“LeisureEurope” is a major boat manufacturer that had been developed a leadership position in Europe for different types of recreational boats. In a period when the overall size of the boat market in Europe was quickly shrinking the company believed the best way to position itself was to enter the USA market.
Unfortunately the resources and the investments “LeisureEurope” made for several years to enter the USA market were not providing the results the CEO was looking for. Why did this happen?
The CEO asked Thinking Dimensions to indentify the main causes for the poor results and to support the company in implementation of a plan to properly enter the market.
The poor results were due to the following causes:
- LeisureEurope started launching products for the USA market without having a clear understanding of the customer needs and of the competition offerings
- The USA market was different from European markets:
- The size and the complexity of the USA market was much higher
- For the type of products offered by “LeisureEurope”, the concept of “leisure boat” as intended by the final user was very different
- Certain types of recreational boats that practically didn’t exist in Europe, represented an important quota of the total market in the USA
- The criteria adopted by the customers (i.e. the retailers) to select their suppliers of boats were different from the one adopted by the European dealers
In the first 2 months after the first meeting with the CE0, Thinking Dimensions helped “LeisureEurope” answer the following questions:
- Which are the main competitors in the USA market?
- Which distinctive capabilities or product characteristics could “LeisureEurope” offer relatively to the competition?
- Which customer segment were actually willing to pay a premium price for these distinctive capabilities or products?
The results of the first phase of the project were very surprising for the CEO: it showed “LeisureEurope” was competitive in a specific market segment that has not been even considered for the USA.
In the second phase of the project Thinking Dimensions worked with “LeisureEurope” to implement the market entry plan focusing specifically on the market segment that had been identified.
5 months after the first meeting with the CEO the company was already generating a volume of sales (and margins) far above the expectations of the CEO and the management team