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Engage the Aftermarket
The document discusses the importance of the aftermarket sector, emphasizing its significant revenue potential through service and parts sales. It highlights the necessity for manufacturers to adapt their strategies to meet customer demands and utilize digital solutions for enhancing customer engagement and operational efficiency. Key strategies include offering subscriptions, optimizing sales channels, and leveraging technology for predictive analytics.
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Engage the Aftermarket
- 1. PUBLIC David Koenig, SAP October17,2017 Engagethe Aftermarket
- 2. 2PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Case for Aftermarket § By the Numbers § The Call to Action § The Winning Strategy § Seizing the Opportunity Agenda
- 3. 3PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Source: Aberdeen Group $1 trillion The value of the U.S. aftermarket
- 4. 4PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Service, consumables, and parts are all aftermarket of industrial equipment and technology companies experienced growth in service revenues. Source: Technology Services Industry Association (TSIA), 2015 B2B buyers would be willing to pay slightly more to buy directly from the brand that manufactures the product. Source: Forrester/Internet Retailer Q4 2017 Global B2B Buy-Side Survey B2B buyers prefer to buy directly from the brand that manufactures the product vs. a distributor that sells it. Source: Forrester/Internet Retailer Q4 2017 Global B2B Buy-Side Survey 78% 43% 27%
- 5. 5PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Looking at the total lifetime costs of equipment With 70 to 90% of the total lifetime cost of heavy equipment to be found in maintenance and repair, services offer not only high profit margins, but also predictable annual revenues that can protect against market volatility. IDC Whitepaper: From Products to Services” “
- 6. You already havethe customer. How do you maximize that relationship?
- 7. Do your customersfeel strongly about your brand?
- 8. 8PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Why are your customers engaging with you? Reputation Support Experience Warranty Salespeople Convenience Trust Relationship Service Speed InformationBrand Availability
- 9.
- 10. 10PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ The world has changed … SAP Hybris Commerce SAP Hybris Cloud for Customer SAP Hybris Marketing SAP Hybris Revenue Cloud Vehicle insights, IoT cloud Vehicle management system Dealer business management SAP S/4HANA Loyalty management Vehicles network
- 11. Aftermarket requires morethan a point solution Aftermarket requires best-of- breed players in: § Commerce § Sales § Service § Marketing § Billing The winning strategy: “moneyball”
- 12. 12PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Digital core Experiencemanagement Data management/analytics Commerce ServiceMarketing Sales Revenue Shared core services Augmenting SAP Hybris solutions with predictiveand machine learning scenarios Extensions SAP Cloud Platform Machine learning services based on SAP Leonardo Machine Learning and SAP HANA automated predictive library (APL) Process orchestration and integration SAP S/4HANA In back office SAP Hybris solutions for the front office Simplifies and differentiates customerprocesses Simplifies and optimizes core processes
- 13. Is your productthe best? Are your services and sales team extraordinary?
- 14. 14PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Benefits § Improve closing rate for service contract renewals § Grow spare-parts business § Achieve better response rates for service requests Solution – SAP Hybris Cloud for Customer, with: § SAP Hybris Cloud for Sales § SAP Hybris Cloud for Service § SAP ERP Vestas: Growing aftermarket through service
- 15. 15PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Benefits § New users attracted to online store, helping to boostsales figures § Average visits per week per customerhas increased § Existing customers buying new products thanks to visibility of the full range § System integration that has facilitated customerand product data management, saving time and effort 17% Increase in visits 12% Increase in sales 8% Increase in AOV (average order value) Chamberlain – LiftMaster: Self-service
- 16. 16PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Workingwith customers to drive: § New products – Solving customer problems not addressed in the product catalog § Extended channels – Easing the reorder by being at the point of need – Automating reordering § New services – Subscription models – IoT-driven innovation § Channel shift – Moving sales to the lowest cost-to-serve channels Grainger – Innovating in MRO
- 17. 17PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Digital core Experiencemanagement Data management/analytics Commerce ServiceMarketing Sales Revenue Shared core services Augmenting SAP Hybris solutions with predictiveand machine learning scenarios Extensions SAP Cloud Platform Machine learning services based on SAP Leonardo Machine Learning and SAP HANA automated predictive library (APL) Process orchestration and integration SAP S/4HANA in back office SAP Hybris solutions for the front office Simplifies and differentiates customerprocesses Simplifies and optimizes core processes
- 18. 18PUBLIC© 2017 SAPSE or an SAP affiliate company. All rights reserved. ǀ Manufacturers ready for success Understand customer needs § Agility § Platforms § Breaking down silos Product as a service § New revenue streams § Subscriptions § “Share of wrench” Lot size of 1 § Configure, price, quote (CPQ) § Quote to order § Installed base Manufacturers must be prepared to open up new revenue streams and exceed customer expectations to remain relevant in an increasingly competitive field.
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