Interview: Andreas Krönke of Stickvogel: A Promissing B2B Approach to Service Customization

Copyright Stickvogel, www.stickvogel.de, all rights reserved!Most mass customization happens in the world of B2C, where a business sells its products to consumers which they have individualized to tehir needs. However, there are a number of B2B approaches as well, MC-companies offering customized services to other companies. I have called these business models "MC platforms", and they are one of the strongest developments in the field.

One of these MC platform is Stickvogel. The venture from Berlin, Germany, has been in the market of embroidery for almost 10 years now and has recently signed a deal with Butlers, a leading German "stuff" retailer (think of IKEA without the furniture, and located on high street). Certainly is a big success for a small MC company! Like with Butlers, Stickvogel enables vendors of embroidable goods to offer their consumers individualized products.

Copyright Stickvogel, www.stickvogel.de, all rights reserved!Core piece of their portfolio is a specialized configurator which can be integrated into the vendor's own web presence. Furthermore, Stickvogel takes the burden of production, logistics and backoffice services off their partner's shoulders, significantly lowering the barrier for companies to enter the market of mass customized products. 

Motivated by the great successes of the past years, the team around CEO Philip Siefer has expanded their offerings to engraving and canvas printing and are planning to broaden their portfolio further. 

All rights reserved!At the MC2012 in June we had the chance to talk to Andreas Krönke, head of public relations at Stickvogel, who kindly granted us a lot of insight into their business experiences, plans for the future, and views on mass customization in general

FTP: Andreas, Stickvogel is going to celebrate its 10th anniversary next year. Can you tell a bit about the evolution of your business?

AK: Philip, our CEO, had the Stickvogel idea in 2003. Later Stephan joined Philip and they both started the whole business in Ilmenau, where they were studying media technology at the Ilmenau University of Technology. In the first years Stickvogel was a manufacturer of personalized textiles. The focus of the company was B2C.  Then, we got IKEA as our customer. In 2006 we started with embroidering in-store in more and more IKEA stores, primarily during the time before christmas.

Last year, our cooperation with the German retailer Butlers began and we turned more into a software startup. We developed a configurator which easily enables the user to personalize a broad range of products in a very qualitative way. At the moment we offer, of course, embroidery, but also engraving and canvas print.

FTP: Your approach is (now) one of a B2B service provider. Can you outline what exactly you offer to companies?

AK: Our most important product has become our configurator. We offer the whole software package to companies which then use it in the B2C market. But not only we offer the software with back-office. Also we produce all personalized products with our very own machinery. However, it's also possible for our partners to produce products with their own machines. You see, our processes are very flexible. Finally we can overtake the complete logistics and cover the whole service like storage, customization and shipping.

FTP: You offer full service, and deal with big players. But your team seems not to be very large. How do you handle both the workload and the risk of peaks during which your capacities might not suffice to deal with all the orders? And how scalable is the package you offer?

AK: Good question. What is very important for us, is automation. All processes have to be really optimized and we always try to make it even more easy for our team in the production. Everything should happen in the quickest way possible.

Our package is very scalable and flexible. We can satisfy big customers as well as small ones like Sox & Boxers. They sell, as one could assume by the name, socks and boxer shorts. With our service they're able to personalize their textiles. And we take care of everything: storage, embroidery, pick and pack, shipping.

FTP: Besides embroiding you do also offer printing and engraving. Did that open up new markets for you? Does it work with your existing infrastructure or are major changes needed to add these techniques to your product portfolio?

AK: Everything starts with a challenge. It's always exciting to add a new product to our portfolio. But our system is so adoptable that it was no problem to integrate these new techniques. In the future we can fulfill even more wishes of our customers and, like that, explore new markets.

FTP: With Butlers you have a rather large vendor as a business partner. Can you tell about how cooperating between a company your size and their size works out in every day business?

AK: Butlers is an exceptional company with a flat hierarchy. Furthermore they are really open minded. That makes it really easy and pleasant to work with them quite close.

FTP: Many smaller MC businesses will be eager to ask one question: How did you manage to establish contact and get into a cooperation with such a large partner?

AK: Actually we were quite lucky. We had a sales promotion at IKEA, where people could experience embroidery live. There we also attracted the attention of Wilhelm Josten, the CEO of Butlers, actually more the one of his wife. By chance Philip himself was there at this very day and so the contact was set up. Philip and Wilhelm Josten kept on talking over many weeks. Don't think that pitching only lasts ten minutes. Adjustments to fit into their value creation chain were not necessary, though. By the way, the same thing happened with IKEA, they saw us during a sales promotion at Breuninger Erfurt.

FTP: Can you talk about some of your business figures and their development over time at all?

AK: We could double or triple our turnover almost every year. In 2011 it was by 300.000 Euros. But please don't tell anyone!

FTP: Which advise would you give someone starting their own MC business?

AK: At first, be passionated about what you do. If you don't love what you do, don't do it. Always stay focused and keep the overview. And don't spend to much money. Of course, we sometimes were in difficult situations, but they've never been an obstacle for us.

FTP: How important do you rate the use of social media not only to promote ones MC-company but also interact with consumers to better position oneselve in the market?

AK: Social media is definitely a key topic. Social media is MC in the internet. We're using many social media channels like of course Facebook and Twitter, where we post contributions about twice a week. But we want to increase our communication more and more, provided that our fans and followers like that. We also really like to get feedback or messages via Twitter and Facebook. But we do not only use these services. We also like YouTube to give people the possibility to peek behind the scences of Stickvogel. And we have a corporate blog that you can find on our website stickvogel.com. The use of social media is very naturally to us and it became completely common. We also use social media for internal communication. In one sentence: We love social media.

FTP: Are you considering to open up a B2C web-shop of your own, with a configurator like a "classical" MC company?

AK: Yes, we do! Keep your eyes open. Silberäffchen

[Silver Monkey] will go live soon. It is a web-shop specialized on engraving of silver products. [UPTADE: Silberäffchen has gone into beta and can be accessed via www.silberaeffchen.de]

FTP: Are there any other new products or projects in planning for you? What can we expect next?

AK: We will acquire lots of more customers in the next weeks and develop the next version of our configurator, an even better back-office and a magento plug-in. And we hope that we can offer more MC techniques. To not discriminate against other animals we want to launch an online shop for every animal. Silberäffchen is just the beginning. Besides we always have some fun projects. But those are mostly secret – for now.

FTP: Andreas, I hope your new projects will work out as well for you as your past ones and I am sure we will keep hearing about you.

All details about Stickvogel can be found on their company website, www.stickvogel.com! And to get a sneak peak of what their production looks like, here is a video for you!

 

About the Author:

Frank T. Piller is a Co-Director of the MIT Smart Customization Group at the MIT Media Lab, Massachusetts Institute of Technology, USA, and a chair professor of management at the Technology & Innovation Management Group of RWTH Aachen University, Germany, one of Europe’s leading institutes of technology. Before entering his recent position in Aachen, he worked at the MIT Sloan School of Management (2004-2007) and has been an associate professor of management at TUM Business School, Technische Universitaet Muenchen. Frequently quoted in The New York Times, The Economist, and Business Week, amongst others, Frank is regarded as one of the leading experts on strategies for customer-centric value creation, like mass customization, personalization, and innovation co-creation. His recent analysis of the crowdsourcing business model “Threadless” (co-authored with Susumu Ogawa), an innovative crowdsourcing business model in the fashion industry, has been elected as one of the Top-20 articles in MIT Sloan Management Review.