Rethink­ing Sales in Oil & Gas

1. Mar­ket Segmentation

Regard­less of the focus on upstream, mid­stream, or down­stream indus­try seg­ments, it will be prof­itable for busi­ness­es to fur­ther seg­ment the mar­ket based on cus­tomer pro­files and per­ceived brand val­ues. There are three types of mar­ket seg­men­ta­tion that are par­tic­u­lar­ly valuable:

• Val­ue Seg­men­ta­tion
  Divide the mar­ket into seg­ments based on trans­ac­tion­al val­ue (how much cus­tomers in the group are like­ly to spend). Exam­ine past pur­chase behav­iour to deter­mine the val­ue of pre­vi­ous purchases. 
• Fir­mo­graph­ic Seg­men­ta­tion
  Divide the mar­ket into seg­ments based on indus­try, rev­enue, loca­tion, and num­ber of employees.
• Sea­son­al Seg­men­ta­tion
  Divide the mar­ket into seg­ments based on con­sumer behav­iour, sea­sons, pub­lic hol­i­days, and cel­e­bra­tions. For exam­ple, con­sumers buy dif­fer­ent prod­ucts at dif­fer­ent times of the year. Sum­mer hol­i­days mean more peo­ple trav­el­ling, so sales of jet fuel, petrol, and diesel increase. The approach of cold weath­er sees increas­es in heat­ing oil pur­chas­es while the onset of win­ter fuels demand for nat­ur­al gas.

Cre­at­ing detailed cus­tomer pro­files for each seg­ment and exam­in­ing per­ceived brand and prod­uct image will reveal new mar­ket­ing and sales oppor­tu­ni­ties. Busi­ness­es can build capac­i­ty to iden­ti­fy chang­ing mar­ket con­di­tions and take full advan­tage of emerg­ing con­sumer trends. 

A thor­ough analy­sis and a detailed mar­ket­ing plan encom­pass­ing all depart­ments will also help organ­i­sa­tions prop­er­ly seg­ment their mar­ket and under­stand their tar­gets, cost, and pro­posed ROI based on their efforts.

2. Devel­op­ing the Right Man­age­ment Con­trol System

The biggest chal­lenge fac­ing oil and gas SMBs today is re-evaluating and recal­i­brat­ing their entire oper­a­tion to align with the Envi­ron­men­tal, Sus­tain­abil­i­ty, and Gov­er­nance (ESG) frame­work now required for all EU com­pa­nies and by many investors in the U.S. An annu­al ESG report reflect­ing well on com­pa­ny activ­i­ty has become a crit­i­cal mar­ket­ing tool.

A robust man­age­ment con­trol sys­tem (MCS) ensures that sales and mar­ket­ing efforts work togeth­er with the rest of the busi­ness as it goes through the changes demand­ed by ESG com­pli­ance. The MCS must include all plan­ning, con­trol, and mea­sure­ment ele­ments. Most impor­tant­ly, the MCS must also fos­ter col­lab­o­ra­tion between all rel­e­vant depart­ments toward achiev­ing ESG goals.

Sales and mar­ket­ing data needs to be shared in real time so that prod­uct devel­op­ment, pro­duc­tion, and finance can respond instant­ly, lead­ing to increased effi­cien­cy and speed to mar­ket. Deliv­ery time and qual­i­ty will also improve.

The tools used to quan­ti­fy suc­cess need to be good at mea­sur­ing how well com­pa­nies do no mat­ter what aspect of per­for­mance they are track­ing. Man­agers can quick­ly trace the root caus­es of any effi­cien­cy when they have real-time data at their fin­ger­tips 24/7.

3. Tech­nol­o­gy Transformation

Tech trans­for­ma­tion con­tin­ues to accel­er­ate across all indus­tries world­wide. To sur­vive, oil and gas SMBs must take a sus­tain­able approach to man­age the tech­no­log­i­cal change and gain the most sig­nif­i­cant benefits.

While they can’t replace the trust in a hand­shake, new tech­nolo­gies can pro­mote aware­ness and build towards seal­ing deals in per­son. The fol­low­ing tech­nolo­gies can stream­line and opti­mize sales and mar­ket­ing strategies:

• A dynam­i­cal­ly evolv­ing web­site forms the heart of new dig­i­tal mar­ket­ing technologies.
• Social media can build a pos­i­tive brand image in the cur­rent green movement.
• Dig­i­tal adver­tis­ing can reach tar­get­ed mar­ket seg­ments and get the news out about new prod­ucts or changes quickly.
• Video can bring a com­pa­ny pres­ence to life, build a more pos­i­tive brand image, and spread the brand’s message.

Com­pa­nies must pair the new tech­nolo­gies with the right skills, process­es, and work­force. Val­ue cre­ation must always be front and cen­tre. The strat­e­gy foun­da­tions must include a clear under­stand­ing of the business’s cur­rent per­for­mance base­line, KPIs, and tools that enable rapid, fact-based decision-making. It will help to break the trans­for­ma­tion process into three baskets:

• Trans­for­ma­tion Strat­e­gy
  A sol­id strat­e­gy devel­op­ment frame­work includes an in-depth analy­sis of all inter­nal and exter­nal fac­tors the tech­nol­o­gy influ­ences. A robust and all-encompassing strat­e­gy ensures that man­age­ment sets achiev­able aspi­ra­tional goals and estab­lish­es the nec­es­sary ini­tia­tives to achieve them.
• Trans­for­ma­tion Plan­ning
  Expe­ri­enced plan­ners will be able to present what needs to be done as part of the solu­tion. They’ve planned and exe­cut­ed trans­for­ma­tion so often that they’re aware of pos­si­ble pit­falls and all the numer­ous fac­tors involved in tech­no­log­i­cal transformation.
• Trans­for­ma­tion Man­age­ment
  Tech­no­log­i­cal trans­for­ma­tion is an ever-evolving jour­ney. An agile approach to set­ting up the best gov­er­nance mod­els to dri­ve effec­tive change brings opti­mum results. Com­pa­nies need a trans­for­ma­tion man­age­ment office to man­age and mon­i­tor the entire process of estab­lish­ing and sus­tain­ing trans­for­ma­tion management. 

Most impor­tant in this aspect is to mea­sure the jour­ney towards the full adop­tion of the changes. This means that new ways of work­ing are embed­ded into the organ­i­sa­tion and its staff and staff con­tribute to dri­ve a cul­ture of con­tin­u­ous improve­ment on their own.