Evaluating potential business models
HEINEKEN wanted to play into the consumer trends of discovering & enjoying specialty beers and driving sales through a combination of traditional and digital channels and approached SparkOptimus to support them.
The first thing we did was convince HEINEKEN to take a pure digital direct-to-consumer approach and set a much higher sales ambition to truly disrupt the market. We helped to get executive level support by creating a bold vision around an e-commerce platform that meets both consumer & (small) brewer needs. Finally, we argued that HEINEKEN should appoint a senior managing director to lead this venture early on in the process.
SparkOptimus led the venture from the first day and stayed until Beerwulf.com was fully operational, while gradually transferring initiative-taking from SparkOptimus-people to Beerwulf-people. SparkOptimus and the Beerwulf team together build the new venture through our proprietary business building approach: (1) plan & prepare, (2) build & launch, and (3) optimize & scale.
The key principle behind this approach is to rapidly work towards a ‘minimum viable proposition’, which allows for testing the customer demand as soon as possible and avoids large upfront investments. Once live, daily operations deliver insights to optimize in a way that cannot be done beforehand as an academic exercise. In the fast-growing & ever-changing digital environment, achieving scale & market leadership quickly is key to success. Our approach ensures optimal speed & agility, while preparing for scale from the start.
Together we developed the proposition and made the business plan balancing customer requirements & business economics. This included building the minimal viable proposition in an iterative way for launch as well as developing a longer-term vision to work towards. For example, we iterated the expected impact of offering best-in-class delivery versus on-par delivery options on the bottom line.
The resulting proposition (assortment, pricing, user experience, service & advice, payment & delivery) was translated into organization & technology blueprints following a set of SparkOptimus principles for optimally scalable businesses. (e.g., ‘build the organization as a multidisciplinary conversion optimization machine’ and ‘develop a modular best-of-breed technology landscape’). Based on our idea, the venture was set up as a separate entity reporting directly to HEINEKEN’s Board with a fitting ‘venture capital’-inspired governance to avoid being smothered by the existing business.
As final part of the preparation phase, we created a week-by-week masterplan. Each key team member owned one or more work streams to distribute responsibility and generate ownership. The masterplan enabled the team to track overall progress and look ahead, which allowed for a go-live in seven months.
SparkOptimus and the Beerwulf team together built & launched the entire venture through three key activities: (i) assemble the team & strategic partners, (ii) build the technology platform, and (iii) prepare for MVP soft-launch.
Assemble team & select partners: The venture team consisted of HEINEKEN employees and externally recruited candidates. We set up the organization following our best practices for a disruptive organization, building it customer-first with agile processes and a focus on intrinsic talent. We temporarily filled operational gaps with SparkOptimus staff, taking on roles such as digital marketing manager, product owner, and BI, while we supported the hiring of key team members. As the team was taking shape, SparkOptimus stayed on to transfer skills and to ensure the proper processes, metrics, and dashboards were in place for data-driven decision making. We created a high-paced working environment on an agile rhythm, with the masterplan as the foundation. After each sprint the team reviewed progress, discussed new insights, and adapted the plan.
SparkOptimus identified & selected external partners to build the technology & marketing platforms. We agreed on the principle to insource core capabilities, but decided to start with external partners to accelerate in the short term. Partner selection was done in an agile way as well: no long RFP documents, but an approach in which we ran pilots with potential partners to gain practical insights, learn how to work together, and check the fit with the venture team.
Build technology platform: We defined a modular technology landscape using a combination of best-of-breed & customized solutions, staying away from monolithic ERP-type solutions as this was seen as risky & not flexible enough. We streamlined the actual platform development through on-the-ground product ownership.
Prepare for MVP soft-launch: We built a marketing launch plan by identifying relevant target groups for each phase and determining content, reward mechanisms, and channels. We developed & implemented key processes to ensure a smooth operation after go-live (e.g., how to onboard a new beer in 48 hours) and organized a closed beta test to test the operation end to end.
After launch, SparkOptimus made sure the team focused on continuous improvement & shifted gears from a ‘project’ to a ‘business-as-usual’ way of working. We refined the proposition based on data-driven insights & prepared the organization for scale-up. Also, we started active insourcing of capabilities (e.g. IT development). We ensured constant availability & use of relevant data throughout the team and implemented a commercial meeting rhythm - fully driven by KPI dashboards - to drive data-driven discussions & decision making. When the operation was ‘stable’, we launched the first mass media campaigns to reach a wider audience.
SparkOptimus enabled HEINEKEN to go from idea to launch within nine months, while building the organization and its capabilities. A crucial factor for success in achieving this was our proposed setup of Beerwulf as separate entity with appropriate corporate governance. While the Beerwulf team started out with only the MD and key leads in place, we helped it scale to a fully operational team with roles ranging from IT Manager to Assortment Hunter. Using our unique approach and principles, we ensured an agile way of working from day one, enabling Beerwulf to learn & achieve rapid growth quickly.
SparkOptimus has been an outstanding and hugely valuable partner for us. We could never have pulled this off in such a short time without their support, ranging from providing global digital best practices and objectively selecting the best partners to building our complete team & processes from the ground up
Hans BöhmMD Beerwulf (aka 'Leader of the pack')