Presentation given at the B2B Marketing conference by Evensys at the Hilton Bucharest on April 19th, 2012

1. Are you realizing the full potential of your customer relations?
Customer Centricity in B2B Markets

2. Welcome
Stefan Kolle (@flb_stefankolle)
We’re no gurus, seminar pro’s or professors …
We’re just some guys who’ve been there too (and still are)

3. “Like an architect,
we add to the
vision of our
clients and
manage their
agencies and
vendors towards
the desired
result.”
Futurelab International
Hoornzeelstraat 24
3080 Tervuren
Belgium
T: +32 2 7338332
F: +32 2 7065772
E: info@futurelab.net
We are business strategist with a passion for customers, innovation and profit
We deliver new profit opportunities through customer-centricity, commercial sense and hands-on innovation
19/04/2012 3

4. Thought leadership Recognition
• + 10,000 articles
• 75,000 regular readers
+ 350,000 readers
+ 10,000 followers
Regular speaking & media
appearances
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

5. When I think of customers
I think of whales
We talk about them
Somehow we care
We even try
But in the end,
month’s bills must be paid
FUTURELAB

6. FUTURELAB
Virtually all CEO’s consider the customer experience to be important
80% of them believe they offer a superior customer experience
8% of their customers agree
Exhibit # 1
Customers are the whales of the corporate world
Source: Bain & Company

7. FUTURELAB
The business hears:
• This may cost money
• This sounds complex
• Another marketing hype The customer evangelists say:
• Yes, this will cost money • They will be more loyal
• Customers pay our salary
• They will talk well about us
• It’s important
Most companies
See customer experience as a “moral imperative”

8. FUTURELAB
There’s only one problem with this
You get paid in Euros,
Not in happy faces.
“Why should I allocate precious
budget to experience?”
FUTURELAB

9. FUTURELAB
Our mission: A more customer-friendly world
Create sustainable, organic
Create some happiness
growth (i.e. make more money)
The next half hour
How to break through this disconnect

10. FUTURELAB
The same coffee beans Cost per cup
The futures market (nov 2011) € 0.01
in a package at the grocery store € 0.075
at Nespresso € 0.40
in a paper/plastic cup from a machine € 1.00
from a machine in a theme park € 2.20
in a cup in a big city café € 2.50
at a deluxe restaurant € 5.00
during my honeymoon with a glass of I haven’t got a clue!
100 year old Armagnac
The good news
There is an intuitive case linking money to experience

11. FUTURELAB
Discounts?
You must be joking.
The good news
Best practice experiences exist

12. FUTURELAB
The bad news
General satisfaction or marketing rethoric won’t cut it

13. FUTURELAB
When surveying the satisfaction responses of ISP defectors in the 12 months prior to their defection
80% were “satisfied” to “very satisfied”

14. FUTURELAB
In spite of a standing ovation
55% Year-to-year churn rates are normal in classical music
(cc) Jorge Franganillo

15. FUTURELAB
“When it comes to customer
experience we’re doing fine. All
our customers are very satisfied.
The only problem is that they don’t
return to buy again.”
Real Case
European B2B brand

16. FUTURELAB
Self Reflection:
Do YOU Expect Not to be Satisfied?
The simple truth
Customers “pay” to be satisfied

17. FUTURELAB
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.

18. FUTURELAB
Detractors: Dislike Passives: Satisfaction Promoters: Delighted
0 1 2 3 4 5 6 7 8 9 10
The ‘ultimate’ question
How likely are you to recommend

19. FUTURELAB
Customers that are so happy they
are likely to recommend a company
 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.
The ‘ultimate’ question – most important finding
Customers who recommend you, are more profitable

20. FUTURELAB
Detractors: Dislike Passives: Satisfaction Promoters: Delighted
0 1 2 3 4 5 6 7 8 9 10
The ‘ultimate’ question – most important finding
This time, there is a money link

21. FUTURELAB
The main reason
This time it’s personal

22. The main reason
And its even stronger in B2B

23. FUTURELAB
Promoters are more profitable
Philips used customer experience to drive revenue

24. Disguised numbers
Client case

25. 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 “at the point of delight, there is an exponential
(recommend) repurchase” increase in the share of wallet”
Source: http://www.ipsos-ideas.com/library/dl.cfm?pdf=IpsosLoyalty_WP_Delight.pdf
The game is not about “customer satisfaction” … it’s about “delight”
Customer Delight

26. FUTURELAB FUTURELAB
The worst I’ve ever seen
5:1 The best I’ve ever seen 6000:1
Promoters are more profitable
Personal experience in 15 industries … and counting

27. FUTURELAB
Detractor Passive Promoter
0-1-2-3-4-5-6 7-8 9-10
Margin on purchase of printer RON 50
___________ ___________
RON 150 RON 250
___________
# Purchases over life time 1
___________ 3
___________ 10
___________
2
___________ 10
___________ 50
___________
# Service visits over life time
Customer Value RON 250
___________ RON 950
___________ RON 5.000
___________
Word-of-mouth effect (+/-) RON 500 -/-
___________ ___________
RON 500 RON 4.350
___________
Total Customer Value ___________
RON 250 -/- ___________
RON 1.450 ___________
RON 9.350
Making the case ASSUMPTIONS
• Printer price: RON 500-2500
Printer case • Average life: 5 years (warranty 3 years)
• Avg. service visit: RON 50 Margin

28. FUTURELAB
Customer value increase
= ROI
Cost to make them happy
So, how do we implement this?
Breaking the CEO Dilemma

29. perception
80% of CEO’s believe their
brand provides a superior
customer experience
8 % of their customers agree
(Bain & Company)
19/04/2012 29

30. FUTURELAB
“Let’s go WOOOOOWW!!” “Let’s spread love & hug” “Let’s be like Disneyland”
The bottom line: with customer experience we’re
We’re not talking about the fluffy stuff

31. FUTURELAB
In fact
The experience IS the product

32. It just works This is cool!
I sell overpriced, underspec’d A low performance gaming
devices with poor battery life. console with few titles.
Defining “what is the experience”
The experience IS the product

33. CEO: I need to be sure that the
“Nobody ever got fired for
strategy I want to propose will be
buying....
supported by the board.
Defining “what is the experience”
The experience IS the product

34. FUTURELAB
This disconnect is the problem
Most companies roll the dice on customer experience

35. FUTURELAB
The Traditional Perspective
Pre-sales Sales After Sales
The Customer’s Reality
Search Evaluate Try Select *** Wait *** *** *** Search
* * * = Confidential
Case
A radically different perspective
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36. FUTURELAB
The Traditional Perspective
RFP Development Delivery
The Customer’s Reality
Latent Self- Discuss Informal RFP RFP …
Problem study @ office RFI Prep
Case: Professional Services
A radically different perspective
19/04/2012 36

37. Customer Experience Management
Is about managing emotions at each step of the journey

38. FUTURELAB
FUTURELAB
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
The amygdala did it
Remember
Experience is about emotions

39. Remember
Emotional Satisfaction

40. Remember
Emotional Engagement

41. FUTURELAB
There’s more
Leave the bank with
your card
Have a coffee next
door if you need to
wait (with alerts)
Friendly & smiling
recruitment policy
NOT rolling the dice
Case: Metro Bank

42. FUTURELAB
I take care of my family,
my employees and my
community. Above
everything I want respect
and recognition for that.
Structural listening: You want to dig deeper
Case: a greek bank

43. FUTURELAB
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.
Structural listening: You want to dig deeper
Case study: a training company

44. FUTURELAB
Aren’t we already
listening enough?
Surveys – market research – customer feedback systems …
Do you listen, or gather information to write reports?

45. But obviously you can’t speak to everyone
A structural listening mechanism

46. FUTURELAB
NPS survey
Implement
initiated action
Prepare and
analyze results
Initiate
Quick
Fixes
Execute Feedback
Calls
Plan and initiate
Derive recommendations for
concrete actions
improvement
Tactically close the loop
Listen to each customer

47. FUTURELAB
A structural listening mechanism
B2B: Look at individuals, not at accounts

48. FUTURELAB
insurance administration doctors nurses
Sleep medicine
& non-invasive
ventilation
government patients patient family anyone else
of relevance
Reminder: it’s not just about direct buyers
Case: patient-centric management at Resmed

49. But it can also be very simple
Case: Rackspace

50. FUTURELAB
Go forth and discover
this wonderful brand!
Once the basics are sorted
You can start activating promoters

51. FUTURELAB
THE ACTIVATION CHALLENGE
Are you likely to Do you actually
recommend? recommend?
YES !! NO
What goes wrong ?
That’s not the whole story
You can start activating promoters

52. FUTURELAB
If you want me to talk about you
Give me a story
that makes myconversations
(and me) more interesting.

53. What IS the story?
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54. And of course…delivery
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55. If you want me to introduce you to my friends
Give me tools
that demonstrate my value to my
friends, colleagues and family

56. FUTURELAB
Co-Creation Customer Council Customer Communities
Help us develop Guide us 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

57. FUTURELAB
If you want me to introduce you to my friends
Just ask me
You’d be surprised how easy it is
to get me to talk

58. FUTURELAB
Dont forget: You already asked them in the survey!
Mechanisms to spread the word
Asking is free FUTURELAB

59. FUTURELAB
• Engage at a truly personal level, individual by individual (no automated communications)
Super • Involve in future marketing, product development, sourcing, etc.
Promoters
• Identify the reasons and sources of their promotion, which help fuel future marketing campaigns
Promoters • Give them tools to actually promote (stories to tell, gifts to give…)
• Ensure that the passives know what drives the promoters, i.e. highlight what is good and positive
Passives • Capture if they just want to be left alone (lest they might turn into detractors)
• Based on root cause analysis engage early and on the topics that matter most
Detractors • Show that you actually listen and are serious to resolve issues – f.i. list current issues on the website
• Engage directly and personally to resolve their issues, see what it takes to stop them from damaging you
Brand • Turn them into ambassadors – also internally, to teach the organisation how to stop creation of ‘terrorists’
Terrorists
NPS based segmentation
Differentiate conversations based on customer attitude

60. NPS based segmentation
Differentiate conversations based on customer attitude

61. FUTURELAB
Case: World Economic Forum
Everyone who works for the
WEF and openly uses social
networks is – de facto – a
spokes person for the company
• Train them
• Create minimal guidelines
• Support them to go (more) online
Guidance is useful
Make sure your people are social-savvy

62. FUTURELAB
2 out of 3 employees
is proud about their
employer, but only 19%
shares stories on
social media: unused
conversation potential.

63. FUTURELAB
“you know what
those idiots did at
work”?
Employees matter
Remember last Christmas dinner conversation?

64. FUTURELAB
117,000 employees*
= 17.5 million 1st degree contacts
= 2.65 billion 2nd degree contacts I have the power to
Not to mention: Distribution network, vendors, other.
make or break you.
If you do the math
There are a lot of conversations waiting to happen
* Applying Dunbar’s number of an average of 150 meaningful relationships to a global electronics company

65. FUTURELAB
Romanian insurance employee media impact (excl. agents) =
350 employees
= 52,500 1st degree contacts X trust multiplier
= 7,875,000 2nd degree contacts
Bucharest population = 1.9 million (4.14 x)
Vs.
Romanian population = 21.9 million (36%)
Act as an ambassador at all times
This conversation actually has quite a bit of impact

66. Consider • Would you buy vs. Would you work
• Handle with care – political
Employee NPS • Anonymity is Imperative

67. FUTURELAB
Would you recommend the bank to friends /family?
32% No 28% conditionally
Would you recommend the bank as an employer?
39% No 30% Yes
N=25,000 (out of 59,000)
This is especially bad if you consider that not all employees are promoters
Case: Commerzbank

68. FUTURELAB
Really??
Debate
How is this in your business
Image attribution: Rob Markey, Bain & Company

69. FUTURELAB
In countries where employees are 10% more likely to promote Holcim, NPS is on average 18 points higher
Case: Holcim
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70. FUTURELAB
Creating promoters
It takes more than ticking the customer feedback box.

71. FUTURELAB
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
FUTURELAB

72. FUTURELAB
@FLB_StefanKolle
www.futurelab.net
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