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In an expanding market, revenue growth will drive profit margins more than cutting costs. Here’s how Redwing helped one cellular company invest US$200m profitably. The key task was to gather small-area geographic data for the whole country, and use this to build a Geographic Information System (GIS). This data was then combined with customer segment data, to identify where potential customers lived and worked. The overall investment was split into 4 phases, and within each phase a priority ranking of target cities was developed. Redwing then implemented a tracking process to manage investment spend and track investment returns. |
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The outcome |
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The initial situation |
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Redwing’s solution |
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The client’s position Already strong in the major cities Planned to spend US$200m to launch their product in 20 new cities over a two year period
The problem our client perceived Where should we spend our marketing, sales and product development budget?
The root cause of the problem identified by Redwing Unclear criteria for evaluating the ranking of target cities No definition of what makes a good customer Limited datasets meant that the company didn’t know where its best customers were located |
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Created a data-rich Geographic Information System (GIS) for the whole country
Performed a detailed analysis of population centers to identify target customers, profitability and payback periods
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Defined numeric criteria to evaluate small area market potential Prioritized investments into four phases of |
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Implementation milestones
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Established a program management function that tracked and evaluated the investment phase |
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Post-launch performance
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Market share rose from 18% to over 30% in targeted areas
Revenue increased by 12% without any increase in investment commitment
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Company focused resources intensely onto the areas of highest potential
Sales, marketing and product investment focused onto most profitable customers |
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Improve profitability by maximizing revenue |
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© Redwing Consulting, 2010 |
