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Business Model Generation - Coggle Diagram
Business Model Generation
Business Model Canvas
1. Customer Segments
Different groups of people or organization an enterprise aim to reach and serve
Customer groups represent separate segments if:
Their needs require and justify a distinct offer
They are reached through different distribution channels
They require different types of relationships
They have substantially different profitabilities
They are willing to pay for different aspects of the offer
Mass Market
VP, DC and CR all focus on one large group of customers with broadly similar needs and problems
Often found in the consumer electronic sector
Niche Market
Catered to specific, specialized customer segment
Often found in supplier-buyer relationships (eg: Car manufacturers)
Segmented
Distinguish between market segments with slightly different needs and problems
E.g.: Credit Suisse - affluent vs normal clients
Diversified
An org with a diversified customer business model serves two unrelated customer segments with very different needs and problems
E.g.: Amazon
Multi-sided platforms/markets
Serve two or more interdependent customer segments
E.g.: An enterprise offers a free newspaper to attract advertisers and for finance production and distribution
2. Value Propositions
A bundle of products and services that create value for a specific customer segment
3. Channels
describes how a company communicates with and reaches it customer segments to deliver VP
raising awareness among customers about a company's product & services
Helping customers evaluate a company's VP
Allowing customers to purchase a specific products and services
Delivering a value proposition to customers
Providing post-purchase customer support
Direct
: Sales Force, Web sales
Indirect
: Own stores, Partner Stores, Wholesaler
1. Awareness > 2. Evaluation > 3. Purchase > 4. Delivery > 5. After sales
4. Customer Relationships
Types of relationship a company establishes with specific customer segment
Customer acquisition
Customer retention
Boosting sales (upselling)
Personal assistance
: Human interaction; real customer representative during the sales process or after purchase is complete
Dedicated personal assistance
: Represents the deepest and most intimate type of relationship; eg: private banking services
Self-service
: No direct relationship with customers
Automated service
: eg: personal online profiles
Communities
: user communities (e.g.: glossier)
Co-creation
: invite customers to create new & innovative products/content (e.g.: Amazon & Youtube)
5. Revenue Streams
Cash a company generates from each customer segment
Different type of revenue streams
Transaction revenues (1 time customer payment)
Recurring revenues (ongoing payments)
Asset sale
: from selling ownership rights to physical products
Usage fee
: use of particular service
Subscription fees
: Selling continuous access to service
Lending/Renting/Leasing
: temporarily granting someone the exclusive right to use an asset for a fixed period in return for a fee
Licensing
: giving customer permission use to use protected intellectual property in exchange for licensing fees
Brokerage fees
: intermediation service perform on behalf of two or more parties
Advertising
: fees for advertising product, service or brand
6. Key Resources
Most important assets required to make a business model work
Physical
: physical assets such as facilities, buildings, vehicles, machines
Intellectual
: brands, proprietary knowledge, patents and copyrights
Human
: Human resources
Finance
: cash, lines of credit or stock option
7. Key Activities
Most important things a company must do to make its business model works
Production
: designing, making and delivering products
Problem solving
: Coming up with new solutions to individual customer problems
Platform/network
: network, matchmaking platforms, software or brands
8. Key Partnerships
Network of suppliers and partners that make the business model work
strategic alliances between non-competitors
Coopetition: strategic partnerships between competitors
Joint ventures to develop new businesses
Buyer-supplier relationships to assure reliable supplies
9. Cost structure
All costs incurred to operate a business model
Cost driven
: minimize cost
Value-driven
: focus on value creation
Fixed cost
: cost remain the same despite volume
Variable costs
: Vary proportionally with volume
Economies of scale
: cost advantages from expand outputs
Economies of scale
: cost advantages from a larger scope of operations
Patterns
1. Unbundling
Composed of 3 different types - customer relationship businesses, product innovation businesses and infrastructure business
2. Long Tail
Selling less of more; focus on offering a large number of niche products, each of which sells relatively infrequently
3. Multi-sided platforms
bring together two or more distinct but interdependent groups of customers
e.g.: Google
CS: Advertisers, Web surfers, content creators
4. Freemium
At least 1 substantial CS is able to continuously benefit from a FOC offer
Eg.: Skype
VP: Free internet & video calling
5. Open Business Models
Closed vs Open