Trōv: A New Business Strategy

By the end of 2019, Trōv, Inc. (Trōv) had ceased to sell its flagship direct-to-consumer single-item coverage insurance product. Going forward, Trōv would no longer compete as an insurance company, but would instead focus on expanding its technology in order to equip established insurance companies, financial institutions, and technology companies with the modern, all-digital insurance apps required to remain competitive and/or gain market share. In doing so, Trōv offloaded the enormous financial burden associated with customer acquisition. Heading into 2020, Trōv’s business was divided into two main units—Trōv Enterprise and Trōv Mobility. As a result of this strategic shift from a business-to-consumer (B2C) strategy to a business-to-business (B2B) strategy, Trōv’s leaders were faced with a new set of questions. Should they implement a fee structure that would allow Trōv to achieve profitability as a B2B technology provider? Were Trōv’s new products designed to respond to its clients’ desired customer segmentation? How should Trōv allocate resources between its Enterprise and Mobility businesses?

The case illustrates how managers must be willing to alter or even abandon their strategies if new innovations do not lead to economically viable business models. Students are asked to consider the strengths and weaknesses of business-to-business technology providers such as Trōv. Further, the case asks students to analyze the feasibility of pricing schemes, the strategic implications of product design, and resource allocation between two new ventures. Ultimately, the case provides students with an overview of how entrepreneurs manage innovation through experimentation and adaptation. After working through the case and assignment questions, students will be able to<ul><li>understand that entrepreneurs must be flexible and willing to alter or even abandon existing business strategies when new innovations do not lead to economically viable business models;</li><li>evaluate how Trōv pivoted its model from B2C to B2B as well as why it transitioned from offering insurance to providing technology;</li><li>identify the strengths and weaknesses of Trōv’s new business models;</li><li>understand the strategic and financial implications of B2B product design and pricing schemes; and</li><li>assess the risk–reward trade-off between various business units and decide how this dynamic should be incorporated into resource allocation decisions.</li></ul>

• insurance, fintech, entrepreneurship