A geographic targeting index in action
We worked with a residential and commercial services company that provides a building repair service and had used geographic analysis to target rural markets, specifically those close to distribution centers that would give it faster access to its installation product.
As we quickly identified, the company’s then-current footprint captured only 19% of demand; there was significant white space left over.
In order to evaluate areas into which the client could expand its services, we performed a robust regression analysis to identify new markets with attributes similar to those of its highest-performing existing markets. In doing so, we discovered that our client performed best in high-income markets with lower median housing values, low vacancy rates and a high concentration of suburban families with young children. We subsequently determined which of these attractive markets were within a reasonable drive time from the company’s regional headquarters and its suppliers’ distribution centers.
With our help, our client was able to prioritize a near-term pipeline of 10-15 new markets that would give it access to an additional $1.2 billion to $1.4 billion in market demand. We also built out a longer-term pipeline of markets that added an incremental $3.5 billion to $4 billion in market access for the company.
As a result of our work, our client has already started entering these new markets with a lot of success, and is considering opening new regional headquarters to help facilitate its entry into markets in other parts of the country.
The world is only getting more competitive, and the residential services space is no exception. That’s why, for providers of residential services, geo-targeting is a necessary component of growth. Getting smarter on data can help companies find the right target in a market that may otherwise not be appreciated.
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