We are all witnessing a big shift in how manufacturers are getting their products & services to market. This shift is also making many manufacturing companies across many disciplines uncomfortable. It has a deep impact on how operations, sales, and marketing are working together to drive revenue growth.
In the end, the use of digital, all ties back to the one thing we all care about: revenue growth.
For the manufacturers that have adapted digital, it has enabled them to streamline operations, drive sales, and create world-class revenue-generating marketing programs.
Now, here’s where it gets interesting. Telling a manufacturer, who is good at manufacturing physical products, to also become experts at growth using digital products and marketing, is a significant change of pace. The good news is that many manufacturing companies can still invest in digital solutions that will have a significant long-term impact on the organization, without restructuring how the company operates.
Here are a few ways manufacturers can start using digital to grow today.
Test new value propositions across customer segments
How has Covid changed your customers’ behavior? There is only one way to find out, and it doesn’t start with creating a survey or hiring a consumer research company. It starts with creating new value propositions across customer segments. This can be testing new value propositions with other businesses, and for some manufacturers, directly with their customers.
The key word here is: “testing.” The more you test, the more you grow. It’s as simple as that. You filter out what’s not working, and you double down on what is working.
Think about the products and services you offer. What could you test to see if there is validity in expanding your offerings? What groups would you test it with? What new products or services could you offer and validate?
This approach accomplishes two things:
It helps manufacturers such as consumer goods companies get in front of customer segments to get feedback on new products and channels. With everyone sitting at home, we used this time to run tests on new value propositions across customer segments. This approach has helped our client acquire new customers via new digital channels and helped prioritize longer term strategic digital investments.
It accelerates revenue creation for existing digital channels. One thing we noticed fairly quickly is that companies aren’t optimizing their revenue growth from existing channels. They often stick to one approach, and let it run its course. True digital growth starts with optimizing every aspect of revenue creation through digital channels.
Drive revenue by leveraging customer data
Working with one of our fast casual partners, we found opportunities to drive short term mobile revenue as well as unify customer touch points across all platforms and channels. Mobile is now a real revenue growth channel, and before it was simply a means to allow customers to order directly from them.
Building a beautiful app is a great start. Optimizing every aspect of the user’s experience with the app to drive more revenue is another. These are often two different skill sets, and is also why growth of mobile revenue gets ignored, because it’s not really understood.
For every transaction, and even transactions that don’t happen, there is something to learn by analyzing the data and putting together an action plan to increase conversions.
Every manufacturing company, regardless of what they produce, can leverage customer data and channels to drive revenue through mobile channels.
Here are questions to ask:
Do we have data that could be useful to optimize our digital growth?
Are we taking action on this data?
What results have we achieved by taking action on this data?
What new customer segments or digital channels could we test based on our existing data insights?
Start with your existing digital platforms and ask yourself this question: Could we be doing more to grow this channel? If not, why not?
Optimize your capital investments for ROI-driven growth
The foundation for growth for manufacturing companies is metrics. The old-school approach was to place several big bets, and place all the time and resources into that approach. And because of things of change caused by Covid-19, it’s almost impossible to tell what’s going to work and what’s not going to work before investments.
The best approach to do this is invest in a capital efficient way. Every dollar invested should be tracked, measured and taken action on. If you can’t track it, it’s not a predictable way towards growth.
Create a series of benchmarks you want to achieve, and align your digital experiments to these benchmarks.
For example, a goal could be -- Achieve 25% growth in our trampoline business. Here are 4 experiments that you could run with a $15k investment in each channel:
Experiment #1 -- Test 5 new copy and image ideas for Facebook Ads
Experiment #2 -- Optimize the mobile app to drive more traffic to the trampoline page
Experiment #3 -- Improve product recommendations to drive more traffic to the trampoline page
Experiment #4 -- Test 5 email blasts to the same customer segment to see what email generates the most revenue. Keep iterating until you have the absolute best email format and copy that you maximize.
Each optimization drives more revenue, and most importantly allows you to filter out what’s not working once and for all. Use your capital efficiently, and let the data drive decisions
The digital shift should be viewed as an opportunity not a threat. Invest in digital today.
It’s not time to panic. It’s time to start investing in growth. Start proving that new digital technology platforms could help your business thrive in new ways. Going digital is not a defensive strategy, it’s an offensive approach.
Test new value propositions, utilize data to drive revenue through optimizations and experimentations, and invest your capital efficiently. Start small, learn, optimize and then you can go big with confidence.