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“We want to make our clients think like online entrepreneurs”: Interview with Sebastian Theopold and Eric Klaassen.
Interview with Sebastian Theopold and Eric Klaassen.
Munich Strategy and Amsterdam-based digital consultancy BLOOM have entered a strategic partnership to advance digitization in the food & packaging, mechanical engineering and construction industries. We sat down with Sebastian Theopold of Munich Strategy and Eric Klaassen of BLOOM to talk about the partnership – the reasons behind getting together, their approach to digital strategy and the new focus in Munich Strategy’s portfolio.
“The party who owns customer data has more power.”
Eric Klaassen, Co-founder of BLOOM
Sebastian and Eric, what was the initial trigger to start this partnership?
Sebastian Theopold: Digitization touches every part of every company we work for. Every single strategy and every M&A project is affected by digital tailwind. And every digital initiative is doomed to fail without a proper strategic chassis. Therefore, rather than just adding ‘digital’ to our portfolio we wanted to make sure we really take on a new approach to digital strategy.
What is your new approach?
Sebastian Theopold: Many of our clients are global champions in either the construction sector or the food industry. Over the past decades they have developed superior business models by riding the wave of globalization and industrialization. But as digital opportunities are entering the scene it will become increasingly important to combine existing analog strategies with digital technology. To make them succeed, we help our clients to embrace the messier world of digital concepts and powerful data.
We wanted to make a visible shift in our thinking, methods and products. Our new approach is data-driven strategy because that’s what we believe in. We believe making smart use of data is the best way to know what creates an impact and what doesn’t. We don’t just applaud any new digital innovation – we want to produce measurable results for our clients. And this is why BLOOM is the ideal partner for us.
Eric Klaassen: Data-informed strategy is the core of what we do at BLOOM. By combining data science and strategy consulting, we are able to translate complex problems into actionable solutions. We do so by generating smart insights from data, or by offering custom data solutions – always focused on unlocking new growth opportunities for our clients. The team has worked in over 20 markets in different sectors as a digital strategy consultant. We have, for example, helped an online industrial auctioneer that works in the construction, food, and agriculture sector to further grow their revenues by creating a strategic roadmap of prioritized actions.
Where do you see potential for digital growth in Munich Strategy’s core industries?
Eric Klaassen: From our experience with companies in the food industry we have seen that digitization offers a wide range of opportunities, whether it is for retailers such as Picnic or food suppliers such as Friesland Campina. Driven by customer needs they are searching for ways to improve transparency throughout the value chain, and increase the sustainability of their products. The party who owns customer data has more power, this is now often the retailer. As producers and wholesalers do not have direct relationship with the end customer, they are reliant on the retailer for customer insights. For a competitive advantage, they need to increase knowledge of their end customer.
Traditional food retailers are faced with competition from new challengers, sometimes online-only players, that gain market share rapidly. Incumbents that successfully defend their position do so by improving their digital sales and marketing, increasing the knowledge of the online channel within the organization, and adopting knowledge of a data-driven way of working.
Sebastian Theopold: The construction industry and its suppliers will undergo a profound change in the coming years. We already actively support this change process for our clients today. We have, for example, developed a digital sales and procurement platform for a global manufacturer of roofing components. While its competitors are still selling through traditional retailers and DIY and complaining about price pressure and lack of customer contact, our client can already handle 40% of its sales directly and in real time. In another project we have established a very successful forecasting instrument for a producer of construction chemicals based on sales and weather data. The tool informs the company about the regional demand for its products. This information advantage enables dynamic pricing and the precise provision of quotations. In addition, sustainable effects in working capital were achieved.
Munich Strategy’s portfolio has been expanded through the partnership with BLOOM. Which additional services do you offer?
Sebastian Theopold: We think digitally in each of our projects and BLOOM has proven to be an excellent sparring partner for us. Our portfolio ranges from data-driven growth strategy and internationalization to pricing strategy and smart innovation management. Together we will place a new focus on digital transformation and digital due diligence, the assessment of a potential target’s online performance and capabilities. Cooperating with BLOOM on this part has already produced excellent results and many eye-opening moments for our clients.
Eric Klaassen: Besides from providing insights for strategy, M&A and transformation projects, BLOOM expands Munich Strategy’s offering in the direction of conception and implementation of digital solutions. Our team is able to kick-start strategy implementation with custom data products, for example an engine to dynamically determine prices or a machine learning algorithm to forecast demand for certain products. For one of our clients we built an algorithm that determines the optimal price of products offered on multiple online channels. To calculate the best price, the algorithm takes into account product characteristics, historical selling data, and competitor behavior. This approach results in over 2,000 input features that together can accurately determine selling probability and potential revenue.
Can you tell us more about your teams?
Eric Klaassen: Our team consists of analytical strategists with data science skills and online know-how. About 50% of BLOOM’s clients are pure online players, which provides a unique perspective on the frontrunners of each sector. We use a fast, agile, smart way of working that is hypothesis-driven. We’re consultants who think like entrepreneurs – something we have in common with Munich Strategy. Munich Strategy know their markets down to the smallest detail, but they also see the big picture. It’s great to be able to build on both our strengths and really work out industry leading solutions together.
Sebastian Theopold: Every CEO who wants to be successful in the digital age needs to at least think like an online entrepreneur and embrace the opportunity to learn and understand almost everything about his/her customers. BLOOM and Munich Strategy share this belief and mindset. Together we want to make our clients think like online entrepreneurs and help them move forward quickly. We both believe in long-lasting personal relationships with clients. We like tailor-made, sometimes unorthodox solutions and want to be dialogue partners who meet our clients at eye level. The Munich-Amsterdam alliance is a powerful combination and we look forward to show our clients what we are capable of doing.
“Munich Strategy and data strategist BLOOM join forces to help clients grow digitally” (Press release)