Alastian Challenges Traditional Business Model in Polymers
Monday May 9, 6:26 am ET
Real-Time and a No-Frills Approach -- Basell's Ground-Breaking Polyolefin Business Model Completes Its First Year of Operations.
BRUSSELS, BELGIUM--(MARKET WIRE)--May 9, 2005 -- "When we launched Alastian, it was clear that the polyolefin sector was ripe for a new business model," said Fulco van Geuns, head of Alastian marketing. "What we didn't know was whether the 'no-frills' approach, which had worked in other sectors like air travel, could work for polyolefins as well."
"One thing was certain," Van Geuns continued. "Some sections of the polyolefin market had moved on while producers had failed to keep up with their needs. Especially users in the commodity part of the market had developed such expertise that they simply no longer required the support and other extras that were priced into the classic business model. We decided to 'unbundle' our offering and allow our customers to choose what they pay for."
The result was Alastian, launched a year ago by leading polyolefin producer Basell. Building on Basell's years of experience in online trading, it was a pure e-business play offering a limited subset of commonly used grades at highly competitive prices. Customers could see real-time prices and availability round the clock at the Alastian portal and place and track orders at any time. Free customer support was available through e-mail and over the phone -- other services such as on-site support and extended credit terms could be had at a fee.
Was this what the market was looking for?
"Looking back after our first year it's clear that we have succeeded in satisfying an unmet need," said Niels Nielsen, Alastian's general manager. "Our sales have grown by an average of 35% a month over the year and we now have a base of several hundred customers. It's very satisfying to see that with Alastian we are now reaching a large number of users who have never dealt with Basell before -- a powerful cocktail of increased reach and disintermediation."
Basell's CEO Volker Trautz echoed Nielsen's satisfaction: "In all my years in the industry I have never seen a business acquiring so many new customers in such a short time."
Alastian now ships resins to customers in every corner of Europe. Chief application sectors include injection moulding, packaging, textiles, small blow-moulding and blown-film.
Feedback from customers has been enthusiastic -- at times extremely so: "A major breakthrough in polypropylene purchasing," commented one UK injection-moulder, while an Italian customer found the facility "extremely useful: an easy-to-use Web interface, transparent conditions and competitive prices." The Alastian model has also generated great interest at international level -- at last year's K 2004 event, over half the visitors to the Alastian stand were from outside Europe.
In fact Alastian is soon to start serving customers in Turkey, its first market outside Europe.
"Turkey is just a first step," said Nielsen. "The real potential outside Europe lies in Asia and Asia-Pacific, as well as North America -- I'm confident that Alastian has the right approach to serve those markets too."
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