Unilever CEO, Paul Polman, famously said that said that before long he could see provenance (i.e. origin, birthplace) being added to the six Ps of marketing. I am sure our guest speaker Nektarios Misios who’s the Global Marketing Manager (Digital) at Royal Friesland Campina (FC) couldn’t have agreed more. At the recently concluded CIO Day at Amsterdam, he spoke – amongst many things – about the universal need for reassurance while buying. When it comes to FC selling milk in countries like China or Mexico – where they are lesser known than they are in Netherlands – this becomes vitally important.
Amongst many interesting things that Nek spoke about, he specifically highlighted:
- How simplicity is the key when it comes to connecting with consumers. FC is a unique company owned by farmers in Netherlands. He spoke about how they used simple solutions like Skype to connect farmers to end consumers in China. This helped them establish a personal connect, discuss issues on the use of fertilizers or to reassure them on the origin and quality of the milk. As they promised the provenance of the milk, they could also substantiate it using digital technologies in a simple fashion.
- Put consumers first: When FC entered Mexico, they setup a platform to address the core needs of the expectant and new-mothers. They helped them by connecting mothers to other mums and by providing know-how. This Facebook based platform drove 11x reach as compared to TV, and apparently had 27% sales growth. (case study here)
- Think Big, Start Small, Fail Cheap: Given the pace of change it’s important to do experiment often and experiment in a cost efficient way.
We have been thinking about the great discussion that followed afterwards. To summarise:
- Digital of Two Speeds: Without being lost in semantics (if it’s 2 or 3 or 4) It’s important for Businesses to focus on Disruption & not just Sustenance when it comes to Digital Transformation. Most initiatives are focussed on doing things cheaper, faster and possibly better.However, ability to disrupt comes from unrelenting focus on addressing core customer-needs (e.g. Royal Friesland Campina). And by doing it better first, then faster and maybe cheaper.
Harvard Business Review has written a great article this month on a related topic – The Discipline of Business Experimentation
- Watch out for the sinking ladder: Businesses are disrupted from either end i.e. high-profile changes at one end and low-profile changes eating into your least profitable customer-segments. And if your business can go direct, it probably will. Look closely at the role you play in fulfilling the customer need. If it’s just an intermediary, it’s a matter of time before you are disrupted because the producer can go direct to the consumer.
- Watch out for new intermediaries: Everyone in the room agreed that we now have competition from unexpected sources (Amazon competing in Grocery, Apple competing in Health and Payments etc.). And if companies don’t get their act together, they would soon be relegated to the background.
It’s been a week since we met at Beurs van Berlage at Amsterdam for the CIO Day event. The theme was Make or Break. It was clear that digital is a great equaliser, and industries can learn a lot from each other. Welcome to Possible!