The Customers Decide

Customers hold the key to valuable insights. As they are the ultimate evaluators of our efforts, decision-making criteria should be specifically crafted with their preferences in mind. Relying on past experiences and intuition might result in failure to understand the dynamic and evolving nature of today's customers. It is crucial to recognize that the most effective approach to understanding customers is through the analysis of the data they generate. We must actively leverage this data in our decision-making processes to stay attuned to their ever-changing needs and expectations.

[Key Action Items]

• When identifying customer needs, check the data left by the customer first to clarify what the data means.
• Don't cherry-pick data for intended, expected results.
• When developing new businesses and products/content, don't abandon incorporating customer verification feedback just because of the product release schedule.
• Discuss and decide horizontally based on customer data rather than making decisions based on hierarchy and authority.
• After making important decisions, accumulate the resulting data and use it for subsequent decisions.

Be Where the Customers Are

Even at this very moment, numerous needs, challenges, and thoughts are unfolding in real-time. To truly grasp the customer experience, it is imperative to immerse ourselves in their environment, actively listen to their distinct voices, and observe their interactions. Continuously stay connected to your customers, attuned to their evolving needs, and maintain a heightened awareness. Remember that individual reviews collectively shape significant public opinions. Follow the flow of customer interactions, navigate both online and offline touchpoints, and be present at every juncture to comprehensively understand and respond to their experiences. Align with the customer's evolving journey and boldly explore uncharted territories to establish new markets.

[Key Action Items]

• Identify and understand customer interests in real time through continuous social listening.
• Check customer reviews daily, ask questions about customers’ complaints, anxieties, and what they really want, and think about what differentiated values we can provide.
• Experience the entire customer purchase journey every month. (search, receiving advertisements, online/brick-and-mortar store purchases, use of points, returns, etc.)
• Continue to identify and visit new online and brick-and-mortar store contact points.
• Wherever the customers are, boldly persue all countries and channels to create new business opportunities.

Fast Decision, Quick Action

In this swiftly changing era, adaptability, agility, and occasional boldness are essential. Instead of searching for the perfect answer, initiate with small decisions and take the first step. In a dynamic and ever-shifting market, it's essential to relinquish rigid thinking and swiftly respond. Accelerate the pace by proactively testing one step ahead, analyzing outcomes, and iterating for improvements. Insights derived from rapid decisions and actions will act as a compass, guiding your subsequent moves.

[Key Action Items]

• Top management should focus on key decisions and delegate authority for other tasks to ensure market responsiveness.
• Set decision-making deadlines for each task from the customer's perspective (within the period the customer is willing to wait).
• Repeat "Test & Learn" every three months for action items related to strategic goals.
• Establish and maintain a system that allows quick transitions, including business models and work processes.
• Sense customer/market changes as sensitively as possible and actively accept knowledge/information from outside.

Content that Moves

Brand fandom emerges through customer empathy, particularly when customers actively share and reproduce content. True empathy is displayed when customers are moved. Rather than settling for the mere creation and dissemination of content, constantly reassess whether your content has the power to resonate with and mobilize customers. Establish emotional connections through two-way communication, ensuring that this engagement seamlessly aligns with customer cognition, interest, and overall experience.

[Key Action Items]

• Based on content people can relate to, capture customers' awareness and interest in the top-/mid-funnel (branding, products) and create customer experience in the low-funnel.
• Create and produce content with the interests of your target customers as the top priority and in their language.
• Prioritize the platforms/media most influential to target customers and focus on sending out content that considers behavioral change.
• Repeat reproducing content in all relevant areas as if you are having a conversation with your customer.
• Our brands must directly communicate with customers’ reactions to content through replies.

Aim to be the World’s Best

Our utmost commitment to customer satisfaction lies in delivering the world’s finest products and services. This is not just a duty but a resounding calling, one that propels both the company and our employees toward substantial growth while accomplishing our objectives. As our grand goals materialize into achievements, they unveil new possibilities in both process and outcome. Let's embark on the challenge of market success by fostering a pioneering artisan spirit, aspiring to be the first and the best in creating the world's premier category.

[Key Action Items]

• Discover white space from customer demand and continue to challenge ourselves to create new categories in which we can become a market leader.
• Select the company-wide world's best candidate categories (approximately five) every three years.
• Once the product category has been sected as the world's best candidate, all company's resources must be channeled into progressively becoming the market leader in key customer touchpoints (country, channel, platform).
• Maintain the proportion of sales of company-wide innovative products (products that can be the first and best from the customer's perspective) at more than 5%.
• Recognize and reward the process of challenging grand goals as a true achievement.

Focus on the Key Products

When an engine product becomes the driving force behind a brand, it propels other products forward, much like the acceleration that occurs when wheels start to spin. The virtuous cycle of enhancing brand value kicks off when a brand's flagship product leaves a lasting impression on customers. Engine products, forged through years of investment and development, play a pivotal role. To foster this cycle, resources from underperforming SKUs should be strategically reinvested, with a strong focus on fueling the growth and success of these pivotal engine products.

[Key Action Items]

• When selecting engine products, consider the brand core first, not short-term trends.
• Consider the engine product candidates and establish a step-by-step development plan when developing a new product.
• After selecting an engine product, develop it intensively for at least three years and gradually achieve 50% of the sales proportion. (20% in 1 year, 30% in 2 years, 50% in 3 years)
• Liquidate the bottom 5% of sales and loss-making SKUs every year. (For products that must inevitably be maintained among the SKUs based on the liquidation criteria, specify why and how long it should be maintained)
• Even if initial sales of a new product are low, discontinue it after keeping it alive for more than two years.

Good Sales and Good Profit

We refer to the sales and profits resulting from the accumulation of brand value as ‘Good Sales/Good Profit.’ Conversely, short-term gains derived from excessive discounts and promotions are categorized as ‘Bad Sales/Bad Profit.’ Under no circumstances is sacrificing brand value considered a viable option. It is well understood that when a brand's value diminishes, the process of restoring it demands significantly more financial resources, time, and effort, and in some instances, regaining the lost value may prove to be an insurmountable challenge.

[Key Action Items]

• Do not engage in practices such as internal price competition, sales that may lead to non-distribution transactions, excessive discount promotions, or aggressive product pushing (sell-in).
• Set prices considering customer value/profitability and establish a discount rate guideline for each brand.
• Manage discount rates based on the customer's final perceived value (inclusive of all benefits such as shipping fee, promotions, product amount, etc.).
• When reviewing sales/profit, be sure to check profit-related indicators together to maintain business soundness (discount rate, Coupang PPM, etc.).
• Do not increase unplanned low-funnel budget spending for short-term sales growth.

Healthy Inventory, Healthy Business

Inventory is equivalent to financial resources. Stagnant inventory hinders cash flow, potentially leading the company into a crisis. Maintaining an appropriate inventory level ensures the timely provision of fresh products to customers. Striking the right balance is crucial – avoiding both shortages and excesses. To achieve this, demand forecasting should rely on clear data rather than mere sales goals, personal will, or intuition. Given that inventory turnover aligns with customer sales flow and influences brand value, it is imperative not to overlook monitoring distribution inventory as well.

[Key Action Items]

• Manage overall inventory status, including not only in-house inventory but also distributors’ inventory.
• Set the appropriate inventory turnover date for each country/channel in detail and manage it through clear data-based S&OP every month.
• Establish a detailed sales plan for each material and continuously record/review the results to increase demand forecast accuracy.
• As for distributor (TP/Agent/platform) inventory, check the current status as much as possible by monitoring actual customer sales trends.
• Regularly check inventory aging and establish a preemptive solution plan three months in advance for inventory expected to be underperforming.

Stay Connected to the Details

Lasting impressions on customers stem from the seamless connection of all brand elements, even in the minutest details. Customer satisfaction is often derived from those small details they might not have anticipated, and its depth is fundamentally tied to the sincerity and depth of our customer-centric approach. Let’s delve into the intricacies of quality and service. This initiative commences with an open and profound comprehension of the diverse characteristics of our customers, laying a robust foundation for a successful global business.

[Key Action Items]

• Even if something is a minor defect, identify the root cause and completely resolve customers’ complaints, starting from minor ones.
• When reviewing your business, focus on how it will impress customers in real life rather than checking performance/numbers.
• Define the core details of your brand and manage the competitiveness of those details at the global top level.
• Quantitatively manage input/process indicators (page loading speed, customer service connection time, etc.) for customer experience.
• Success stories in one country/market should not be directly applied to other countries/markets; instead, thoroughly understand each characteristic from A to Z.