6 Ways to Grow a Business into an Adjacent Space

  1. Expand along the value chain.  This is one of hte most difficult adjacency moves – De Beers extended its diamond business from wholesaling into retailing.
  2. Grow new products and services – IBM moved into global services, which now constitutes for more than 50% of the company’s revenue and pretax profits.
  3. Use new distribution channels – EAS, a leading sports supplement company, made minor changes in formulation, packaging, and celebrity sponsorship of its Myoplex sports bar and moved from a niche position in speciality nutrition stores to become the leader in its category, selling to Wal-Mart.
  4. Enter new geographies – Vodafone expanded from the UK to Europe, the United States, Germany and Japan.
  5. Address new customer segments, often by modifying a proven product or technology – Charles Schwab expanded its advisory services for discount brokerage customers to target high-net-worth individuals.
  6. Move into the “white space” with a new business built around a strong capability. This is the rarest and most difficult adjacency move to pull off. – American Airlines created the Sabre reservation system, a spin-off now worth more than the airline itself (in 2003).  Sabre, in turn, went on to create a new business adjacency of its own in the online travel agent Travelocity.

About Andre

Experience Business Developer & Alliance Partner Manager with Strong Technical Background Dealing with Complex Solutions
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