Improvement of digital service platform business models to enter new markets

Abstract

AkzoNobel wants to explore new business models to anticipate on the ever-changing market needs of customers by integrated digital service platforms in their business. AkzoNobel invested in a new Joint Venture business entity Zervices (ZRVCS) to develop a service platform for the Have It Done paint service. The first market entry selected by this concept was in Belgium, which has currently not reached the predicted business KPI’s. The order intake has not reached the break-even point yet. Many suggestions were given for this slow start, but a concrete problem identification lacks. This led to the following question: “How can we improve service platform business models to enter new markets in the have it done professional paint industry?” In order to identify the problem for the slow start in Belgium and to propose future strategies for ZRVCS, a theoretical framework was made based on business model innovation, important factors for developing competitive advantage and market entry methods. This was used to analyse three case studies with interviews: Uw Schilderwerk, ZRVCS Belgium and ZRVCS the Netherlands. The first case, was the proof of concept Uw Schilderwerk in the Netherlands, which had problems during the start-up period. By resetting the business from year one with a good internal organization, improved platform and financial resources they became the biggest painting company in the Netherlands. This shows that the three factors from the framework are important for their success. Building on this knowledge the case of ZRVCS Belgium was analysed. Different reasons were given during the interviews and the target group of ZRVCS Belgium and Uw Schilderwerk was compared. All these things showed that the business model missed all three factors from the framework, showing the problems of the market entry in Belgium. The last case was the entry in the Dutch market ZRVCS together with de Consumentenbond using a market penetration strategy. The Dutch market is considered an attractive market due to the success of Uw Schilderwerk. During this entry the important aspects for market entry were shown, such as the importance of an attractive market and good collaboration with partners, such as established brands, de Consumentenbond and Sikkens/AkzoNobel.