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Learn how European companies are adapting to the weak economy and using marketing strategies to bounce back. Practical insights and examples provided.
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After the recession. How are European companies fighting back? Andrew Harvey Moscow 22 October 2014
First, some warnings • Content is practical • Basis is experience, not academic • And based on the fact that I am still learning • Some background and then some examples • Happy to take questions
A little about me • Early career in travel – both business and consumer • First Commercial Director for Virgin Trains • 15+ years in professional services sector • Firms to €400million t/o and 3000 people • Consultant to range of businesses, leading marketing and change
My other roles • Board member and Chairman, Chartered Institute of Marketing (2007 to 2014) • Board member and Chairman, European Marketing Confederation (2008 to date)
European Marketing Confederation • Marketing associations across Europe • Based in Brussels • Sets standards for profession • Shares good practice between members • Content provider for member associations • EMCQ - common qualifications framework
What’s the context? What’s happening in Europe? • Growth still very weak • Inflation fell to 0.4% in July (ECB target 2%) • 5 EU countries in negative growth • Some bright spots – Ireland, Latvia, Lithuania • And outside the Eurozone – Hungary, Poland, Great Britain • For marketers in all businesses – pressure to perform
Marketing orientation – even more important than before • Establishing the market need • Designing a response to that need • Distributing/communicating a product or service • Delivering customer experience • Not the preserve of private companies. Equally applicable to government sector, charities etc
What can happen if you get it wrong? • Decline is inevitable • That speeds up in changing markets • And even more so in the digital age
How to get it wrong – and right again • Founded 1884 in Leeds, northern England • Grew for over 100 years • Reputation for value and innovation and as a great employer • 1953 – ‘The customer is always and completely right.’ • A brand to aspire to be like, notably in retail
What went wrong? • No customer based strategy. For example - uncoordinated international expansion • Poorly managed switch to international sourcing, aggressive buying policies • Competition at both top and bottom of its markets • No true marketing orientation • Recession
What’s changed? • Focus on the voice of the customer, significant effort • Customer voice as the driver for everything • Market positioning that reinforces that • Practical change to offering
And the impact? • Recession caused decline but….. • Turnover back, above former levels • Profit around 50% of best years • Sentiment improving • … but lasting damage
Digital – driving reputation for a service company • 2010, started with an Icelandic volcano – providing information • Now service support – 24/7, 10 languages, all in one hour • As an example, ‘Meet and Seat’ • Facebook – 4.7m followers, 4% engagement • Multi-platform – Twitter, Instagram….
Digital – more than reputation • Three pillars – reputation, service, commerce • Very personal – ‘What I need now’ • Very fast – 1 hour or less • Expectations getting higher and higher
And what does KLM say? • Complete change in customer engagement • Using database to drive service changes • Social based marketing campaigns – seven times better rate of return
And what more does KLM say (but might rather not)? • The dog is an actor • Keep social ‘honest’ • www.keepsocialhonest.com
Change in communications landscape – it’s real • Every European country, print in decline (not Germany) • TV varies hugely by media market • Online growth in every country Source: Publicis
For some, digital is a real threat • Some models rely on other channels • As an example, luxury travel market • Built on a knowledgeable adviser, quality experience • Does the internet destroy all that?
Kuoni • Swiss – founded 1894, strong across Europe, particularly in Britain, Switzerland, Scandinavia • Mixed direct and agency sales • Travel more commonplace – and much more self-service • Needed new positioning • Really strong brand equity, needed to work harder
Kuoni – improving direct sales experience (fewer quality agents)
Kuoni – advertising to reinforce strengths, extend distribution channels
Kuoni - outcomes • Context of weak international market • 27% improvement in income • Key elements – greater control over distribution, improvement in sentiment amongst essential markets
Seeking out a niche • Insurance, a market where most do everything • RIAS, launched 1992 as ‘over 50s’ specialist • Allowed building processes and data for that segment, eg claims handling • Heavy reliance on ‘old fashioned e-mail’ • Contact centre culture built on quality conversations
RIAS - results • Renewal rate almost twice that of competitors – for same age group • Customers buy 2.1 policies a year (compared to 1.2)
And how can not-for-profits fight back? • Many of the same tools and techniques can be used • Background – charitable giving under pressure • Competing pressures for money • Western governments leaving more social care and support with charities
Simple but creative • A problem most of us see every day • Irritating to us, but imagine if you were blind • 24% click through rate • Almost four times more likely to donate • In digital, the best are still very creative
In conclusion – what have we learnt • Some companies buck the trend • Thinking and planning are the key • Creative still a vital part of what we do • Common theme – thinking from the customer perspective, or marketing orientation • Understanding your market is everything
Thank you for listening • What are your stories? • What are your questions? Andrew Harvey + 32 2 742 17 40 aharvey@emcoffice.net andrewqharvey
After the recession. How are European companies fighting back? Andrew Harvey Moscow 22 October 2014