With the global climate summit in Copenhagen just around the corner, I've been reading an increasing amount about eco-initiatives from organisations that you wouldn't normally associate with the green movement.
Fascinatingly, a number of organisations are moving away from just plastering their marketing material with their great intentions and instead are taking more direct action. I read today that Lush, the high street cosmetics company, is more or less setting itself up as an environmental activist company, with other companies taking a similar line to prove 'that you can do good through doing business', as one company director put it.
"We look at issues and we decide which ones are important to us and then we see how we can support them", explains Andrew Butler, Lush's director of campaigns. "We partnered with Sea Shepherd (a marine environmental organisation) - a direct action group best known for confronting Japanese whaling vessels, and we felt that shark finning was an issue we could help them with." To this end, Lush sold 'shark fin soap' (soap bars with a fake fin sticking out of the top) with proceeds going to the cause. Mr Butler argues it's about attracting attention to an issue that might otherwise have languished. "In all, we raised £25,000", he said.
I'm fascinated about this movement of environmental and sustainability issues into mainstream business.
How does a company's value proposition to its customers reflect corporate values? How does Lush translate its passionate, activist, environmental stance into a valuable customer experience? I'd love to hear your views.
Tuesday, 27 October 2009
Tuesday, 20 October 2009
Dixons forget value and go for price
Well, I’ve been thoroughly enjoying the heat-and-light generated by Dixons’ latest advertising campaign. Media-luvvies have been falling over each other in their haste to write articles, arguing the toss over whether this is gutsy advertising or the desperate stance of a failing brand. And Selfridges, John Lewis and Harrods – the targets of the copy – are … let’s say… irritated.
For those of you who haven’t seen these adverts, here’s an example of one ad: "Step into middle England's best-loved department store, stroll through haberdashery to the audio visual department where an awfully well brought up young man will bend over backwards to find the right TV for you. Then go to Dixons.co.uk and buy it."
From a value proposition point of view, Dixons have obviously done their customer research, understood that the only ground upon which they can legitimately compete is price and so put this message front-and-centre of their campaign. This is, to say the least, a risky stance, not least because price competition is the most shifting of all grounds upon which to base your value proposition.
As we have always said, the value equation is Value = Benefits minus Cost (with cost including risk not just price). Dixons are clearly gambling that people will only consider price when buying their electronic goods. However, I suspect that many consumers are not only price-conscious but also increasingly risk-averse and are actively seeking the warranties, after-sales care and impartial sales advice offered by stores such as John Lewis.
Time will tell whether Dixons’ bold advertising will bring in the sales boost from the shoppers of ‘middle-England’. Some people may well be tempted but I suspect that, for many, the value equation won’t balance and the ‘best loved department store’ will therefore continue to do very well.
For those of you who haven’t seen these adverts, here’s an example of one ad: "Step into middle England's best-loved department store, stroll through haberdashery to the audio visual department where an awfully well brought up young man will bend over backwards to find the right TV for you. Then go to Dixons.co.uk and buy it."
From a value proposition point of view, Dixons have obviously done their customer research, understood that the only ground upon which they can legitimately compete is price and so put this message front-and-centre of their campaign. This is, to say the least, a risky stance, not least because price competition is the most shifting of all grounds upon which to base your value proposition.
As we have always said, the value equation is Value = Benefits minus Cost (with cost including risk not just price). Dixons are clearly gambling that people will only consider price when buying their electronic goods. However, I suspect that many consumers are not only price-conscious but also increasingly risk-averse and are actively seeking the warranties, after-sales care and impartial sales advice offered by stores such as John Lewis.
Time will tell whether Dixons’ bold advertising will bring in the sales boost from the shoppers of ‘middle-England’. Some people may well be tempted but I suspect that, for many, the value equation won’t balance and the ‘best loved department store’ will therefore continue to do very well.
Wednesday, 30 September 2009
Does BA understand the concept of Value Proposition?
I am fascinated to note that British Airways appears to be moving away from the concept of delivering customer value and is focusing solely on the balance sheet. Over the last three months, BA has abolished meals on short flights, cut luggage allowances and has just introduced charging extra for the privilege of reserving your seat. At the same time, it has just launched a business-only service from London City to the US. Confused? You should be.
I don't think I'm alone in thinking that BA has lost its way and is increasingly devaluing its value proposition which hitherto has been based on providing an excellent customer experience and brand clarity. Competition with low-cost airlines will be increased, not decreased, by its recent moves as the competitive playing field is being levelled by BA itself.
BA may well boost flagging revenues in the short term but at the risk of alienating its loyal customer base and thus destroying its hard-won value proposition.
I don't think I'm alone in thinking that BA has lost its way and is increasingly devaluing its value proposition which hitherto has been based on providing an excellent customer experience and brand clarity. Competition with low-cost airlines will be increased, not decreased, by its recent moves as the competitive playing field is being levelled by BA itself.
BA may well boost flagging revenues in the short term but at the risk of alienating its loyal customer base and thus destroying its hard-won value proposition.
Thursday, 16 July 2009
"Our survey said…" - What are your thoughts on value propositions?
Through our work, writing and speaking etc we get lots of questions and comments about value propositions. Reading through research material and general information about value propositions it seems that there are many interpretations of what is a value proposition. As a consequence, we want to get a snapshot of what people think about value propositions.
Please would you help us by filling out this short questionnaire. Link to questionnaire. It should take 4 minutes and if you give us your contact details (which are only for our admin use and will not be displayed in the summary), we will send you the summary report in the Autumn. We will release this report to coincide with the launch of our book "Creating and Delivering Your Value Proposition: Managing Customer Experience for Profit" by Cindy Barnes, Helen Blake and David Pinder, Kogan Page 2009.
We'll let you know more about the book in the next newsletter; it's due out later this year.
Link to questionnaire.
Please would you help us by filling out this short questionnaire. Link to questionnaire. It should take 4 minutes and if you give us your contact details (which are only for our admin use and will not be displayed in the summary), we will send you the summary report in the Autumn. We will release this report to coincide with the launch of our book "Creating and Delivering Your Value Proposition: Managing Customer Experience for Profit" by Cindy Barnes, Helen Blake and David Pinder, Kogan Page 2009.
We'll let you know more about the book in the next newsletter; it's due out later this year.
Link to questionnaire.
Discounting Europeans
70% of world-class organisations say that if they do give price concessions to customers, they always ensure they get comparable value in return, such as an extended contract or an additional warranty. This compares with only 19% of European firms, according to the 2009 Sales Best Practices Study from Miller Heiman. In other words, European companies are too ready to discount without getting anything in return. I’m looking forward to the UK-specific breakdown of this report which is due out shortly. It will be interesting to see if Brits are more or less likely to offer discounts or if we understand value any better.
The study, based on input from European and global sales professionals, analyses complex B2B sales environments to reveal the best practices of world-class sales organisations.
It’s so important that you first understand and really believe your own value. If you don’t then you are much more likely to devalue yourself, your offering, your firm by offering some form of pricing reduction. The best way to really understand your value is to ask your customers, conduct a customer value experience exercise. This is the first step on the road to creating a value proposition – note the word value – it’s not there for decoration, it really does help you create, articulate, believe and substantiate your value!
A free copy of the executive summary is available by calling
01908 519 615.
The study, based on input from European and global sales professionals, analyses complex B2B sales environments to reveal the best practices of world-class sales organisations.
It’s so important that you first understand and really believe your own value. If you don’t then you are much more likely to devalue yourself, your offering, your firm by offering some form of pricing reduction. The best way to really understand your value is to ask your customers, conduct a customer value experience exercise. This is the first step on the road to creating a value proposition – note the word value – it’s not there for decoration, it really does help you create, articulate, believe and substantiate your value!
A free copy of the executive summary is available by calling
01908 519 615.
Left brain, right brain
When times are tough, you’ve had to lose good people and you can’t afford to hire more, the key to growth is innovation and the best way of achieving this is pairing a left-brain thinker with a right-brain thinker.
Innovation is a messy process – hard to measure and hard to manage. Most people only recognise it when it generates a surge in growth. When revenues and earnings decline most executives conclude that their innovation efforts are just not worth it. Better to focus on what we know, they say, rather than the untested. Better to play safe and be risk averse.
Recently we worked with a technology company on one of their largest customer accounts. We analysed what was happening with the account in terms of value, processes and people and in the course of our work came across two sales professionals – we’ll call them Jim and Tom – who were totally dissimilar in pretty much every aspect of their approach to work. Jim was a total ‘left-brain’ thinker (logical, analytical, task-driven) and Tom a ‘right-brain’ (creative, relationship-orientated, door-opener) but they had figured out that together they could create a fantastic approach to innovative, consultative sales within their customer account. Individually, they were OK sales people but by working together they were incredibly successful.
Defining successful behaviours in successful sales professionals is something we have been working on for some considerable time. Come back to this Blog very soon and you’ll find more information on an exceptional way of identifying and defining successful people.
Innovation is a messy process – hard to measure and hard to manage. Most people only recognise it when it generates a surge in growth. When revenues and earnings decline most executives conclude that their innovation efforts are just not worth it. Better to focus on what we know, they say, rather than the untested. Better to play safe and be risk averse.
Recently we worked with a technology company on one of their largest customer accounts. We analysed what was happening with the account in terms of value, processes and people and in the course of our work came across two sales professionals – we’ll call them Jim and Tom – who were totally dissimilar in pretty much every aspect of their approach to work. Jim was a total ‘left-brain’ thinker (logical, analytical, task-driven) and Tom a ‘right-brain’ (creative, relationship-orientated, door-opener) but they had figured out that together they could create a fantastic approach to innovative, consultative sales within their customer account. Individually, they were OK sales people but by working together they were incredibly successful.
Defining successful behaviours in successful sales professionals is something we have been working on for some considerable time. Come back to this Blog very soon and you’ll find more information on an exceptional way of identifying and defining successful people.
Selling to the Post-recession Buyer
In the developed world, until last year we had 15 years of uninterrupted prosperity where growth was a permanent feature. Between 1995 and 2005 disposable incomes increased in the slower economies by 10% and in the highest growth economies by as much as 33%. That economic landscape has had a profound impact on our buying habits. We could afford to be curious about gadgets and new technology, indulge ourselves in premium products and just-for-fun experiences. In the latest Harvard Business Review(1) research shows how the recession has sobered us all up, moving some buying trends forward and slowing or reversing others.
The key dominant and advancing trends are:
1) Focus on how to help people realise the true value of your offering. It amazing what great and simple ideas can come out of doing this
2) Be honest. In a world of mistrust, 'spinning' your messages is turning people off fast.
3) Don't start by focusing on price! Price is relative and it's a bad place to start any sales and marketing efforts. Get your customers talking about what really matters to them and then you can reframe the whole 'price' discussion.
4) Network. As buyers are shopping around and using technology and networking as part of their decision-making process, then you need to be part of it. Linked In, Twitter, Blogs are proving to be powerful influencers. If you're not tweeting, then you need to start!
In what ways are you changing your sales and marketing efforts for this economy? What's working for you?
(1) Understanding the Post Recession Consumer, P Flatters and M Willmott, Harvard Business Review July-August 2009, pp 106-112
The key dominant and advancing trends are:
- A demand for simplicity
Even before the recession many people were feeling overwhelmed by the proliferation of choices (see the article More Jam Anyone? in this blog) coupled with 24/7 connectivity and were starting to simplify. The recession is accelerating this trend.
The authors say, "Consider the rise of edited retailing (consumers are offered limited collections of coordinated product choices), a growing demand for trusted brands and value, an increasing desire for advisors - ranging from social networks to product ranking web sites - that can simplify choice making, and enthusiasm for less complicated, more user-friendly technologies." - A focus on the boardroom
Like the simplicity trend, this issue has been building for years, spurred by major governance failures such as Enron and WorldCom. Misbehaviour in the boardroom is no longer acceptable. The huge tax payer bail-outs of badly managed businesses will accelerate this trend. This also builds on people's well established reflex to punish companies for unethical labour or customer practices, as Nike and Nestlé have learned the hard way. - Discretionary thrift
A desire to be more wholesome and less wasteful is prevalent, with people recycling more and buying more used goods. "People are imbuing their children with traditional values - behaviours that dovetail with the growing demand for simplicity and a solid, though currently slowing, interest in green consumerism." Many post recession purchases will be less extravagant versions of pre-recession ones. - Mercurial consumption
Buyers are more agile and more fickle due to technology and social networking. They are more likely to shop around and shift allegiances.
1) Focus on how to help people realise the true value of your offering. It amazing what great and simple ideas can come out of doing this
2) Be honest. In a world of mistrust, 'spinning' your messages is turning people off fast.
3) Don't start by focusing on price! Price is relative and it's a bad place to start any sales and marketing efforts. Get your customers talking about what really matters to them and then you can reframe the whole 'price' discussion.
4) Network. As buyers are shopping around and using technology and networking as part of their decision-making process, then you need to be part of it. Linked In, Twitter, Blogs are proving to be powerful influencers. If you're not tweeting, then you need to start!
In what ways are you changing your sales and marketing efforts for this economy? What's working for you?
(1) Understanding the Post Recession Consumer, P Flatters and M Willmott, Harvard Business Review July-August 2009, pp 106-112
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