01/03/2021 – Innovation / B2B / Customer / Experience
Why customer experience is key (even in B2B)
Author, speaker and thought-leader on customer engagement, Steven van Belleghem, explores the innovative strategies adopted by some of the world’s most successful B2B companies in their effort to build an ‘Offer You Can’t Refuse’ when it comes to customer experience.
According to research by B2B International, only 14 per cent of large B2B companies have a culture in which the customer experience is deeply ingrained. And according to McKinsey, B2C companies typically score in the 65–85 percent range when it comes to customer experience, while B2B companies average less than 50 per cent.
And yet, according to that same McKinsey study, the benefits of a fantastic customer experience for B2B companies are high: “In our experience, customer-experience leaders in B2B settings have on average higher margins than their competitors. In cases where companies have undertaken broad transformations of their customer-experience processes, the impact among B2B and B2C players has been similar, with higher client-satisfaction scores, reductions of 10–20 percent in cost to serve, revenue growth of 10–15 per cent, and an increase in employee satisfaction.
When I talk to different B2B companies around the world about the matter, the response I receive is usually something along the lines of: “But it’s a lot easier for B2C companies to focus on this experience than it is for us”. However, there are lots of great examples of B2B companies who are working to create a customer experience that differentiates them from their competitors, and in the minds of their customers. They are using three strategies: 1. Offering ultimate convenience; 2. Becoming a ‘Partner in the Life’, and 3. ‘Saving the world’, in order to create what I call, ‘The Offer You Can't Refuse’.
1. Offering ultimate convenience
Kabbage – 5,000 times faster
It takes a typical bank 20 days to approve a small businesses loan, which is a horrible experience if you are working to secure the future of your company. Financial-technology start-up Kabbage understood that frustration and solved it with a system requiring just seven minutes to approve a small-business loan – nearly 5,000 times faster than the industry standard.
ING & Shipster: Better access to information
Sometimes offering convenience is just as simple as offering better access to information. Netherlands-based bank ING enables its retail and corporate clients to access real-time account overviews and customised reporting, alongside the ability to process various transactions from any location. Offering this service required a significant transformation of the bank’s systems and processes. However, after just one year ING had grown profits by 23 per cent and increased its share price by 15 per cent.
Another great example is how logistics start-up Shipster ‘recycled’ the tracking and tracing apps used in retail – instead applying them to the B2B world of international shipping. The firm puts live tracking of international shipments on apps for web and mobile phones for all its customers.
Hewlett-Packard – friction-free buying
One of the best ways for offering customers the ultimate convenience is use of the subscription model. Here, the customer only has to take an action once to launch the service, and then everything is taken care of. For its enterprise customers, Hewlett-Packard identified a gap in the market for a friction-free ink-replenishment service and launched its ‘Instant Ink’ offering, which delivers ink before the cartridge runs out. On top of that, it provides attractive cost savings of up to 70 per cent through the subscription programme with its high yield cartridges.
2. Becoming a ‘Partner in Life’
Of course, becoming a Life Partner of customers and answering to their hopes and dreams takes on a slightly different twist in the B2B world. The end-customer this time is a large entity like a company. And becoming a Partner in the (Business) Life of companies entails helping organisations becoming better versions of themselves, growing, becoming smarter, or helping them help their customers. There are several ways B2B companies are stepping up to that challenge.
The Belgium-based Aertssen operates in the construction and infrastructure industry – not exactly an industry known for its digitisation efforts or customer experience. Its ‘Partner in Life’ strategy started in a very pragmatic way. It wanted to streamline the tedious and stressful internal process of renting heavy machinery for their projects. This could only be done ‘efficiently’ by phone, and so Aertssen decided to completely digitise this repetitive and time-consuming task. The result was great: planners ended up renting the materials 75 per cent faster, and making 55 per cent fewer mistakes. This made the management realise that customers, partners and even competitors had the very same ‘frustration’ – and they therefore crossed the industry lines from construction to the platform rental business in order to ‘solve the whole problem’ of their network. They launched the platform Smartyard, enabling others, too, to hire or rent out heavy construction machinery much faster, with less friction. Put like this, you could mistake their move for an “ultimate convenience” strategy. And it is, yet the firm is planning to go far beyond that: the plan is to create additional value for Aertssen’s customers by returning the data collected through the platform in a structured way. This information should help the client company make investment decisions based on market insights and grow in much more informed ways.
Salesforce launched Work.com, a hub of new technology solutions and resources to help its B2B customers to reopen safely, re-skill employees and respond efficiently to the Covid-19 pandemic. This is not just a convenient and helpful solution for its customers – it focuses just as much on wellbeing, health and reskilling in times where all of these have become absolutely crucial. In short, it helps Salesforce grow as a company and helps the firm help its own customers and employees.
Another great example of a company that helps its customers’ businesses grow is Alibaba. It’s often called the Amazon of China, but it has a very different approach that is very ecosystem-driven. Through its e-commerce marketplaces Taobao (consumer-to-consumer), Tmall (business-to-consumer) and Aliexpress (aimed at international shoppers), it functions as a network that empowers a huge group of small businesses with the tools and platform they need to thrive. The underlying idea is that “if you help others grow, you’ll grow with them too”. In 2004, for instance, it launched Aliwangwang, an instant messaging system to connect buyers and sellers with each other; it also provided free business trainings to sellers. And the firm is constantly looking out for ways to enable and train its customers.
3. Saving the world
Cisco is a B2B company with very strong ‘Saving the World’ strategies. For instance, it focuses on education to help solve society’s toughest problems with Cisco Networking Academy, which builds IT and career skills that empower people to thrive in the digital economy. And through grants and donations of its technology, the company helps improve access to quality education worldwide. It also helps create IT careers for young people in Asia, supports entrepreneurs in Latin America, and enables access to financial resources in Africa. It also continuously seeks ways in which technology could reduce energy use and greenhouse gas emissions. In 2019, it boasted a 49-per-cent reduction in Scope 1 and 2 greenhouse gas emissions. Meanwhile, 83 per cent of energy consumed by the business came from renewable sources and one million metric tons of supply chain greenhouse gas emissions was avoided. Last but not least, Cisco’s technologies help disaster-relief teams move faster and provide vital services to more people when disasters strike. The company therefore helps to make the world a better place from several angles.
Salesforce is perhaps the most well-known B2B company with a ‘Saving the World’ strategy – and has been since the moment it was founded. Even before the company had a working product, in the earliest planning documents it designed the 1-1-1 philanthropic model that set aside one per cent of Salesforce’s equity, and one per cent of its product and one per cent of its employees’ time to the community. As the company has grown, that model has serious financial teeth now, and over 8,500 companies have since joined Salesforce in this pledge.
Mark Benioff, its CEO, is a strong believer in corporate social responsibility: “Now being a CEO means that you’re taking care of all stakeholders,” Benioff told Fast Company in 2019. Mr Benioff’s activism includes bold stands on homelessness in San Francisco – he believes if companies and government can work together and invest enough money, then they will be able to solve this challenge.
In relation to this, Salesforce’s CEO clashed with many other tech leaders on Proposition C, a 2018 San Francisco ballot measure that would tax the city’s largest businesses in order to support homeless services. While Prop C’s implementation is currently stuck in the courts, Mr Benioff has doubled down on his commitment to the issue. In 2019, he established the Benioff Homelessness and Housing Initiative to study homelessness intervention strategies.
Steven van Belleghem’s new book, ‘The Offer You Can't Refuse’, is out now. Visit: www.stevenvanbelleghem.com
Latest issue – Vol 3/21
– Security focus
– Global gas supply risk
– Deepwater dangers – Cyber-security on deepsea drill rigs
Suriname International Petroleum & Gas Summit and Exhibition 2021
International “Astana Mining & Metallurgy” Congress
Ukraine Gas Investment Congress 2021
PARKOVY Convention and Exhibition Center, Kyiv, Ukraine