Caterpillar Inc. surpassed $2 billion in digital part sales last year, and in May 2022 set a goal of increasing online sales through its dealers by another 50% within three years. Today, Brent Steffen, director of ecommerce and digital marketing at the equipment manufacturer provided an update on the progress of the campaign.
![BrentSteffen-Caterpillar](https://www.digitalcommerce360.com/wp-content/uploads/2022/12/BrentSteffen-Caterpillar-300x300.jpg)
Brent Steffen, director of ecommerce, Cat Digital, Caterpillar Inc.
Speaking in a keynote fireside chat with Digital Commerce 360 editors Mark Brohan and Gretchen Salois at the 2023 EnvisionB2B Conference & Exhibition in Chicago, Steffen explained that the first step was understanding the different types of buyers of Caterpillar’s earthmoving and other equipment, and how best to serve them online.
Research enabled Caterpillar to segment customers into three groups:
- Retail buyers who may own a few pieces of equipment and only need repair parts occasionally.
- Professional buyers with large fleets of equipment who buy parts constantly.
- Integrated buyers, the manufacturer’s largest customers, who want to make purchases directly from their procurement and enterprise resource planning (ERP) accounting systems.
With that understanding, Caterpillar designed its parts-sales ecommerce site, Parts.Cat.Com, so that each type of buyer sees the kind of information they need about the 1.5 million parts the site offers.
For retail buyers, the website provides a lot of information, imagery, specifications and two-dimensional designs. Professional buyers need the website to be tailored to each member of frequently extensive teams — from machine operators to technicians to procurement managers — and the website caters to each person’s needs.
Integrated buyers get direct access through their ERP and procurement software to the 130 out of Caterpillar’s 156 worldwide dealers that participate in its ecommerce program.
“We worked to understand the different types of customers in an ecommerce portfolio that addresses their needs and makes customers more productive,” Steffen said.
Caterpillar sets digital standards for its dealers
As Caterpillar worked through this process, Steffen said, it identified two important groups that were critical to its digital success: its dealers and the employees who sell parts over the counter at those dealers’ 2,800 physical locations around the world.
While dealers are all independent businesses who do things their own ways, Steffen said, Caterpillar wants every online customer worldwide to have a premium and personalized experience. To do that, Caterpillar set digital standards that it works with its dealers to achieve.
That includes ensuring that every dealer ecommerce site shows real-time pricing and availability of parts. Retail customers must be offered a range of payment types, not just credit terms but also credit cards and local payment options. And, when orders are placed, the website must enable customers to see the status of their order. Customers also must be able to initiate a return online, he said.
As for the over-the-counter salespeople, many felt that ecommerce would cannibalize their sales and reduce their commissions, Steffen said. Caterpillar embarked on what Steffen called a “change management” campaign to convince dealers and their employees “that we’re not trying to channel shift customers from over the counter to digital.
“We’re convincing them that when we give customers choice, when they can come in to buy or buy online, our customers are more happy.”
Caterpillar’s new mobile app
As part of the ecommerce acceleration initiative, Caterpillar this year introduced a new mobile app, Cat Central. A customer can use the app to scan the QR code on a Caterpillar machine and get information directly related to that piece of equipment, which the app identifies through the serial number embedded in the QR code.
That provides the customer with direct access to parts that fit that machine. While that makes it easier for customers to buy replacement parts, that’s not the app’s only function, Steffen said.
He said the app also provides each day personalized informational content and tips related to each customer’s equipment. The idea, he said, is to encourage customers — especially smaller customers who only buy parts occasionally — to use the app every day.
“That retail segment, they’re harder to bring in,” Steffen said. “The premise of Cat Central is we give retail customer compelling, useful content, delivered every day about how to own and operate equipment and do maintenance and repair, and seamlessly buy repair parts when there is a need.”
He said if they use the app regularly, they’ll know it’s available when they’re ready to make a purchase.
And because the app is as much informational as a sales tool, Steffen said, Caterpillar measures success not by conversion rate, but by how many customers use it.
Caterpillar sets digital goals in 14 areas
Steffen emphasized that a huge campaign such as Caterpillar’s ecommerce acceleration program must be broken down into its component parts. He said the manufacturer has identified 14 critical areas of work, such as site search, mobile and quality, and defined key performance indicators (KPIs) to measure success in each area.
Key to success has been commitment to the initiative from top management, he said.
“Our entire company is focused on driving services growth,” Steffen said, “and using ecommerce to do so.”
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