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McKinsey Medium Profitability

Contact Lenses

#Consumer Goods
ProHub Comment

This is a structured profitability case that requires candidates to isolate the revenue driver (channel distribution) through process of elimination. The case tests both quantitative analysis (profitability calculations by channel) and strategic thinking (resource reallocation), culminating in an optimization problem around sales rep call frequency. The interviewer-driven format allows flexibility in candidate approach while maintaining focus on the core insight.

Estimated Time 27 minutes
Difficulty Medium
Source Chicago Booth
40 / 100

Your client is a well-known contact lens provider called BB. BB manufactures and distributes contact lenses in the U.S. While BB is one of the largest players in the U.S. market, and has been for quite some time, the company feels that compared to its main competitor, it is not doing as well as it could.

BB has called in McKinsey to find out how to solve this problem and to recommend a solution.

How would you go about structuring this case?

Clarifying Information

  1. For the scope of this case, BB manufactures and distributes only in the U.S.
  2. Demand for contact lenses has been growing steadily at about 3% annually
  3. The client and its main competitor each sell about 10 Million contacts per year
  4. The industry has high barriers to entry (since a high R&D outlay is necessary), is mature (20 years plus), and is dominated by BB and its competitor, who are equal in most areas.
Mock Interview
Interviewer

Your client is a well-known contact lens provider called BB. BB manufactures and distributes contact lenses in the U.S. While BB is one of the largest players in the U.S. market, and has been for quite some time, the company feels that compared to its main competitor, it is not doing as well as it could. BB has called in McKinsey to find out how to solve this problem and to recommend a solution. How would you go about structuring this case?

You

Thanks. Before analyzing, I'd like to clarify a few key questions...

Interviewer

Good question. Let me provide some background information...

You

Based on this, I suggest analyzing from these dimensions...

AI Score
Structure Analysis Communication Business Sense Quantitative
Practicing...
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Practice this case with AI Mock Interview

BB, a contact lens manufacturer, seeks to improve profitability relative to its competitor. Through framework-based analysis, candidates identify that while costs are competitive, BB underperforms in the high-margin doctor’s office channel compared to lower-margin big box retailers. The solution involves reallocating sales resources to maximize calls to the most profitable customer segment.

Key Insights:

  1. Profitability problems require decomposition into revenue and cost components; this case isolates the issue to channel mix rather than pricing or costs
  2. Channel profitability varies significantly (9% margin for big box vs 57% for doctor’s offices), making distribution strategy a critical lever
  3. Optimization problems require understanding constraints and trade-offs; maximizing revenue per sales rep involves balancing mandatory baseline calls with incremental high-ROI calls
  4. The case rewards candidates who eliminate possibilities systematically using industry knowledge and economic reasoning rather than jumping to conclusions