy to call or email somebody if they prefer to work that way.”