BLOG

The Secret to Creating Growth Moves

Beef up the value proposition, tap into a new audience and find fresh promotions.

We’ve previously explored how to drive growth in a pragmatic way through the development of a strong customer value proposition. Now we’re looking at how to develop the actionable initiatives needed to bring that value proposition to market.

We call these initiatives and steps “growth moves” and their goal is to push a company’s thinking forward and create new ideas that can disrupt the category or challenge a competitor’s strategy.

The Secret to Successful Business Growth

The secret to creating these moves is a combination of art and science. On the one hand, they need to answer a business need that has been identified in the value proposition and make sense financially. (We recommend creating a business plan per growth move.) On the other hand, they must be a creative solution that resonates with the target customer and reflects their attitudes, behaviors and needs.

3 Actionable Steps for Achievable Business Growth

We’ve outlined a few examples below to help you get a better understanding of growth moves that have proven successful in the past. Some of these could likely be applied to your own growth initiatives.

1. Access A New Industry Type

In the previous article, we talked about our insurance client in Latin America for which we developed a channel strategy that would allow them to penetrate a new industry type – employers. In order to bring this growth strategy to life, we generated specific growth moves.

Some mid-size companies needed support in managing their employee base, so we put together an ambitious plan to educate and provide tools for employee management in small to medium-sized companies to build the notion of a partnership with the insurer, and provide access to their employee base.

“We call these initiatives and steps “growth moves” and their goal is to push a company’s thinking forward.”

2. Supporting Value Proposition

When we launched the T- Mobile “Un-carrier” strategy we helped them develop a set of moves that would support the new value proposition during the first month, including growth moves like no contracts, or the device-updating approach “JUMP” which had a massive commercial impact and made the value proposition real to customers.

3. Reignite Promotion

But growth moves don’t have to be complex. A great example is the “Breadstick Nation” concept we developed with Olive Garden, Darden Restaurant’s largest brand, which found itself in a highly competitive environment.

The restaurant chain needed to reignite its promotion strategy in a way that would increase guest reconsideration, particularly during weekday lunches. We had to develop “quick hit” promotions that could be launched almost immediately. Breadstick Nation launched to wild success, with Darden Restaurants’ stock surging 15% and hitting a new all-time high in the weeks following the #breadsticknation launch.


FINAL THOUGHTS

When developing growth moves, it is easy to get lost in the excitement of idea generation, so it is important to be pragmatic. Make sure that the growth moves answer the following questions:

  • What’s the customer insight / need we’re addressing?
  • How does the concept work?
  • What are concrete next steps?
  • Who’s responsible for execution?

When growth moves are developed with specific consumer needs in mind, they will break through the noise and give consumers clear reasons to choose your company over competitors.

Next, it’s time to explore the best way to pilot these growth moves to quickly demonstrate real business impact.

If you’re thinking about where to look for your next wave of growth, Prophet can work with you to develop growth moves that drive brand growth.

BLOG

Building Relevance in Financial Services – It’s All About Customer Experience

People crave the kind of holistic experiences that can only come from cross-collaboration and plenty of data.

We believe relevance—how meaningful brands are in people’s daily lives—is the single biggest determining factor of a brand’s long-term success. It’s what makes companies like Amazon, Android and Netflix, which are at the top of Prophet’s Brand Relevance Index™ (BRI), successful. They have made themselves so indispensable that their fans can’t imagine a day without them. But relevance is a currency most financial brands just don’t have. Only three financial services companies crack our top 50: PayPal, TurboTax and Visa. And the bottom of the list is a different story – it is jammed with banks, insurance companies and wealth-management firms that struggle to achieve meaningful engagement with their customers.

The Pragmatism of Financial Brands

The BRI, which is based on a survey of 15,000 U.S. consumers, measures what we believe are the four drivers of relevance: customer obsession, distinctive inspiration, pervasive innovation and ruthless pragmatism. Financial brands scored the best in ruthless pragmatism—as they should. Pragmatism is measured by consumer responses to statements like “I know I can depend on this brand,” “it makes my life easier” and “it’s available when and where I need it.” Consumers are sending the message that basics matter: if a bank can’t handle mobile deposits or an insurance company doesn’t pay claims, what good is it?

But this pragmatism doesn’t stand on its own, and for the brands that ranked higher than most,  pragmatism was coupled with high levels of customer obsession. Meaning they took the millions of data points at their disposal and translated them into relevant services, products and experiences that make consumers’ lives run a little more smoothly.

Examples of Successful Financial Customer Experiences

The financial brands that embrace ruthless pragmatism and customer obsession can be just as fiercely beloved as those in other categories. Let’s look at three brand examples:

  1. Most people only turn to TurboTax once a year, but they love how it makes a difficult task in their lives easier. More people in the U.S. said TurboTax “meets an important need in my life” than any of the 300-plus brands we measured.
  2. Visa is an “old reliable” that has become a digital-first thinker.
  3. PayPal, which emerged as a super-dependable way to make online payments when it was still on the eBay platform, is safer and faster than ever.

All three excel in mobile technology. And most of all, they understand that they are not in the business of creating financial products. They know their role is enabling better customer experiences.

Build Experiences, Not Products

In our work with financial companies, we push toward experience-led thinking by asking our clients to reimagine the industry and what their brand would look like if they were starting from scratch today.

It would probably look something like Mint, Intuit’s personal finance software, which lets customers see all their money and expenses in one place.

It would likely include something like Venmo, the PayPal-owned payment app millennials love so much, or SnapCash, the payment platform preferred by Gen Z.

It might even borrow elements from WeChat, which ranks as the second most relevant brand in our Brand Relevance Index in China. (Started as a chat app, WeChat added digital payments, e-commerce, fundraising and microloans.) From this platform, what’s needed next is translating all that information into personalized products, services and experiences.

It’s the Holy Grail. No one has done it yet, and many branding experts can’t believe mainstream financial services companies, with all that marketing muscle, are still so behind the curve.

“Internally, there is no unified view, which makes creating one for their customers very difficult.

That’s a little glib. Those of us working in the industry know that the obstacles are real. For one thing, changing regulations, like the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, have created challenges. For another, unlike start-ups from Silicon Valley that can get away with years of losing money, the investors who own these established companies demand profits, not losses.

But the biggest problem they face is their own organizational structures. Historically, each type of product—retail banking, mortgages, retirement, and various policies—are housed in distinct silos, governed by separate profit-and-loss statements. Internally, there is no unified view, which makes creating one for their customers very difficult. And the reality is that employees are incented to focus on products, not experiences, in order to meet their product sales goals.

Think Holistically About Customer Experience

Solutions can only come from thinking holistically. At companies that are becoming more customer-obsessed, there’s a growing understanding that “brand” isn’t something that comes from the marketing department. It develops and grows in every department—sales, distribution, product, and technology. Similarly, the mindset throughout the organization needs to shift from “what can we sell?” to “what value exchange can we create?” In building long-term relationships with customers, what types of products and services make people say, “This brand isn’t just out to make a quick sale—it really has my back?”

This requires taking giant steps away from “business as usual” thinking. Ford CEO Mark Fields, for example, shook up the automotive world with the announcement that the company is striving to be “a mobility company,” not just a car manufacturer. This has enabled it to develop brand-new approaches to the way today’s consumers think about urban transportation. What will be the equivalent shift in financial services?

The most important step financial companies can take to gain relevance is getting every division on the same page: Improving customer experience and engagement. And that can only come from customer obsession, constantly pushing all departments to work harder to see things from the consumer’s point of view.


FINAL THOUGHTS

Most financial companies aren’t able to do this yet, but they are trying. That’s evident in the widespread acceptance of multichannel offerings, with banks understanding that customers expect to be able to have their needs met no matter where they are or what time it is. And many are closer to making their offerings channel-agnostic, with ultra-pragmatic mobile solutions.

Sometimes, companies ask us about increasing the other drivers of relevance– distinctive inspiration and pervasive innovation. We discourage them unless they are already performing well on more pragmatic measures and customer obsession. If a bank is staffed by surly tellers or brokers who provide confusing statements, even the best performance on other measures can’t help. These may seem like table stakes, but our rankings prove otherwise.

For today’s consumers, relevance requires delivering useful and engaging experiences powered by technology. The only thing that will work is improving the experience at every touchpoint, providing relevant content and taking the broadest view of customers. It’s not about making a better financial product. It’s about making consumers’ lives better. Relevance doesn’t come through branding. It’s built on these rewarding experiences.

BLOG

3 Brand Naming Strategies for Growth Acceleration

Names that respect both company heritage and customer journey resonate best.

Personalization is becoming increasingly prevalent in categories from shoes to cars to phones. But while appealing, this inundation of choice can overwhelm consumers rather than satisfy their needs.

How can a brand provide the variety of options consumers crave and fulfill the desire for a simple customer experience? The answer lies, in part, in naming. The most successful companies drive relevance and growth in their portfolios by naming – organizing and communicating offerings in a way that prioritizes what customers want and need in each purchase decision.

When done right, naming at the product, version or feature level can simplify and guide prospective shoppers to the relevant offerings for their needs. But when done poorly, it can frustrate customers—and even inhibit them from making a purchase at all.

The 3 Commandments of Brand Naming

1. Consider the customer journey: Brands need to think about the entire customer journey, how (and when) a customer makes decisions, and how to nurture customer loyalty.

2. Ask what requires a name: Not every product, service or feature needs a name. Be selective about what truly requires a name.

3. Keep the DNA of the brand front and center: The personality of a brand should be reflected in each brand name. Use it to gut-check and filter naming decisions. And then name accordingly.

3 Brand Naming Strategies Driving Growth

Looking across categories, we’ve identified three successful brand name strategies to help customers better understand your products and support business growth.

  1. Consider the Customer Journey: Jawbone Focuses on What’s Important

One of the most confusing and challenging naming conventions is tiering, or differentiating similar offerings within a portfolio by their power, capabilities, etc. The challenges companies face with tiering are many. Three of the most difficult are clearly differentiating between offerings, creating a tiering convention that allows the product line to expand into the future and avoiding making the lowest tier sound undesirable.

A strong tiering example comes from the consumer tech and wearables company, Jawbone. They’ve extended the simplicity of their product design to their naming convention and product architecture, choosing to quietly discontinue their line of Bluetooth speakers to focus more fully on fitness trackers.

Jawbone has four models on the market: Upmove (which is, after all, the essence of fitness – getting up and moving), UP2, UP3 and UP4. Each successive model builds on the functionality of the previous one, making the tiers a simple incline in value, rather than random sets of features customers need to understand.

With such simple product tiering and feature names, Jawbone has the freedom to be creative with color and material naming (which are paired together within the product tiers), providing customers with exciting choices like Ruby Cross and Black Gold Twist. In doing so, Jawbone simplifies the most important functional decisions (what to buy, what you need) and lets customers have fun with the more playful—and secondary—decisions.

  1. Ask What Truly Requires a Name: Tesla Builds Meaning Into Naming Conventions

Many technological advancements have opaque names with little explanation as to what they mean (i.e. Star Wars’ C-3PO). Sometimes they’re SKU numbers, sometimes they’re abbreviations and sometimes they stand for the developer’s children’s initials. Whatever they are, they’re rarely understood and have a high likelihood of creating confusion for customers navigating between nuances. (“What’s the difference between the X1300A and the X1301B?”).

“When done right, naming at the product, version or feature level can simplify and guide prospective shoppers to the relevant offerings for their needs.”

In contrast, Tesla’s naming conventions are incredibly simple. Known for its commitment to innovation, Tesla consistently defies expectations, even going so far as to publish a high-level roadmap in the form of its “Master Plan.” Tesla’s Model S P90D has all the bells and whistles, including an impressive and seemingly opaque acronym. But each component has a clear meaning: P denotes that it’s a performance model, 90 is the battery capacity in kilowatt hours and D means that the car has a dual motor. This is complemented with highly descriptive feature naming: Cabin Overheat Protection, Autopark and the famous Autopilot, and each is named for exactly what it does. Of course, this approach is supported by an extremely focused product portfolio. Tesla sells three automobile models, while many of its peers’ offerings are in the dozens.

  1. Keep the DNA of the Brand: IKEA Aligns Product Names to Scandinavian Roots

Unlike Tesla, IKEA has a vast portfolio; the company sells roughly 9,500 products and introduces 2,500 new items per year. Its stores, despite their homey vibe and intuitive layouts, can be overwhelming even to the best-prepared shoppers.

To help IKEA put a strategy in place to guide the creation of all names, which started with its founder, Ingvar Kamprad. Kamprad is dyslexic, making it much more difficult to use the traditional method of long SKU numbers. Instead, IKEA assigned a type of name for each of its product types. True to the company’s heritage, the system is Scandinavia-centric: beds, wardrobes and hallway furniture are named for places in Norway, dining tables and chairs are places in Finland, and upholstered furniture and coffee tables are places in Sweden. Because each type of name can apply to multiple items (for example, Nellie’s apartment features a Hemnes bed, dresser and hall bench), IKEA creates clear signposts that help customers shop the store more comprehensively and connect the dots across their pieces.

While this strategy is less intuitive for non-Scandinavian shoppers, it is inarguably memorable, and makes customers loyal not only to IKEA, but to Malm, Kivik, and of course, Hemnes.


FINAL THOUGHTS

Jawbone, Tesla and IKEA share a common overarching goal in their naming: to help customers understand their products. However, how they do it is distinct, and most importantly authentic to who they are. Jawbone’s naming is sleek and minimalistic, with a splash of fun. Tesla’s naming is efficient and hard-working. And IKEA’s naming is unwaveringly grounded in the company’s roots.

BLOG

4 Ways Customer Experience Drives Business Growth

New fans matter. But it’s real secret is deepening relationships with its most devoted customers.

How Customer-Led Experiences Drive Business Growth

Customer experience used to have a clear beginning, middle and end. And most customers followed a similar path. But traditional customer journeys no longer exist. Today, these experiences are non-linear, unpredictable, and shared; and only a few companies are taking advantage of this new reality. Most still view customer experience through a traditional lens: What’s wrong, and how can we fix it? But for those willing to widen the aperture and obsessively follow customers in all directions, experience-led thinking is creating new value, revenue growth and profit.

Customer experience (CX) is at a tipping point: The only brands winning love and loyalty are those taking engagement to a deeper, more complex level. In fact, digital has given companies the power to easily add new moments and touches, and remove steps, streamlining the experience. By following customers through the crisscrossing network of real-world, social and digital experiences, organizations find a deeper understanding of people, as well as opportunities to use those insights to create signature moments that drive relevance, word-of-mouth, and loyalty.

With the blending of digital and physical worlds and virtualizing of brands, customer experiences are being transformed while becoming even harder to control.  This means that authenticity has become critical.  As emotional decision-makers, customers are constantly seeking experiences that go beyond function.

Transformation requires seeing customer experience differently. Customer experience is no longer just an output or something brands create and exclusively own. It’s also an input, a valuable conduit. It is a collection of all the moments and interactions that build and shape customer expectations. It is a series of experiences that engage and inspire – strong empathy compels customers to share those experiences with others.

Non-Linear Customer Journey

While experiences may once have been linear, today they are unpredictable. People may stumble across you on their tablet at 3:00 am, dismiss you while reading reviews on their phone, only to rediscover you in an enthusiast’s blog. Customer experience is now the sum–the collection–of all those moments and it is imperative that companies engage and inspire through those moments.

Some experts describe the journey itself as broken, but we prefer to think of it as rerouted—it’s now part helix, part labyrinth, and part maze. People interact with brands across many touchpoints, and they determine their own path to purchase. And whether they are in the pre-purchase, post-purchase or ongoing-use mode, one thing is certain–they are no longer spectators or co-creators. They are in the driver’s seat.

Customers are continually talking with other people about brand experiences–those that thrill and those that disappoint. And they’re doing it publicly, and on social media. Given these shared experiences, the most important part of the experience is fast becoming not just what impacts one particular person, but all the potential customers around them.

Industries that have been the most disrupted by technology seem to understand this better. In travel, for example, airlines are increasingly recognizing that mobile technologies are everything to frazzled travelers. But brand parity has made physical comfort more important than ever—look at Delta’s renovated JFK Terminal, which includes spa services and better food (a Shake Shack, for example), more security lanes, and a lounge luxurious enough to make layovers more bearable.

“Companies that are truly customer obsessed put peoples’ needs and aspirations ahead of technology, business operations and other processes.”

Healthcare is another example. As consumers, providers, hospitals, and insurers have become increasingly disenchanted with the status quo, smart companies are pioneering powerful experiences via patient portals, telemedicine and even virtual doctors.

Four Essentials to Grow the Customer Experience

What successful companies have in common is that they’ve adopted an experience-led mindset that allows customers to lead the way. Reaching this higher level of thinking requires following four principles:

1. Customer obsession

Customer experience efforts are routinely based on insights, but the most successful companies are those that gather intelligence at a ferocious pace, and constantly put customers at the center. They are tireless in their quest to understand and think like their customers. They invest time–lots of time–listening, watching, and interacting with people to plumb their “absolute truths” and build insights.

Sephora, the beauty retailer allows consumers to build in-depth profiles of their skin tones and favorite products – yielding a wealth of intelligence but also allowing them to deliver a seamless transition between online and store.

And Starwood Hotels & Resorts, with intense analysis of its weary business travelers, uses its obsession to create experiences customers didn’t even know they wanted, such as Keyless Entry to streamline getting to the hotel and entering the room

Creating a breakthrough experience starts with the customer. Companies that are truly customer-obsessed put peoples’ needs and aspirations ahead of technology, business operations and other processes. This is not about just conducting customer research­­–it’s about allowing people to co-create and join in the development cycle. Customers are the independent variable that comes first. Everything else comes later.  As obvious a point as it may seem, customer experience is about customers and if you do not understand customers deeply it is hard to achieve successful growth.

2. Ruthless pragmatism

Companies need to stay focused on essential objectives, prioritizing investments that add the most value. It’s important to understand what part of the experience truly matters to customers and then align that to feasibility and operational efficiencies.

“Some experts describe the journey itself as broken, but we prefer to think of it as rerouted.”

This also means adopting a test-and-learn mentality that allows piloting the most promising ideas, as well as metrics to kill initiatives that aren’t working. Google conducts thousands of tests every year, but on very small groups of users. Relatively few go on for additional testing. This hard-nosed thinking is critical to determine where to focus investments: Which areas matter most, and have the greatest impact?

3. On-brand authenticity

Fueled by customer insights, it’s important to shape experiences that are consistent with a brand’s core equities, translating them into signature touches. What are the brand attributes that need to be reflected in every aspect of the experience? Patagonia excels at authenticity, making high-quality, multifunctional clothes that “last a long, long time.” It delivers on its purpose in inspiring ways, from the “Better than New” truck that repairs items, the “Worn Wear” campaign that celebrates the stories “we wear” and by featuring interestingly sourced materials (such as recycled plastic soda bottles) in its products.

Tesla is another, with customer advocacy that extends beyond its interactive, educational showrooms into its hassle-free servicing. With a vow to never have service as a profit center, most repairs are completed remotely through “over the air upgrades.” And when a car does need dealer attention, Tesla provides a loaner, delivered directly to the owners’ doors.

4. A Connected Mindset

This is often the most difficult and involves working across silos, bringing people together around a shared goal in effective cross-functional teams. Aligning incentives and processes allow people to think outside of their functional groups and business units, because to consumers, that’s all irrelevant. Tech companies often have an inherent advantage, simply because they’re newer and less entrenched in their respective silos. From PayPal to Facebook to Amazon, they’re known for pulling together for bold moves.

But any company can learn to work this way. GE Healthcare, a Prophet client, traditionally led from its own engineering prowess. But by working across departments, it switched its focus to the crushing dilemmas of large hospitals. To streamline purchasing and maximize machine use to improve care and lower costs, it allowed its customers to lead it to a new selling focus, one that elevated it from a vendor to a true partner.


FINAL THOUGHTS

To win in today’s competitive marketplace companies must adopt experience-led thinking to drive growth. At Prophet, we’re working with clients every day to make such leaps, and with our ability to leverage brand as a key asset for the company, we are pushing past the basics of customer experience to develop signature moments and enhancing experiences at every possible touchpoint. Customers can lead the way to this expanded mindset if brands are willing to follow them.

If you know you need to focus on customer experience but don’t know where to begin, speak to Prophet who can help you to move your organization forward.

BLOG

Taking B2B Growth To The Next Level

Let a deeper commitment to data integration help bring you closer than ever to customers.

Harness the power of data integration to provide more powerful B2B solutions

For B2B suppliers, finding ways to strengthen and increase the value of the solutions they provide is a proven and effective way to accelerate growth. Over time, solutions-driven companies have moved beyond the predictable precepts of “solution selling” and product bundling to solve important customer problems by linking products, services and advice in ways that deliver significant customer value. Hewlett-Packard’s move to link systems integration and networking support to its hardware offering is a classic example of the effectiveness of moving from products to solutions.

Our client work has highlighted the opportunity to move to higher, more integrated and more comprehensive levels of solution delivery by integrating the power of exploding digital data sources, predictive analytics and digital information interchange with customers. These solutions do not merely use big data to target customers or improve how companies promote existing products or services. Instead, they integrate data into the actual solution so the solution adapts and becomes more valuable as a customer uses it.

Data-integrating solutions are emerging because data has reached a tipping point, with 90 percent of it generated within only the last two years. The power of integrated solutions is all around us. Caradigm, a joint venture of GE Healthcare IT and Microsoft has begun providing data integrated solutions to help hospitals better coordinate patient care and fill in treatment gaps. Logistics companies such as UPS are incorporating traffic congestion data into route planning to improve package delivery times. Facility managers have begun using smart heating and cooling systems that adapt the use of resources to the environment, energy prices and demand.

Monsanto is an example of a company at the forefront of unleashing these new, data-integrating solutions. Over the course of less than a decade, it has moved from leadership in producing seed with improved yield characteristics to becoming a greater partner with farmers in improving field productivity. And at the same time, it has outperformed its industry peers by nearly five-fold. The shift from seed-product producer to field-solution provider has involved several steps, including the introduction of an agronomist force that helps farmers make better choices.

Recently, Monsanto has accelerated the solution shift by purchasing Climate Corp., a data source for weather and climate information and is integrating its information with soil and crop data, creating powerful new solutions that improve farm performance. Importantly, these solutions are not static. They learn and become more meaningful as weather and soil conditions change and as farmers experiment.

Data-integrating solutions are emerging because data has reached a tipping point, with 90 percent of it generated within only the last two years. Yet few companies have a plan to use these new sources of information and customer value effectively. To achieve gains that are truly transformative, B2B companies must learn to harness this data to build integrated solutions that elevate them above the role of the vendor. It requires harvesting the most relevant customer information available and offering insights that make them genuine business partners.

Pitfalls in the search for solutions

The rare B2B company is able to prosper through a steady flow of extremely innovative products and services, offerings that are so unique and protectable that competition cannot keep up. But most must use every tool possible to avoid becoming commoditized, to stay relevant as customer requirements change and to differentiate in more global and competitive markets.

And adding related products and services and providing expertise for broader solutions has certainly been effective in avoiding being treated as an ordinary supplier and more like a strategic partner, enabling interactions with higher-level decision-makers. These stronger, more solid relationships—at least theoretically—also decrease the risk of losing business to a competitor.

But creating a tangible and measurable return on the added investment continues to be a challenge. Many B2B companies find it difficult to charge for the extra investments or generate a premium through their core pricing. Customers begin to see such innovations as a “favor” for giving a supplier all the business, value-added service with benefits that are hard to rely on or quantify. When solutions don’t yield margin or a platform for meaningful growth, they don’t remain sustainable and wither without additional support. Companies may start a pilot project here or there, but the risk tolerance is low. If they can’t figure out a way to make it profitable rapidly, they shut it down.

The power of data-integrating solutions to create customer intimacy

Digital technologies are enabling B2B companies to get close to end customers quickly and cheaply, and these insights are providing tools that jump-start growth. Dunn & Bradstreet has joined forces with Salesforce Analytics Cloud to build a more valuable prospecting solution by making financial and firmographic data available to millions of salespeople, even via mobile device. Avery Dennison has found new ways to combine high-technology labels with data to improve end customer package line speeds. The label, packaging, data solution increases overall packaging productivity without giving up on-shelf impact.

At Prophet, we’ve become adept at finding new ways to help our clients leverage data integration to achieve growth. Here are four data-driven strategies that show plenty of promise. With this new data and fresh insights, the odds of success are better, and the stakes for failing to do so are higher:

Combine product, expert service with data Cisco has shifted its primary business away from just communications and networking/switching components to include systems integration, software, network design advice and monitoring. It’s enabled them to build and maintain powerful collaboration communities around key issues, such as productivity or call-center management. Landis + Gyr has moved beyond the sale of electrical meters to smart meters and provides data collection and analytics. It’s now working to improve the energy efficiency of the entire electrical grid, making it more resilient and robust.

Enhance your product with powerful data Halyard Health, formerly the Kimberly Clark Healthcare division, makes the gowns, masks and gloves that help control infections in hospital settings, a process that has come under intense scrutiny with the rise of such illnesses as MRSA and Ebola. In providing data on best practices, hygiene, and ER and OR efficiency, Halyard launched a service called AiRISTA, installing a simple tag at hand-washing facilities that tracks when and how frequently providers wash their hands. It helps ER personnel become more compliant with washing their hands, which in turn reduces infections and lowers hospitals’ re-admittance rates. In doing so, Halyard has moved from selling gloves and gowns to selling data powerful enough to significantly improve patient health and ultimately lower operating costs.

“The rare B2B company is able to prosper through a steady flow of extremely innovative products and services, offerings that are so unique and protectable that competition cannot keep up.”

Leverage data to go direct B2B companies can no longer sit on the sidelines and let others disintermediate their distributor relationships by appealing to their end customers. Channel conflict is an age-old issue, which expanding data access is rapidly making more complicated and more difficult to manage. Airlines such as United are no longer sitting and watching intermediaries (data collectors like Kayak) take control of the travel planning of large corporations with heavy travel needs. Others with historically restricted access to end customers, such as pharmaceutical companies, are providing data to build direct (if not actually transactional) relationships with physicians and sufferers around ways to improve overall patient health while keeping within regulatory restrictions.

Harness the power of data companies such as Citibank don’t just issue credit cards or use big data to improve campaign targeting. They are also organizing and finding insights based on their billions of transactions to use as a separate business to support their B2B clients. They are helping their B2B clients improve forecasting demand for products, adjust merchandising plans and modify staffing assignments based on improved access to high-quality data.

Make this search for solutions better than the last
Often, our clients tell us they’re not sure where to begin the search for the best ideas for integrated solutions. We’ve found three guidelines keep B2B companies on track:

  • Get closer to your customers: Putting the customer—and your customer’s customers–at the center of your decision-making has never been more important. Understand deep needs and behaviors, and study what they do on the web. Push beyond traditional market research methods to collect and mine actual behavioral data on your customers.  Augment everything you do with collecting data on web traffic.  The best solutions come from a more nuanced understanding of customer behaviors based on data and traditional insights gathered from market research.
  • Build, buy or partner: In many cases, the data and insight landscape is changing too fast for you to become an expert. You can choose to build, but it will require a multi-year investment with low NPVs in the short term. Explore partnerships and potential acquisitions. You can accelerate your knowledge more quickly by leveraging what others already know about how to effectively use data.
  • Stay committed: Integrated solutions take time to get right. Be ready to fail fast, but don’t back down. Failures are to be expected, and even encouraged, because in regrouping, you’ll improve your organization’s agility.

FINAL THOUGHTS

Don’t let early failures stop you. If you give up, someone else might step in and disintermediate you. Once you create small successes, you will be inspired to create more solutions that will you can take your enterprise to the next level.

BLOG

5 Essentials to Organic B2B Growth

How our work with Avery Dennison, GE Healthcare and Pentair helped them develop new levers for growth.

B2B growth leaders such as Avery Dennison, GE Healthcare and Pentair share a few common essentials that are the key to their success. They prioritize meaningful innovation. They target customers who appreciate value and are willing to pay more for it. They create and deliver solutions that are hard to duplicate.

Accomplishing this takes hard work, a belief in profitable growth and an unrelenting focus on the underlying needs of customers. Put simply, these companies think through where to play and how to win one application, one industry segment at a time.

We’ve worked with B2B companies with a strong track record of sustained, profitable revenue building and have since identified five growth essentials for success:

Focus On Your Customers

You have to focus on the customers who are the key decision-makers in the value chain. A manufacturer of labels has to think about the CPG company that determines how packages are labeled, not just the distributor. Commercial insurers need to add value to the companies seeking risk management who ultimately buy their products, as well as the brokers who sell them. Finding the right decision-makers and building relationships with end customers is crucial. Their insights will ultimately drive new product and service innovation at your company.

“Finding the right decision-makers and building relationships with end customers is crucial.”

Avery Dennison put its core label business back on a sustainable growth trajectory by supplementing its distributor-focused sales effort by identifying, understanding and addressing the needs of the end customer – packaging engineers who were the drivers of packaging decorating innovation. Segment teams learned where packaging engineers played and who advised them in different industries. The Avery Dennison segment teams determined how to tailor innovation and product information to meet their requirements. By making innovation and marketing more relevant, they boosted sales.


FINAL THOUGHTS

Sell Solutions

When we began working with GE Healthcare, scores of different P&L centers proliferated in a siloed pursuit of revenue growth. It was common for five or more different GE Healthcare sales teams to call on the same customers, each selling a different product or service. GE Healthcare leadership recognized the need to drive a more comprehensive value proposition to spark hospital engagement, loyalty and growth. Through careful research, the company identified the three top opportunity segments to receive unified messaging, targeted innovation and a cross-business sales support model.

The sales organization could now work as a single team to deliver an expanded, relevant value proposition that stretched across all healthcare units. The result: Exposure to higher-level decision-makers and communicating an integrated view of how GE Healthcare’s entire spectrum of products and services could work together on their behalf.

BLOG

Chick-fil-A’s Raving Fans’ Growth Strategy

New fans matter. But its real secret is deepening relationships with its most devoted customers.

As the Chief Growth Officer at Prophet, I see a lot of companies struggle with growth—both where to find it and how to manage it. And unfortunately, oftentimes marketing isn’t even part of those conversations. That’s why I never stop marveling at the way Steve Robinson, Chick-fil-A’s senior vice president and chief marketing officer, and his team combine their role as marketers with the businesses’ broader goals and growth targets.

Recently, I sat down with Steve to talk about what he’s learned in his 32 years at the fast-growing QSR chain. Between gains from its existing restaurants and opening new stores, the company has been growing at the enviable rate of roughly 13 percent annually, which means the business doubles every five to seven years. Not jealous yet? For the last several years, it’s even managed to do so with no borrowing.

“Our growth is based on two things,” he says. “The first is brand relevance, which includes everything from menus, buildings, service, technology, packaging and sustainability. And next, we have a strong focus on our Operators to ensure they have what they need to grow same-store sales.”

Here are six of Chick-fil-A’s marketing strategies that apply to the many companies looking to find new paths to growth:

Build your “raving fan” base

Long before social media experts talked about WOM and brand ambassadors, Chick-fil-A had identified a type of customer it nicknamed “Raving fans.” Of the 7 to 10 million people eating at its restaurant each week, this is a rabid subset, about 10 to 15 percent of its total audience. They visit Chick-fil-A four or more times each month, and are so jazzed about the company that they even dress up as the brand’s famous cows to celebrate “Cow Appreciation Day” to win a free sandwich.

Of course, Robinson says the company always strives to bring new fans in at the top of the funnel. But these die-hards “are crucial to the health of the business and help us grow. Our goal and strategy is to build special relationships with them.” To that end, Chick-fil-A Operators go to incredible lengths. They might follow a customer out to their car, holding an umbrella on a rainy day. A recent example: After Auburn’s recent defeat of the University of Georgia, some homebound fans phoned in an order, even though the store was about to close. Not only did the restaurant stay open, when the Operator discovered they were bereft “Dawg” fans, he gave them the meal for free. “No one told the Operator to do that,” Robinson says. “They create these fans themselves every day, and we’re constantly amazed at the innovative ways they think of to deliver this level of unexpected service.”

Know what will make your customers happy tomorrow

Whether it’s a Peppermint Chocolate Chip Milkshake, ever-more-clever cow “Eat Mor Chikin” ads, or a new mobile payment app, Robinson says the company tries never to lose sight of what delights its customers.

“Yes, great crave-able food is the most important thing. But how do we plus-it-up with great service, interactions, and experiences?”

Steve Robinson, Chick-Fil-A

That also means reaching beyond known pleasure points to discover new ones: “Sometimes customers don’t know what they want yet. Our job is to uncover those things and get out ahead of them. It’s like my favorite Wayne Gretzsky quote, ‘We need to go where the puck is going, not where it’s been.’”

To that end, Chick-fil-A recently opened “Hatch,” its 80,000-square-foot innovation center, to explore new ideas in food, design and service. Among its breakthroughs so far: Streamlined technology to make ordering and payment faster and easier, and a new way of fixing chicken that actually required patenting and building a new custom grill. “By May, you’ll hear us talking a lot about this new platform for grilled chicken. That is a hardware innovation, but it is key to our marketing message of relevant menu improvement.”

Build relationships, not transactions

Selling more sandwiches is a good thing, but to Robinson, almost beside the point. Real growth, he maintains, comes from rich relationships, not minor sales blips. College football is one of his favorite examples, and the company has been involved with college sponsorship for 17 years. “It’s our sweet spot,” he says, “a demographic and lifestyle fit.  College fans, alumni, and viewers index very high for Chick-fil-A.” The company tracks engagement by measuring reactions to digital offers made during games: Some 75 percent of Chick-fil-A customers watch with a second screen in their hand.

“We also activate on the ground, giving away food at Chick-fil-A Bowl games, and at events on campus. Our Operators strike vendor relationships with stadiums. We have Operators in the communities who have great relationships with over 200 athletic departments where we provide catering.” Yes, it’s an expense, and not always an easy one for everyone to grasp. “But for us, measured in terms of relationships built and enjoyment for fans and our customers, it’s worth it.”

Stand up for your customers, even when it’s difficult

Robinson, who is also on the executive committee, says marketing has earned its seat at the table primarily “by being a relentless advocate for the customer.” Sometimes, he concedes, that requires tenacity. A current example: Building restaurants that are LEED-certified, a sustainability certification that carries greater expense. “That may not sound interesting to all of our leaders, but it is very important to our customers. Which makes it a priority.”

Decide how you won’t grow

Robinson and his team are keenly aware of the fierce battle for share of America’s stomach. More than half of the country’s meals are now eaten away from home. As restaurants proliferate, even convenience stores and grocery chains are now selling prepared meals, fighting for every breakfast, lunch and dinner. “But we know we will not compete on price. For us, the evolution has been how to do more than food. Yes, great crave-able food is the most important thing. But how do we plus-it-up with great service, interactions, and experiences?”

Bring grace to the table

Robinson admits he’s had to learn a lot, both personally and professionally, to roll with the punches that come with engaging on a political or social issue.  Last year, the company found itself embroiled in a controversy over remarks Dan Cathy, COO and son of founder Truett Cathy, made regarding same-sex marriage. The ensuing firestorm resulted in boycotts, protests, and even nasty Tweets from some mayors. The company eventually issued a statement that it would harken back to what has always been most important to Chick-fil-A – serving everyone with honor and respect. “The experience reminded me about the spirit of hospitality, of graciousness, that this company was founded on. Everyone is welcome at Chick-fil-A. Everyone should feel at home. The root idea is grace, and our Operators have really leaned in and stayed true to that model, even handing out food and water to protesters. Staying true to our core values can help weather any PR storm.


FINAL THOUGHTS

Steve’s tenacity at growing Chick-fil-A in both a gracious and aggressive manner should give current and future marketing leaders something to think about as they head into 2014.

This post originally appeared on the Forbes CMO Network on Scott Davis’ blog, The Shift. To read related thinking from Scott on Forbes, follow his blog here. 

BLOG

10 Quick Ways to Drive Organic Business Growth

Of course, long-term growth strategies matter. But there are many ways to boost revenue–starting right now.

Quick wins are crucial to any growth strategy. They build momentum and fund investment for longer-term growth initiatives. Cost-cutting, acquisition and restructuring are important tools in improving short-term gains, but they often distract organizations from building revenue organically.

Immediate, customer-driven revenue gains are often overlooked in the search for quick wins. When combined with prudent cost reduction they yield tangible results and keep employees focused on the customer. They also build the marketing, sales and innovation competencies needed to grow even faster in the future.

At Prophet, we’ve developed a checklist of ten rapid revenue drivers based on the repeated achievements of successful growth organizations. But first, let’s ensure we’re all clear on what organic growth means:

What Is Organic Business Growth?

Organic business growth is achieved by using your existing resources to expand your business. On the other hand, inorganic growth is done through mergers, acquisitions, and takeovers.

Organic growth is a key method for yielding tangible results, keeping employees focused on customers, building marketing, expanding sales, and innovating.

10 Ways to Organically Drive Business Growth

To help you determine some quick ways to drive organic growth, we’ve developed a list of ten essential strategies, based on organizations we’ve seen grow successfully:

1. Sell More to Your Best Customers

It’s easy to believe your biggest customers are also your best customers. But, usually, it’s a myth. An analysis of profit contribution, cost-to-serve and organic growth potential can highlight key customers worthy of an intense, cross-company focus. We’ve repeatedly seen that type of full-court press on just 10 to 20 percent of the customer base (the best customers) boost bottom-line profit by 5 percent or more.

2. Make the Most of New Customer Relationships

The early days of a new relationship are critical, and yet one of the most overlooked parts of the customer experience. Clients across categories consistently express the greatest willingness to buy more and to try different products just after they come on board. Why not take advantage of that honeymoon period, offering more products, services and accessories?

There’s a long-term benefit as well. Our studies on behalf of clients have found that on average, customers who make a second purchase within 90 days of the first purchase are more than double the lifetime value of the average customer.

3. Focus on Your Sales Team

For immediate impact, adding or beefing up the sales team is one of the most effective drivers of organic growth.  This is especially true in industries with multiple sales channels. We’ve seen it work for a national insurance company, which got immediate results by resisting the urge to cut costs and instead adding sellers to its highest-growth market. And we have also found a consistent pattern of profitable revenue gains from targeted sales-strengthening moves in Fortune 500 companies. Many didn’t even increase headcount, but rather redeployed existing resources, using better training and better processes. Redeploying resources generates an almost instant payback versus the typical six to 12-month payback from new sales hires.

4. Optimize an Upcoming Launch

Too many line extensions and not enough blockbusters scheduled for launch next year? Prioritizing the most important introductions and focusing on execution is one of the simplest ways to organically boost revenue. It won’t create best sellers, but it avoids having a plethora of small launches dilute impact among customers.

It doesn’t happen as often as it should because it takes day-to-day diligence and a willingness of functional teams to work together. But when leaders focus on cross-functional priorities, time-to-market improves an average of 20 to 30 percent, mostly from avoiding the delays that build up in over-extended organizations. These gains require little to no incremental investment.

5. Raise Prices Strategically

While across the board price increases may be inadvisable in competitive markets, there are usually groups of customers or clusters of products that can withstand a price increase without slackening demand. Our clients have repeatedly identified 20 percent of their lines with lower elasticity due to a different competitive set or different buyer profiles. Selective price increases are one of the fastest and lowest risk moves a company can take because almost all the benefits flow to the bottom line and the investment in analysis takes only a few weeks.

6. Implement a Measurable Media Strategy

Insufficient data is no excuse for not being able to assess the impact of media investments or failing to conduct marketing mix analysis. If media isn’t measurable, shift the mix to media that is. If it is measurable, dig in and start optimizing. We have found that companies who have shifted marketing dollars to digital mediums have been able to quickly launch, test and learn new value propositions and pricing, which can add 10 to 15 percent incremental revenue.

7. Consider Organizational Change

Organizational change can definitely result in greater working efficiency and increased productivity, but keep in mind that organization-wide restructuring is incredibly taxing for leaders and employees— it creates upheaval and usually takes a while to pay off.

The cross-functional dependencies required to innovate, sell and market are easily disrupted— so evaluate your goals and your timelines before you decide to rock the boat now, or whether you need to focus on short-term growth.

If your primary goal is long-term organic growth, consider an organizational change. But if your priority is short-term business growth, concentrating on encouraging and supporting the work of informal multi-functional teams will have a greater impact.

8. Refresh Best-Selling Products

When times are tough, supply chain leaders want the sales force to focus on over-inventoried products. Finance frets about margins. And product engineering looks to the newest thing – even if it doesn’t have a benefit. Don’t indulge. Take your best-selling products and focus on selling more of them.

Crayola increased crayon sales by 50 percent in a single year by renaming a few colors. Samsung boosted washing machines sales by 15 percent, simply by making them in bright reds and blues. Find ways to refresh the products through color, materials and packaging. Explore new marketing avenues through brighter merchandising, sharper messaging and more inspired promotions.

9. Rework Your Sales Pitch

It’s usually just a few highly skilled members of the sales team who produce the bulk of incremental sales. Use their experience and customer understanding to rework the pitch for the rest of the team. A sharper pitch, particularly when it shifts focus to customer issues and delivers solutions, can have an immediate organic growth payoff.

Avery Dennison generated remarkable results by doing just this for their reflective materials division. A single pair of salesmen sold five times the average. It turned out they talked about the advantages of the product in a totally different way than their colleagues. The revelation changed the way everyone else went to the market and transformed the marketing message.

10. Set Concrete Goals & Reward Success

It is amazing what people can do if they have a concrete goal to speed up a launch or introduce an important initiative. Detailed process redesign may be crucial to long-term speed-to-market improvements. But in the short term, there is no substitute for asking teams to go faster, celebrating their success and rewarding them for the additional effort. The secret sauce? Growth leaders at these companies take the time to find and unclog administrative and process bottlenecks their teams are facing.


FINAL THOUGHTS

Beyond the power to boost revenue in the short term, organic growth wins also provide key insights into your customers and their motivation. This customer focus will help sharpen your strategy every step of the way.

Learn how Prophet can help you implement a more successful growth strategy within your organization. 

BLOG

New Subcategories: The Path to Real Growth

Subcategory innovators account for a disproportionate percentage of revenue growth and market capitalization.

In my book, Brand Relevance, I argue that the only path to real growth, with rare exceptions, is to engage in transformational or substantial innovation that creates “must-haves” that define new subcategories (or categories). In virtually any product arena that you examine over a long period of time, from water to banking to computers, any growth spurt, (again, with rare exceptions) can be associated with such an innovation. For example, in the Japanese beer market, the market share trajectories changed only four times in over 40 years. In three of those instances new subcategories were formed, and in the fourth two subcategories were repositioned.

In a recent article in the Harvard Business Review, Eddie Yoon and Linda Deeken provide more evidence of this phenomenon. They observed that if you analyze Fortune’s lists of the 100 fastest-growing U.S. companies from 2009 to 2011, 13 of those companies were instrumental in creating a new category or subcategory. These 13 firms accounted for 53 percent of the incremental revenue growth and 74 percent of the incremental market capitalization growth over those three years. Such innovators benefit from higher growth in part because they can expand the marketplace. Chobani, for example, created a new subcategory of thick, creamy, high-protein yogurt that is now in excess of $1 billion in part by attracting new customers into the yogurt world.

These subcategories or categories can be created by substantial innovations that do not alter the basic business model. In the article, Yoon and Deeken point to Sara Blakely’s creation of Spanx slimming apparel and Kevin Plank’s development of Under Armour’s moisture-wicking apparel for athletes, both  $1 billion brands, as examples. Another is Crest’s Spinbrush, which created a new subcategory between the regular toothbrush and the expensive electric versions. All these products use the same marketing and distribution strategy as before, they just now contain a new “must-have.”

A category or subcategory that innovates can also involve a change in the basic business model. Yoon and Deeken describe several examples. Keurig pioneered the “cup-at-a-time” pod-style brewing in the 1990s as an alternative to the existing coffee pot for the office, and later for the home. With a business model around selling K-cups, which come in 200 flavors and sell for around 50 cents, they have created a U.S. business approaching $4 billion. Redbox DVD kiosks, which offered rentals in other stores, were transformational as was Microsoft’s Xbox Live gaming system which added a subscription-based online service to a video game console.

“Firms under-invest in “big” innovation and the product and market research that would support it and over-invest in incremental innovation.”

Transformational innovation can actually be easier to develop and implement than a substantial innovation. You have to have a lot of resources and luck to come up with the innovations that led to Spanx, Under Armor and the Spinbrush. But it just takes insight and creativity to offer a reward program that helps cell phones users in Africa earn life insurance benefits, like MTN. Or for a cell phone maker in China (Xiaomi) sells phones directly by bypassing the telecom firms (think of Dell bypassing the retailers). Both were transformational innovations because they altered the marketplace.


FINAL THOUGHTS

In my view, firms under-invest in “big” innovation and the product and market research that would support it and over-invest in incremental innovation. Yoon and Deeken note that Nielsen’s Breakthrough Innovation Report finds that only 13% of the world’s leading consumer product companies introduced a breakthrough innovation from 2008 to 2010.

It should be more. I don’t know how much more, but more. It is a “big” innovation that moves the needle.

BOOK

Developing Business Strategies

DAVID AAKER

Summary

A successful business strategy enables managers to provide organizational vision, monitor and understand a dynamic business environment, generate creative strategic options in response to environmental changes, and base every business effort on sustainable competitive advantages. Developing Business Strategies provides the knowledge and understanding needed to generate and implement such a strategy.

This fully revised and updated edition of David Aaker’s highly influential strategic manual offers copious new information on important emerging business topics. Numerous new and revised sections cover such critical areas as the big idea, knowledge management, the customer as an active partner, creative thinking, distinguishing fads from trends, forecasting technologies, alliances, design as strategy, downstream business models, and more.

“Developing Business Strategies” is available at AmazonBarnes & Noble, or wherever books are sold.

Highlights

  • A new chapter on strategic positioning
  • Many new illustrative examples from B-to-B, high-tech and the Internet
  • Increased focus on global leadership and global brand management
  • Using the Internet to develop and support business strategies

Endorsements

Robert L. Joss
Dean of the Graduate School of Business, Stanford University

Unquestionably the most comprehensive treatment available on the subject. I found this book unique in its capacity to benefit executives, planning staff, and students of strategy alike.

About the Author

David Aaker, is the author of over one hundred articles and 18 books on marketing, business strategy and branding that have sold over one million copies. A recognized authority on branding, he has developed concepts and methods on brand building that are used by organizations around the world.

Connect

Want to interview Dave or feature him on your next podcast? Please connect with us or David Aaker directly.

Explore how David Aaker and Prophet can help your business develop and implement business strategies.

Your network connection is offline.

caret-downcloseexternal-iconfacebook-logohamburgerinstagramlinkedinpauseplaythreads-icontwitterwechat-qrcodesina-weibowechatxing