Customer focus and digitalization: ten examples from world-renowned companies

Are you looking for the perfect used car? Then hurry to Allianz! Or would you prefer a new car this time? Then try Sixt. You don't have to worry about financing - either directly with Sixt or perhaps with Goldman Sachs. And remember, you wanted a new washing machine, which you can pay for with Daimler's new payment service (Mercedes Pay) - or with your new O2 banking account. Incidentally, you can then switch it on via the new Bosch Cloud from your newly purchased vehicle so that the washing is clean when you get home in your new car...

... Wait a minute, aren't the brands a bit mixed up here? No, this isn't a guessing game where you have to correctly match the brands to the services. Nor is it a vision of what the world might look like in 10 years' time. This is an excerpt of what the world will look like in 2017. "+++ Allianz now also has a used car exchange +++ Goldman Sachs now also offers consumer loans [1] + + + Lufthansa now also sells insurance +++ Bosch becomes a cloud provider..." - the news ticker had a lot to offer in 2016: The list of companies that seem to suddenly appear in areas in which they have never been represented, despite centuries of corporate tradition in some cases, is long. It makes you rub your eyes: How is this possible? And can it work?

Where is the good old maxim "Cobbler, stick to your last!"? For a long time, this formula, handed down from time immemorial, was a good recommendation for many business decisions; after all, it warns entrepreneurs who are too keen to experiment to focus on their core competencies. However, the examples above show that deviations from this popular formula are becoming increasingly common. The interplay of change is particularly prevalent in the financial sector in the broadest sense - after all, this sector is under particularly strong pressure to change. Banks and insurance companies are among the companies with the greatest potential for digitalization, as they have always collected, processed and linked customer and transaction data [2]. However, what can be observed here only shows what can be seen everywhere in the economy through a magnifying glass. This article uses ten use cases to illustrate the practice, looks at the causes, identifies the drivers and provides tips on how companies should position themselves in this world.

The Ten Examples of Customer Orientation at a Glance

(1) Mercedes Pay: car manufacturers are now getting involved in mobile payment

2017 saw the continuation of a trend that had already emerged in 2016: the big players are playing chump change. In January 2017, car manufacturer Daimler announced that it was now entering the mobile payment business [5].

(2) O2-Banking/Vodafone: Mobile phone providers are pushing into the banking business

The keyword here is "O2 banking". O2's parent company Telefónica is the first major mobile communications group to offer its customers in Germany a complete bank account for their smartphone. This is being implemented as part of a cooperation with Fidor Bank, which holds a full banking license. By sharing this license and the structure of the partner, O2 now acts like a bank and is involved in its own banking business of account management, so to speak [6].

(3) Allianz and used car exchange

What product providers can do with the financial market can obviously also be done in the other direction. In 2016, the Group announced that it would now also be entering the used car business. To this end, Germany's largest insurer acquired a stake in an online used car dealer (Instamotion Retail GmbH). The used car portal enables its customers to search for the vehicle of their choice on the Internet and have it delivered to their home along with their desired license plate number [7].

(4) Goldman Sachs grants loans to the little man after almost 150 years of company history

In the 147 years of its existence, Goldman Sachs has not been active in the mass market. Now, all of a sudden, people are seeking their fortune here. The Internet portal that the bank has been using for a few months to attract private customers is called Marcus. Anyone can now obtain a loan here, e.g. 10,000 dollars to renovate their kitchen [8].

(5) VW Bank in the car rental business

2016 was also the birth year of Volkswagen Financial Services Rent-a-car. Strictly speaking, however, it was not really a birth - it was just given a new name: Volkswagen Bank renamed its wholly-owned subsidiary Euromobil. Euromobil became Volkswagen Financial Services Rent-a-car. This brought the case back into the spotlight, even though the company had already been acquired in 2012 [9].

(6) Bosch Smart Home

Bosch has long been on its way to evolving from a pure product manufacturer into a service company. This path reached a new level in 2016, as Bosch announced the launch of its own cloud for its IoT services at its IoT conference ConnectedWorld in Berlin. The Bosch IoT Cloud will consist of the technical infrastructure as well as platform and software offerings. The electrical manufacturer and automotive supplier intends to use it to operate various applications from the areas of connected mobility, industry and buildings. Initially, it will only offer internal services and will also be available to other companies from 2017 [10].

(7) Ricoh Germany replaces the management board in the area of service transformation

Similar to Bosch, Ricoh has been undergoing a transformation from a pure manufacturer to a service provider for years. In Germany, the focus reached a new dimension in 2016: "Ricoh Germany restructures management - realignment should help to respond even faster to customer requirements", was reported on the Print.de portal at the beginning of 2016 [11].

(8) Alibaba as a bank (MyBank) - from online retailer to financial institution

Chinese tech giant Alibaba launched an internet bank at the end of 2015 and has been granting loans to small and medium-sized enterprises ever since. The goal set in 2016 was to gain ten million customers by 2020 [12]. In the first half of 2016, Alibaba announced that MYbank, which was founded a few months earlier and operates as a direct bank, had performed extremely well [13]. While Western tech giants such as Google, Amazon, Facebook and Apple are still speculating about what they will do with the banking licenses they already hold in some cases, disruption is in full swing here.

(9) Eesti Energia AS - pioneer in the energy sector

Eesti who? Admittedly, the company is not instantly recognizable. But it is of central importance in Estonia. The company is wholly owned by the Estonian state and is the country's most important energy supplier. If you look to Estonia, you get a picture of the digital future - including the energy industry 4.0. Eesti Energia already has numerous applications on the market that are still being discussed in the meeting rooms of energy representatives here. The company is even experimenting with gamification and nudging. At the helm is not a warhorse à la Deutschland AG, but a digital native [14].

(10) Helaba focuses on its core business and sells Hannover Leasing

In 2016, the press reported that Helaba was divesting its leasing subsidiary. On what grounds? With the familiar justification that has been heard just as often in such restructuring processes as we now hear about customer focus and digitalization: the aim is to focus on core competencies! Helaba is divesting itself of the leasing company and justifies this with the advantage of now being able to concentrate fully on its core business [15]. Admittedly, this example is somewhat out of line. So they do still exist: the cobbler's last! Apparently, even in this day and age of digitalization and customer orientation, there are constellations in which you should stick with them.

Sources

1 FAZ, Finance category (2016). Goldman Sachs discovers ordinary bank customers. URL: www.faz.net/aktuell/finanzen/fonds-mehr/goldman-sachs-bietet-alternative-zur-kreditkarte-14490375.html
2 Roland Berger (2016). New study: Plan D - consistently digital. URL: www.rolandberger.com/de/press/Neue-Studie-Plan-D-%E2%80%93-konsequent-digital-2.html
3 Bruhn, M., Hepp, M. & Hadwich, K. (2015/1). From product manufacturer to service provider - business models of service transformation. Marketing Review St. Gallen. URL: www.bruhn-partner.com/files/hadwich_servicetransformation_2016.pdf
4 Wikipedia (2016). Customer value. URL: de.wikipedia.org/w/index.php
5 Heise Online (2017). Entry into mobile payment: Daimler takes over Paycash. URL: www.heise.de/newsticker/meldung/Einstieg-ins-mobile-Bezahlen-Daimler-uebernimmt-Paycash-3598440.html
6 FAZ. Economy category (2016). Mobile providers push into the banking business. URL: www.faz.net/aktuell/wirtschaft/unternehmen/vodafone-und-o2-expandieren-ins-finanzgeschaeft-14219059.html
7 Manager Magazin, Unternehmen category (2016). Allianz will also sell used cars in future. URL: www.manager-magazin.de/unternehmen/handel/allianz-verkauft-kuenftig-auch-gebrauchtwagen-a-1117141.html
8 Businessinsider, Business category (2016). An account for one dollar: Tens of thousands have already become "normal" bank customers of Goldman Sachs. URL:
www.businessinsider.de/zehntausende-wurden-kunden-von-goldman-sachs-2016-6
9 Autohaus, News category (2016). New brand identity for VW rental cars. An account for a dollar: Tens of thousands have already become "normal" bank customers of Goldman Sachs. URL: www.autohaus.de/nachrichten/euromobil-neuer-markenauftritt-fuer-vw-mietwagen-1747959.html
10 Heise Online, IT news category (2016). Internet of Things: Bosch becomes a cloud provider. URL: www.heise.de/ix/meldung/Internet-of-Things-Bosch-wird-Cloud-Anbieter-3131750.html
11 Print.de, News category (2016). Ricoh Germany restructures its management. URL: www.print.de/News/Markt-Management/Ricoh-Deutschland-strukturiert-die-Geschaeftsleitung-neu_7992
12 Handelsblatt, Company category (2015). Chinese online retailer launches Internet bank Ricoh Germany restructures its management. URL: www.handelsblatt.com/unternehmen/it-medien/alibaba-chinesischer-onlinehaendler-startet-internetbank/11971822.html
13 China Daily, Business / Companies category (2016). Alibaba's Internet lender extends $6.88b in loans in 8 months. URL: www.chinadaily.com.cn/business/2016-03/01/content_23693839.htm
14 Disputes (2016). Energy sales of the future: Are you still consuming? Or are you already producing? URL: streitfragen.de/energievertrieb-der-zukunft-konsumierst-du-noch-oder-produzierst-du-schon/
15 Helaba corporate website, Press category (2016). Helaba sells Hannover Leasing. URL: www.helaba.de/helaba/die-helaba/presse/presseinformationen/presseinfos-2016/presseinfos-2016-basislayout/helaba-verkauft-hannover-leasing/412532