Background and Challenge
One of the leading global food ingredients companies sought our support to address perceived weaknesses in its go-to-market strategy: high costs, low customer intimacy and the perception that a “one size fits all” model was unlikely to be optimal.
Approach and Recommendations
We worked closely with a broad range of stakeholders to diagnose and understand the issues. An analysis of client profitability highlighted that the company was particularly strong in serving upper-midlevel clients: national champions, regional leaders and the like. Penetration of the world’s largest global accounts was, however, below expectations. And a long trail of small clients kept the sales force and supporting organization busy, without generating meaningful economic value.
Integrating market research, internal data and external data, we segmented the market and identified eight meaningfully different client segments that would need to be addressed in a differentiated manner. Half of these were short-listed as priority segments on the basis of both their attractiveness and the company’s ability to develop a winning differentiated value proposition.
For each of these prioritized segments, we defined the necessary product and service value proposition, price positioning and commercial agenda. Critically, we also redesigned the commercial strategy, creating four different channels:
- Two industry-focused sales teams dedicated to serving specific high-value segments with a full product offering and an expanded service model; our client went as far as developing full-service contracts for customers’ plants.
- A generalist sales team dedicated to serving large regional clients along geographical boundaries.
- A very high-touch key account management team targeting 10 of the world’s largest and most attractive global clients and prospects across Europe, Asia and the U.S.
- A new online direct channel targeted at 80% of the firm’s existing clients — either too small or not service-sensitive; this offered a limited range of standardized products in standardized formats at predefined conditions, with a simple customer interface integrated into the firm’s global logistics operations.
We knew from the outset that the success of the engagement would depend on ensuring all stakeholders contributing to the solution in order to be fully engaged in its delivery and execution. We worked in close collaboration with constituents throughout the sales organization to thoroughly understand issues, co-create the necessary solutions and test proposed solutions.
The outcome was a totally redesigned go-to-market model that dramatically increased the focus and effectiveness of the sales force, increased service levels for the client’s best and most attractive segments, and reduced headcount by over 150 FTE globally.