Sarpco
A Tire Recycling Company unlocking new innovation routes in order to gain Competitive Advantage
Project Type
Innovation
- Business Model Design
- Research & Audits
- Brand Architecture
Challenge
SARPCO is a tire recycling company and recycled rubber downstream products producer located in the KSA. They serve multiple industries, such as tire recycling, commercial flooring and also sports field solutions. They reached out to Blue Hat at a stage where they were suffering from a Red Ocean strategy; competing in a highly saturated market with a capacity below market standards. However, they were still hoping to use their well-known brand name to pull away from this situation. They commissioned us to suggest new product ranges to offer within their existing capabilities, and to design a roadmap to help them gain global recognition and market leadership in the KSA.
Intervention
We’ve kickstarted our innovation strategy with several research methods at once to discover and gather various insights on the company as well as the industries they serve.
In order to get to know more about Sarpco, we conducted elaborative interviews with C level and departmental managers and audited their current market positioning and marketing strategies based on official reports and documentations. Then, we published an anonymous survey in order to assess their company culture and internal dynamics, and had an online tour at the company to get a sense of the work environment and conditions.
Concurrently, we conducted a detailed market research on international market dynamics, trends and standards, mapped out the best practices and future possibilities like design driven solutions, digital transformation, innovative partnership models and new ways to enhance customer experience. We also researched into the Kingdom's future vision and regulations regarding recycling, usage of recycled materials and sports.
In the light of our research outcomes; we analysed Sarpco’s tangible and intangible resources, mapped out their current business model and conducted a competitor analysis to assess Sarpco’s overall competitiveness, strengths and weaknesses in all the markets they operate. After that, we created a competitor segmentation chart to showcase all the companies operating within the industries that Sarpco serves (Tire Recycling, Recycled Rubber Downstream flooring materials, Commercial Flooring, Industry Specific Flooring, Industry Specific A-Z Solutions). This chart determined Sarpco’s main problem: trying to compete in various industries with a tremendous amount of competitors at the same time. In fact, it resulted in causing a flagrant stress on their market positioning, having no long term differentiation or competitive advantage.
Based on our research outcomes, we decided to set up a workshop with Sarpco’s C level managers to showcase to them the company’s current situation and to map out a new strategic vision that would benefit them in the long run. We used alignment squared model framework to assess their value proposition, value demonstration, target markets, offerings and key differentiators by categorising each sub feature to be continued, postponed, stopped, and started. This procedure emphasized on the fact that the client did not want to give up on any industry that they served which made us act strategically and therefore suggest a completely new brand architecture structure.
To be able to differentiate between Sarpco’s business lines, give them market focus and enhance each one’s customer experience, we suggested two brand architecture structure models to follow: Branded House or Endorsed Brands. No matter which structure they would go for, we built up our innovation strategy that would treat each of Sarpco’s main services as separate companies (Sarpco Production, Sarpco Commercial Flooring, and Sarpco A-Z Sports Solutions). We provided specific innovation routes for each sub-company.
Sarpco Production
Their aim revolves around producing high quality crumb rubber and SBR powder to offer a variety of rubber downstream products that serve various industries. We suggested new downstream products that they can offer with their existing machinery and new partnership possibilities, events to attend, certifications and awards to aim for with the intent of earning global recognition and gaining market leadership in the KSA. We created a more simplified and structured business model and also defined a unique market positioning for Sarpco Production as a stand alone company.
Sarpco Commercial Flooring
This company’s aim is to provide creative and customisable flooring solutions based on the client’s needs. Their objective is to become a customer-centric organization and enhance their supply chain with innovative and premium offerings. We provided new flooring ranges, complementary solutions, installation and layering techniques to adapt. We also suggested who to partner up with to revamp their brand ecosystem, build strong partnerships, and events to attend. We found that it is preferable for them to reach architects & interior design firms alongside their existing target of contractors & construction firms. Moreover, we designed a new business model and also defined a unique market positioning for Sarpco Commercial Flooring as a stand alone company.
Sarpco A-Z sports solutions
We defined their purpose as to elevate the level of sports facilities across the Kingdom and empower them to reach their goals. Therefore, we suggested a new range of services to offer and to become more customer centric such as consulting, concept creation, training services for client’s employees, enhanced maintenance solutions, experiential showroom and many more. We also defined a wide range of products to offer from sports flooring ranges to lighting systems, sports equipment and digital solutions. We recommended innovative partnership opportunities, events to attend and accreditations to look out for in order to increase their market reach. We also designed an innovative business model and defined a unique market positioning for Sarpco A-Z Sports Solutions as a stand alone company.
Results
We restudied their business structure, provided them with opportunities to increase their network, and suggested new technologies to boost their product performance. On top of that, we also set out possibilities to create product systems within their existing portfolio and came up with new services and channels which will create an enhanced customer experience and lead to market leadership as well as global recognition.
As a finishing touch, we asked the board members to rate their main business considerations and grade each innovation route that we’ve suggested based on certain criterias such as industry diversification, R&D investments, return on investment (ROI), by using a weighted matrix.
Overall, we ensured that our innovation strategy would provide solutions for all three sub-brands to help them innovate on multiple levels.
INNOVATION ROUTES
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