Wolf&Grayson EditorialGrowth strategy in building materials still runs on a reflex: enter more markets, add more segments, chase every adjacency where the product might plausibly work. The logic feels unimpeachable until the numbers arrive, and the company discovers it has bought mediocre positions in six places instead of a defensible one in two. Marco Ludwig, who has led commercial operations at Zumtobel, Schlüter, and Uzin Utz, argues the opposite case, and he argues it from the inside of businesses that delivered double-digit organic growth. His point is not that expansion is wrong. It is that expansion without concentration quietly destroys what made the company worth buying from in the first place: a value proposition sharp enough that customers can tell the difference.
The Cost Of A Watered-Down Proposition
Ludwig is careful not to claim market focus alone drove the growth he oversaw. “Focusing on fewer markets definitely wasn’t the only reason why those companies were growing by a double-digit, but it definitely helped to focus on those markets you really understand, especially the customer and the customer journey,” he says. The mechanism matters more than the correlation. Deep knowledge of a single customer journey converts into sales because the company can tailor services and products around needs it truly understands. Spread that same organization across unfamiliar segments and the knowledge advantage evaporates, leaving only the product, which on its own is rarely enough.
The failure mode he describes is specific and common. Companies attacking too many markets at once are forced into a one-size-fits-all offer, because nothing else scales across that spread. “In reality, the strengths of your products and portfolio can only find a lot of demand and bring value to the table in very few markets and customer segments,” Ludwig says. The result is money and management attention poured into places where the product is merely acceptable. Worse, the cost is not confined to the new markets. Ludwig flags the drain on the core: pursuing a related market where the company might have a chance “takes away the focus, the attention, and also the CapEx and the message to the customer away from your core competencies.” That last item is the one finance teams never see on a report. A diluted message to the core customer has no line in the budget, and it compounds.
How To Decide What To Cut
Most executives know in private which parts of the portfolio are not working. What stops them acting is the fear that a retreat will read as failure, and that the sales organization will revolt. Ludwig’s method defuses both by making the decision analytical rather than political. Start with an honest situation analysis: which markets the company is present in, what it offers there, how much revenue each produces and how profitable that revenue is. Then run the second axis, the one that gets skipped. “Don’t forget also to look at the potential of those markets and the products you currently have,” he says. Current performance alone would strand a promising position in a market that has not matured yet, and would protect a comfortable business with no upside left in it.
The second axis cannot be built by the strategy function on its own. Ludwig insists the assessment pulls in sales, marketing, production, and research and development, and that every participant works from the customer’s perspective to judge what could become a genuinely valuable offering and how large it could grow. That design has a political payoff as well as an analytical one. When the people who will live with the decision have built the evidence themselves, the conclusion lands as shared judgment rather than as a verdict from above. “If you compare those two, what’s the current situation and what’s the future potential, then it usually becomes fairly clear in what areas you want to invest your time and resources in the future,” Ludwig says. Markets failing on both axes get cut, and in his experience most teams reach that agreement without protracted argument. The discipline sits in the preparation, not in the confrontation.
Consolidation Raises The Price Of Being Unfocused
Distribution is consolidating across lighting, flooring, and electronics, and Ludwig sees the same pattern nearly everywhere. He resists the comfortable reading that this hands specialty brands an advantage. Fewer, larger channel partners do not automatically favor the small supplier with a differentiated product. What concentration does is raise the threshold of relevance. A distributor managing a rationalized portfolio has less room for suppliers who are interesting but marginal, and the question for every specialty brand becomes whether it clears the bar with that partner or disappears from the shelf.
That is why Ludwig treats focus as a requirement for survival rather than merely an optimization opportunity. For smaller and specialty brands in particular, dispersing sales resources and product development efforts too thinly means they never attain genuine relevance with the channel partners that remain available to them, or with the customers who purchase through those partners. Concentration is, as he puts it, “probably the only solution to stay relevant.” The leadership implication runs deeper than channel tactics. Ludwig declines to offer a to-do list, and instead points to strategy built on three honest answers: where the company wants to go, which paths it can credibly take, and what resources it genuinely has. The forward view has to account for AI, for regulation and politics, and for shifts in how customers and installers behave. The last of the three is where he sees most leaders come undone. “They have the best goals and a great path, but they are completely unrealistic in what resources they can really spend in order to achieve those goals.” Market focus is what makes a resource base look adequate instead of absurd.
Follow Marco Ludwig on LinkedIn for more insights on market strategy, channel dynamics, and growth leadership in building materials.
