Customer Experience Management

Understanding the Context of Discounts in Toilet Soaps

2012-01-02T05:50:00.000-08:00

Understanding the Context of Discounts in Toilet Soaps

Discounts are reductions to a basic price of goods or services. There are many purposes for discounting, including; to increase short-term sales, to move out-of-date stock, to reward valuable customers. Some discounts are forms of sales promotion.

A visit to Spar Hypermart gave us an insight to:

What are the products and product categories on which the store is providing discounts?
What type of discounts are given, e.g. price reduction, bundle offers, in-store discount, bundling, combo offers, quantity discounts etc.
What kind of people are looking for discounts. Do rich people really care about discounts?
Do discounts help in increasing sales?
Do discounts affect impulsive buying behaviour?

Pyramid (Toilet Soaps)

Price Range

0-10 = Lifebuoy, Lux

11-20 =Lifebuoy, Lux, Vivel, Harmony, Medimix, Lux, Cinthol

21-30 =Boro Plus, Emami Pure Skin, Medimix, Pears, Dettol, Vivel, Hamam, Savlon, Lux, Camay, Chandrika, Santoor

31-40 =Yardley, Park Avenue, Rexona, Lux, Dove, Savlon, Dettol, Fiama Di Wills, Liril

41-50 =Dove, Pears, Liril

51-60 =Himalaya

61-70 = Olay, Himalaya.

Observations.

· In-store discounts given on top and middle level soaps for pushing up sales.

· Bundle offers present in middle and to some extent in top level.

· No offers in bottom level segment of soaps.

Syed Munir

Class of 2012

December 31, 2011

7As APPROACH TO CUSTOMER EXPERIENCE MANAGEMENT AT STORE LEVEL

2010-12-26T07:34:00.000-08:00

Some of the most memorable quotes on Customers are:

"It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages" - Henry Ford
“There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else"- Sam Walton

In a recent HBR article ("Let Emerging Market Customers Be Your Teachers", HBR, December 2010), the authors gave out an interesting insight quoting McKinsey studies. "In developing economies, the retail aisle is where the marketing action is - it's where the customers make purchasing decisions. McKinsey studies show that in China, for example, as many as 45% of customers make those decisions inside stores, compared with 24% in the United States."

Although their study did not include India (the authors conducted a study in 2009 in China, Poland, Turkey, Brazil, South Africa and Peru), I am sure the results would apply equally well to Indian retail landscape as well.

How to engage the customers at the store level? What kind of experience should stores offer to the customers that would increase their customer life time value? How to improve the customer experience at the store level?

To answer these questions, I have developed a model titled - 7 As Approach to Customer Experience Management at Store Level - that would help retailers orchestrate a better and delightful customer experience management at the store level. Remember however: It is only when all these 7As are used simultaneously that the stores can expect better delivered customer experience and not in isolation.

RURAL CUSTOMERS' BEHAVIOR - THE PYRAMIDS MODEL

2010-12-24T07:02:00.000-08:00

Are rural customers' different from urban and semi-urban customers? What distinguishes their consumer behavior? When someone looks at the kind of glossy and rosy presentations on the potential of India's rural markets, one can not help but get bemused. Why get bemused? It's for the simple reason that none of those presenters nor the people from whom these presenters would have got the information would have ever visited even one village and tried to find out for themselves as to what it is like living in a rural area? It's not to blame them though. Rather, it is to sensitize others to take those glossy presentations with a pinch of salt. When you are on a extrapolation, can that be called an exploratory study? And most of these estimates are extrapolations rather than based out of any valid and wholesome sample.

To understand rural consumers behavior, I have developed an exclusive model that we used it during GRAMDARSHAN, Aegis Global Academy's Rural Immersion Workshop in three different villages - Nanjagoundanpalayam, Vellalapalayam and Thottipalayam in Gobi (75 kilometres from Coimbatore).

Termed PYRAMIDS model, this is an intuitive model that we used for assessing rural consumers' behavior. It was good although it wasn't the best. Based on this model, the questionnaire was constructed and administered amongst 480 customers across 3 villages over 2 and half days and the behavior can largely be categorized into this model.

INNOVATION AND CREATIVITY

2010-12-23T03:38:00.000-08:00

What is the difference between Innovation & Creativity? While creativity is all about development of new ideas, innovation is all about end-to-end solution starting with an idea and ending with value creation. What do companies need- creativity or innovation? In other words, whom do companies require - "creative" employees or "innovative" employees? Definitely and undoubtedly, innovative people, for, they create the cash registers ticking. Mere creativity sans commercialization would just deplete the cash flows forcing companies to face unwarranted challenges.

What is the difference between innovation & creativity?
Why innovation matters most to the companies?
How companies create and nurture innovation culture in companies?
What it takes companies to redefine their INNOVATION DNA?

To answer these questions, Aegis Global Academy has found the best person in Smita Tharoor, CEO, Tharoor Associates, London.

Smita Taroor, CEO, Tharoor Associates, London would be addressing an impressive list of Corporate honchos in Coimbatore and the future Corporate Czars from Aegis Global Academy's World's First Institute of Customer Experience Management on January 13th 2011 at Aegis Global Academy's Campus in Coimbatore. She wouldbe speaking on Innovation & Creativity, a key success and differentiating factor for corporate success. Never give a chance to curse yourself for not being there.

Those of you who can make it up for the day are most welcome.

MISSION FIRST, ME NEXT - FROM CORPORATE EXTREMISTS TO CORPORATE MERCANARIES

2010-11-27T23:33:00.000-08:00

What does, MISSION FIRST, ME NEXT mean? Not getting into the philosophical underpinnings of the purport of this adovcacy issue, it means that it is every employee's responsibility to put organizational goals first and the individual goals next. Remember, Henry Fayol's 14 principles of management? One of the fourteen principles says, "subordination of individual interest to general interest". How true and prophetic he was.

Most of the times the employees assess do I like it and then do. Some employees are forced to "I should" therefore I do. What is the difference between these two sets of employees. While the first set of employees become HOBBY HORSES the second set of employees become SULKING SAINTS. And both are detrimental to the long-term and larger interests of the organizations. While the hobby horses would drive the companies towards their passtime favorites at the cost of negative returns (most probably) the sulking saints would let the sheens off the companies because they would not be giving their best to the companies. In other words, while hobby horses indulge in "I Like" activities, sulking saints "I should" activities. And as argued earlier, the companies would suffer from these corporate extremeists.Therefore what's the way out? According to me, the best you can do is to convert "I should" into "I Like" so that you start loving what you are supposed to be doing.

How many of you love everything that you do? How many of you love everything that you are asked to do? How many of you love doing what you want to do? How many of you love to hate what you are doing? The answers to these questions decide what and how much the organizations stand to get to from you and me. And you and me are there to let the organizations flourish so that we too can flourish under its ever-expanding umbrella and it is not the otherway around.

Let's make no mistake in interpreting our roles. We are there to serve organizational interests and not our selfish interests. If we cannot let organizations prosper, how would organizations let us prosper?

Rural Consumers' Behavior - What is RURAL

2010-11-22T19:52:00.000-08:00

GRAMDARSHAN, conducted on behalf of Aegis Global Academy's and the World's First Institute of Customer Experience Management during November 16th 2011 and November 18th 2011 in three different villages - Nanjagoundanpalayam, Vellalapalayam and Thottipalayam - in Gobichettipalayam , Erode District, Tamilnadu was an eyeopener for many reasons.

Firstly, thanks to our ever-accommodative students (the batch of 2011) and the esteemed colleagues at the Academy who bore the brunt of inconceivable inconveniences during those three days, we could have a first hand experience of rural consumers.

Before I share my observations from our rural immersion workshop (GRAMDARSHAN), let's ask these questions:

(a) What is RURAL? Is there any standard definition of RURAL as defined by someone like Nactional Council For Applied Economic Research (NCAER), or Ministry of Rural Development, Government of India or any other apex institution in the country?
(b) Who is a rural consumer? What are his/her income generation sources and what are his/her spending patterns?
(c) What are unique and distinct characteristics of rural consumers?
(d) What is his/her educational background and what are his priorities in life?
(e) How does he/she measure the progress of his/her life? In other words, are there any specific yardsticks with which he/she measures the progress of his/her life?
(f) What are their priorities? In other words, how does Maslow's hierarchy of needs framework works in the case of rural consumers?
(g) Who/What influences their buying decisions?
(h) What are their aspirational values and lifestyle statements?
(i) What are the moments of truth when they shop around?
(j) Is there any significant between standard of living and standard of life for the rural consumers?

In the next post, I would try to answer these questions from the survey that our students did in the three villages. There are some very interesting insights that we got from this wonderful field study. More than exposing the students to the ground realities, the GRAMDARSHAN became a window for them to see through the lenses of the rural consumers firsthand.

GRAM DARSHAN - IMMERSION WORKSHOP IN THE RURAL MARKETS

2010-11-12T09:44:00.000-08:00

Aegis Global Academy launches the country's first-ever rural immersion workshop. Titled GRAMDARSHAN, this field visit exposes the students to rural markets primarily to sensitize them the ground realities so that they can serve them better.

This program involves students staying in 3 villages near Gobichettipalayam, 60 kilometers from Coimbatore for 6 days. Divided into three different teams, each team spends two days in each of the village on a rotation basis so that each of the team spends 2 days in each of the village. During this field visit, each of the team would be physically stationed sans their regular luxuries - mobile phone, lap tops, well-furnished and air-conditioned classrooms, air-conditioned off-campus, hot-served food, etc. It is not to steal away what they deserve, after all. It is more to let them empathy with the target group - the rural markets. The resulting dissonace (if at all!) would enable them to not only appreciate the ground realities but also equip them to serve them better in latter years.

Especially from the view point of delivering better customer experience to the rural customers, what better way is there than to visit them at their place and understand their innate needs, drives, motives, implicit and explicit behavior etc?

RURAL CONSUMERS - DISCOVERING CUSTOMER EXPERIENCE MANAGEMENT TOUCHPOINTS

2010-11-07T20:38:00.000-08:00

"India lives in its villages", said Gandhiji decades ago. Over the decades since Independence, several Government programs have been launched and implemented with a single point agenda - poverty alleviation. All the State Governments have also implemented many rural-oriented welfare schemes. However, all these schemes and programs at best have become political bastions and rehabilitation vehicles for "politically active" workers and eventually these programs over the years have become grand sloganeering vehicles. Remember, Mrs. Indira Gandhi's "Garibhi Hatao" slogan?

Added to these 'governmental' efforts were the causes championed by NGOs, social entrepreneurial ventures, corporate social responsibility initiatives, microfinance institutions etc. The big difference between governmental initiatives and the 'private' initiatives has been that while the end remained the same - poverty alleviation - the means differed distinctly. While the governmental efforts "aided" the rural masses, the private initiatives sought to increase the purchasing power by encouraging several self-imployment and entrepreneurial ventures.

However, the achievements of both of these "Poverty Partners" - the government-led institutions and privately-held institutions - are very far from the desirable.

It isn't as though nothing has been achieved. While a significant progress has been made - especially in sensitizing the rural masses to the clarion call - a lot needs to be done in changing their mindset. How would you sensitize them to higher order goals, not needs? How would you sensitize them to come out of their cocoons?

Every report on Indian rural markets paints a rosy picture. All those are in (real?) numbers and do not speak anything of the nature of Indian rural markets. By some estimates, it is about $500 billion - $ 600 billion market.

How to tap this huge potential? What needs to be done to ensure a sizeable portion of this market?

CUSTOMER-CENTRIC ORGANIZATIONS

2010-11-02T01:40:00.000-07:00

Creating Customer Centric Organizations

“The purpose of a business is to create a customer…The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself…The single most important thing to remember about any enterprise is that there are no results inside its walls. The result of a business is a satisfied customer” said the messiah of management, Peter Drucker decades ago. And today they are even more pertinent.

While 1950 – 1980 can be described as the era of products, 1981 – 2000 can be described as the era of brands. And while 2000 – 2010 can be described as the era of processes, 2010 – 2025 can safely be predicted as the era of customers. Accordingly, the organizations were structured and rallying around products (Product-centric organizations), brands (Brand-centric organizations), Processes (Process-centric organizations) and customers (Customer-centric organizations). It should however be noted that: (a) All four of them co-existed in each of the respective periods, and (b) the importance given to each of them differed greatly in each of the respective periods. For instance, brands, processes and even customers were given importance even in the product-centric organizations or product era. It was just that while products were given more importance, the other three were given less importance. Similarly, the co-existence of all the other three elements in other three eras.

The reasons are historical and contextual. The ‘Zeitgeist’ part of the logic says that organizations had to concentrate more on manufacturing immediately after World War II as there was pent up demand and the world was not yet introduced to do modern day business competition. And mostly conglomerates were ruling the day with their significant presence in every major industry. Why should companies worry about brands, processes and customers when there was almost an insatiable captive demand? Accordingly, the organizations were structured around products and that was the birth of product-based or product-centric organizational structures. The organizations’ primary responsibility was to manufacture products with reasonable quality in enough numbers. As JS Mill said, It was a typical ‘supply creates its own demand” situation.

And once the competition came on – especially from Japan, Germany, France initially and later from BRIMC countries, South Korea and a few eastern European countries – the platforms for competition have changed and the new points of differentiation have emerged. And the biggest and the most defining differentiating factor for this next two to three decades would who is on top of customers’ mind? And who stays on customers’ mind? The customer-centric organizations. What are customer-centric organizations and how to create customer-centric organizations?

What is Customer Experience Management?

2010-10-31T23:20:00.000-07:00

What is customer Experience Management? Before I attempt to answer this question, I would like to throw up a few interesting questions:

Who is a customer? What is the difference between a customer and a consumer? What is a consumer decision journey? Why does a consumer consume something instead of letting it go? Can he consume everything that he 'desires'? What does a customer buy- a product or an experience or both? How does he define his priorities?

What is experience? How do consumers and customers experience? What are the modes through which experience is received and felt? Is experience emotional or logical? Or is it both?

What is management? Can customer experience be managed? Are there any principles which would govern the way the experience should be managed?

What are the implications of these questions for the companies, CMOs, other CXOs, Marketing Managers and Store Managers. Of course, these are not exhaustive questions. However these few questions help us find the direction. And once the direction is set, setting the pace etc isn't a big issue.

The answers to these questions would define what is customer experience management all about?

WORLD'S FIRST CUSTOMER EXPERIENCE MANAGEMENT INSTITUTE

2010-09-01T08:32:00.000-07:00

Are you not curious to know about world's first Institute of Customer Experience Management? Like everyone else, I too was curious to know about the ICEM. Essar's Aegis Global Academy has partnered with IIM Indore, SQC (Singapore) and COPC (USA) to offer a PGDM in Service Management.

The beginnings of such a course can be found in the evolving and the inevitable convergence economy where the customers are engaged not with the (tangible) products anymore but the service. And therefore the way a company engages the customer defines its long-term standing in the market. There are three components to the Customer Experience Management:

Customer Centricity + Customer Experience + Customer Lifetime Value

And each component has a reverbating effect on the other components and therefore they effectively form a virtuous cycle.

Deeper insights on this proposition would be posted some time later.

3 Vs Approach to Strategy

2010-08-29T00:37:00.000-07:00