How category design is helping the customer chief at hipages find growth
- 11 September, 2018 08:09
The concept of category design has not only given hipages the tools to create its first mass market brand campaign, it’s also crystallising the business strategy for its next rapid phase of growth.
Stuart Tucker joined the Australian online marketplace for buying and selling trades services last October as inaugural chief customer officer, uniting the marketing, sales and services teams. Prior to this, he spent four years with CBA, and boasts of a 30-year career as a marketer for the likes of Optus, KFC and Aussie Home Loans.
While Hipages has certainly experienced significant growth since launching 14 years ago, with 2 million consumers using the platform and a 37 per cent increase in year-on-year revenues to $37 million in FY17, Yet Tucker said it was clear the company lacked a well-articulated point of difference in the market. And it was suffering from below-average brand awareness as a result.
So Tucker and his team got behind the notion of category design, as detailed in the book, Play Bigger, written by the founders of a Silicon Valley advisory firm of the same name.
At its core, category design is about taking rational steps to define the space around a company and its product offering so customers not only understand products better, they demand them. Authors, Al Ramadan, Dave Peterson Christopher Lochhead and Kevin Maney, describe it as the opposite of a ‘build it and they will come’ mentality.
“In modern marketplaces in particular, once you define the consumer problem, and be clear on what category it is you want to be in, you create that program that makes yourself the category king and authority,” Tucker explained. “For example, Uber created a new category – there were taxis, and they were unreliable. The solution was a new category called ride sharing. Another is Airbnb, or even Salesforce, for its ‘no software/ software-as-a-service’ approach.”
In hipages’ case, the insight was the need to improve the relationship between tradies and consumers.
“Let’s face it, the tradie engagement model has been a feat of mutual endurance,” Tucker said. “Tradies are increasingly frustrated about how hard it is to coordinate and communicate with consumers; they’ve gone out to pick up the kids, the specs weren’t clear, they didn’t pay on time, the job wasn’t well defined. On the other side, we know finding a tradie who’s available, who’s working in your local area and who you trust and is qualified, is truly difficult.”
The market size is also huge. Tucker pointed to fresh research by hipages in partnership with Ernst & Young Sweeney and LEK, which showed 70 million trades jobs being completed in Australia per year – an average of seven per house per annum.
“We pay tradies $73 billion a year, not including materials… yet it’s an industry still anchored in old-fashioned ways,” Tucker said. “It’s incredibly fragmented, it’s diverse – you have everything from builders to pest control and everything in between – and it hasn’t really been disrupted. There’s certainly not enough use of digital to improve and become more efficient.
“We are not aware of any Uber or Airbnb equivalent in the tradie sector globally. No one has really cracked it. Yet it’s huge, broken and inefficient, and the frustrations exist on both sides of the marketplace.”
Using the research and category design principles, hipages has defined the ‘on-demand tradie economy’, and reoriented its brand purpose and company mission, product roadmap, and marketing and communications around owning this market.
“The greatest marketing activities are those grounded in a consumer problem. The beauty we have with a double-sided marketplace is that the problem is shared, which makes solving it even more powerful,” Tucker said.
The brand campaign
Hipages releases a whitepaper on the subject this week. But the first external iteration of this new category is the national mass-market campaign launched on 12 August.
Running across digital, print, broadcast and outdoor, ‘Change the way you tradie’ centres around hipages’ app features, such as matching homeowners with qualified tradespeople and assigning reliable quotes, using photos to upload jobs, helping schedule appointments and arranging payment and checking customer ratings and recommendations on tradies. It’s been crafted in partnership with creative agency, VCCP. Hipages covers more than 240 categories and has 135,000 qualified tradespeople available nationwide, with more than 100,000 jobs per month posted on its site per month.
“‘Change the way you tradie’ is really is a call to arms to change the way you’re thinking… and looks at how we modernise and digitise the industry by empowering people to find tradies using their phone,” Tucker said. “It’s staking a claim that no one else can make and gives us the opportunity to highlight some of our key features.”
It’s a big investment for hipages, and Tucker said getting the brand campaign over the line meant building a strong case for incremental media investment.
“It’s pretty easy with brand research to show where we stack up in terms of awareness, and that showed a gap to where we really should be. We were able to also show where other marketplaces had been spending money to grow their brands and some of the outcomes of that,” he said. “And we proved that if we were going to fuel growth, and become known as the category leader, we had to get ourselves out of the limited media we’d been doing.
“We are very strong in performance media, and our activation capability is first class; our paid search is as good as I’ve seen and we rely on it very heavily. But if we want to remove ourselves from that drug, we need to be building our brand awareness so people come to us a lot more actively and are thinking of us first.”
The campaign launched during TV show, The Block. The team is also tapping into media provided by News Corporation, which owns 30 per cent of the business, to create a bigger presence than Tucker said you’d normally expect from a brand of this size.
While the tech behind hipages might be new, Tucker said he’s taken quite a traditional approach to the media mix. “We know 75 per cent of Australian households use a tradie every year - it’s not a niche market. It’s also a market slightly older than other brands in digital, yet those [next-generation companies] are still consuming traditional media,” he said.
“So on the Sunday we had a DPS in the Sunday Telegraph, followed by The Block, a homepage takeover, outdoor, and some cheeky guerrilla activity.”
These guerrilla tactics included banners on unfinished construction and lightrail sites in Sydney and Melbourne posing the question: ‘Need some help finishing that job’?
Tucker said early results are highly positive. “We’ve seen significant increases around metrics that count the most – such as downloads of our app; plus significant shift in unbranded to branded search – people actively looking for hipages, rather than searching for a plumber in their local area. On the other side of the market we’ve had 2.5 weeks of record sales for new tradies wanting to join the platform,” he said.
Getting buy-in meant starting at the board level, which thankfully was marketing and media savvy and supported the need to invest in a longer-term brand play. Next up was engaging the senior leadership team in the original creative idea. Tucker said it was then a matter of “just getting on with it”.
What the category work and brand repositioning does is provide an anchor for everything, Tucker continued. “Now we’ve got a clear point of view in the market we can go at, which should make everything else work harder.”
Another key priority is being agile and responsive to the market and current affairs, and Tucker pointed to hipages commenting on the Prime Minister battles of a few weeks ago as an example.
“If we’re going to be a disruptive brand, and challenge the way people tradie, we need to be jumping in on conversations and real-time events to make that happen,” he said.
Up next: What it takes to understand your customer, plus the changing role of the CMO/customer leader
Get your customers
It’s clear Tucker’s experience over the past 30 years, mainly within challenger brands, is helping informing his approach at hipages. And what makes any CMO or chief customer officer truly successful is the ability to put yourself into the shoes of your target audience, he said.
“I believe marketers are becoming guilty of becoming more removed from customers,” he claimed, adding this is particularly apparent in larger corporates. “I also think the marketing industry is genuinely suffering from a lack of diversity and we live in a bubble. It’d be really easy to think mass Australia looks like the people who work in white collar marketing roles. It’s so far from the truth.
“I sit with the customer service and sales teams, and it’s like sitting in Town Hall Station. It’s always buzzing. That doesn’t exist in a lot of big corporates. It’s a genuine problem.
“The art of the marketer is to try and put themselves in the shoes of their target audience.”
As a digital marketplace, hipages has visibility over what’s happening with customers at virtually every touchpoint in the journey and is awash with first-party data.
“But it still doesn’t give you that sentiment and nuance. You have to have that combination,” Tucker said. “Marketing needs to be the people living and breathing the customer, defining what that experience should be, setting the benchmarks and measures and expectations and the rest of the business can deliver against it. And if employees know how they’re delivering against the customer experience and feel empowered and know how to deliver, then it’s that happy balance.”
At hipages, it’s still early days on some of the formalities of customer experience management, with parts of the experience measured via Net Promoter Score and customer satisfaction scoring in place. A more cohesive approach will be launched in coming months, Tucker said.
He also recognised the need to do more to build engagement, and said the company is reviewing its martech stack to find more ways to improve communications.
“We just put in the Adobe bid management tool [Adobe Media Optimizer] to help us do our performance media and it’s making a big difference to the way we operate,” Tucker said. “Now we’re finding new and efficient ways to both track journeys as people are coming on and off app, as people are coming through, but also to broaden our reach beyond email into push messaging and the in-app experience.
“If you’re a marketplace for tradies that people need infrequently, then you have to find ways to keep the customer engaged in your brand inbetween. That’s where content comes into it.”
Hipages is already using personalised, localised and even seasonalised content via email marketing around topics such as preparing for spring, getting aircon installed before summer, and preparing your garden.
“Then on the tradie side it’s sharing best practices more than anything – how are other tradies benefitting from the platform and how they can be smarter and more efficient with using digital,” Tucker said.
“It’s the other reason to have the brand top of mind – you might need us for a plumbing job in July then a plastering job in December. We need to fill the gaps both at an activation level as well as brand reminders.”
Core business metrics, meanwhile, include tradie and product growth, as well as engagement and how frequently and deeply tradies and consumers are interacting with the solution.
Top attributes to lead growth
Whether you’re called CMO or chief customer officer, Tucker said it’s vital leaders looking to be champions of company growth embrace data.
“Really be ready to find insights from data, and also test and learn – get things to market fast and learn from them, rather than waiting until it’s gilt edged and the Rolls Royce,” he advised.
Another vital attribute is being clear on prioritisation. “Instead of trying to do 20 things, do 3-4 things really well; for us it’s then about making sure we had a clear reason for being that aligned all our activity,” Tucker said.
“More than anything though, it’s a mindset. Unless you have people prepared to stick their heads up and have a crack, you’ll never drive any change.
“We have to get back to marketers being at the heart of innovation, ready to take chances obviously considered risk, but taking their organisations on a journey of making a difference with consumers. Because no one notices the boring stuff.”