4. Consumer Brands and Retail
Vectia Case: Pfizer
Healthy solutions with customer insight
Starting point
At Pfizer organisational change worked as a catalyst for new ideas as the change from country units to global business units encouraged Pfizer to find new ways to serve customers and created a need for deeper customer insight into strategic accounts and to provide solutions for customers.
Objective of cooperation
A central aim of the process was to change Pfizer’s sales orientation from products to solutions. At first the team members found it hard to ask questions instead of providing answers, but when the project continued Pfizer realized that real solutions are based on the challenges pointed out by their customers. With the insight gained from customer meetings, concrete solutions that really solve the challenges of customers we developed.
Results and business impacts
Also the customers have benefitted from Pfizer’s new sales orientation, as also they attained valuable information in the meetings with Pfizer through the new communicative approach. The project also resulted in better teamwork through a shared language and working methods to evaluate customer management.
Based on case article in Vectia Explore magazine Spring 2010.
Pfizer is the world’s largest research-based pharmaceutical company.
Vectia Case: Fazer Bakeries
Category leadership in the baking
Starting point
The change from small-scale production to mass production has set challenges for the bakery industry. Bakeries have always been close to the consumer’s life, but as the manufacturers grow it is harder to maintain a real connection with the consumer. Fazer wanted to establish a stronger connection to its consumers and gain better understanding of their processes. Fazer had previously done segmentation from a demographic perspective and now a new and fresh way to look at consumers was desired.
Objective of cooperation
Together with Vectia, Fazer explored different kinds of segmentation perspectives that were tested and trialed until finally product use was chosen to be the main segmentation criteria. Consumer surveys, interviews and Fazer Bakeries’ own data was used to ensure segmentation based on actual facts and figures. Fazer was able to identify six different segments. The structured segmentation process also helped make marketing a solid part of business operations.
Results and business impact
With its new segmentation tools, Fazer gained strategic competence. Fazer Bakeries’ Marketing Director Ismo Nikkola rejoices: “Deeper consumer understanding is likely to have a major influence on the firm’s strategy. The actual benefits of consumer segmentation are more often gained in strategic decision making than in everyday tactical work.” Besides consumer insight, Fazer also received tools to serve clients, retailers and HoReCa sector better. “We believe that by having better consumer segmentation, we can provide much needed consumer insight to retailers as well.”, says Mr. Nikkola.
Based on case article in Vectia Explore magazine Spring 2010.
Fazer Bakeries is the leading bakery company in Finland.
Vectia Case: Tamro
Finding growth in a regulated environment
Starting point
Due to the tight competition for exclusive distribution rights and the pharmaceutics business being regulated strictly by society, growth within the core business is challenging to achieve. Growth opportunities and commonly shared direction of business is sought by gearing strategy process, in which Vectia was a familiar partner to continue the co-operation with.
Objective of cooperation
Tools such as Competitive Arenas and Must-Win battles were utilized in order to find new growth initiatives. Updating and validating the Competitive Arena analysis made during previous strategy rounds gave guidelines and aid to decide on which ones are worth to develop further. Furthermore core business strengths were identified and utilized to provide better services to existing customers.
Results and business impacts
Turning the focus from producing distribution services to observing and fulfilling customer needs was a significant change according to Tamro Group’s Managing Director Juha Koponen, and led to planning and implementation of a customer-based organization. Change of the focus has been well received by the whole organization: “We all have a clear direction and a strong will. We have, in fact, even surpassed our targets. All this leads to a positive escalation and multiples the organization drive”, says Juha Koponen.
Based on case article in Vectia Explore magazine Autumn 2009.
Tamro is leading pharmaceutical wholesaler in Northern Europe.
Vectia Case: Sinebrychoff
Securing the flow of drinks and cash
Starting point
People’s wildly different personal tastes impose challenges on beverage houses to come up with new, original tastes and concepts for ciders, beers and long drinks as well as energy, wellness and soft drinks. There are changes that Sinebrychoff has to react to: the beverage can levy ended, recycling was extended to plastic bottles, the alcohol tax was raised, consumer segments have become even more fragmented and customers such as retailers and restaurants are more demanding.
Objective of cooperation
Vectia was engaged to help Sinebrychoff to prepare for changing times by identifying change forces and uncertainties and to create possible scenarios and their implications. The project included assessing and analyzing Competitive Arenas, finding relevant Must-Win Battles, as well as creating a strategy and business model, including support for strategy execution.
Results and business impacts
Sinebrychoff’s CEO Pekka Tiainen rejoices: “The strategy process resulted directly in a list of to dos, a schedule for execution by responsible persons. We now have a credible three-year business plan!” The strategy process at Sinebrychoff engaged the whole personnel. “We now get spontaneous opinions and initiatives. We already have concrete and realistic cost-saving initiatives from our personnel. Understanding, engagement and cooperation between functions is better,” says mr. Tiainen.
Based on case article in Vectia Explore magazine Autumn 2009
Sinebrychoff is the oldest industrial brewery in the Nordic countries.
Vectia Case: Veikkaus
Managing customer experiences is no lottery
Starting point
Embracing digitality has not only created new gaming potential and new revenues, but has also brought new challenges for managing Veikkaus’ customer relationships and experiences across channels. Better insight for creating stronger emotional bonds was needed, because Veikkaus’ customer base began fragmenting into smaller segments and different people took care of different channels and created different customer experiences.
Objective of cooperation
To be able to manage and design aligned multichannel customer experiences, Veikkaus continued its long-lasting cooperation with Vectia. The objective was to create a unified and rewarding customer experience that is not dependent on the channel. To understand the customer experience better, Vectia mapped out situations that influence customers’ experiences. In the next phase, the relevant situations were thoroughly investigated, with the most crucial ones assigned for further development. In the final stage, the desired customer experience in different channels was described and designed.
Results and business impacts
In order to ensure ability to create strong commitment among customers, Vectia defined a strategy for managing multichannel customer experiences. Veikkaus’ Director of Customer Relations and Offerings Ari Aarnihuhta describes the results: “As a result of the project, the customer aspect is more pronounced; everyone believes that a positive customer experience will have a significant effect on our result.” Mr. Aarnihuhta further appraises Vectia. “Vectia is not overly dogmatic. They see the big picture, but are able to adapt it to ensure Veikkaus’ advancement.”
Based on case article in Vectia Explore magazine Autumn 2009
Veikkaus is Finland’s national lottery company.
Vectia Case: K-Supermarket
The better-than-average loyalty programme
Starting point
The Finnish retail scene is dominated between three players: Kesko, the S-Group and Tradeka and competition for the customers between these players is fierce. Hence, the companies must find new ways to differentiate themselves in the marketplace to be able to manage the current customer base, protect the most valuable customers and attract new customers.
Objective of cooperation
By building a new reward model for managing the customer base and supporting the core customer promise K-Supermarket is able to increase the customer rewarding value and allow independent entrepreneurs to conduct store-specific activities. The local entrepreneurs are responsible for executing the customer promise with the store’s selection, quality and service and therefore must be closely engaged in and familiar with the reward model. The customer’s total rewarding experience is finalised with store-specific actions and recognition.
Results and business impacts
The customer base analysis revealed that a small base of customers accounted for a major amount of profits, so this segment was especially important to concentrate on. Differentiating the rewarding system by both customer value and customer needs lead to a pull of 30 % for an individual K-Supermarket campaign. Thinking beyond me-too concepts and monetary rewards as well as taking into account strategy and brand elements shows that it is possible to create an innovative and meaningful loyalty concept that is both easy to use for the entrepreneurs and more rewarding to the customer.
Based on case article in Vectia Explore magazine Autumn 2008.
K-Supermarket is a leading Finnish retail chain with the customer promise of being “better-than-average food store”.
The better-than-average loyalty programme:
Together with Vectia the K-Supermarket chain analysed its customer base and created a new reward model that properly reflected the chain’s brand and customer promise. When rewarding loyal customers the model took into account not only purchase volumes but also buying behaviour based on food styles and motivations. Among other things, the programme increased pull for specific campaigns from 5% to 30%.
Vectia Case: Eli Lilly
Overtaking the future
Starting point
The pharmaceutical sector faces intensifying generic competition, which increases pressure on prices. When patents expire original manufacturers must have a contingency plan to ensure future success of their business. To proactively shape their own future, original manufacturers need to plan ahead and systematically observe and foresee changes regarding new product launches, potential exclusivity losses and pricing decisions.
Objective of the co-operation
Eli Lilly set out to define the most business-critical initiatives to secure its future. The companys strengths and weaknesses were assessed, and an event map for recognised opportunities and threats was developed. Three different sales scenarios were estimated for each of Eli Lilly’s major products. Based on this analysis, Eli Lilly identified the business critical must-dos. To accomplish the best-case sales scenario, Vectia created a template for proactive business contingency planning, as well as a follow-up reporting tool for the management team.
Results and business impacts
The management team now has tools and processes to proactively evaluate and shape the company’s future. Strategic initiatives are prioritised and planning is made with a longer perspective than before. The management team meetings and reporting are more structured, disciplined and transparent than before. The team members feel dedicated and the employees feel more united as a company. As Eli Lilly Finland has an excellent track record in the Eli Lilly organisation, Finnish initiatives are watched closely, and this project attracted international interest and acclaim.
Based on case article published in Vectia Explore magazine in Spring 2008.
Eli Lilly is one of the leading, innovation-driven pharmaceutical companies
Vectia Case: Philips
Finding the key to success
Starting point
Philips DAP (Domestic Appliances and Personal Care) faced the situation of managing a growing product portfolio with numerous different national and international distributors and retailers. Philips is perceived in the market as an innovative quality brand. However, on certain distribution channels low value competitors are penetrating the market. The challenge ahead was to create growth in an increasingly competitive situation.
Objective of the co-operation
To identify where Philips stood at that moment on a country, product and customer dimension, an assessment using internal and external best practice scenarios was carried out. The assessment revealed that Philips was active on a lot of boards, but the structure was missing. Most alarming was the unclear situation between marketing and sales, also it was unsure how to define the strategic accounts. The assessment led Philips to enter Vectia’s Key Account Management (KAM) program. Through goal setting and program metrics, roles and responsibilities were defined.
Results and business impacts
As a result of the project, marketing and sales are more aligned, roles and responsibilities are clearer and resources better allocated. There is new clarity in priorisation of tasks. Strategic and Key Accounts have been defined. Deep strategic cooperation with these most important customers will enable cooperation on strategic decisions of the customer, including e.g. purchases, marketing and logistics. Also the customers see that they can benefit from the clarification of Philips’ direction.
Based on case article published in Vectia Explore magazine in Autumn 2007.
Philips is a global leader in healthcare, lifestyle and technology.
Vectia Case: Eli Lilly
A new medicine for sales compensation
Starting point
As the use of prescription medicine increases, doctors are subjected to ever-increasing marketing efforts by sales reps of pharmaceutical products. One key challenge is how to motivate the representatives to carry out systematic and target-oriented work in a limited time span.
Objective of the co-operation
The aim was to derive from company’s sales strategy a new way to reward and motivate sales representatives. As the sales strategy was based on customer centricity and information, also the compensation model was designed to drive the desired behaviour. Using both quantitative and qualitative metrics the new incentive model was designed to bring more meaning to representatives everyday work by including behavioural elements. The compensation was based on reaching the sales quota and acting in a desired way. All the elements were included also in role-specific scorecards.
Results and business impacts
During the development phase Eli Lilly engaged people from all levels of the company to make the model as fair as possible. The possibility to influence one’s own working methods enhanced the motivation and encouraged team work. This new sales compensation model is believed to be first of its kind in the pharmaceutical field and it has been globally approved and applauded by Eli Lilly. The new model also helps in reaching the ultimate goal of the company: that patients will benefit from being prescribed the most appropriate treatment for them.
Based on case article in Vectia Explore magazine Autumn 2006.
A leading, innovation-driven company committed to developing pharmaceutical products.
Vectia Case: Schering
Doctor’s orders
Starting point
Schering Austria’s quantitative segmentation tool was based on customer potential and revenue. Pharmaceutical business relies highly on customer relationships. Hence, Schering wanted to ensure that beside profitability, they are offering the right services and benefits to right customers.
Objectives of cooperation
The aim of the project was to create models for serving Schering’s customers and making the company’s own processes and offerings more efficient. Also, a set of practical tools were to be designed to help sales representatives in meeting their customers’ needs.
The existing segmentation model was expanded by adding a qualitative dimension to it. Customer types were based on the doctors’ behaviour and differing interests. A rule of “Five Golden Questions” was created in order to help the sales representatives in classifying the customer base.
Customer types were consolidated into customer segments and strategies were created for each one.
Results and business impacts
With the help of CRM Cockpit, a CRM management tool, the new model and customer types have helped in combining customer relationship value and customer needs – the basis for decision-making concerning efficiency as well as offering or service design.
As a structured model for effective marketing and sales along with considerable competitive advantages, the model has gained momentum in being regarded as the best practice in the Schering world.
Financial benefits are realised along with the segmentation model’s implementation in the organisation.
The project with Vectia has also created a positive mood for change within Schering’s marketing, sales and service organisation.
Based on case article in Vectia Explore magazine Spring 2006.
A leading global pharmaceutical company