Steadfast into the future: how companies can sustainablynavigate their way through crises
umlaut consultants Kristin Klinge and Jan Birnbaum on customer value management and how it can help to make companies crisis-proof
Ms Klinge and Mr Birnbaum, as consultants, you help companies with their strategic orientation and develop visions and innovative ideas. How has the pandemic changed the market?
Jan Birnbaum: The pandemic has shaken things up. Initially, we sensed a great deal of unrest and uncertainty among our clients. A lot of strategy projects were put on ice for the time being. The question was no longer where companies wanted to go in the long term, but how they could get through the crisis in the short term. In the meantime, most of them have realised that now is the time to have a rethink. The pandemic offers them the chance to adapt business models in a sustainable and crisis-proof way. We have the right solution at hand.
Can you give us an example from actual practice?
Kristin Klinge: Let’s take a tool manufacturer… Until now, they’ve always sold their products to the customer via intermediaries – like DIY stores. In times of the pandemic, the DIY stores were and are temporarily closed. So the B2B market has largely disappeared for the manufacturer. The question this raises is this: how can the tool manufacturer bridge the gap over the middleman and reach the customer directly in order to maintain sales? For many firms, the change from B2B to B2C is a big challenge: those who operate in the B2B market often don’t know the end customers. With our customer value management, we can change that.
What does customer value management mean?
Jan Birnbaum: In simple terms, it means we help our clients to better understand their customers and to align their business model accordingly.
How does it work?
Kristin Klinge: We look at the status quo, i.e. the current customer portfolio, and identify the so-called high value customers. They’re the customers from whom the tool manufacturer can expect the most sales and a high degree of loyalty. This is precisely where we come in with a comprehensive data analysis: with our anonymised data obtained from crowdsourcing, we gain insights into the movement profile, behaviour and needs of this target group. This results in answers to the questions of who the top customers are - and what they want from the manufacturer.
Where do the data come from?
Kristin Klinge: With our customised crowdsourcing platform, we collect more than five billion data points every day in compliance with the European General Data Protection Regulation. They’re collected from more than 1,000 apps around the world - with absolute respect for data protection and the privacy of the participants.
What do you do with the findings?
Kristin Klinge: We use them to deduce which products and services offer the customer real “value” - in other words, which sell well. Would the customers prefer the high-quality drill or the inexpensive hammer? We compare our findings with the company’s existing products and services. One result of the analysis might be, for example, that we remove certain articles or services from the product range. Or we may have to add others, possibly even develop new ones. In a nutshell, we refine the portfolio - in the long run.
What does “in the long run” mean?
Jan Birnbaum: Life will continue after the pandemic, too. One important thing to learn from the current crisis is that firms need a certain amount of flexibility as regards external factors. In the future, too, they’ll face changes, which can be new customer needs or adapted shipping methods, as well as many other things. That’s why we always see our solutions as a multi-sales channel approach.
So you’ll be keeping an eye on B2B and B2C even after the pandemic?
Jan Birnbaum: Exactly. With our customer value management, we focus on both strands. We help our customers to place their products on the market better via sales partners, but also to sell directly to their customers – be it through online direct trade or special services. With the multi-sales channel approach, sales risks can be better distributed and crises more easily cushioned. What’s more, measures can be reviewed and adjusted repeatedly through performance controlling.
How does such a change process ultimately succeed?
Jan Birnbaum: It succeeds when we take a holistic look at the customer. That means not only analysing data, providing strategic advice and applying solutions, but also being able to develop, test and deliver products to the customer. All in all, we combine industry- and product-specific know-how with our software and data analysis skills. We drive important changes in the company not by the waterfall model and over a short period of time, but constantly and agilely. From start to finish, so to speak.