INSIGHTS
Is your commercial strategy relevant?
Your business has a revenue number. Does it have a commercial strategy?
Most leadership teams can tell you what they sold last quarter. Far fewer can tell you why customers bought, which parts of the business actually make money, which quietly subsidise the rest, and, critically, where future revenue will come from.
This gap is expensive.
Growth is not strategy
Revenue can climb while the business gets weaker. Discounting buys volume. Complexity buys headcount. A few loyal customers can hide the fact that margins are thinning everywhere else. Without a commercial strategy, you can’t tell healthy growth from busy growth until the numbers force the question.
We saw this after a major acquisition, when a leading Australian B2B provider had to integrate a large, disparate sales organisation. The business was a $4.5bn operation, and its sales data sat in multiple disconnected sources. There was no reliable view of baselines, opportunities or risks. We built two aligned models, one for revenue forecasting and one linking revenue delivery to sales commissions. Regions, teams, and individuals finally worked from the same numbers, and the program delivered multi-million-dollar sales improvements. The revenue was never the problem. The business simply couldn’t see how it was earning it.
Research points the same way. Firms with more structured strategy practices tend to grow faster and be more profitable, especially in complex industries. Complexity is exactly where most of us now operate.
The plan on the shelf is not the strategy
Here’s the uncomfortable part. Executives report losing a large share of their strategy’s potential value to execution breakdowns, and many plans are flawed from the start, built on a single forecast and followed rigidly. The annual strategy deck may be the most expensive document in your business, and the least used.
Why this matters more now
Customer expectations are shifting faster than planning cycles. Cost pressures are reshaping pricing. New entrants and AI-enabled competitors can copy a product in months and undercut a model in weeks. A commercial strategy written in a calmer market is a map of a country that has moved. If your last serious review of how you create, capture and sustain value was before the market changed, you aren’t running a strategy. You’re running a habit.
Five questions to ask in your next leadership meeting
- Which customers, products or channels make us money, and which only make us bus?
- Can every function explain how its work connects to how we earn revenue?
- What assumptions behind our model were true three years ago and may not be now?
- Where are we competing on price because we’ve stopped competing on value?
- If a competitor rebuilt our business from scratch, what would they do differently?
If these questions get vague answers, that tells you something.
Sometimes the answer is to do less
A fitness brand with more than two million members in its history was losing market share and relevance. Its new CEO asked us to audit legacy marketing, quantify what was working and cut what wasn’t. We ran two tracks in parallel: a deep dive into sales performance data and research with customers and prospects. We recommended stopping pursuit of crowded, high-competition segments and anchoring the brand in its most loyal, mature core. The result was a leaner brand and a measurable lift in revenue. Strategy is often as much about what you stop doing as what you start.
The real cost
The cost of a missing or outdated commercial strategy rarely shows up as one dramatic failure. It looks like margin erosion, discounting that becomes the norm, teams pulling in different directions, and opportunities you never saw because nobody was looking. By the time it shows up on the P&L, it’s already been compounding for years.
Strategy isn’t something you have. It’s something you keep revising and challenging as the market around us changes. As oil prices touch and fuel prices rise across the globe, and the threat of AI paralyses decision-making, it’s more important than ever to have a commercial strategy grounded in today’s realities.
Does your commercial strategy reflect the market you’re in today? If you can’t answer that with numbers, it’s worth building the model that can. Lisa Edmonds, Founder of Emmet Consulting, wrote this article and references real-life commercial transformations delivered to clients with multi-million-dollar upsides, along with research from Bain Consulting.