In this increasingly digitized world, consumers have more choice than ever. So how can businesses maintain growth when technology gives customers unrestricted access to products from across the globe? Companies in the chemicals sector are innovating to keep customers buying their products in a changing market landscape.
Over the past five years, growth in the chemicals industry has taken two major forms: mergers and acquisitions (Dow/DuPont, Monsanto/Bayer and Syngenta/ChemChina, etc.) and a focus on higher margin specialty products. Many larger groups have achieved both by increasing their intellectual property portfolio through acquisitions (rather than developing products in-house), thereby accelerating their entry into specialty markets.
To attract customers to higher margin products, chemicals companies must first identify the end customer’s needs. Today’s customers have shifted from buying products to buying outcomes; this means that companies must review the value chain to ensure that they are selling an attractive idea. For instance, in chemicals, this means promising an abundant crop yield instead of marketing pesticides.
With an enticing enough outcome, companies have a better platform to sell their higher margin offerings.
Because of the changing mindset of buyers, companies now consider VOC (voice of the customer) when developing products. The customer centric model is not a new concept, but it is becoming increasingly central in the competitive specialty chemicals market. I have seen a number of companies focus their strategic marketing, application engineering and technology services on identifying and analyzing the needs of their customers. Whether it is large multi-national corporations, such as 3M or Huntsman, or smaller groups, such as Loparex and Gelest, companies must conform to the changing behaviors of buyers to maintain client relationships and ensure continued growth.
But how do companies address the more technical and specialist needs of a customer?
They need to hire professionals who can balance a number of key tasks within the realms of sales, research and development. This is not an easy ask when an individual needs a PhD in chemistry to understand the finer technical aspects of the product, paired with a strong financial and commercial acumen in order to communicate effectively with senior leadership.
A professional with an understanding of both sides of the customer/client relationship, a background in chemistry and knowledge of profit margins is a rare – but essential – resource in today’s chemicals industry. By investing in the customer relationship and making products based on insight into the needs of customers, chemicals companies can keep their bottom lines healthy.
How important is customer experience to your business?