Cierra Dobson, a Strategy Director at design and technology agency, Rufus Leonard, explores how brands of all kinds can adopt service brand strategies to drive growth and win market share.
Service brands deliver an intangible outcome rather than a physical product, but they’re also distinguished by the length, breadth and depth of their customer relationships. As Covid-19 has accelerated digitisation and introduced new market pressures, many brands are looking to fight commoditisation through value-adding experiences that can expand their relationship with customers. You too can adopt a service brand mindset to grow your revenue and take the lead. Here’s how.
Service Brands Put CX & Technology at the Heart of Growth Strategies
Being a service brand doesn’t automatically inoculate your business from commoditisation. Rather, service brands tend to possess a more customer-centric organisational mindset, a more robust technology infrastructure, and greater flexibility because they deliver outcomes rather than physical products. Forrester notes that organisations that use technology to make a meaningful difference to people’s lives grow 4x faster than their competitors. If customer experience is a canvas, service brands have a bigger one, with more opportunities to deliver value, delight, educate and entertain.
Consider a few examples: Wise (formerly Transferwise) is a service brand that originated in a highly commoditised category; Domino’s is a product brand in a fairly commoditised category; and Peloton is a premium brand which straddles both products and services. All three have expertly used insight-driven CX, purposeful branding, and digital ecosystems to deepen the relationship they have with customers and disrupt their categories. We’ll explore how each has defined their category and how to unlock similar success for your own business.
Designing Around Customer Need at Domino’s
After a rough decade in the 2000’s, Domino’s reinvented their entire offer from ingredients to delivery. Besides making the pizza more edible, Domino’s focused on a core need: their customers want to get pizza with as little effort as possible. They pioneered the real time pizza progress tracker, allowing customers to worry less about when it might arrive. Their AnyWare platform allows customers to order from an ever-expanding list of channels with a single click. Designing an effortless, user-centric delivery experience has helped Domino’s revenue grow from $1.6B in 2010 to $4.1B in 2020. Brands should ask themselves, ‘how could we make the experience around our core offer meaningfully better for customers?’
Use co-creation to uncover core customer needs: Co-creation workshops bring the perspective of real customers into the design process at the conceptual stage. This invariably uncovers new ideas for features and functionality, but just as importantly, it exposes misconceptions about their needs and behaviours early in the process.
Being a service brand doesn’t automatically inoculate your business from commoditisation. Rather, service brands tend to possess a more customer-centric organisational mindset that sets them apart.
Strategy Director, Rufus Leonard
Expanding with Purpose at Wise
With 10 million customers, a reported 70% growth in revenue, and doubled profits YoY from March 2020, Wise combines frictionless CX with category-beating low fees and speed for international money transfers. The brand’s mission statement, “Money without borders”, has acted as a powerful North Star for its recent expansion into new services . The statement describes an outcome, and the company’s newest services—like bank accounts designed for people who live, work and travel all around the world—tightly align to that outcome. Brands looking to strategically expand their services should start with a clear mission; what is the outcome you want to deliver for your customers and the world?
Take inspiration from your brand purpose and identity: Brainstorm service experiences that deliver on your promise. And think about the reverse— what might get in the way of the customer outcomes you’re aiming for? Even small changes, like using less jargon in website copy, can make a significant difference.
Integrating Physical & Digital Ecosystems at Peloton
Peloton is difficult to categorise. It’s digitally enabled exercise equipment, it’s a virtual fitness coach, it’s a streaming service for fitness content, it’s a social platform… Motley Fool’s Neil Patel describes it as “hardware that is differentiated by software.” The Peloton ecosystem combines data, content and community interaction to make the customer experience feel empowering and addictive for each individual customer . Brands that want to expand their offer should think strategically about their ecosystem; is your tech stack fit to deliver seamlessly across digital and physical touchpoints?
Ensure your tech stack is future-fit: Flexibility is key. At Rufus Leonard we frequently recommend the MACH approach (Microservices, APIs, Cloud Native and Headless CMS) because it allows you to choose the best of breed technologies, add elements independently, and carry out upgrades/maintenance more efficiently and cheaply.
All Organisations Can Benefit from a Service Brand Mindset
Thinking like a service brand means delivering a whole outcome that is meaningful to people (not just a product). Brands that have shifted into this mindset have re-defined entire categories and left competitors reeling in their wake.
About Our Guest Writer
Strategy Director, Rufus Leonard
A Brand and CX strategist with 8+ years experience transforming complex problems into insightful, actionable strategies that organisations can rally behind, Cierra is Strategy Director at Rufus Leonard. For Cierra, strategy has been the perfect marriage of storytelling and exploring human behaviour – which is why she marched directly into it after studying English and Psychology at university. Previously, Cierra worked at AKQA and R/GA.