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Winning and Losing

For any business, being able to retain customers is one thing but understanding why you weren’t able to conquer the ones that didn’t make the purchase is just as important.

From my years of experience conducting market research, many companies seem to focus solely on business they do have (which is great) but forget about the sales they should have made but didn’t.

I have devised a simple and practical, yet effective, do-it-yourself market research strategy which any business can implement in-house. It’s called the Win/Loss Analysis and forms the first chapter in our series, Market Research Made Easy (watch this space!).

Understanding why customers didn’t choose you but someone else is central to this analysis. When you’re asking the ‘ones that got away’ as well as your usual customer base, you are essentially combining a competitor analysis, a customer satisfaction survey, your company’s own brand perception among your customers, and at the same time highlighting areas of the business which require much needed improvement.

How did the idea of the “win/loss analysis” originate?

  • After having worked with numerous clients over the years, we found ourselves talking to their customers about not only what worked well for them but also what didn’t work well for them.
  • We then translated this into asking lost sales (i.e. people who obtained quotes or made an enquiry but didn’t proceed with a purchase) why we didn’t win their business
  • The analysis from these two groups then presents significant opportunities for companies to improve operations at all levels.

Why ‘winning’ and ‘losing’?

  • It’s very simple: we needed to examine the differences between getting the sale (winning) and not getting the sale (losing).

What are some of the key outcomes of the analysis?

  • This process can pick up significant issues; for instance the importance of inventory control or a company’s ability to provide the right training to deliver their product or service, or any problems relating to the sales function such as quote turnaround times etc.
  • Companies can also identify and communicate the how and what of their competitive advantage and unique selling proposition (USP).
  • And, just as important, it can identify operational issues such as service protocols and make sure they match customers’ expectations.

What are some the things to consider when doing your own Win/Loss Analysis?

  • Don’t be afraid to ask your customers tough questions (e.g. what did we get wrong or what can we do better for you?).
  • Make sure your questionnaires are consistent; it is important to use the same questionnaire for your customers so you can compare the results.
  • You don’t have to ask many of your customers or lost sales; 10 in each group is usually enough.
  • Make sure the questions are relevant to your customers and you are prepared to make changes based on those findings; good or bad.
  • Let your customers know what changes you plan to implement in your company, product, or service offering in response to their answers. This can translate into more customer loyalty.
  • Don’t let your ego get in the way; it’s not about you … it’s about your company and, importantly, your customers.
  • Once the analysis is done, be sure to follow-up any changes and measure how effective those changes are with your customers. Do this over regular intervals.

Don’t wait.
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ASEAN Now

We have always been proponents for trade with our neighbours up north, the ASEAN Community, a name which was self-declared at the end of 2015. This help setup the ASEAN Economic Community which offers a framework for simplifying, standardising and facilitating economic trade activity between its member states.

As the world’s third-most populous economy (637 million) in 2016, after China and India, it presents massive opportunities for Australian businesses to engage and embrace this rapidly growing region. While only making up 3.4 percent of the world’s GDP, its average annual growth in GDP in 2016 was 4.6 percent, higher than the world’s average of 3.2 percent for the same period. The ASEAN Community also represents the third largest economy (US$2.5tn, 2016), only following China (US$11.2tn, 2016) and Japan (US$4.9tn, 2016).

 

business strategy Asia market research ASEAN graphic GDP

ASEAN – GDP 2016 – Research by Design.

 

ASEAN Now: Insights for Australian Businesses, Commonwealth of Australia 2017

 

Australia has much to gain from embracing the growth in the ASEAN Community:

  • Much closer in proximity than many of our other major trading partners, e.g. China, Japan, U.S.
  • Expanding cities
  • Rising demand from a rising middle-class
  • Increasing integration and interconnectivity through free trade agreements (FTAs)
  • Access to digital innovation

Australia’s lifestyle, products and services have a reputation of being high quality and are widely recognised. Businesses should take advantage of this reputation by tailoring an Australian solution to a Southeast Asian problem. We all mutually benefit.

ASEAN Now is a fantastic read for those who are not familiar with the region and a great top-up for those who are already familiar (click for PDF).

Learn about how you harness the power of our neighbours. Don’t miss out.
Contact us now for a free, no obligation, 2 hour consultation about your research needs.

Satisfaction is not enough – How to build emotional customer connections

Today companies face ever increasing global competition, whilst striving for continuously growing profits and market share. Most firms focus on achieving high customer satisfaction at every stage of the customer journey. But satisfaction is not enough!

A recent study published by the Harvard Business Review suggests that customers with an emotional connection to a brand are 52% more valuable than highly satisfied ones.

They purchase more and more often, are less price sensitive, pay closer attention to promotional material, follow advice and actively promote the brand.

But how can a brand build emotional connections with their customers?

A brand has to understand their customers’ deep and often unspoken needs and link these motivators to specific purchasing behaviour to evaluate which desires are most profitable.

 

Source: Scott Magids, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions” 

 

Emotional connections may differ between industries, categories and customer segments and may even shift in a segment depending on where a customer is in their customer journey.

Each brand needs to identify a specific set of needs that motivate their key customers and drive sales:

  1. Examine how the top quartile of your customer base or your most successful location differ from others
  2. Search for the key motivators of these connected customers
  3. Quantify the impact of different motivators on purchasing, spending, loyalty, and advocacy
  4. Gain a deeper understanding of connected customers through online surveys
  5. Evaluate motivators separate from your brand (reasons for brand choices do not always match key motivators)
  6. Develop informed strategy and optimise investments to turn highly satisfied customers into emotionally connected ones
  7. Make emotional connection a key objective not just in the marketing department but across the firm
  8. Regularly review customers’ emotional connection levels, as well as the correlation of customers’ emotional connection scores with lifetime value measures, such as annual spending, churn and tenure to adjust the strategy

A retail case study has shown that the implementation of an informed strategy led first year sales of new stores to exceed past averages by 20%, leading to shorter breakeven times and higher returns on capital. Sales grew by 3.5% in comparison with the annual average of just 1%, whilst inventory turnover increased more than 25%. Market share and customer advocacy also grew, contributing to record-high customer lifetime values.

The retailer had identified the need for a sense of belonging, a sense of thrill and a sense of freedom as key motivators. The brand redesigned their stores and implemented a social media campaign were customers could share their favourite outfits to satisfy their customers deepest desires.

 

Sounds daunting?

Actually, some of the world’s leading brands mistakenly believe that being considered a “good brand” by a large percentage of customers will secure long-term success. However, the blue bar in the following graphic demonstrates how many customers these brand failed to build an emotional connection with.

 

Source: Scott Magids, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions” 

 

This emotional connection gap represents an enormous opportunity for all brands to transform satisfied customers into emotionally connected and more valuable ones.

Source: The New Science of Customer Emotions

Know what your customers are thinking. It’s really that simple.
Read more about the Key to Successful Marketing.

The Power of Data Analysis

Global competition and increasingly ambitious business objectives leave no room for instinctive decision making.  Staying ahead in a world of infinite social media tweets and posts and online shops requires a 360-degree view of the elusive customer to guarantee successful and goal oriented omni-channel brand engagement. You have to know your customer and their every wish and desire to service them strategically and uniquely to guarantee sustainable success.

However, a 2017 CMO survey by Black Ink revealed that marketers perceived access to advanced analytics and general data to be the biggest hurdles in marketing; and, continually find themselves forced to rely on legacy solutions such as Excel or CRM systems.

The key to sustainably successful marketing is to align data insights with strategic company objectives.

Ask yourself:

  • What are your core objectives?
  • How does marketing contribute to these objectives?
  • Which data can you utilize to analyse your performance?
  • How will you measure success?
  • How can you design and install a systematic and continuous measurement process?

These questions will help you identify your key objectives and strategically collect and analyse data to measure success and inform strategy.

Be very selective about which data you choose to analyse and how and why. Metrics should only be included if the relationship between the metric and the goal is clear.

Such as:

Goal

Metric

Increase brand awareness number of daily website visitors
Focus budget on most profitable customer segments return on ad spend
Maintain market leader position content trends
Optimise spending on campaigns campaign conversion rates

 

This objectives-focused data analysis approach makes data both accessible as well as actionable by providing an in-depth performance summary, enabling decision making on the spot.

Metrics should be re-evaluated and modified regularly and made accessible to all team members; guaranteeing informed, prompt and appropriate decision making and goal oriented actions.

Source: Marketing Analytics dashboards: The do’s and don’ts

Know what your customers are thinking. Act now.
Read more about the Key to Successful Marketing.

Aged Care – A Critical Analysis

We have seen an exponential increase in the number of elderly in proportion to the total population over the past decades. However, people aged 65 and over are not as healthy in old age as projected considering our prosperity, according to recent findings of an international study done by BDO in cooperation with the OECD.

Additionally, elderly and healthcare costs are continuously increasing especially due to an international increase in comorbidity (two or more illnesses are present in the same person simultaneously) among those aged 65 and over, placing a heavy social and economic burden on future generations.

Average medical expenses for a person aged 85 and over amount to over AUD$79,200 per year (BDO); an alarming amount considering that this group is expected to exceed 25% by 2050 worldwide.

Furthermore, due to high educational requirements, the demand for health care professionals far outstrips the supply. What’s more is, many lower-skilled health care professionals were made redundant in the last years, due to unnecessarily high requirements.

Analysing national differences in their approach to aged care revealed extraordinary insights in BDO’s recent international study.

Even though all examined countries were faced with tremendous demographic challenges, the study found that not only differences in health care models and funding seemed to impact the health of the elderly, but lifestyle and habits too. In Norway, for example, people are healthier for a significantly longer period of time due to an outdoor lifestyle, a ‘culture of caring’, with families taking care of each other and the elderly taking an active and meaningful part in society

Furthermore, smokers made up only 4% of the population, whereas in Germany, where elderly (on average) only have 8 healthy years over 65, 20% of the population smoked.

A different approach to evaluating return on investment (ROI) in the Netherlands is showing positive results. The country seeks to shift their focus away from the disabilities of patients and further towards their abilities.

BDO concluded that current healthcare systems focus on curing the sick rather than preventing sickness and does not deal with the root of the problem.

To achieve a more affordable, more effective and sustainable aged care system we need to:

  1. focus on innovation, prevention and rehabilitation;
  2. target funding to boost innovation;
  3. lower educational barriers for health care professionals;
  4. develop technical innovations;
  5. encourage and support big-scale lifestyle changes;
  6. invest in methods, solutions and processes that ensure people age differently;
  7. seeking greater dialogue with the elderly to identify areas of improvement;
  8. evaluate ROI;
  9. acknowledge lack of difference between private and public healthcare systems; and
  10. give the elderly a place and purpose in our society.

Source: https://www.bdo.com.au/en-au/insights/healthcare/publications/new-perspectives-on-elderly-care