Can the customer value proposition be saved by service dominant logic?
'Value propositions' are over-hyped and under-utilised according to Adrian Payne. But could service dominant logic and cocreation change this?
- Laundries that sign up with Milliken get access to a computerised routing system enabling them to route their trucks much more efficiently. As a consequence, they can get rid of a few trucks, redeploy the drivers and eventually make a long-term cost saving.
- Milliken has developed specialised software for accounting and finance that allows laundries to do a lot more in-house and not go to expensive accountants.
- Milliken also has a system that can be put in place that enables laundries to do an internal laundry comparison, so that they can benchmark where their industrial laundry sits along hundreds of others and benchmark where they sit, as well as providing a profit improvement programme that enables laundries to establish what they need to do to move to higher profitability.
- Laundries also get factory leads from Millken.
- Milliken also provides free training for the salesforce.
- A belief that existing customers are being or will be retained as a given.
- A belief that their churn rate is high so they must “fill the leaking bucket”.
- Customer acquisition is reported regularly to shareholders/analysts/senior management, but businesses don’t report churn rates.
- Sales teams are rewarded for acquisitions but not for retention.
You might also be interested in
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 15 years, including Internet Works, CXO magazine and Business Management. He joined Sift Media in 2007.