Back to Strategic Marketing/Value Propositions

CASE Study: When to Re-Calibrate Your Value Proposition (Part 1)

Experiencing Your Brand Through the Eyes of the Customer

By Allison Jurgens, February 15, 2018 

This topic is best covered in a story (Part 1) followed by a case study solution (Part 2).  

I’ve spent the majority of my career working in and with service providers in the upstream oil and gas market, so I understand the glacial pace of change within mid-size and large organizations. It takes a lot of patience and time to realign processes, dismantle biases, and abolish the continuation of status quo operation - particularly in the area of marketing. Many organizations have only recently (in the last decade or so) adopted the use of value propositions in their messaging - a step-change difference from the tech specs of their not-so-distant past.

And because those changes probably took quite a while to adopt and implement, the last thing most B2B marketers and executives want to hear is why it's now time to change yet again. Rather than give you a litany of statistics and compelling business arguments, I think a good story might be easier to relate to.

And so the story begins...

Let’s pretend for a moment that I’m a drilling engineer working in a large oilfield services company. I’m responsible for helping my client, an independent E&P operator, design a drilling program for a new well to be placed in the Woodford Shale. I’m very familiar with the tubing options provided by my top three suppliers, but I’m curious if there are any new technologies on the market I should evaluate. There are plenty of manufacturers to choose from - in fact the market is oversupplied at present. 

I’d like to know (customer expectations): 

1. what are my options; 
2. what others think of the technology and vendor (reviews, testimonials, or track record); 
3. how effective the technology is (case studies and whitepapers); 
4. if it meets our minimum safety standards and requirements (product specifications); and 
5. a general estimated cost. 

Ideally, it would be great to go to a marketplace for this information where I can easily compare different products (desired customer experience). I pull up my internet browser and type in “What new tubing technology can be used in the Woodford Shale?” 

Notice that I’m not simply using keywords, but rather I’m asking my browser to interpret and understand my question. I do this frequently using audio commands on my mobile device for personal searches, so it seems natural to do the same for my business-related searches. (a topic-based search)

Here are my results:

Pages 2, 3 and 4 reveal similar findings. I’m not getting what I’m looking for so I adjust my search and type in, “Woodford shale tubing technology”. Almost the exact same results appear and I’m still not able to find what I need. I try broadening my search to something slightly more generic, “New tubing technology”.  This is what I find:

This is better, but I will have to do quite a bit of research to determine which of these vendors has a product that is viable to my specific application and has proven successful in the Woodford Shale. It would probably be easiest if I just contact the top three suppliers and ask for their suggestions, but I really don’t want to deal with a salesperson at this stage since I’m simply trying to investigate my options. (desired customer experience)

I try a different search for “oilfield tubing manufacturers” to see what other vendors are available. I find it strange (customer perception) that only one of the top three suppliers, Tenaris, is present on the first page of results. (TMK didn’t appear at all and US Steel appeared on page 4.) Below are the search results:

I’ve now spent almost half an hour searching the web and I’m no closer to my answer. It will take me several more hours to compile the information from all these sites into a comparison (customer pain point) and I’ll need to call each one of them individually if I want to get detailed information about pricing (customer pain point). Nevermind the fact that I’d like to get opinions from other users on their experience working with the vendor and using the technology (customer expectations), which will add another layer of complexity and time to this equation.

I opt for a more pragmatic approach and explore the websites of my three main suppliers. My findings are below:

Tenaris Website Review: (customer experience)

I used the search function on their website and typed in Woodford Shale. It pulled up a lot of conferences and exhibitions, and one page on their website dedicated to shale solutions. On the shale solutions page, they have a map of the US shale plays and the proximity of their facilities, but there is no indication if their products have been used specifically in the Woodford. There’s also no way to tell what new technology they’ve created for shale plays. 

I take a look at their recommended OCTG technology and click on the link. It takes me to a general web page containing a variety of products including categories for Coiled Tubing and Casing and Tubing. I click on Casing and Tubing and here’s the main message:

Our casing and tubing pipes are manufactured according to API grades and also in proprietary grades including sour, high collapse, chrome and CRA products for special applications. Our proprietary grades allow us to offer the best solutions for each customer’s particular well conditions.

There is nothing further on the page except some more generic information and some links to product brochures. I found an area called New Project Online, but it lead me to a ‘Contact Us’ page and not to a configurator or estimator as I was hoping. They do have a PDF document I can download that will help me build my project requirements that I can submit to receive an estimate.

TMK Website Review: (customer experience)

I used the company’s search feature on their website and typed in Woodford Shale. It comes back with an HTTP Error 500. I navigate back and try “Shale Tubing” in the search box. Again, I get the same error. I navigate back and this time opt to click on their Product menu which gives me the option for Oil Country Tubular Goods (OCTG).

I’m directed to a page that includes the below message:

TMK IPSCO is on the forefront of oil country tubular goods innovation, partnering with our customers to create new, highly customized solutions to move the oil and gas industry forward. As we recognize that each well design is unique, TMK IPSCO manufacturers a portfolio of OCTG products to ensure that we offer products for varied drilling applications.

The page also includes some other facts about how they manufacture their casing and tubing, but there is nothing specific on which tubing they recommend for shale applications. There is a PDF document spec sheet with all of their available options, but nothing that indicates why their tubing is different or better than other manufacturers.

I found no way to generate a quote or produce an estimate online.

US Steel Website Review: (customer experience)

This website didn’t offer a search function, so I navigated directly to the OCTG product line from their home page. They have a brief mention of shale plays in their opening statement on the page, but nothing more on the subject. At the very bottom of this page, I find a short section that says this:

U. S. Steel is now the exclusive global licensee for low plasticity burnishing (LPB) of energy tubular products. LPB is a revolutionary new surface treatment that mitigates crack propagation. 

I don’t see anything further that indicates new products or technology on this page. In a mid-section, they list a number of OCTG product categories including casing and tubing. I navigate to this page and below is the main message:

Providing over a century of commitment to manufacturing the finest quality steel tubular products for the oil and gas industry. Shale plays, extreme temperatures, extended reach applications: U. S. Steel Tubular Products creates oil country tubular goods (OCTG) specially designed and manufactured to meet the demands of today’s most extreme oil and gas environments.

The page includes a lot of ISO and API certifications, as well as a few new resources such as their distributors and authorized agents, and their innovation and technology center. There is no mention on this page about the LPB technique previewed on their OCTG landing page. I’ll have to remember to investigate that later.

I continue my research on the page and look for their recommendations on what to use for shale applications. I don’t see anything specific except a tiny blurb under the OCTG connections, but there a four options for horizontal drilling and one that says it was designed for “unconventional shale plays”. 
I found a 238-page catalog that included product specs for all of their available casing, tubing and connections. 

I decided to navigate to the OCTG connection they listed for shale applications. When I got to this landing page, I saw product specifications and some information on how these connections were designed. However, it did not include any information about how this technology was used in shales or why it proved better than any of the other connections they sold. I don’t recall even seeing the word “shale” on the page.

I don’t see any MSRPs in the catalog, and my only ability to get an estimate is to contact one of the twenty-seven third-party distributors listed on their site. As a last ditch effort to discover new technology, I opt to go back to the OCTG overview page and click on the link for that LPB technology.

This page has a great overview of the technique and why it’s important, largely to prevent the cracking of pipes, and provides some test and validation results. There are no case studies, product reviews, or mentions of the technology being used for horizontal drilling applications. They provide a link for me to learn more from their distributors which takes me back to the previous list of 27.

My Frustration Is Obvious

I emerge from my office two hours after I began my initial search and I have not achieved my objective. A colleague notices my irritation and we chat about how annoying it is that we can’t compare different tubing options or read reviews on these basic products that we purchase on a regular basis (market need). We express the desire for a buying process more like what we get in our personal online shopping experiences. (valuable differentiator)

My colleague commented, “Why can’t they just make this whole process easier for us? (customer need) It’s almost like they make it intentionally complex.” (customer perception) 

My reply, “What’s even worse: I just spent two hours reviewing the websites of the top three standard suppliers - not only did I not get what I was looking for, but I have no idea what makes one manufacturer better than another.  They all look the same and sell the same products, so it really is only a price comparison at the end of the day.” (customer perception)

I now trudge back to my office and dread spending the next several hours on the phone contacting various suppliers to get the answers I’m looking for.

Heavy sigh.

Case Study Solution:

Part 2 provides a detailed analysis and example of how these companies can transform their marketing by first re-calibrating their value propositions.