An iconic British company known for its luxury cars has taken a unique approach to serving customers in its jet engine business. Instead of customers buying a jet engine and taking on the associated risks of maintenance, repairs, and replacements, Rolls-Royce now offers a fixed-dollars-per-flying hour fee that includes the engine and maintenance throughout its lifespan. This shift transfers the risk to the manufacturer and provides customers with greater cost certainty and less risk.
Rolls-Royce is just one example of many companies that have diversified their offerings by providing customized and managed services. These services aim to deliver specific outcomes and experiences to customers, offering a strong business case for both customers and providers when structured, priced, and marketed effectively.
Customers benefit from these services by receiving a valuable product along with a tailored outcome that provides cost certainty and reduces risk. The responsibility of managing the product’s outcome shifts from the customer to the provider. On the other hand, providers gain a new fixed revenue stream, expand into new markets, strengthen existing customer relationships, and scale beyond their core products.
However, the biggest challenge for companies looking to offer these services is ensuring that the services they develop meet customer needs. Based on the experience of a chief revenue officer, here are five key steps to successfully position and market a product and service bundle:
1. Determine which product or solution can be bundled with services to add ongoing value for customers. Identify unique service propositions that solve important problems for your target customers and consider what assets can be packaged to enhance their lives or businesses.
2. Lay the groundwork for marketing by developing a segmentation model and prioritizing customer profiles to target with the service. Identify vertical markets, specific personas, and effective channels for reaching them, while crafting messaging that resonates with their needs.
3. Shift from a transactional mindset to prioritize positive outcomes and partnerships. Emphasize the provider’s ability to deliver personalized outcomes that meet customer needs, positioning the service as a trusted business ally, expert, risk manager, and problem-solver. Sales teams should adopt a consultative approach, understanding customers’ challenges and offering unique solutions to help them grow their business.
4. Build partnerships to enrich service offerings. Identify potential collaborations with apps, hardware, specialized capabilities, or expertise that can complement and enhance the value of the service. These partnerships can strengthen the overall offering and provide unique benefits to customers.
5. Measure customer experience and profitability expectations and continuously improve. Gather customer experience data, synthesize it with other business information, and use analytics to gain insights for refining and enhancing the offerings. Consistently evaluate the services to make them more cost-efficient without compromising their value to customers.
Ultimately, the success of managed services lies in providing value to both customers and the company offering them. By adopting these strategies, companies can effectively position and market their product and service bundles, delivering exceptional outcomes and experiences to their customers.