“Leverage” from the flagship product

Phu My Industrial Park has triggered the development of auxiliary products for the people working here such as houses for lease, supermarkets, schools...

However, for many businesses, this approach remains quite unfamiliar. So, what is a flagship product strategy, and how important is it to the growth of your businesses?

Spillover effect

Vung Tau is one of the coastal cities in Vietnam that has thriven in tourism. Tourism products have become a mainstay to attract tourists to Vung Tau. These tourism products have resulted in the gradual development of their auxiliary products, such as hotels, resorts, passenger transport services, food services..., followed by services for tourism human resources in Vung Tau: supermarkets, cafes, cinemas, houses...

In contrast, Phu My, a town of Ba Ria-Vung Tau province, is not developed in tourism. Their core offers are heavy industrial products: petroleum, thermal power, steel, plastic. Phu My Industrial Park has triggered the development of auxiliary products for the people working here such as houses for lease, supermarkets, schools... The more industrial products in Phu My develop, the more ancillary products, as well as the local people's life, will improve.

As a result, key products have a strong impact on many other business sectors. The development of the former will help the entire value chain as well as the whole locality to develop.

Ancillary products development

In fact, many business managers have also developed a strategy for the flagship product. Among the company's products, they choose a core product to develop many ancillary ones.

VinGroup is a very typical example: Housing products are one of their key products, thereby many ancillary products have been developed to serve VinGroup apartments: VinMart (now transferred to Masan) helps residents to shop right at the residential area; VinSchool provides residents’ children with high-quality educational services; VinMec offers medical services to Vingroup’s residents…

Or another corporation has also used this approach to speed up ancillary segments. Starting as a car company specializing in intercity passenger transport in the southern provinces, Phuong Trang has taken advantage of its key product to expand its related business segments: rest stops for both drivers and passengers, or Futa Express is an intercity and terminal transport service, and Futa Petrol specializes in petroleum trading. It can be seen that the stable development of intercity passenger transport will help ensure the stability of their extra business segments. Once the flagship product is still stable, all other products will be developed strongly.

Opportunities for SMEs

The key product strategy is not only useful for such large enterprises as VinGroup…, but also helps small and medium enterprises (SMEs) expand sustainably.

In recent years, ERP-based business standardization has gradually blossomed. Technology companies in turn launched their own ERP products. For example, MISA launched the ERP AMIS software. The latter quickly took advantage, because AMIS easily connected with the accounting software used by customers, instead of taking many intermediary steps in case of using other ERPs. It can be noted that the flagship product paved the way for the following products to immediately occupy their own market share.

Instead of developing many products of equal importance, try focusing on your strongest product, making it the mainstay, thereby developing the ancillary products to help elevate your flagship product. Business resources are always limit ed, a dollar spent on the core product will bring more opportunities for ancillary ones. And once it gets a foothold, ancillary products will become a foundation for other business segments to boom right at the start.