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  Market Structure Study Helps Client Make Dramatic Shift in Strategic Direction  
" The domains provided much needed discipline for our team and our brands,” commented the Business Unit Head. “With the results from the NuVista study we now have a more focused vision and goal to accomplish for our division.”
A major consumer products manufacturer had enjoyed ongoing success in building and extending its brands through the 1990’s and into the new millennium. But by 2002, brand sales had slowed or were declining despite major investments in consumer spending and aggressive new product efforts. Management wanted to take a step back and gain new insight into how its brands were used and purchased by consumers and to set a new course for growing its businesses.
NuVista’s Approach
NuVista Strategies was retained to conduct a comprehensive Market Structure study in 25 product categories. Syndicated purchase data was combined with the diary records of product usage by over 2500 consumers during a two week period. NuVista utilized its own proprietary models to determine usage domains and used switching methodologies to build purchase models. NuVista integrated the models with its own algorithm. The research findings would prove to be groundbreaking for the client and resulted in fundamental changes in its brand management and marketing efforts.
Key Findings
NuVista’s modeling led to a startling revelation. Products and brands in the client’s market space fulfilled very different roles for consumers than was the conventional wisdom. In fact, it revealed that the client’s brands needed to stay much more focused on particular “segments” than they previously realized, as attempts to cross-over these domains would not be seen as credible by consumers and would weaken the brands.

It was clear that the client would need to change course on some key strategies. Competitors had been similarly in the dark with respect to the consumer-based segments, which provided an opportunity for our client to gain a competitive advantage.
  Market Structure studies often lead to profound insights and profound actions. In light of the findings, our client took several dramatic steps:
Halted wasteful spending and shifted it to high potential areas.
By understanding how consumers viewed the brands and how they used them in their households, simple changes could be made in the brand communications that correctly aligned the new products with the consumer domains. Consumer spending efforts that were determined to be inefficient from the structure study analysis were moved to high opportunity programs.
Refocused new product efforts.
Many opportunities arose that were completely consistent with the domains identified in the study. NuVista’s models were able to accurately quantify the volume potential of each of the top six ideas in the pipeline at the time so that efforts could be focused on the highest potential 2-3 projects.
Equipped Sales to add value and overhaul retail approach.
Equipped with quantified new insight about consumer behavior and the interaction of various products, our client’s sales organization was able to recommend a new approach to retailers for organizing retail store sections. Instead of organizing products by brand or a general category, planograms were recommended based on the domains identified in the study. This helped organize sections into logical groupings by the domain needs as defined by the consumer – making the products and sections easier to shop and more efficient and profitable for retailers.
Reorganized the marketing department.
Brands had previously been managed as separate business units with an “every brand for himself” mentality that had fostered much of the competitive cross-domain efforts that had proven inefficient. Brand management was realigned by domains identified through the NuVista study to take full advantage of each brand’s potential within their consumer usage set. Brand management could now position and market brands in sets that fit the way consumers used them.
Since the study was completed in 2004 and new strategies implemented, our client benefited quickly from its new strategic direction. Sales in the division were up 25% in 2006 and all major brands have reversed sales declines and are enjoying strong growth. In addition from base brand improvement, new product efforts have also been very successful in driving new growth.
© NuVista Strategies, Inc. 2011. All rights reserved.