New B2B Markets in Financial Services
Overview and Problem Summary
A Fortune 1000 financial services company had committed to an ambitious growth plan. Achieving that plan required identifying and expanding into new geographic markets. The question was: how to identify the best markets to enter and in what order. Unwilling to trust corporate capital to pure guesswork, the client asked Enabled Concept to build a model which could forecast which markets to enter and in what order.
Solving the problem involved first understanding what made their existing offices successful. So EC built a model of existing office profitability that took into account the customers, prospects and competitors in the area surrounding the existing offices. We then constructed a database of all the the cities in the US with populations over 250,000. Each city had the locations of all potential prospects and competitors, so we could use our office profitability model to predict how successful an office might be an any city.
The result was an interactive tool which allowed the client to identify the most profitable locations and avoid costly mistakes of investing in unprofitable ones.
It creates value by…
- Predicting which new offices will be most profitable
- Predicting how long it will take to become profitable
- Identifying which existing offices may not be correctly located
It’s usable in two ways.
- There is a suite of visual tools which allows the user to scan the US graphically and zoom in on areas of predicted profitability.
- This approach is also allows the user to identify potentially unprofitable locations
- Recommendation: The solution also provides a rank-ordered list of the top locations based on predicted revenue a maturity
The solution was completed in two months, approximately 2 years ago.
It became the primary decision making tool, guiding the selection of new offices. Several offices have been successfully opened based on the system’s predictions and one non-performing office consolidated, dramatically increasing revenue and profitability.