In brief

In brief

  • Accenture’s 2020 Global Buyer Values Study for Chemicals found that customers consider changing suppliers and materials if their needs are not met.
  • This is the second in a series of reports that explore the study findings and identify actions for companies to take to be more customer centric.
  • The willingness to switch puts a significant portion of a chemical company’s revenue at risk due to customer attrition that is difficult to reverse.
  • A focus on differentiation, protecting key customer relationships and being prepared to win over new customers can defend against attrition.

Across the B2B world, customer loyalty is a significant challenge—and the chemical industry is no exception. Buyers are generally ready and able to switch away from sellers that fall short in meeting their needs. And when customers make this change, they are likely to be gone for a long time, if they can be won back at all.

According to Accenture’s Global Buyer Values Study, a majority (78 percent) of chemical companies are concerned about losing customers—whether from attrition, loss of market share or enticement from competitors—if they are not customer centric. And they have reason to be worried—perhaps more than they know.

A surprising number of buyers (58 percent) from across all industries in the study said that they could change suppliers if their preferences were not met—and many are thinking about doing so within the next year. About the same number (56 percent) said they could switch to alternate materials, including those from outside the chemical industry. (Figure 1)

Figure 1: Percentage of buyers that consider switching suppliers or materials if preferences are not met (full sample & select industries)

A surprising 58% of buyers across all industries said they could change suppliers if their preferences were not met within the next year. And 56% said they could switch to alternate materials, including those outside the chemical industry.

Altogether, these findings challenge the traditional view in the industry that price is the overriding cause of customers deciding to switch. In fact, the research shows that customers may not be as price-sensitive as sellers think—and that chemical companies need to address a broader range of buyers’ needs to keep customers.

The research also found that there are large gaps between what sellers think is important to buyers and what those buyers actually value, which makes the risk of customers switching very real. Looking at the plastics and rubber industry, for example, buyers were more likely than sellers to think that having pricing information was important. They also placed a higher level of importance on being able to purchase materials that help them differentiate their own products, carbon neutrality and automation. (Figure 2)

Figure 2: Top value perception gaps for plastics and rubber industry customers

The research found large gaps between what sellers think is important to buyers and what those buyers actually value, which makes the risk of customers switching very real.
Gaps in understanding buyer values open the door to customers “voting with their feet” and changing suppliers.

Moving from insight to action

Armed with the knowledge that many buyers are willing and able to switch materials and suppliers, chemical companies can consider the following actions:

Double down on differentiation
Sellers can differentiate product and service offerings to more closely match customer applications and adjust their pricing and service models to incentivize loyalty and long-term relationships. They can also:

  • Develop a better understanding of customer preferences and provide differentiated products and services that really matter to customers—making it harder for them to leave.
  • Invest in identifying those customers that are most likely to leave, making a concentrated effort to meet their needs while simply continuing current practices with those that are not deemed to be at risk.

Protect the base
Sellers can strengthen their efforts to reach the customer’s customer to create more pull and lock-in for their products. They can also:

  • Take a data-driven, fact-based approach to truly understand what customers value, and then tailor their offerings and interactions accordingly.
  • Consider investing in competitive intelligence about supply/demand, pricing and potential competing materials.
  • Monitor the customer’s production processes and technologies to see where increased competition from other materials is likely to emerge.

Play offense, as well as defense
Sellers can connect with buyers that are potentially “on the move” in the market by identifying the main underserved needs in their customer industries and make meeting those needs the center of customer-acquisition campaigns. They can also:

  • Keep a sharp eye out for competitors’ customers that may be open to changing suppliers by using analytics to identify behaviors that signal an intent to switch.
  • Establish mechanisms across sales and customer service that make it possible to quickly act on opportunities to win over new buyers.

Virtually all (99 percent) chemical sellers in the survey believe that customer centricity is important, and many think they are doing a good job—with 61 percent giving themselves a ranking of 8 on a 10-point scale. But that confidence may be misplaced, as the research shows a number of significant gaps in sellers’ understanding of buyers’ needs. Those blind spots are likely to mean that customer needs are not being fully met. And in an industry where customers are quite willing and able to switch suppliers and materials, companies will need to move fast to remedy that situation and build even higher levels of customer centricity.

The Accenture 2020 Global Buyer Values Study for Chemicals assessed and compared the perspectives of chemical companies (sellers), their customers (buyers), retailers and end consumers. The study identified areas where seller and buyer perspectives are aligned and where they differ, and where sellers have an opportunity to do a better job of meeting buyers’ needs.

This report covers only a portion of the study’s extensive findings, which can be used to provide an in-depth understanding of a range of factors affecting customer centricity—for specific companies, as well as the industry as a whole. The next report in this series looks at how disconnects in seller and buyer perceptions can create tremendous opportunity for chemical companies.

Thank you to Accenture’s David Apel, Bruno Djapanovic, Michelle Ganchinho and Karin Walczyk for their help in executing the study and writing this report.

Dr. Bernd Elser

Senior Managing Director – Global Lead for Chemicals and Natural Resources

Dr. Tobias Radel

Managing Director – Strategy & Consulting, Chemicals

Paul Bjacek

Principal Director – Lead, North America Thought Leadership & Global Resources Research

Rachael Bartels

Lead – Function Networks and Programs


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