What a marketing conference taught me about Service Design

Filling the gap between sales, marketing and product development by leveraging Service Design.

What is Service Design? And more importantly, how does it fit into more traditional business functions such as sales, marketing and product development? I was shocked last year when I heard from the professors at the Service Design faculty that they are having a hard time trying to figure out what career paths to recommend to their future grads. Here’s a (rather long, but quite precise) definition of Service Design by PracticalSXD:

Service design is a human-centered design approach to business development, to help organizations see an end-to-end, surface-to-core perspective, enabling understanding services from a customer perspective. Service design is rooted in design thinking, and brings a creative, human-centered process to service improvement and designing new services. Through collaborative methods that engage both customers and service delivery teams, service design helps organizations gain true end-to-end understanding of the market and the product-market fit for their services.

Despite all the pedantic wording and the obvious fit of Service Design into startups, I have always been wondering, what does Service Design mean to larger organizations. Specially to those with proven business models and even operating in B2B markets. But it was only recently, at a marketing conference called NEXT16, that I learned how a B2B software company managed to break free from flat revenue back to growth by focusing on Service Design as the core of their marketing strategy. The company in question is F-Secure and this is how they did it:

Changing the Mindset: from Product-Centric to Customer-Centric
One of the most fundamental problems in today’s way of doing marketing is that very few companies spend time listening to the market. Instead, the majority of organizations elaborate sophisticated budgets for social media campaigns, paid advertisements and other promotion campaigns to, so-they-say, build their brand and raise awareness. Now, think for a moment.

As of 2016, the level of noise about different products and services must be well over a 1000x higher than what it used to be 20 years ago. Yet, most companies’ marketing strategies focus on shouting louder with the desperate hope that someone will pick their signal. But what happened to the ultimate marketing mantra?

Every first-year student of Marketing Management knows the very first principle of marketing:

The ultimate goal of marketing is to create products that sell, not to sell products.

In order to create products that sell and fulfill the marketing mantra, companies need to listen to the market. Yet it seems that most companies are trying very hard to sell products, instead of investing in listening to the users.

This is a result of companies being stuck with the product-centric approach. These companies would rather work on product attributes and features in order to innovate. However, there are quite a few companies that are already making the shift from a product-centric approach to a more customer-centric approach in their marketing activities.

F-Secure was one of many companies with a product-centric approach that kept investing in brand building and raising awareness, while their revenue growth was becoming stalled. In 2012, their marketing department decided to start a movement inside the company, promoting service design as a tool to understand what made growth become to halt. After four years of deep transformation and educating the sales department as well as top management, Service Design has taken a central role in the organization’s marketing strategy. This change in the company culture enabled F-Secure to listen to their customers again, and therefore bring new growth through innovations and better value propositions.

User Personas
In order for F-Secure’s marketing department to show the rest of the company the benefits associated with the cultural change (from a product-centric approach to a customer-centric approach), they started off by defining their user personas.

User personas (or buyer personas, or stakeholder personas) are fictional characters associated to the different stakeholders to the company. User personas are part of a larger subject: user research. By leveraging user research, organizations can truly understand who are the different stakeholders and analyze what are their real pain-points, which enables the company to provide more accurate value propositions that solve real problems of each stakeholder.

Example of User Personas. By Toby Freestone.

With user personas, you are giving a name, a face, an age, a geographic location, a list of behavioral properties and many more attributes to each stakeholder. Without going too deep into the science of user research, user personas make it so much easier to organizations to recognize who are their customers, what do they look like, what do they like and dislike, what are their buying habits, and many other relevant details that can help the company build a perfect value proposition.

F-Secure’s marketing department had another brilliant idea: instead of using the user personas just within their team, they run workshops and sessions to introduce those personas to other departments. Thus, helping developers, sales managers and top managers to truly understand who are the audiences for the organization, and what are their needs. This was extremely eye-opening for other departments. For instance, developers now could imagine (even seeing her face) the person they are developing the software for, and sales managers would have a much better idea about where to find their next prospects and how to optimize their approach based on their behavior.

Customer Journey Maps
After defining the user personas, F-Secure went on and prepared different customer journey maps. Customer journey maps describe the whole process of a sale (or otherwise non-commercial action) for each stakeholder. They identified how these different personas found the company, then found about the product, then learned more about the product, then got in touch with their sales, etcetera.

Customer journeys are a great tool for finding the so-called “touchpoints”. Touchpoints are the specific moments or places in the customer journey where the stakeholder interacts with the organization. For instance, a search by your brand on Google, or opening your website, or pressing a button to get more information.

Example of Customer Journey. From Kampyle.

Within F-Secure, the marketing department worked hard together with the sales department to represent the most important customer journey maps. After validation, they had a very powerful tool at their disposal: they could basically analyze each customer’s behavior and fit it into a customer journey. This way, F-Secure could discover what are the most important touchpoints (majority of customers buying in or majority of customers dropping out), and improve where necessary.

So why are customer journeys so important and why do they help with sales growth? Hint: it is not a coincidence that customer journey maps have a very similar look to sales funnels 😉

Listen and optimize
By adapting customer journey maps to sales funnels, F-Secure managed to identify the critical customer touchpoints and create a priority list which included:

  • High-performing touchpoints: those where most customers go ahead.
  • Low-performing touchpoints: those where most customers drop out.
  • Uncertainty touchpoints: those where some customers go ahead and some drop out.

Provided the list above, it becomes obvious that every company must:

  1. Maintain the high-performing touchpoints untouched or with little variation.
  2. Dramatically change or remove low-performing touchpoints.
  3. Perform a deep research on uncertainty touchpoints to discover what happens with half of the population dropping out, in order to introduce the right changes and increase conversion rate.

In addition to this, F-Secure’s marketing department challenged their previous value proposition messages and tested them against each customer journey. In fact, they checked whether each value proposition remains consistent and truthful at every single touchpoint.

Therefore, by optimizing every touchpoint and reviewing how value is managed at each stage of the customer journey, F-Secure enhanced its overall added value across different types of customers and journeys, leading to an overall corporate growth, both in terms of branding and profit.

Conclusions
Service design is a human-centered design approach to business and product development, where the people who are buying or using the final product are placed at the earliest stage of the development to co-design and co-create the final product or service.

The ultimate goal of marketing should be to create products that sell, not to sell products. In order to better understand the customers and create better value propositions, organizations are integrating Service Design into their marketing strategies, in order to have proper tools to listen to the market.

User personas and customer journeys are must-have service design tools for companies that have a customer-centric approach to marketing. They help organizations identify the customer touchpoints and understand where and how customer value is managed at each stage of the sales funnel.

In order to increase growth, a company must find a way to move faster customers in the sales funnel and find a way to retain them in the long term. For that reason, service design tools such as customer journey mapping can have a huge impact in the overall company’s growth.

If you are a service designer or want to know more about this topic, drop me a line and let’s put Service Design to work. You can also follow me on Twitter and LinkedIn.