ROI Case File No.281 | 'PromoX's Promotional Support Dilemma'

Chapter 1: Requests Beyond Capacity — Overflowing Inquiries, Insufficient Resources

The week following the resolution of Printora's Pirate Metrics case, a consultation arrived from the East Coast regarding a promotional support company's strategic crisis. Episode 281, opening Volume 23 "The Pursuit of Reproducibility - Sequel," tells the story of identifying one's strengths and weaknesses and choosing the battlefield on which to fight.

"Detective, we cannot keep up with client requests. They ask for everything—planning, design, development, maintenance. But we have no engineers. We can't discern what to accept and what to decline."

PromoX's business development director, Sarah Miller from Boston, visited 221B Baker Street unable to hide her confusion. In her hands were a list of 30 development projects and estimates, each marked "under consideration."

"We provide promotional support for BtoC businesses with physical stores in Massachusetts—retail shops, restaurants, and service businesses in shopping districts. We've been supporting their online customer acquisition. But now, the requests exceed our capabilities."

PromoX's Capacity Crisis: - Founded: 2017 (BtoC promotional support) - Clients: 128 companies (retail and dining with physical stores) - Annual revenue: $15 million - Employees: 22 (12 planners, 8 designers, 2 sales) - Engineers: 0 - Development projects (under consideration): 30 - Declined projects: 18 (past 6 months)

Deep anxiety showed on Sarah's face.

"The problem is that customer demands have shifted from 'planning and design' to 'development and maintenance.' Requests have changed from 'please handle our social media posts' to 'please build a reservation system,' 'construct an e-commerce site,' 'maintain a membership management system.'"

Shifting Customer Needs: - 2020: Planning and design focus (social media management, flyer creation) - 2023: Increased development and maintenance requests (reservation systems, e-commerce, membership management) - Background: COVID-19 accelerated online transformation, rapid increase in DX demand for physical stores

PromoX's Difficult Response Cases:

Request A: Café Chain (15 locations) "We want a mobile ordering system. Customers can order from QR codes in-store." → PromoX: No development capability, outsourcing eliminates profit

Request B: Beauty Salon Group (8 locations) "We want to customize our reservation system. The existing system is unusable." → PromoX: No maintenance structure, cannot accept

Request C: Local Supermarket (3 stores) "We want to launch an e-commerce site, including product registration and delivery management." → PromoX: Technically unable to respond, abandoned

"We're losing clients. But we cannot fulfill all demands either. What to give up, where to focus—we cannot make that judgment."

Chapter 2: The Intersection of Internal and External — The Path Shown by Four Quadrants

"Sarah, what criteria guide your current project acceptance decisions?"

To my question, Sarah answered with a bitter expression.

"Basically, it's a feeling of 'can we do it or not.' We can handle planning and design. But when development is involved, we're suddenly lost. Sometimes we search for outsourcing partners, but costs don't align, and we usually end up declining."

Current Decision Process (Intuitive): - Decision maker: Business development director (Sarah's) intuition - Criteria: Only "can we do it ourselves" - Outsourcing consideration: Individual search per project - Result: 30 considered, 12 accepted, 18 abandoned

I explained the importance of clarifying one's own position.

"It's impossible to fulfill all customer demands. SWOT analysis—visualizing internal strengths and weaknesses, external opportunities and threats, and selecting the battlefield. That's the first step in strategic division of labor."

⬜️ ChatGPT | Catalyst of Concepts

"Those who try to answer everything lose everything. Focus on strengths."

🟧 Claude | Alchemist of Narratives

"Companies are not omnipotent. Choosing the stage where you shine is the art of survival."

🟦 Gemini | Compass of Reason

"SWOT analysis is a compass of choice. Derive the best from four strategies: SO, WO, ST, WT."

The three members began analysis. Gemini deployed a "Promotional Support Industry-Specific SWOT Analysis" framework on the whiteboard.

SWOT Analysis Four Elements:

Internal Environment: - Strengths - Competitive advantages - Weaknesses - Competitive disadvantages

External Environment: - Opportunities - Favorable external circumstances - Threats - Threatening external circumstances

"Sarah, let's discover PromoX's true strengths and winning domains."

Chapter 3: Anatomy of Facts — The Gap Between Self-Assessment and Reality

Phase 1: Identifying Strengths (2 weeks)

First, we listed what the company recognized as "strengths."

Self-Perceived Strengths: - Understanding of physical retail business - Regional relationship-building capability - Planning and design quality - Price competitiveness - Rapid response

Next, we verified whether these truly constituted "competitive advantages."

Objective Evaluation:

Understanding of Physical Retail Business: - PromoX: Planners with field experience in retail and dining - Competitors: Major agencies lack physical store experience, web specialists - Customer feedback: "They understand our on-site struggles" (92%) - Conclusion: True strength (differentiation factor)

Planning and Design Quality: - PromoX: Customer satisfaction 4.6/5 - Competitors: Major firms 4.2, small firms 3.8 - Repeat rate: 78% (industry average 52%) - Conclusion: True strength

Development and Technical Capability: - PromoX: 0 engineers - Competitors: Major firms have dedicated teams - Conclusion: Clear weakness

Price Competitiveness: - PromoX: Planning costs 70% of major firms - However: In development projects, outsourcing costs reverse this - Conclusion: Strength in planning, weakness in development

True Strengths (2): 1. Deep understanding of physical retail business (field experience) 2. Planning and design quality and speed

Phase 2: Identifying Weaknesses

Clear Weaknesses: - Development capability: 0 engineers - Maintenance structure: No technical support - Financial resources: Cannot handle large-scale investments - Brand recognition: Inferior to major agencies

Phase 3: Identifying Opportunities

External Opportunities: - Rapid increase in online promotional demand for physical stores (35% annual growth) - COVID-19 accelerated DX for small businesses - Major agencies avoid small projects (minimum contract $40,000+) - Government DX support subsidies for SMEs

Phase 4: Identifying Threats

External Threats: - Major agencies entering SME market - Development companies advancing into promotional support (integrating technology × planning) - Rising customer expectations (development and maintenance becoming standard) - Intensifying price competition

Phase 5: Creating SWOT Matrix

We arranged the four elements in a 2×2 matrix and derived strategies.

SO Strategy (Strengths × Opportunities): - Strengths: Store understanding + Planning capability - Opportunities: DX demand from small businesses - Strategy: Specialize as "Physical Store DX Planning Experts," collaborate with trusted partners for development

WO Strategy (Weaknesses × Opportunities): - Weaknesses: No development capability - Opportunities: Rapid DX demand growth - Strategy: Strategic alliance with development specialists

ST Strategy (Strengths × Threats): - Strengths: Field understanding - Threats: Major firm entry - Strategy: Differentiate through "field intimacy" (what major firms cannot replicate)

WT Strategy (Weaknesses × Threats): - Weaknesses: No development capability - Threats: Development company entry - Strategy: Withdraw from pure development projects

Chapter 4: Designing Strategic Division of Labor — Focus on Expertise, Partner for Weaknesses

Phase 6: Constructing New Business Model (1 month)

Based on SWOT analysis results, we designed PromoX's new positioning.

New Strategy: "Physical Store DX Planning Specialist + Development Partner Collaboration"

Domains PromoX Handles (Leveraging Strengths): 1. Field interviews and problem identification 2. DX strategy planning 3. UI/UX design 4. Continuous client support

Domains Partners Handle (Compensating Weaknesses): 1. System development 2. Infrastructure construction 3. Technical maintenance 4. Security measures

Phase 7: Selecting Development Partners (2 months)

We carefully selected strategic alliance partners.

Selection Criteria: - Capacity to handle small and medium projects - Flexibility to understand PromoX's planning - Price transparency - Trustworthiness for long-term cooperation

Alliance Partner: TechBridge Inc. (SME-focused development specialist) - Track record: 100+ system development projects for retail and dining - Strength: Handles small projects (from $4,000) - Contract type: Comprehensive alliance, not project-by-project

Alliance Details: - PromoX handles planning and design, TechBridge handles development and maintenance - Profit distribution: PromoX 60%, TechBridge 40% - Customer window: PromoX provides unified response - Quality assurance: Joint responsibility

Phase 8: Executing New Model Projects (6 months)

We re-challenged previously abandoned projects with the new model.

Project A: Café Chain Mobile Ordering (Re-attempt) - PromoX: Field research, order flow design, UI/UX design - TechBridge: System development, payment integration, maintenance - Duration: 3 months - Revenue: PromoX $35,000, TechBridge $23,000 - Customer satisfaction: 4.8/5 - Results: 40% reduction in order processing time, +18% sales

Project B: Beauty Salon Reservation System Customization - PromoX: Booking operation analysis, improvement proposals, screen design - TechBridge: Existing system modification, staff training - Duration: 2 months - Revenue: PromoX $15,000, TechBridge $10,000 - Results: 85% reduction in booking errors, improved customer satisfaction

Results After 6 Months:

Business Metrics: - Order acceptance rate: 12/30 (40%) → 24/30 (80%) - Annual revenue: $15M → $23M (+56%) - Operating profit margin: 8% → 22% - Customer satisfaction: 4.6 → 4.9

Strategic Achievements: - Focus on strengths: Concentrated resources on planning and design - Overcoming weaknesses: Partners handle development, no risk - Differentiation established: Unique positioning of "field understanding × technology"

Customer Testimonials:

Café Chain Owner: "Major agencies told me 'minimum $40,000.' PromoX understood our field needs and proposed only necessary features. Development was smooth, and now they're an indispensable partner."

Chapter 5: The Detective's SWOT Diagnosis — Opening of Volume 23

Holmes compiled the comprehensive analysis.

"Sarah, the essence of SWOT is 'self-awareness.' Trying to answer everything is the same as achieving nothing. Identify your strengths and focus there. Acknowledge weaknesses and complement them with trusted partners. That is the path to sustainable growth."

Final Report 12 Months Later:

PromoX became a leading company in physical store DX support on the East Coast.

Final Results: - Annual revenue: $15M → $35M (2.3x) - Clients: 128 → 285 companies - Alliance partners: 1 → 3 companies (expanded by specialty) - Industry reputation: "The most field-understanding promotional partner"

Sarah's letter expressed deep gratitude:

"Through SWOT analysis, we transformed from 'generalists' to 'specialists.' Most important was the courage to acknowledge weaknesses. Not being ashamed that we can't do development, but making it the reason to partner with those who have that strength. Now, when considering new fields, we always evaluate with SWOT. Choosing the battlefield is the first step to victory—this we now understand."

The Detective's Perspective — Prologue of Volume 23 "The Pursuit of Reproducibility - Sequel"

That night, I reflected on the essence of strategic choice.

Volume 23 is a journey of applying frameworks learned in Volume 22 to more complex realities. What PromoX faced was the conflict between the goodwill of "wanting to serve everyone" and the reality of "being unable to serve everyone."

SWOT analysis becomes a compass to resolve this conflict. Identify strengths, acknowledge weaknesses, seize opportunities, avoid threats. And most importantly, decide "what not to do."

"A company's strength is determined not by what it can do, but by what it focuses on. And the courage to acknowledge weaknesses creates true strength."

Volume 23 now opens. The next case will also depict a moment when reproducibility carves out a company's future.

"Those who try to serve every customer reach none. Only those who deeply understand one customer are chosen by many."—From the detective's notes

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