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Objectives1. To understand how the business model canvas can helpus to think about intelligently marketing a business2. To look at how different business models require differentkinds of marketing3. To apply these techniques to our own businesses orclients that we work with
Business Model DefinitionA business model describes how anorganization creates, delivers andcaptures value
Customer SegmentsFor whom are we creating value?Who are our most importantcustomers?
Customer Segment TypesMass MarketBusiness models focused on one large group with ofcustomers with broadly similar needs and problems.The Value Propositions, Distribution Channels and CustomerRelationships all focus on one large group of customers withbroadly similar needs and problems.Example: Consumer Electronics
Customer Segment TypesNiche MarketBusiness models focused on specific, specialized CustomerSegments.The Value Propositions, Distribution Channels and CustomerRelationships are all tailored to the specific requirements of aniche market.Example: Supplier-Buyer relationships such as car partmanufacturers.
Customer Segment TypesSegmentedBusiness models focused on market segments with slightlydifferent needs and problems.The Value Propositions, Distribution Channels and CustomerRelationships are all slightly tailored to the specificrequirements of a niche market.Example: The retail arm of Credit Suisse distinguishesbetween customers with under $100k affluent clients withover $500k.
Customer Segment TypesDiversifiedBusiness models focused on Customer Segments withcompletely unrelated needs and problems.The Value Propositions are completely different for eachCustomer Segment.Example: Amazons retail business and its cloud computingservices.
Customer Segment TypesMulti-sided MarketsBusiness models that serve two or more interdependentCustomer Segments.Example: Credit Card companies need a large base ofcredit card holders and a large base of merchants whoaccept them.Example: A free newspaper needs a large reader base toattract advertisers and advertisers to finance production anddistribution.
ChannelsCommunication, distribution and saleschannels comprise a companysinterface with customers.
Channel Considerations● Through which channels do our Customer Segments want to be reached?● How are we reaching them now?● How are our Channels integrated?● Which ones work best?● Which ones are most cost-efficient?
Customer Relationship TypesPersonal AssistanceThis relationship is based on human interaction. Thecustomer can communicate with a real customerrepresentative to get help during the sales process or afterthe purchase.This can happen on-site, through call centers, by e-mail orother means.Examples: Clothing stores, cell phone companies
Customer Relationship TypesDedicated Personal AssistanceThis relationship involves a dedicated customer servicerepresentative for each individual client. This is the deepestand most intimate type of relationship and normally developsover a long period of time.Examples: personal bankers, account managers
Customer Relationship TypesSelf-ServiceIn this relationship the company maintains no directrelationship with customers by providing all the necessarymeans for customers to help themselves.Examples: A toy company, many retail products.
Customer Relationship TypesAutomated ServicesThis type of relationship uses personalized services basedon data about the customer to deliver customized services.Examples: Googles search service, Amazon.com.
Customer Relationship TypesCommunitiesThis type of relationship facilitates user communities thatallow members to exchange information and solve eachothers problems.Examples: Many of Googles services, etc.
Customer Relationship TypesCo-CreationThis type of relationship involves inviting customers to co-create value with the company.Examples: Amazon reviews, Youtube.
Revenue StreamsThe cash a company generates fromeach Customer Segment
Revenue Streams1. Transaction revenues resulting from one-time customerpayments2. Recurring revenues resulting from ongoing payments toeither deliver a Value Proposition to customers or to providepost-purchase customer support
Revenue Stream TypesAsset SaleSelling ownership rights to a physical product.Examples: Honda sells cars which buyers are free to drive,resell or even destroy (Camerons car).
Revenue Stream TypesUsage FeeGenerated by the use of a particular service; the more theservice is used, the more the customer pays.Examples: Ritz-Carlton (per night of stay), UPS (perpackage), Phone Service (per minute of long distance)
Revenue Stream TypesSubscription FeeGenerated by selling continuous access to a service.Examples: Gym (monthly or yearly subscription), OnlineGaming Services, etc.
Revenue Stream TypesLending/Renting/LeasingGenerated by temporarily granting someone the exclusiveright to use a particular asset for a fixed period in return for afee.Examples: Apartments, Zipcar.com, etc.
Revenue Stream TypesLicensingGenerated by giving customers permission to use protectedintellectual property in exchanged for licensing fees.Examples: Media, Technology Patents
Revenue Stream TypesBrokerage FeesGenerated by intermediation services performed on behalf oftwo or more parties.Examples: VISA, Insurance / real estate brokers, etc.
Revenue Stream TypesAdvertisingGenerated by advertising a particular product, service orbrand. Traditionally the media industry and event organizersrelied heavily on this.Examples: Huffington Post, Google, Sports Teams, etc.
Application1. CURRENT STATE - Partner up and complete thebusiness model canvas for a client or your own business2. MARKETING & MODEL INNOVATION - Based on theresults, identify three possible ways that the marketing andbusiness model could be changed.