What are some 'creative' ways to increase topline revenue?

Bain & Company BCG brainstorming brainstorming questions calculation Case Interview McKinsey profitability revenue
New answer on Jul 04, 2022
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asked on Jul 01, 2022

I recently came across a case that asked me to brainstorm ways to increase revenue in the first part.

I said to increase prices, conduct M&A to combine synergies, and capitalize on marketing to bring in more consumers. Are there any other creative solutions? I would love to hear them!

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Florian
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replied on Jul 01, 2022
#1 rated McKinsey Case and PEI Coach | 5 years at McKinsey | Mentorship Approach | 120+ McK offers in 18 months

Hey there,

Good question!

The creative aspect is super important for McKinsey brainstorming questions. The quality of your answer depends on if you cover the issue broadly at the top-level (exhaustive) and add the needed creativity and concreteness of your ideas on the lowest level of your structure.

At the top level, I would only focus on 

  1. Quantity
  2. Price

Keep it simple BUT exhaustive (as in covering the whole problem), then dig, deeper and create creative ideas on the lower levels.

For instance:

Ideas related to quantity:

  • Upsell
  • Cross-sell
  • Get repeat customers and repeat purchases
  • Enter new markets
  • Add new distribution channels
  • Launch new products or product lines
  • Bundling of products
  • Offer new (deferred) payment terms (gives access to new customers)
  • Discounts (think about interdependencies with price dimension)

Ideas related to price:

Break the price down into its components and raise all (think about what airlines are doing)

  • Price increase for product / service (think about interdependency with quantity)
  • Purchase fee
  • Credit card fee
  • Delivery fee

All depends on the actual industry you are working in since the answers need to be tailored, relevant and concrete for McKinsey.

Learn more about McKinsey structuring and brainstorming here: https://www.preplounge.com/en/articles/mckinsey-interview

Cheers,

Florian

 

 

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Rahul
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updated an answer on Jul 01, 2022

Hey there, 

You haven't provided details about client and the industry.   Ideas should be relevant to the case context , client capabilities and the industry. Standard revenue growth structure may not suit the purpose. Also you should look to segment or structure the problem into logical branches that will help you more creative . For example, 

(1) Increase volume 
(1.1) Acquire more customers in existing market - (M&A or taking market share from competitors, geographic expansion)
Creativity - Hypothesis: There are fast growing customer segments or geographies that we have not been focusing 
(1.2) Sell more to existing customers (e.g. expand product offerings) - Creativity - Hypothesis: There are adjacent product categories that we have capability to produce and customers would be willing to buy from us

(2) Increase avg. price
(2.1) Increase price of existing products (depending on price elasticity) Creativity - Hypothesis: There are certain products in our portfolio thar are not optimally monetized  
(2.2) Product mix. Focus on premium products in the portfolio Creativity - Hypothesis: Diverting some of our manufacturing and sales capacity towards higher value products will increase revenues 

 

(edited)

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Moritz
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replied on Jul 04, 2022
Unearth your spike & get the offer |ex-McKinsey | 120+ coachings & interviews @ McKinsey | ESADE MBA | Transition Expert

Hi there,

Sounds a lot like the first question you would be asked in a McKinsey interview. The best answers to this kind of question are specific. However, without a context, this is not possible.

Generally speaking, your variables are price and quantity. You can increase/decrease them to grow the topline. However, that's not a good answer and way too generic.

Depending on the specific context of the company i.e. business model, industry, product line, ownership structure, region, macro economic trends, strategy, balance sheet, etc., your answers should be tailored accordingly. When you take all these factors into account and manage to come up with specific and creative ideas, that's where you will impress people!

Hope this helps! Best of luck!

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Ian
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replied on Jul 02, 2022
MBB | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

Hi Alice,

This totally and completely depends on the industry!

Remember that even while being “creative” you still need to be structured!

If you can give us an industry, we can help here, but here's a random list for the car industry:

  1. Move DTC (get rid of dealerships)
  2. Sell add-ons
  3. Sell more maintenance/repairs
  4. Sell customization
  5. Build a platform for “renting” and “loaning” cars
  6. Sell brand accessories (shirts, bumper stickers, etc.)
  7. Change pricing model/payment (subscription, crypto, etc.)
  8. Sell electricity or create mechanism to sell electricity from car battery
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Florian gave the best answer

Florian

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