2005 Annual Conference Napa Valley, CA Implications of Reputation; How Intangibles Can Drive Performance and Build Strategic Advantage Earning the Reputation You Want and Deserve Fred Crawford Managing Director AlixPartners, LLC
Earning the Reputation You Want and Deserve • What (positive) reputation do you want? • How can it be achieved?
A Comprehensive Study: Consumer Relevancy • Consumer Relevancy Study… • Conducted in U.S. in late 1999 and February 2001, pan-European study in January 2002, Japanese study in 2003; US study repeated in 2005 • Interviewed over 161,000 consumers • Asked 60 questions about the importance of various aspects of the shopping experience • …gets rave reviews • New York Times, Business Week and Wall Street Journal best seller • [Lafley, P&G] CR is the best tool…for incorporating customer wants and needs.” • [Burandt, Georgia-Pacific] “…a big idea and blueprint for action.” • [Smith, FEDEX] …exceptional strategic thinkers who have given anyone concerned about customers a practical, innovative and unique approach to competitive differentiation”
The Two Myths of Excellence • That most businesses understand what customers are really asking for • That attempting to be great on all aspects of customer engagement is the way to win FACT: a very different customer…
Three Mega Trends Societal Situation Human Condition Consumer Need Societal devolution Inability of traditional institutions to adequately reflect fundamental human values “Fortify, reinforce, ratify my personal value” Increasing inability to keep pace with daily life Increase in stress, guilt, anxiety “Help me survive psychologically and emotionally” Proliferation of information and communication technologies Informed and aware, but cynical and confused consumers “Clarify my options, allow me to feel satisfied with my choices” ….A Changing Need Set
Human Values Are Embedded in the Context of an Offering Self Actualization Esteem Love and belongingness (feeling loved and accepted by others) Safety, security Physiological Needs (air, water, food, sleep) Maslow’s Hierarchy of Needs Context= Human Values Content= Basic Needs “Today, technical differences between products are barely perceptible, which is the reason why context has become more and more important for brands.” – AG Lafley, Chairman, Procter & Gamble Source: Maslow, A. H., The Farther Reaches of Human Nature, 1968; CGE&Y Analysis
The Conceptual Model for Consumer Relevancy Price Product Experience Access Service Level III Seek Customize Inspire Agentry Intimacy Solution Level II Prefer Convenience Consistency Care Reliable Educate Level I Trust Accommodate Respect Ease Credible Honesty Trust is a substitute for perfect knowledge and the time to act on it.
The Second Myth of ExcellenceThat attempting to be great on all aspects of consumer and customer engagement is the way to win Ideal Value Profile(as perceived by consumers) Dominate Differentiate Parity ILLUSTRATIVE A 5,4,3,3,3 profile/mix is optimal. Companies that try to be excellent in every attribute are either doomed to fail or leave significant money on the table
Building the Desired Reputation Drives Different Operating Behaviors Supply Manufacturing Marketing Sales Cust. Svce HR IT Store Ops Low Cost Price Agentry Value Standard Standard Basic Productivity No Frills Knowledge Transfer Product Inspire Features Innovate Quality Inform Innovation Test/Use Customer Insight Satisfy Customers Educate/ Personalize Service Customize Flexible Flexible Adaptive Response Knowledge Mgt Access Problem Solved Solution Answers Results Extend Empower Comfort Customer Interaction Facilitate Relationship Experience Intimacy Comfort Lifestyle Integrate Custom Leverage
ThankYou!! Fred Crawford email@example.com