Customer Centric Innovation in B2B

Some notes, ideas and cases

Stefan Kolle (@flb_stefankolle)

Welcome

We’re no gurus, seminar pro’s or professors …

We’re just some guys who’ve been there too (and still are)

We do more than consult, we want to right what is wrong

Opinionated – a desire to make a difference – unafraid to take the high road

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Regular speaking & media

appearances

Recognition Thought leadership

22/09/2016 4.

Our promise

We bring you new profit opportunities

Ways to make more

from the customers

you have today

Innovations to attract

your customers of

tomorrow.

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Who will be the first Penguin?

There ARE no orcas!

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Today

How to innovate in a customer centric way

Create some happiness Create sustainable, organic

growth (i.e. make more money)

Our mission: A more customer-friendly world

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8

Innovation is not just new products

Source: Mohan Sawhney, ©2002

Brand

Organisation

A 360° VIEW ON BUSINESS INNOVATION

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Innovate Beyond the Product

PROCESSED FOOD PHARMA

AIRLINES BANKS COMPUTERS

UTILITIES

Source: The Doblin Group

Most industries focus just on one type of innovation, winners go “beyond”

Business

model

Finance

Networking

Channel

Delivery

Brand

Customer

experience Core

process

Process.

Enabling

process

Product

performance

Offering

Product

system

Service

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Deconstruction

What (non-obvious) assets do you have?

What assets do we really have?

Supplier Network

Logistics

Locations

Personae

Brand/reputation

Partners

Audience

Your people

Skills

Etc

How can we use these in a

different way?

What about the experience behind these processes?

Do we actually think about the real customer experience?

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The customer evangelists say:

• They will be more loyal

• Customers pay our salary

• They will talk well about us

• It’s important

The business hears:

• This may cost money

• This sounds complex

• Another marketing hype

• Yes, this will cost money

See customer experience as a “moral imperative” Most companies

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“Why should I allocate precious

budget to experience?”

You get paid in Euros,

Not in happy faces.

There’s only one problem with this

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The good news

There is an intuitive case linking money to experience

The same coffee beans

The futures market (nov 2011)

in a package at the grocery store

at Nespresso

in a paper/plastic cup from a machine

from a machine in a theme park

in a cup in a big city café

at a deluxe restaurant

after proposing on the Piazza San Marco

Cost per cup

€ 0.01

€ 0.075

€ 0.40

€ 1.00

€ 2.20

€ 2.50

€ 5.00

I haven’t got a clue!

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perception

80% of CEO’s believe their brand provides a superior customer experience

8 % of their customers agree

(Bain & Company)

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Personal experience in 15 industries … and counting

5:1

The worst I’ve ever seen

6000:1 The best I’ve ever seen

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Experience is about making money

Happy customers are most profitable

Your product – your services – your people – your reputation/company – your agreements - …

Customers “judge” you by the experience you offer

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How experience makes money

Experience drives margin Experience is about making money

Metro Bank 3 year savings = 3,04% … rivals = 4+%

OPEN 7 DAYS

(early & late)

FREE COIN COUNTING

NO STUPID BANK

RULES

LEAVE THE BANK WITH

YOUR CARD

HAVE A COFFEE

NEXT DOOR

(on us)

FRIENDLY & SMILING

STAFF

OPEN 7 DAYS

(early & late)

OPEN 361 DAYS A YEAR

NO ANNUAL FEE

NO LATE PAYMENT FEE

NO OVER-CREDIT LIMIT FEE

NO CASH ADVANCE FEE

NO BALANCE TRANSFER FEE

FREE ATM USAGE

…

(January 2011)

The bottom line: the ones with the best experience win

Ultimate premium experience

What you get

• best online shopping experience

• 365 day return policy

• free shipping/returns

• surprise “overnight” shipping upgrades

• extreme customer service

• occasionally send customers to competitor sites

• no discounts or coupons

How they do it

• no maximum call times

• no sales targets for customer service reps

• warehouse 24/7 with 100% product on inventory

• recruit & train on people values & fit

• active customer engagement (on site & off site)

across all social networks ‘go to the customer’

• EVERYONE is a customer-service agent

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The bottom line: the ones with the best experience win

The ultimate discount experience

“Customer experience includes having the

lowest price, having the fastest delivery, having

it reliable enough so that you don’t need to

contact [anyone]. Then you save customer

service for those truly unusual situations.”

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The bottom line: with customer experience we’re

We’re not talking about the fluffy stuff

“Let’s spread love & hug” “Let’s be like Disneyland” “Let’s go WOOOOOWW!!”

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In fact

The experience IS the product

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Defining “what is the experience”

The experience IS the product

I sell overpriced, underspec’d

devices with poor battery life.

It just works

A low performance gaming

console with few titles.

This is cool!

This disconnect is the problem

Most companies roll the dice on customer experience

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Pre-sales Sales After Sales

The Traditional Perspective

Search Evaluate Try Select Wait Search *** *** *** ***

* * * = Confidential

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The Customer’s Reality

Case

A radically different perspective

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RFP Development Delivery

The Traditional Perspective

Latent

Problem

Self-

study

Discuss

@ office

22/09/2016 27

The Customer’s Reality

Informal

RFI

RFP

Prep RFP …

Case: Professional Services

A radically different perspective

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What is your customer’s journey?

Do you REALLY understand all the steps? Have you walked in your customer’s shoes?

22/09/2016 28

Customer Experience Management

Is about managing emotions at each step of the journey

69% of consumers say emotions drive their

customer experience

Source: strategic resource development group, 2006

In B2B, the average impact of emotional

motivation on loyalty outweighs rational

motivation by 2:1 margin, in both goods and

services

Source: Synovate Meta-analysis of 275 studies, 2008

Remember

Experience is about emotions

The amygdala did it

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Remember

Emotional Satisfaction

Remember

Emotional Engagement

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Experience: rational and emotional

1

Drive technology, yet also:

- Connect to customer

needs (strategic,

operational, personal)

- Look beyond R&D

- Use open innovation and

co-creation to balance

speed and

accuracy/success.

Business Class Beds

• A rested manager is more profitable

• A nice bed, meal and movie is more

agreeable

Custom Procedure Trays

• When it comes to life & death

there’s no room for error (both moral

as financial argument)

Factory Chairs

• Workers who tire less quickly are

more productive

• I actually sit more comfortable

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Listen , I shouldn’t say

this but I actually like

your December events in

London best, as it allows

me to get in some

Christmas shopping.

The experience IS the product

Case study: a training company

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It would be really

important for us to have

the opportunity to say

our prayers appropriately

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Insights

Not only in B2C!

Know your customer....”

These are insights too...

CEO: I need to be sure that the

strategy I want to propose will be

supported by the board.

“Nobody ever got fired for

buying....

Structural listening: You want to dig deeper

A short-cut: Toyota’s Secret Weapon

WHY?

WHY?

WHY?

WHY?

WHY?

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Structural listening: You want to dig deeper

Case: a bank

I take care of my family,

my employees and my

community. Above

everything I want respect

and recognition for that.

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- Business support

tools

- Trusted Payment

management

- Time management

support

Lawyers

Whats the insight?

41

ALS EERSTE KANTOOR IN NEDERLAND GAAT HVM DAAROM OVER TOT EEN GESEGMENTEERDE

MARKTBENADERING

1. beperkt aantal juridische

diensten

2. van hoge kwaliteit

3. doch lage “fixed”

marktprijs (incl.

abonnementsformule)

4. Met de juiste partners

voor de overige diensten

Een “first price” juridisch pakket dat

dankzij extreme proces-efficiëntie

in staat is de MKB’er bij te staan

met een

1. Gestandardiseerde kwaliteit

biedt doch met persoonlijke

“touch”

2. Dat fixed price werkt, dan

wel met een vaste offerte

vooraf, die ca. 25% onder de

huidige marktprijs ligt

Voor courante diensten

Een “middenklasse” juridisch

pakket dat dankzij innovatief

“account management” & interne

processen

Voor specialistische diensten

Een “topklasse” juridisch pakket

waar budgetten bewust worden

beheerd maar kwaliteit primeert

(wanneer het écht belangrijk is)

1. van de hoogste kwaliteit

(alleen partners)

2. Met 100% maatwerk qua

inhoud en prijs

Spin-out

REMOVED

Structural listening: You want to dig deeper

Remarkable B2B “classic”: Livevault

Activity:

• Note the insights you gain

• Share them with the group

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Surveys – market research – customer feedback systems …

Do you listen, or gather information to write reports?

Aren’t we already

listening enough?

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Make the customer a point of continued conversation

Case: P&G India – did you speak to a customer?

But obviously you can’t speak to everyone

A structural listening mechanism

Enter Fred Reichheld

We need something else …

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, and Fred Reichheld.

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How likely are you to recommend The ‘ultimate’ question

Detractors: Dislike Promoters: Delighted Passives: Satisfaction

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Customer Delight is “the” biggest driver of future business growth …

Likelihood to Repurchase (B2B-markets) Share of Wallet (B2B-markets)

“delighted customers are 5x more likely to

(recommend) repurchase”

“at the point of delight, there is an exponential

increase in the share of wallet”

Source: http://www.ipsos-ideas.com/library/dl.cfm?pdf=IpsosLoyalty_WP_Delight.pdf

Customer Delight The game is not about “customer satisfaction” … it’s about “delight”

Customers who recommend you, are more profitable The ‘ultimate’ question – most important finding

spend more

negotiate less

stay longer as customers

are more open to upselling

are easier to service

upgrade quicker

are ready to refer to others

increase staff morale

etc.

Customers that are so happy they

are likely to recommend a company

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0 1 2 3 4 5 6 7 8 9 10

This time, there is a money link The ‘ultimate’ question – most important finding

Detractors: Dislike Promoters: Delighted Passives: Satisfaction

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This time it’s personal The main reason

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And its even stronger in B2B The main reason

Promoters are more profitable

Philips used customer experience to drive revenue

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5:1

The worst I’ve ever seen

6000:1 The best I’ve ever seen

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Promoters are more profitable

Personal experience in 15 industries … and counting

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Derive recommendations for

improvement

Implement

initiated action

NPS survey

Plan and initiate

concrete actions

Prepare and

analyze results

Execute Feedback

Calls

Initiate

Quick

Fixes

Listen to each customer

Tactically close the loop

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A structural listening mechanism

B2B: Look at individuals, not at accounts

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A structural listening mechanism

NPS driven innovation

Dropoff Distribution Selfmanaged BBQ Academy

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Make the customer a point of continued conversation

Case: Orange

The people behind the processes

Reminder: it’s not just about direct buyers

Case: patient-centric management at Resmed

patients

Sleep medicine

& non-invasive

ventilation

nurses doctors administration insurance

patient family government anyone else

of relevance

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Who is the buyer vs who is the influencer?

22/09/2016 62

We know who’s the influencer – but what’s the real story?

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Doctors revolt

Observing your customers

They key to understanding

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Seed Farmer Auction Super

market Consumer

Info

Sharing

Active observation

& insight gathering

Sales

Argumentation

Case: Syngenta

22/09/2016 66.

Syngenta really knows its customers

22/09/2016 67.

Help your customers help their customers

Co-Creation Help us develop

Customer Council Guide us

Customer Communities Help each other

Beware: these are not employees!

Dont try to be too controlling – let them become selfmanaging.

Dont pay them in cash – pay them respect.

Back at your office

Activate your most loyal and enthousiast customers

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Savouries @Unibake

Case

70

Wireless Router

Your iron

Finally....

REMOVED

A few suggestions from a guy

who’s been there before.

Making Customer Centricity Happen

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Always remember

It’s a balancing act

BE 100%

CUSTOMER-CENTRIC

Structural Change

ORGANISATIONAL

STABILITY

Quick & Easy Wins

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Make sure your people see the value in customer experience

#1 Show Me the Money

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Build a mechanism to close the loop on every customer at every touchpoint

#2 Listen & Act on the Customer Voice

LISTEN TO

THE

CUSTOMER

ORGANISE A

MEETING ON

FINDINGS

AGREE ON

ACTIONS

0 1 2 3 4 5 6 7 8 9 10

Disarm Detractors Delight

passives

Draw lessons

on promoters

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Build a mechanism to close the loop on every customer at every touchpoint

#3 Empower your people to go beyond the script

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(cc)

Za

ch

Kle

in

“I’m sure this is all interesting but I don’t

have time for the fact that customers find

our bills too complex.

I don’t deal with the customer.

So I really think I shouldn’t be here and

do something useful instead.”

Head of IT

Include everyone in your customer experience efforts

#4 Link every task to its customer impact … or kill it

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Words, action lists and process maps are meaningless

#5 Set the example & start a movement

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Call-out

So, what will you do?

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A structured approach

1. Show me the Money

2. Listen to the Customer’s Voice

3. Build a platform for aligned action

4. Manage the customer experience

5. Future-proof your channels

6. Manage all your social media

7. Build a customer movement

8. Walk the customer talk

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