Value-added services help to know the needs of clients in different regions and better meet their demand.
▪ Digital capabilities at the global level: Collect and aggregate global customer data and upgrade CRM systems to be global. Volvo creates a unified storage database, integrates existing data (mostly from regional agents) and sets up a digital process to continuously enrich and update the data. “‘We got numerous data from our dealers,’ said Paulsson, Volvo’s senior brand manager. ‘If we can collect the data of our products, our distributors and our customers, we can have an overall understanding of the business. Analyzing the data can help us find the way forward. We have achieved very significant results and we have already known who our customers are, what products they buy from us, how often they buy as well as have after-sales service and how big their budgets are. Unlike using the conventional product segmentation, we already have the ability to segment the market in response to different groups of customers. In this way, we have the ability to turn mass marketing into personalized marketing.’”
Volvo aims to achieve “selling experience rather than cars” by digital marketing. Driven by the strategy of digital transformation, Volvo successfully developed from a pure B2B enterprise into one of B2C+B2B: connecting every Volvo vehicle on the unified global platform to obtain better brand influence and stronger relations with clients.
1.3.3 Internet B2C player: Amazon
As one of the earliest players in e-commerce and also the largest e-commerce website of today, Amazon has also become the synonym of e-commerce. Starting from an online bookstore, Amazon has made its presence felt in almost every product category and in all major national markets around the world.
However, Amazon is more willing to define itself as a data company for the reason that, when it has access to the purchasing information of users, Amazon also records all user tracks on its website. For example, how long a user stays on one page, how many comments one user has read, what keywords he has searched and what products and information he has browsed. Its sensitivity to data and constant investment in data discovery have endowed Amazon with the best data capability, making it different from other rivals with its data-based business model. Its data capability can be shown from the following three aspects:
1.3.3.1 Most precise referring capabilities
If you have had shopping experience on Amazon in person, you will be able to discover Amazon’s unique product recommendation capabilities. Recommending items based on purchase or browsing behavior is the function of all e-commerce sites, but Amazon has enough confidence to be more accurate than others’ recommendations. Because most of the other competitors can only recommend similar items that have been viewed, Amazon has a more advanced logic: items working well with the goods purchased before at a similar price and of a similar brand. The difference is more pronounced in the case of books, which are the core of Amazon’s business. How does Amazon know that readers who buy book A will have a potential interest in reading book B? The logic behind this algorithm is so complex that it is difficult for other businesses to simply imitate Amazon.
1.3.3.2 Evolving predictive capability
With historical data, Amazon is able to predict the repeated buying behavior of users, especially some consumables, such as printer ink, daily consumables and food. Amazon has built multiple models to know the frequency of each kind of product used by different individual customers, so as to know when they will repurchase and then it reminds users to buy by e-mails. This naturally makes Amazon the first choice for customers. There were times when some careless customers did not notice they were running out of shampoo until Amazon sent them a reminder. Based on such predictive capability, Amazon can easily offer their Subscribe & Save service. After selecting the payment method and favored items, Amazon can send the products to the customer’s designated address regularly based on customers’ use frequency. This whole process, thanks to a strong data system, is automated.
1.3.3.3 Improving experience
Amazon is very concerned about the user’s page experience and constantly updates its pages for customer tests. What information can be provided to increase the conversion rate of customers? The layout, color, size and buttons of the website all refer to the solutions formed by many customer tests. When conducting user experience tests, other Internet companies often send user invitations before analyzing user behavior by observation. Amazon’s powerful database, however, ensures that they do not have to set up a separate process, but just provide a test solution as users browse. You can learn which solution is more directly experienced through the final behavior of your customers. Powerful data capabilities give Amazon the ability to improve user experience in real time.
Powerful data capabilities not only give Amazon the advantage of data in its traditional e-commerce business but also help Amazon build business advantages in other areas, such as enterprise cloud computing services. Before Amazon launched its cloud computing service, it did not dabble in the corporate services business, nor did it have the experience of establishing customer contacts with business CIOs and IT departments or reach long-term licensing agreements on cloud computing with Fortune 500. Amazon does not yet have a marketing team for business, or a corresponding after-sale service system, but Amazon has a computing infrastructure that supports complex data collection, data mining and analysis. If Amazon’s computing power can help itself complete sophisticated and esoteric data storage and calculation, helping other businesses complete the corresponding computing services is also no more difficult.
According to Amazon’s financial statements, business computing generates more than US$6 billion in annual revenue, reaching a profit of around US$1 billion. Even compared with Microsoft and IBM — the traditional giants of B2B cloud computing services — Amazon is no less capable.
1.3.4 HourlyNerd
The reason as to why this enterprise aroused our interest was that they and us are in the same industry — strategic consulting, or “professional service providers”. There are as many sweet spots as there are pain points. HourlyNerd, a company that provides short-term consultant matching for SMEs, was founded in 2013. As an Internet company, it connects companies with consulting needs and freelance/part-time consultants and experts. Enterprises submit their needs on the platform, and consultants provide consulting regarding business plans, competition analysis, market analysis and research, SWOT analysis and pricing strategies on the platform. Most of the consultants are graduates of famous business schools. With the help of HourlyNerd, companies can find matching consultants at a lower price; consultants can also become independent of firms to provide service freely (Figure 1.14).
This model addresses the several difficulties in purchasing consulting services as follows:
• Not many enterprises are capable enough to pay for big consulting firms — many SMEs need consulting as well.
Figure 1.14. Business model of Hourlynerd.
Source: KMG Research.
• Not every project needs a full consulting service — many small demands are not satisfied, such as pricing for single products.
• Expenses by enterprises on consulting are never enough — but Hourly-Nerd saves them 90% of the fees.
As HourlyNerd restructures the consulting business, it is important
