The digital revolution has triggered a new way to compete among enterprises, both domestically and internationally. Many entrepreneurs tackle the challenge by publishing a showcase of their business on the web, with a more or less extended degree of digitization of their activities. Even if the impact of digital technologies is stronger in some segments than others, the potential of the information economy is very high even in more traditional industries. Conversely, the role of the physical economy is, contrary to appearances, fundamental in highly digital industries. Companies that have a full awareness of this interdependence and know how to integrate these two pathways for the development of their business, undoubtedly acquire a competitive advantage.

Hence, the underlying message: there is no physical way digital, and vice versa. So, rather than thinking about work online / offline, companies should think about how to effectively integrate these two channels in all business areas.

Among the functions of the company, sales/marketing is one of the most exposed to this change, for the concurrence of several factors, such as the spread of social media, the development of communication channels and the dramatic increase of the opportunity of contacts, both between companies and between companies and consumers. Therefore, a full reconfiguration of the promotion, distribution, and management of the business proposal is mandatory.

This is more evident in the international markets, far from the company’s ones, where technology can play a key role in managing the bigger sales and relational network complexities.

The commercial content

If you want to grasp the essence of the content of any international trade action, you must blend together an exchange of communications/information (digital) and of objects / physical activities (physical). The review of the trade process in this context is an excellent exercise for understanding how the physical and digital channels can effectively interact and can be integrated to achieve the commercial expansion of the company.

It is possible to compare the international distribution chain to a two-lane highway, one direction, with an intermittent strip between the two. In developing the promotion, communication, and management of its foreign trade network, the company can go to each stage in a lane, or in the other, or in both.

The following schema shows an example of a manufacturer looking for a foreign distributor, who in turn sells to a network of shops who eventually sell to end customers, using the international supply chain as a pathway (see “The choice of a supply chain in an export project”).

As is clear from the schema, the flow of interactions among the various players in the supply chain (in this case, Producer / Distributor / Retailer / Customer) can be reduced to minimum terms of business, breaking down the promotion, development and sales activities into a mere exchange of:

– Information (technical and commercial know-how)

– Communications (promotional messages and interaction among the actors)

– Goods (products, equipment, materials)

This exchange takes place today on a multiplicity of channels, much more than those available in the recent past. In fact, the development of digital communications along with physical ones makes this interactivity easier, having a significant impact on international trade that, in this new context, reduces the disadvantage of great physical (and cultural) distance.

A new way to approach the distribution chain

So today the company, in practice, with the multiplication of the means of communication and the points of contact can think about how to completely reshape the entire supply chain (in a wider perspective, i.e. including sales, marketing, logistics, transactions, and customer assistance) or how to change the interaction processes among the actors along the chain, in order to achieve purposes of operating efficiency and/or commercial effectiveness.

This study should not be approached incrementally. Rather than analyzing step by step every physical activity and trying to title it / replace it by a digital channel (or vice versa), it should be done instead through a more holistic approach, able to transform the existing dynamics of interaction and to modify the same (intermediate) actors of the supply chain or even to replace or eliminate them. This awareness of how important it is to balance both components, the physical and the digital, as it is a factor capable of providing a competitive advantage to the company in international markets.

As a matter of fact, the right convergence of these two areas ensures mutual benefits, while minimizing their underlying weaknesses. For example, in general terms, the physicality brings unparalleled sensorial and social experiences, and physical proximity of the seller reassures buyers/consumers (at the time of purchase, or later, in facing issues concerning the guarantees and the post-sale assistance, etc.). Similarly, digital marketing ensures maximum interaction opportunities, easing the buyer evaluation and purchasing process, and bringing efficiency throughout the whole sales process.

Besides this, with very few exceptions, a supply chain is always composed of both channels, as in the classic example provided by e-commerce. Though e-commerce hosts most of the sales process online (publishing the information and technical content, enhancing the product promotion, guiding the buying path and providing full contact assistance), it is unable to complete its deals without the intervention of a robust physical infrastructure (product delivery, customer care, etc.).

The new way of physical and digital integration to compete in the foreign markets

In order to successfully grow in international markets, companies must break down the flow of their contents (communication, information, goods) and analyze how to create new tools and/or workflow processes triggering innovation and strengthening their competitive position.

In other terms, the joint action of a reorganization of physical and digital channels enables improved operational efficiency and commercial effectiveness in the development of international sales. This allows the company to improve its offer and create greater interaction with its buyers/distributors / consumers.

Here are some examples of the results obtained from such a reorganization that impacts the supply chain, processes, communication, and international marketing:

• Proximity: the physical presence of the product (or sample) on-site allows a more careful evaluation of the buyers and ensures a sensory experience;
• Trustful relationship: the physical infrastructure, the staff on site, the presence of multiple channels of contact and assistance increase the trust of customers, and therefore their propensity to buy (or to repurchase);
• Shortened chain: the increase in channels and communication tools amplifies the capacity of interaction and exchange of information of the company, allowing it to potentially skip different actors in the supply chain and to get closer to end-users.
• Simplified interactions: the growth of interaction tools at all three levels (information, communications, goods) gives the company new ways to physical and digital content delivery and overall their simplification, automation, and speed.
• Transaction speed: a higher amount of information about the business proposal, the use of multiple channels and the management of the physical proximity of the products and/or of the organization, are all factors increasing the speed of the buying process by the international buyers with an immediate advantage for the company- higher efficiency (and effectiveness) of its commercial activities.

This process of innovation in processes and commercial communication can be carried out also by companies that export and have already gained significant sales volumes; in fact, on the one hand, some changes can be particularly onerous and perhaps risky in reshaping a sales structure already in place. On the other hand, the presence of buyers and established channels allows for a wide source of information on what to change and how. It is sufficient to analyze the existing dynamics and to listen to the demands of customers (whether direct or indirect, rather B2B and B2C), while also monitoring the evolution and trends of the industry and technologies that anticipate new requirements or solutions. Altogether, this process can be conveniently applied to those taking their first steps on a foreign market, studying from the beginning how to approach the distribution chain, and by what means and channels to “transmit” the related content (information, communications, goods).