This case requires candidates to combine quantitative analysis (market share and incremental revenue calculations) with strategic brainstorming tailored to a specific consumer segment. The key insight is recognizing that low-income consumers have different purchasing behaviors and preferences across product categories, requiring a customized market entry strategy rather than a generic expansion approach.
Our client is a large, multinational consumer products company with business in over 200 countries. Today, we are going to focus on its US business. It has been following US demographic trends and has found that low income households have been growing 2X (twice) as quickly as other consumer segments. Low income is defined as families with income at the poverty level or below.
Our client has always had a premium product strategy. It sells its products in grocery stores, convenience stores, mass retailers, etc., but its products are always priced at the high-end of their respective categories. It has never targeted the low income segment before and doesn’t have a strategy to do so, but, given the growth of this segment, our client is considering entering the low income segment.
Our client has 3 questions for BCG: