profit by design - meetupfiles.meetup.com/19129776/profit by design 7th sept 2016bcx&dt...

Profit By Design

leveraging from the power of customer spend dynamics and advocacy

1 © Mark Hocknell 2016 Profit by Design

Overview • Customer Portfolios and profit

– Customer spend and advocacy

• What is the problem..?

• Business Alignment with Customer Intent – The Three Phases – Living under the cloud

– Customer Strategy and Value

• Architecture for Customer Engagement – The Conversation that Attracts and Keeps your

Awesome Customer


Profit by Design © Mark Hocknell 2016 3

• Understand how the value is created for Households – For the business (eg: higher retention, therefore

increased profitability; product mix and usage etc)

– For the customer - services, usage, accessibility, etc

• Develop strategies to create more customers with the same characteristics

Lessons from Financial Services

Advocacy and Net Promoter Score


• Promoters / Passives / Detractors NPS

• 40 40 20 = 20

• 20 40 40 = -20

• Relative to alternatives available to your customers, it predicts future success

Two-Way Value, feels like partnerships, connects with increased spend and

advocacy.

The Two-Way Value Exchange is the sweet spot

Design your Business for Profit © Mark Hocknell 2016 5

Value to the Business

Value to the Customer

• Revenue • Some profit • One way exchange • Customers feel like captives

• Cherry pick value • Price sensitive • Passive or Detractors

Customer portfolios and profit

Key takeaways

• Not all customers are equal

– In how they gain value from the business, or in how they reciprocate value

– Or in advocacy

• Customer portfolios are created by the business – implicit and explicit actions and decisions


What is the problem..?

How the traditions of sales mislead


1. “Perception that sales is easy” 2. “Build it and they will come” 3. “It is all a numbers game” 4. “The gun sales guy” 5. “One throat to choke” (managing the parts rather

than the whole)

6. “Focus on targets and dollar outcomes” 7. “Close the sale” 8. “Sell the product/service”

Profit by Design 8

The Eight Great Misleading Traditions of Sales

© Mark Hocknell 2016

Business Alignment with Customer Intent

The Three Phases – Living under the cloud Customer Intent and Value


Create the Customer Strategy

Understanding Two-Way-

Value

Customer Groups

Delivery of Value

Experience and Process Management. Measurement and Improvement.

Alignment of resources: people, culture, communications, sales tactics. service delivery.

Value Proposition Development

What does each Customer Group value? What is the Value Proposition for each

Customer Group?

Phase One

Phase Three

Phase Two


Phase One: The Customer Strategy

11

Defining the customer groups:

• what are the different groups of customers • what defines one group from another • what attributes do they have • what do they value

Step 2 • Balance the delivery of value to customers with the needs of the organisation • Not all customer groups are equal • Define your customer strategies for each customer group

Step 1

• Once you have done step 1 and 2

you can then decide your intent for each customer group.

There are only seven core strategies, the key factor is to chose one

(maximum two) per customer group.

•Translation of the business strategy for the organisation into what the strategy means for each customer group • Describes the approach, principles and tactics • Identifies the value-delivery-systems

Profit by Design © Mark Hocknell 2016

(Possible) Intent with a Customer Group Strategy Description

Grow Acquire more of these types of customers.

Protect the relationship

These customers are strategically important (value/leverage) and we will apply proactive retention approaches to engage with them with the net effect of not losing any customers.

Maintain the relationship

Goal is maintain the current, transactional relationship with these customers; service is provided with the view of minimal cost and basic needs provided to the customer.

Re-engineer the relationship

Our goal here is to change the way the customer interacts with us, or how these customers behave in the environment.

Enhance the relationship

Similar to ‘Re-engineer’, however Enhance is about delivering additional value to the customer.

Win Back Identify customers of value that have been lost and develop tactics to win them back.

End the relationship With these customers they represent no value to the organisation, and we can see no other alternative to Maintain, Re-engineer or Enhance the relationship.

12 Profit by Design © Mark Hocknell 2016

Value Propositions • Two Levels for the customer – answers:

• “Why I should buy from you” – Your business, you the sales person

• “Why I should buy your product/service” – Over the alternatives

– Use specifics

– Needs to answer three questions

• Customers make buying decisions emotionally, then seek rationale to justify.


Architecture for Customer Engagement

The Conversation that Attracts and Keeps your Awesome Customer


•Thru email contact aim to define the potential customer • Offering support/help in learning • Build rapport, provide information and reiterate value propositions and benefits

• Awesome Customer B

• Awesome Customer A

Advocates Unknown Customers

Visitors / Contacts

Known Guests

Customers

Customer Buying/Decision-making process:

0. Unaware.

No problem, trigger or

need.

Customer Engagement:

1. Awareness

of a problem, need, or

trigger to improve.

2. Customer

investigates and

considers initial set

of solutions

3. Customer adds or

subtracts potential brands/

solutions (shortlist)

4. Customer

does active evaluation of options

5. Customer makes the purchase decision

6. After purchase

Customer develops expectations of performance –

informs re-purchase and level of

advocacy

Attraction: • Blogs • “Free” Reports • SEO • Word of Mouth

Open up: • Direct contact • Call / email • Guide thru the decision-making process • Open the relationship

Delight • Deliver value and great experiences • Continuous improvement

Getting to know: • One pagers • White papers • Landing pages • Web site design

• Inform/Educate • Values • Problems/ Benefits

• Outbound / Referrals • Proactive contact

Internal Sales – Values Based Sales Process

Sales – 4 Step Sales Process

• Account management • Service delivery

Profit by Design 15 © Mark Hocknell 2016

Sales Cycle

Adoption1 Innovation

Adoption2 Product/Service

Values & Ethics

Customer Decision-making process

Scripts/Prompts vs Methods

Initial Inputs Secondary Stage Act Measure / Monitor

Do the results suggest changes to

the Initial Inputs..? Progressive Improvement

Customer Groups Value Propositions

Architecture for Customer Engagement: The Conversation that Attracts and Keeps your Awesome Customer

•Thru email contact aim to define the potential customer•Offering support/help in learning•Build rapport, provide information and reiterate value propositions and benefits

• Awesome Customer B

• Awesome Customer A

Customer Buying/Decision-making process:

0.Unaware.

No problem, trigger or

need.

1.Awareness

of a problem, need, or

trigger to improve.

2. Customer

investigates and

considers initial set

of solutions

3. Customer

adds or subtracts potential brands/

solutions(shortlist)

4. Customer

does active evaluation of options

5. Customer makes the purchase decision

6. After purchase

Customer develops expectations of performance –

informs re-purchase and level of advocacy

Attraction:• Blogs• “Free” Reports• SEO• Word of Mouth

Open up:• Direct contact• Call / email• Guide thru the decision-making process• Open the relationship

Delight• Deliver a value and great experiences• Continuous improvement

Getting to know:• One pagers• White papers• Landing pages• Web site design

• Inform/Educate• Values • Problems/ Benefits

• Outbound / Referrals• Proactive contact

Internal Sales – Values Based Sales Process

Sales – 4 Step Sales Process

• Account management• Service delivery

Profit by Design 16 © Mark Hocknell 2016

Five Levels of Customer Engagement

5 On Purpose

4 Almost There

3 Middle of the Road

2 Ad Hoc

1 Exit Strategy


• Customer acquisition based on customer strategy (Awesome customer known) • Revenue / profitability is predictable • Processes / systems enable customer engagement • Leaders focus on results – purpose is customer focused

• Employees engaged • ↑ NPS • ↑ Retention

• Sales results are random • No process or method • Non-productive relationships, stress and worry

• Targets are money driven • Product is main focus • Leaders are “Gee Men” • Features selling

• We are highly skilled at creating interesting reasons for poor results • Lost sales are about price • Moderate sales team turnover • “Noisy” customers

• Targets are money driven • Blend of Product and Customer focus • Features selling (some advantages)

• Revenue / profitability appears stable but sometimes unexplainable • Separate marketing and sales functions, targets • Processes / systems in development to be integrated • Leaders focus on targets – purpose is company focused

• Revenue / profitability appears stable • Integrated customer functions and goals • Clear understanding of good leads (MQL/SQL) • Leaders focus on targets – purpose is company focused

• Personas developed • NPS used (overall) • Developing collaboration / skills

Profit by Design • Remember to build a really profitable customer

portfolio you need to, design it from the start – Know you Awesome Customer (spend and advocacy)

– Know the two-way value exchange

– Know you value propositions and how to deliver them

– Use and implement the Architecture for Customer Engagement to start that Conversation that Attracts and Keeps your Awesome Customer

So you can build your profitable customer portfolio

on purpose.


2-Day

How to Design

your Business for Profit

Workshop

Coming later this year


2-Day How to Design your Business for Profit Workshop


Profit by Design: Applying the Architecture for Customer Engagement Day One

1. Profit by Design – key principles (Customer Portfolios, Spend, Advocacy, A.C.E.)

2. Business Alignment with Customer Intent – your Customer Groups, Two-way Value and Intent

3. Your Value Proposition - Level 1: Why you. Level 2, why your Product / Service the three levels and specificity

4. A.C.E. Initial Inputs Aoption1, Adoption2, Vales & Ethics, Sales Cycle

Day Two

• Building your A.C.E.

5. Customer Decision Making – B2B/B2C

6. Selling in our Age - intro to selling methods, techniques that build engagement

7. Finalising your A.C.E. – bringing all the components together into a congruent engagement approach

8. Implementation - it’s all about execution

Profit By Design

leveraging from the power of customer spend dynamics and advocacy


Mark Hocknell 0438 451 405

[email protected]

profit by design - meetupfiles.meetup.com/19129776/profit by design 7th sept 2016bcx&dt...

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