How can organizations meet inevitable growth challenges? Constellation Brands’ Chief Commercial Officer, Bruce Jacobson, and Axiom Consulting Partners’ President, Garrett Sheridan, share perspectives on the relationship between data, insights and action, and how to develop strategies of investment in market and customer segments.
Garrett Sheridan: I really like that approach and mantra that you have around data, insight and action. I sometimes find with clients, especially executives that are less experienced with data, they have preconceived notions around how the business works. I will give you one example where we were able to help move from data to insight to action. We were working with a large cloud software provider in the human capital space and they sell their licenses on a per-employee basis. And when we looked at the market, what was happening was that the salespeople were naturally gravitating towards the larger accounts. Yet there was this whole swath of accounts in the middle market, in fast-growing companies that were adding employees, that were not getting the coverage.
So by just segmenting the accounts, both those they had already served and potential accounts, they were able to get about 12% growth. But getting the action required, changing other levers, we had to change the incentive plans; we had to move accounts around. Because people were flying all over each other, literally, because they had what they called ‘Xs on doors’ — accounts that (only specific individuals could serve because they had in the past). So I think sometimes to stimulate growth you need to take on some change that is challenging. Can you describe some challenging changes that you have taken on to spur growth?
Bruce Jacobson: Oh yes. There is no question. In fact, one of the projects that Axiom helped us with was the redesign of our organization several years ago. It really helped us understand where we would see the growth of the company into the future. It helped us create a mantra that we called ‘big where and when it matters.’ You may remember that because you helped us with that. The whole idea behind that is that there are going to be certain places that you know you are going to win because you are going to have success in those areas. And there are places that are just as important but just not as big, so they don’t have the impact on your business. So we will used that mantra to help understand where we put our resources from selling and marketing standpoints. There are certain weeks of the year that are always more important, when we make sure the marketing is a supported going into those weeks and all of the programs we have around our brand building are set up in a way that helps those weeks be stronger at retail. The consumers then see the advertising on TV, walk into their local grocery, liquor or convenience stores, and they see the brands coming to life like they just saw them on TV maybe the night before. All those things are all very well coordinated.
And ‘big where and when it matters’ also ties to our customer base. So we have segmented our customers, again with the help of Axiom, to understand who our strategic allies are. And we use that term very clearly and deliberately because an ‘ally’ is someone with whom you are on the same side, but you don’t have to be. It is a choice to be there. We don’t like the ‘partner’ idea because we are not partners; we are business allies. So our job is to make sure they remain allies by doing the things that keep them engaged with our business. So we use strategic allies, we have a group of distributors we call our core distributors, which are in very big cities in markets that are essential for us to win, and then we have markets where we are a little underperforming and so we invest in those; those are ‘invest’ markets. And then we have an awful lot of other markets that are called ‘enabled’ markets. We do everything we can to enable them to be successful with the portfolio and we apply that to our retail environment as well.
GS: That sounds like a highly coordinated strategy that requires working with the sales force, getting people aligned, getting your national account and distributors with the right with the right and appropriate level of focus.
BS: Yes. And so we take a little over a $5 billion beer business and we have to simplify it, and we simplify it by the segmentation. And once you understand the segmentation, it makes it so much easier for people to understand why we are investing in one place, or with one customer, and not investing exactly the same way with another one.
Other videos in this series: