Business model canvas

A BUSINESS MODEL IS

HOW A COMPANY CREATES VALUE FOR ITSELF

WHILE DELIVERING PRODUCTS OR SERVICES FOR ITS CUSTOMERS.

Business model canvasValue proposition

Customer relationships

Customer segments

Channels

Revenue streamsCosts

Key partners

Key activities

Key Resources

Business model canvasValue proposition

Value proposition

NOT a list of features / technologies

How do you create joy or relieve pain?What need are you addressing?What problem are you solving?

Look for needs when possible!=> 5 why’s

Business model canvas

Customer segments

Customer segments

• Better multiple detailed than one generic

• Create persona(s) / archetypes per segment

• Learn to know your customer!– How do they buy? – How do they learn about new products?– What is their role?– What matters for them?

Customer segments

Look for the holy grail: product – market fit

• Map value proposition to customer segments

• Make sure these hypotheses are TESTED

Business model canvas

Channels

ChannelsVirtual channel Physical channel

Virtual product • Facebook• Twitter• Apps

• Insurance• Software• Stocks

Physical product • Shoes• Books• Movies• Consumer electronics

• Food• Household goods• Cars

Channels

Channels

Business model canvasCustomer relationships

Customer relationships

• How do we GET customers?

• How do we KEEP them?

• How do we GROW?

Customer relationships

Customer relationships

Physical channel

Customer relationships

Web / mobile / cloud channel

Customer relationships

GET customers by PAID demand creation

• Public relations

• Advertising

• Trade shows

• Webinar

• Direct (e-)mail

• Search engine marketing

Customer relationships

GET customers by EARNED demand creation

• Publications in journals

• Speeches / conferences

• (Guest) blogging

• Social media

Customer relationships

KEEP customers

• Loyalty programs

• Product updates

• Customer satisfaction

• Contests / events

• Blogs / newsletters

• Social media

Customer relationships

Keep the metrics!

• # awareness / # consideration

• $ spend on adds / acquired purchase =

customer acquisition cost

First think about GET, once you have some think

about KEEP and GROW

Business model canvas

Revenue streams

Revenue streams

NOT ONLY the price people are paying

Revenue stream = the strategy the company uses to generate cash from each customer segment

Pricing = the tactics you use to set the price in each customer segment

Revenue streams

What value are customers willing to pay for?

How do customers pay today?

How much are they currently paying?

Revenue streams

• Asset sale: ownership of physical product

• Usage fee: proportional fee to usage of service

• Subscription fee: continuous access to service

• Renting: temporary access to good/service

• Licensing: fee for use of some IP

• Intermediation fee: bringing two parties together

• Advertising: fee paid by brands and companies for ads

Revenue streams

Common mistakes:

• Price on cost

• Price on value

• By default less than competitor’s

Business model canvas

Key partners

Key partners

• Shared economics (2-way)

• Mutual success / failure

• Common customers

• Co-invention / co-development

Key partners

Risks:• Impedance mismatch• Timing mismatch• No clear ownership of customer• Product vision problems• Different underlying objectives• Churn in partners strategy / personnel• IP issues• Difficult to unwind / end

Business model canvasKey activities

Key activities

What is essential for you to be able to deliver your value proposition?

Business model canvas

Key Resources

Key resources

• Physical resources– Company facilities– Products / services

• Financial resources• Intellectual resources• Human resources– Qualified employees– Mentors / teachers / coaches

Business model canvas

Costs

Costs

What are your costs?

What are the most expensive resources /

activities?

Fixed / variable?

Tips on creating business models

• Separate colors for each customer segment

• Use sticky notes …

… but as few as possible

• Focus on quick communication

• Draw instead of write

• Explore lots of possibilities

• You sell your value proposition …

• to a customer segment …

• who you reach through some channel.

• You have an ongoing relationship to create

retention and lock-in.

= That’s how you make money

• To create the value proposition, you do certain

key activities …

• using your key resources …

• which costs you money.

• Anything you don’t do or have yourself, you get

from a partner.

EXAMPLE