Market to Customer

2. Market to Customer

Clariant’s success relies on its ability to understand customer needs along the entire value chain, develop solutions to address those needs, and capture the value created for profitable growth. To attain these goals, Clariant focuses on building strong customer relationships and strengthening its marketing and sales capabilities.

2.1. Addressing new market opportunities and customer demands

Customer demand for sustainable products and solutions continued to increase in 2019. To meet this demand, Clariant is continuously bringing forward new solutions that are more sustainable without compromising on performance or the company’s commitment to fulfilling customer needs. Using 36 sustainability criteria to screen products across their entire life cycle as part of its Portfolio Value Program (PVP), Clariant awarded 27 new products the EcoTain^® label in 2019 to recognize their outstanding sustainability profile. Read more in Manufactured Capital

The continuing commoditization trend in the chemical markets has required Clariant to increasingly provide innovative products and services to meet customer-specific needs, while also maintaining cost-efficient operations in order to stay competitive. Clariant addresses these challenges by leveraging digitalization capabilities in its operations and services in order to improve production efficiency and customer service. Clariant plans to further incorporate customer needs into the definition of customer segments to refine value propositions and further focus marketing and sales activities.

Ongoing consolidation in the chemical sector intensified competition for Clariant in 2019. This trend was particularly apparent in Clariant’s customer base, where upstream and downstream processes are increasingly integrated within the supply chain. By better linking business forecasts to production planning, Clariant helped its customers continue to build more integrated end-to-end supply chains.

2.2. Understanding the customer journey

Looking through a »customer lens« allows Clariant to understand changing product and service needs, as well as discern how the customer perceives the company. Clariant manifests its customer centricity through the Commercial Excellence initiative established in 2011, which facilitates dialog with customers, partners, and prospects to evaluate and improve commercial strategies, customer engagement, and sales and marketing operations. In 2019, Clariant continued to implement the Marketing Excellence Find & Win process to systematically understand each touchpoint along the customer journey. This allows the company to develop tailored products and solutions and maintain long-term relationships with customers. In 2019, 404 structured interviews with customers and 144 with industry experts were conducted to gain insights. Clariant also launched a strategic key account management program aimed at more effectively transforming market opportunities into sales.

To leverage customer feedback, Clariant conducts biennial customer satisfaction surveys, which provide insights into how Clariant’s operational, commercial, and innovation performance is perceived. Customers of all Business Units in all regions were surveyed in 2018.

2.3. Sharpening value propositions with a holistic approach

The volatility of raw material prices over the last several years requires Clariant to closely monitor costs and supply chain competitiveness while also focusing on sales growth.

In 2019, Clariant initiated additional holistic pricing projects to maximize long-term value. By applying new online tools and practices that furthered transparency of costs, Clariant was able to pass cost increases on to customers. Simultaneously, Clariant evaluated several software providers to develop procurement forecasts for raw materials and margin scenarios. In addition, Clariant continued to refine its value-based and transactional pricing with software improvements and new applications to gain better insights into extraordinary price points, for example.

By carving out the savings or revenue upside in terms of total cost of ownership at a mutually beneficial price point, Clariant’s commercial organization transforms value created for customers into profitable growth. Clariant’s value calculators are a helpful tool to demonstrate a product’s value to customers, as they quantify and visualize the financial benefits of using Clariant’s products as compared to the next best competing alternative.

To develop solutions that create value for both the customer and Clariant, cross-functional teams are formed that combine expertise and training in innovation, marketing, sales, procurement, and operations. With this holistic approach, Clariant is able to detect optimization potentials in pricing and commercialization that ultimately lead to a compelling value proposition.

2.4. Enhancing commercial capabilities through the Leading Marketing Organization

In 2017, Clariant launched the Leading Marketing Organization, an initiative that further integrates marketing within the Business Units. In 2018, all key positions of the redefined marketing organizations were filled, and a training program that reinforces marketing skills was piloted. In 2019, an advanced strategic management program was launched to strengthen the commercial competencies across Clariant. Extensive internal and external training increased the quality and visibility of Clariant’s marketing experts.

The Marketing Advisory Board, comprised of the Marketing Heads of Business Units, Head of Marketing Communications, and Head of Sustainability, continued to share best practices and drive further development of marketing processes, tools, and capabilities. In 2019, emphasis was placed on solving commercial challenges by developing best-in-class practices. By looking deeper into portfolio management, the customer journey, and commercial data analytics, Clariant will focus on the priorities defined as must-win battles of the Business Units in 2020. Read more in Strategy