Kern is a global company headquartered in Switzerland and has been one of three world leaders in the mass mailing industry for over fifty years. The company produces large mailing machinery and intelligent software systems for businesses sending hundreds of thousands of mail pieces every day. Businesses such as banks and utilities companies sending statements and collateral to their millions of customers. Kern’s expertise in manufacturing and software for high precision applications means that they are well placed to explore related markets such as packaging.
In 2006 Kern UK set up a packaging machinery division. By 2012 this industry had become hugely competitive with front runners from Germany and Italy holding the lion’s share of market. Kern needed to assess their Business Development strategy to identify the potential value of the packaging market and find better ways to add a larger share to their bottom line. They engaged Hoot to provide analysis and a new angle of approach to help them increase sales.
Up to this point Kern’s marketing and communication centred around their machines. Kern believed that as this was a major investment the prospect needed to have as much information as possible right from the onset. What Kern hadn’t considered in relation to their marketing communication were the key drivers for their audiences and how they might make their decisions. For example a baker who sold bread rolls to supermarkets and bakeries needed a packaging system that would keep the rolls fresh, intact and allow them to look visually appealing, perhaps almost artisan. That baker’s first priority wasn’t all the fancy widgets that a machine could offer. We needed to understand more about the customer and the food industry.
Hoot carried out a piece of in depth market research into the packaging industry which told an exciting story of how scientific studies had influenced particular areas within the industry. For example how people view the packaged food they eat and how nanotechnology was helping food producers give consumers more of what they wanted in their fast paced lives. People were eating fresh ‘fast food’ and they wanted it packaged in the most sustainable way. Globally we have been looking for more sustainable food sources. Insects are a key part of the diets of people in the east while here in the west we feel squeamish about eating ants! As the story unfolded we found that in fact insects are viewed by those in the know as the next major food source, so here in the west we had better get used to that idea. We looked at how the packaging machinery industry had evolved and changed over the period that Kern had been selling into it and found that it’s the consumer requirements that have helped shaped the needs of the food manufacturers and this presented a new angle of approach to Kern.
These trends and innovations are the things that are important to Kern’s customers, the people who are packaging products such as food items. Once we had an idea of the market requirements as a whole, we undertook Client Insight Research and spoke directly to Kern’s customers about what mattered to them. It became obvious that food and food tech was the most important subject in their world and they needed a supplier who could help make their lives easier and help them make their own customers lives easier. The machinery is merely a part of that landscape, and it’s not the most interesting part. It becomes interesting when they begin to see it as a means of providing something new or different or better to their customer and not just a means of wrapping something up so that it can be sold. Through these conversations we also discovered why customers enjoy working with Kern over and above their competitors, and in some cases we identified areas where Kern could change and provide even better products and service to customers.
From this research phase we determined a number of key areas where a real change in strategy would yield benefits to Kern.
A change within the sales team structure and how they operated was necessary. Making sure their sales messages were aligned with the industry business need (not machine need) and a new modern language based on subjects of interest to the customer was born. Also how they identified, qualified and followed up on leads helped Kern develop a steady supply of proper warm enquiries.
Customers were interested in the packaging machines as a facilitator of their own ambitions, not particularly in the machines themselves. Kern had previously communicated about their machines and the features and benefits of what they offered from a technical perspective. In fact, customers are more interested in what was going on in their own industries. By changing their angle of approach and engaging customers in what mattered most to them, Kern began to ‘speak their language’. For example one of the first articles on their new editorial calendar was about ‘Insects being the next food source’. This became one of the most read articles they had published to this point.
Through research and intelligence gathering Kern now approach their marketing and communication based very much on their clients’ interests. They offer ideas for improvements in industry and make observations about topics that are valuable to their clients. They don’t start communication at the transactional end anymore, rather they look for the stories that will inspire and deliver relevant insights.
In the first quarter following the new strategic marketing approach Kern secured an incremental 6 figure sum ahead of sales target. Warm leads coming into the business increased by 133% and have been sustained at that level for over twelve months. Kern’s Head of Marketing Kim Comotto commented ‘Following this work with Hoot we have had the best year ever from a sales perspective and we are bowled over with all of the leads that are coming through…’
The ROI on their stories has been evident in their sales figures and revenues are well and truly up year on year.