Konica Minolta has close to two million customers connected by a sales and service system that we have built up across 150 countries. This customer base is an asset that contributes greatly to our growth. With an emphasis on connecting with our customers directly at an early stage, we have built a direct-sales system that does not involve going through distributors. This allows us to get a keen sense of the issues our customers face in the workplace and to offer suggestions that meet their needs.
This extensive and profound connection with the customer is a strength unique to Konica Minolta. By making full use of this strength, we work to improve customer value and increase profitability by proposing not just standalone devices but solutions that include a variety of services.
In the Digital Workplace Business, for example, we have enhanced our ability to offer IT services by undertaking M&A and other moves beginning 10 years ago in anticipation of bearish print volume (PV) owing to offices going increasingly paperless. Meanwhile, we have also paired MFPs with IT services and conducted hybrid sales of solutions aimed at solving our customers’ issues. We previously made sales calls every four or five years, coinciding with when our customers replaced their MFPs. Since we began providing IT services, however, we now provide suggestions to customers more often and have improved customer engagement. Through persistence in these efforts, we boosted the retention rate to 85% from what was once about 70% while increasing per-customer profit. Steady progress is being made.
During the period of the SHINKA 2019 medium-term business plan, we began rolling out the Workplace Hub next-generation platform with an eye to building a new business model not dependent on PV. Our direct connections with so many of our roughly two million customers will serve as a strength as we expand our business even further.
With regard to the Workplace Hub, we were unable to achieve the goals of the initial sales plan due to the time needed to complete a successful firmware version both in terms of customer satisfaction and expediency for us. However, fiscal 2020 will see us begin to bring together the Workplace Hub, MFPs, and IT services towards achieving the Intelligent Connected Workplace^*, allowing us to expand the solutions and value we provide the specialized industries. Through this effort, we will continue contributing to better business efficiency and productivity.

*Intelligent Connected Workplace: A smart workplace environment that brings the necessary people and information together, and allows for creating value with anyone anywhere, and at any time.

Measures to boost sales by leveraging connections with customers

While cultivating new customers is critical for further increasing connections with customers, traditional sales approaches involve a lot of wasted effort and are inefficient. To solve this issue, we employ a scientific sales approach for our Business Technologies Business in the U.S.
For some time now, Konica Minolta has been creating a database of customer profiles. By analyzing this data using AI, we can identify promising goods and services according to industry or company size, and can determine profit ratio trends. We then create a pipeline (a list of prospective customers) for cultivating new customers. Using this list as a starting point for sales activities has enabled us to provide more effective proposals from early on in deal negotiations, resulting in better sales efficiency and customer satisfaction.
Our vast customer base is what makes this sales approach possible. With COVID-19 complicating in-person negotiations, figuring out how to assess customer needs remotely is key. For that reason, as well, we believe it is important to cross-deploy our scientific approach from the U.S. to other regions and from the Business Technologies Business to other businesses, ensuring it is used effectively. In the three years of the new medium-term business strategy, DX2022, we lay out a new initiative aimed at taking this approach a step further by using an AI employed for analyzing data to automatically generate the most suitable proposals based on customer type.
In addition, we will be deploying a system for scientifically evaluating and verifying how well we are doing in engaging customers. Up until now, our source of reference has been the Net Promoter Score (NPS), which assigns scores to how willing customers would be to recommend something to another customer. Now, we will take this to the next level and have our customers scored according to a standard of our own design— one which asks customers “do you plan to continue using Konica Minolta products or services?” We will then deploy our own evaluation system that will compile and analyze the assessments on a weekly basis, making use of our findings in sales activities.

Through the connections we have with customers in a broad spectrum of industries, we are able to discern a diversity of undiscovered issues that our customers face— issues that present numerous business opportunities. We will capture every such opportunity and use them to expand our business. To this end, through One Konica Minolta, we go beyond business boundaries to provide unique solutions and create ever greater customer value.
For example, in response to the needs of schools looking to bolstering security, we provide IT-related security as well as solutions in the form of surveillance cameras that monitor for suspicious trespassers. We also seek to meet the needs of local governments interested in achieving operational reforms. In addition to document solutions that digitize and centrally manage large volumes of documents through the tracking and assessment of workflows, we even sometimes suggest healthcare-related solutions to improve operational efficiency at public health centers.
To carry out this multifaceted style of proposal making, we have consolidated each business’s sales functions into a single sales subsidiary, replacing a sales system centered around specific business segments with one that can offer different solutions specific to our customers’ industries and lines of business.
This gives us a deep understanding of the issues unique to each of our customer’s industries and lines of business, and enables us to propose a variety of the best possible solutions. We also have the means to replicate elsewhere in the group successes achieved in one country or region.
In addition, Konica Minolta experts well-versed in security and other specific fields engage in talks with customers, creating opportunities to conduct assessments and implementations in the field. Going forward, in order to create even more of these opportunities, we will focus on cultivating experts in every business segment, for example, utilizing our European experts in a cross-border capacity by having them take part in deal negotiations with our Asian customers.
The extensive customer connections we have built up will drive our future growth, and I am confident that we can achieve greater growth by leveraging these connections across business borders. Under One Konica Minolta, we will continue upping the pace of our solutions proposals, one step at a time.