BrazilFormer CEO discusses Heineken’s collaboration with SparkOptimus
In the latter period of his tenure as CEO of Heineken, Jean-François van Boxmeer worked with consultants from SparkOptimus on Heineken’s digital transformation. The former chief executive reflects on the collaboration and how the external expertise helped drive the brewery’s digital evolution.
Speaking to SparkOptimus Managing Partner Alexandra Jankovich on the firm’s digital journey, Van Boxmeer – who held the company’s top role for fifteen years, before stepping down eight months ago – noted that in the early days it was “fairly logical to think about digital,” having quickly realised that digital is just “one more channel to communicate,” internally and externally.
As a result, the early digitalisation of Heineken focused on its “office and administrative lives,” building mechanisms to manage client relationships, and on ERP systems which he now concedes “were invented a long time ago.”
“I think the digital evolution happened in three steps,” Van Boxmeer elaborated. “The first one was the automation of all the administrative tasks. The second step was communication. I think it revolutionised the way we communicated with our end customer which is the consumer. Instead of putting up billboards and preformatted movies we were kind of entering into a direct dialogue with people.”
“And then the last mile would be the online trading of things which is a new channel for us, so all three things happened over a certain period but it is just a continuation of using new technologies to our advantage.”
Digitalisation for Heineken continues to be more evolutionary than revolutionary, however, meaning that there will always be room for improvement and innovation. Determined not to rest on its laurels in this regard, the company six years ago first tapped digital transformation consultancy SparkOptimus for advice and support.
Complementing sales reps with an app in Mexico
One of their joint endeavours, Van Boxmeer recalled, involved the development of a digital app for customers of the company in Mexico. “Customers in Mexico are typically small shops,” he explained. “They were visited once or twice a week by a sales rep and he would take up the order and then it got delivered by our trucks. You can complement the sales rep with an app so the shop owners can also order directly themselves. That was what we developed in the first place.”
Having started in Mexico, Heineken has since rolled out this app across its international business units.
Following on from this, with many customers now owning a smartphone and finding it easier to handle things online, SparkOptimus helped Heineken build a platform that enables them to share their requests proactively, rather than having to wait for physical meetings with a sales representative.
Mapping the customers’ needs with Citylabs
This initial collaboration was followed by a project that was “more of a people thing, rather than a technological development.” Called Citylabs, the project helped Heineken consult its grassroots to plot its future digital development, rather than plotting a top-down change that might conflict with or under-support certain aspects of the business.
The former CEO expanded, “It is about sitting down with district sales reps and saying: What is it really that we can do differently to sell more and give our customers a better service to have a more satisfied customer? People gather around and give examples from their daily lives and I think SparkOptimus helped in that, in recognising the patterns because a sales rep always comes with his or her particular kind of example.”
“Out of all these examples, you have to be able to recognise the patterns, and out of these patterns you can assess if it is worthwhile to develop and innovate.”
Explaining how this went on to help Heineken, Van Boxmeer noted one example as the firm’s fridges. Again, pointing to Mexico, he explained that the heat of the country means the brewery deploys tens of thousands of fridges there. Having them accurately stocked on time is a big part of the business. Building on feedback from the firm’s grassroots, Heineken determined that a solution needed to be developed to do that before a store opens.
They started testing a more digital approach: Instead of waiting for the visit of the sales rep, “people make their own photo; send it to the sales rep and it is then picked up. This process can subsequently be improved further through smart technologies.”
“Of course, it would be ideal to start immediately with a perfect, fully automated system… but I think the beauty of the collaboration with SparkOptimus was always that we reached milestones that rapidly delivered additional business, while in parallel keeping an eye on opportunities for further improvements down the line.”
Getting to know the customers in South Africa
Another market SparkOptimus supported Heineken in is South Africa. In contrast to Mexico, the area represents a relatively young operating company, presenting a different challenge to help establish the brand in a market with a less direct route to the customer. With distributors between the company and the customer, Heineken wanted to know more about the people buying its products.
In order to gain these insights, the beer giant came across a start-up called Touchsides, which had been developing what effectively was a cash register machine for a sales outlet, which also allowed an ordering function towards the supplier; enabling an analysis function of different categories of products and the competitive field a product is in.
Heineken bought Touchsides, and then asked SparkOptimus to support with the scaling phase. “Scaling such businesses is not our core business.” The consultants took the lead for this and have since managed to integrate its growing insights and offerings into the South African business.
Having now exited the firm, Van Boxmeer asserted it was still too early to “declare this technology an absolute winner,” however, he believes there are enough elements Heineken can build on for the future “that are extremely valuable” to the firm’s efforts.
Building a direct-to-consumer channel in the Netherlands
Closer to home, Heineken brought in the expertise of SparkOptimus to support with the launch of Beerwulf, an e-commerce platform in what is a departure of its traditional B2B focus. Participating in the direct-to-consumer e-commerce channel was a completely new thing to Heineken, but an important leap to make as it sought to tap into the growing enthusiasm for craft beer across Europe.
“The world of craft beers has been a bit similar to the wine world with a lot of varieties, a lot of little stories to be told a lot of people using different ingredients, you have an infinite variety of products. There is an increasing consumer base for these special products. To tap into this market, you can either build a store where you put a lot of craft beers together or you can do it with a digital store, and that is what we did.”
The resulting platform of Beerwulf sees Heineken offer all products in an open system (not favouring its own special beers). While the company has some on offer, they are a minority in the portfolio offered through Beerwulf. “The platform aims to become ‘the place to go’ for special beers consumers cannot find in the local supermarket.”
Beerwulf’s operation builds on a state-of-the-art logistics platform to cater to the sheer size of different products and the delivery expectations of customers. Van Boxmeer: “The logistical machine that you have to organise has to be flawless… SparkOptimus also supported this part of the project.”
Full interview? The complete 55-minute interview with Jean-François van Boxmeer can be watched on YouTube.
