After the recession. How are European companies fighting

back?

Andrew Harvey

Moscow22 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

What does all of that look like?

Digital world – a way to marketing orientation

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 digital can be used to change sentiment

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

Online ads % Print %

Great Britain 40 28

Sweden 29 38

The Netherlands

23 40

France 21 23

• 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)

RIAS – what does it look like

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

Making the medium the message

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 40aharvey@emcoffice.net andrewqharvey

After the recession. How are European companies fighting

back?

Andrew Harvey

Moscow22 October 2014