Electronics industry leaders are maintaining a bright outlook despite predictions of moderating economic growth later in the year. This is especially true of the distribution sector, where many companies are focused on buyer behavior and how it is changing in our increasingly digital economy.
“The business is shifting. The world is becoming more digital. [As a result], we are watching user behavior more carefully, because it [affects] how we all go to market,” explains Chris Beeson, executive vice president of global supplier and new business development for electronic components distributor Digi-Key, emphasising the need to continually evaluate and improve the customer experience online. “We are asking, ‘how does the engineer do their job today versus how they did it five years ago? What do they rely on?’”
Such questions open the door to a wide range of topics, Beeson says, from tools and services that can help customers do their jobs better and more efficiently, to discussions about privacy and how best to protect customer data while also mining it for ways to improve the user experience and get even closer to supply chain partners.
“I think we all are seeing in our personal and business lives the boundaries being created as to utilisation of analytics and data,” he adds. “I think we want to be prudent and respectful in how we do that, but at the same time maximise engagement with our customer and supplier base. We’re spending a lot of time on the user experience to understand how this plays out.”
It’s nice to talk about double-digit increases in web traffic and growing use of online tools, he adds, but more important to discover how much time customers are spending online, what they are doing while they are there, and how frequently they want to engage with distributors offline as well. Companies that continually address such challenges will find themselves in the best position to weather a potential slowdown in the years ahead, he adds.
And although Beeson and others predict another strong year for the industry, a host of economic challenges are on the table. They include the United States’ ongoing trade war with China, tightening monetary policy worldwide, and a shortage of skilled workers in the industrial and manufacturing sectors. Late last year, The Conference Board predicted 3.1 percent economic growth in 2019, down from 3.2 percent in 2018. The researcher also said that U.S. economic expansion will likely peak in 2019 as the effects of tax cuts and fiscal spending wane during the course of the year.
“The global economy will remain strong through the next half year—with no signs of a downturn—assuming there are no major policy disruptions such as a widespread escalation in tariffs on trade,” Bart van Ark, executive vice president and chief economist at The Conference Board said in a November statement announcing the findings of the group’s Global Economic Outlook 2019. “But business cycles are maturing in most economies and growth rates are gradually reverting to slower trends in the medium-term. Looking beyond 2019, the main concerns are slower growth of labor supply and modest projections of productivity growth.”