From Roy is an online business delivering luxury, artisanal panettone. The project brief was to develop a sustainable business model in which From Roy can thrive to exceed the yearly demand quota to cover for yearly fixed costs whilst maintaining the high quality of the products and the experience sold and providing a comfortable earning model for From Roy. Our team iterated and developed several possible directions that the business could take, finally landing on the recommendation of a subscription model that would help the business generate consistent revenue throughout the year, create a deeper connection to their customer base and potentially tap further tap into a rapidly growing market.
Strategy Designer, Client Services
Business Model Innovation, Customer Research
Discovery began with establishing a clear understanding of the clients' motivations, needs and goals.
After establishing the brief, we began to understand the challenges that the business was facing, and where there was room to intervene. We used the design criteria canvas to determine how flexible the business model was, and how much room their was for adjustment.
We also went through customer records and data to understand consumer buying patterns, pain points and uncover what people loved about the business. We learned that 'From Roy' was adored by customers, and while they faced some operational challenges around customer services, the quality and craft associated with the product had led to a loyal and ever growing customer base.
Having defined the goal of the project as helping the business see more consistent sales around the year, we moved on to the next phase of ideating a number of business models that could help From Roy grow their business.
DESIGN + DEVELOP
We generated several models and clustered the ideas around themes such as new products, services or experiences the business could develop.
Three models were shortlisted based on alignment with the client's needs and potential for profitability. These were shared with the client in order to uncover what did or did not work about each model. This gave us an opportunity to develop the model together with the client, making it more viable and actionable.
After this process, the team used the client session as a guide to design a new business model that took the best of previously developed models and built it into a cohesive system that would not hamper the existing operations, or require a large investment of resources.
The next step was to validate the assumptions on which the new model was built. We sent out mailers to existing customers to gauge interest in a panettone subscription, as well as test price sensitivity. We surpassed our set metrics instantaneously, with a number of customers reaching out in support of the idea and indicating a clear willingness to pay.
The adjustment to the client's business model was estimated to have a 19% increase in sales in the first year without having to acquire new customers, with a potential growth rate of 34% over 2 years on targeting a wider audience.