When micro-strategy creates macro opportunities
A European B2B portfolio business finds new markets for its prestige brands to realise year-on-year growth and performance aspirations.
Revenue growth was decelerating in the core market as dominant intermediaries captured a greater proportion of the sector’s profit pool and discouraged brand loyalty whilst new value for money brands began to gain traction with some customers. Management could maintain its competitiveness in the core market in the short-term but needed to find new markets to grow at a faster rate. Management turned to Focus Solutions for assistance.
Our approach was to work with management to identify key differentiating characteristics about how the brand created value for its customers – specifically superior product performance and after-sales support. Then identify and articulate seven adjacency markets where the brand was capable of leveraging brand equity and differentiation. Naturally, this included a deeper understanding of competitive axis, customer needs and dissatisfaction with incumbent suppliers, and also the development of a new market segmentation model and a new business model that included direct supply (disintermediation).
We supported management prioritise markets to enter, develop the market entry strategy, three-year business plan, marketing and sales approach, and organisation structure.
12 months after entering the new markets, average selling price was 40% higher than the core market and operating contribution from new markets accounted for 35% of total revenue. The business development pipeline is the healthiest it has ever been.