know your customer...a marketers' perspective

KYCLearnings from a marketer…

Know Your Customer

Sunil Singh Rana

22nd Nov’ 2014

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Learning Types

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Content & Flow

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Back to Basics

Key Learnings Summary

Explore Learnings

KYC @ MTS

Learnings from the case

Objective

Case – When the US Giants blinked

Q&A’s / Feedback / Querries…..

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Objective

• No Customer, No Organization (purpose of existence)

• Nurture customer to grow

• Repeat customer are must for success

The purpose of a business is to create a customer

- Peter Drucker

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Marketing is the process of communicating the value of a product or service to customers, for the purpose of selling that product or service.

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Communication-Customer-Marketing

• Marketing Orientation Changes:

Production Products Selling Marketing

• Communication:

Activity of conveying information through the exchange of ideas, feelings, intentions, attitudes, expectations, perceptions or commands, as by speech, non-verbal gestures, writings, behavior and possibly by other means such as electromagnetic, chemical or physical phenomena and smell.

It is the meaningful exchange of information between two or more participants

Technological advancement have made it more direct and focussed

• Customer v/s Consumer

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Industries which have evolved with mankind

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US Automobile Industry

• 1899: Almost 60 car manufacturers open in US. 10,000 cars on-road, 25 mn horses supplied most local transportation. Ford Motor Co established in 1903.

• Sep 1908: Billy Durant founds General Motors

• 1908 - Ford introduces Model T. First-year production is 10,660 cars. Model T was unpretentious, reliable, and remarkably sturdy.

• 1913: Ford installs the first moving assembly line, car building time dropped a record 12 Hr. to an average 1.5 Hr., with the capability of producing 1000 cars/day

Source: About.com

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The Shift in balance

• From the mid-1950s

through 2008 - “Big

Three” lost over 40%

points of market

share in the US, after

having dominated the

industry during its

first 50 years.

• By 2008, Toyota, the

largest Japanese

automaker became

the largest producer

of vehicles worldwide

(position that was

been previously held

by GM for 77

consecutive years)

1929 2008

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Event that made impact

• By 1910’s - Assembly line manufacturing Affordable Cars

• Better Highways network Growth to travel long-distance.

• Demand for automobile and aircrafts soared further by 1939 on account of WW II

• With the demand, the power/ size mattered for US manufacturer.

• Japanese started learning quality from quality Guru, W. Edwards Deming.

• First Fuel (oil) Crisis in Oct began in Oct 1973

Source: Thoms H Clair, Economic Perspectives, 2Q/2009

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Event that made impact (Contd..)

• 1979 (or second) oil crisis. Though oil supply decreased by only ~4%, panic resulted price rise of crude oil from $39.50/barrel in a year

• 1979 oil shock was accompanied by a severe downturn in the economy.

• Fortunes of group stabilized with the emergence of light truck —as a popular and fast-growing segment of the auto Mid-1990s,

• Six foreign producers started to compete in the light truck segment

• Starting in 1998, the price of gasoline was rising again, after having been essentially flat for over a decade. Gas prices approached $4/gallon

Source: Thoms H Clair, Economic Perspectives, 2Q/2009

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What went wrong and the Learnings

Demand for more fuel efficient cars

Ignoring the changing public taste for “Small Car” in 70’s

Power & Efficiency trade-off

Technological Innovations also change the customer taste

Know Your Customer well! (Who? Preference, taste,

lifestyle, trends and changes)

#1

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Japanese kept on upgrading with technology including manufacturing. Priority for American was managing.

The Oil Shocks of 1973 & 79 were unplanned external events. The learnings of Oil Shock ignored with recovery of business (Restrict Innovation)

Concern for Global emission standards and need for clean fuel and rising globalization

Innovation is must to evolve with customers.

Technology and external factors can make you obsolete

#2

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Customer were looking for solution (fuel efficiency, Comfort, Style, Aesthetics etc.) and not products only

The manufacturing of small cars was costlier earlier also, however the segment existed

Post Oil Shock of 79, Mini Truck segment emerged which was catered well by them, however soon it saw competition

If you don’t serve your segment well, someone else

will…

#3

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The competition was not only from the product boundaries which were becoming thinner as they served the same purpose, it was global too

The US Auto industry defended their turf and asked for protection. But to grow, The World is Your Marketplace

Apart from one “C’ of your KYC, you need to know the

other “C” i.e. Competitor

#4

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Know Your Customer Well

• Demographics - asl; changes in asl; Virtual Existence

• Psychographics (Overarching mindset that leads to a perceptions and behaviors)

• Attitudes - toward the category or industry. Involvement Levels makes difference when it comes to changing behavior.

• Telling Behaviors - Actions and the extent these ‘telling behaviors’ will shed a lot more light on the psychograph

• Current Usage – Substitutes, Frequency, Competition, Usage Pattern

• Functional Needs

• Emotional Needs Source: BrendaBence.com

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Know Your Customer Well

• Existing Customer / Potential Customer

• Source of data collection Inbound Interactions

Outbound Activities

Secondary Sources (Market Research)

Virtual Activities

• Relationship Marketing

• Customer Life Cycle Management (CLCM)

• Every interaction is an Opportunity

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Few learnings…..

Upgrade your offering to stay

relevant to the changing customerNew segment can be created

Your offering can’t hold customer

and segment which evolveMove up your offering with

CLCM.

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Few learnings…..

Change in product positioning

can create new segments

Regulations can kill your market

New segment can be targeted to

expand

Technology can be a biggest

disruptive force

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Few learnings…..

Customer pay for (brand)

perceptions, Not products

Few things can be misleading

about actual consumer

Observe your segments to

understand their (unstated)

needs, rather than asking them

The thin line in product categories

are redefining competition

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Few learnings…..

Customer remain hooked to you,

if your (Brand) are her inspiration

Invest to understand your

customer and exceed her

expectations

You can’t remain complacent

being #1. Innovate

Loyalty is difficult to cultivate.

Admit. Work Hard to retain.

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KYC

• Name

• Age

• Sex

• Location (Address)

• Phone Number (Alternate)

• E-mail ID

• Product Subscribed

• Usage (Quantity, Frequency,

Time of Usage)

• Secondary Financial Products

• Social Activity

• Satisfaction Levels

• Feedback

Data Sources

• Customer Activation Form

(CAF)

• Activation Calling

• Call Center Interaction

• Store Visit

• Internal Data History

• Transactions (Retailer, Web

etc.)

• Market Research

• Consumer Forums

• Site History

• Web Analytics (includes

SNS)

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Key Learning Summary

Know Your Customer well!

With customer evolution, upgrade your offerings.

Protect your forte from competition and explore new segments.

Keep an eye on external factors – Technology, regulatory etc.

Interact to understand her, however do not offend her.

Follow your customer too. Invest in her and products

Do not create just customer, create advocates and ambassadors.

Use technology to gain insight, however do not breach privacy.

Develop relationship and gain trust by being one step ahead.

Surprise her with meeting unmet and unstated needs.

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Reach Me / Feedback @

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(+91) 9925000293

[email protected]

www.sunilsinghrana.weebly.com