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The Business Model Canvas

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Alar Kolk EIA

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The Business Model Canvas

  1. 1. Alar Kolk President, European Innovation Academy
  2. 2. Different
  3. 3. Grow Fast or Die
  4. 4. ARE YOU SOLVING THE RIGHT PROBLEM? “If I were given one hour to save the planet, I would spend 59 minutes defining the problem and one minute resolving it,” Albert Einstein Most firms are not and that undermines their innovation efforts… Indeed, when developing new products, processes, or even businesses, most companies aren’t sufficiently rigorous in defining the problems they’re attempting to solve and articulating why those issues are important. Without that rigor, organizations miss opportunities, waste resources, and end up pursuing innovation initiatives that aren’t aligned with their strategies.
  5. 5. Customer Discovery
  6. 6. Customer Discovery, Phase One: State Your Business Model
  7. 7. Value proposition? Value proposition?
  8. 8. What are value propositons for the products?
  9. 9. Business Model Determines Value of the Product or Service. Business Model Innovation Transforms Technology into Money Business Model Functions: 1.Value Creation 2.Value Capture Business Model
  10. 10. Focus in Business Model A business model is a conceptual tool that contains a big set of elements and their relationships and allows expressing the business logic of a specific firm. It is a description of the value a company offers to one or several segments of customers and of the architecture of the firm and its network of partners for creating, marketing, and delivering this value and relationship capital, to generate profitable and sustainable revenue streams. Osterwalder, Pigneur and Tucci (2005)
  11. 11. areas4
  12. 12. WHAT? WHO?HOW? $? €?
  13. 13. WHAT? WHO?HOW? $? €? CUSTOMERCUSTOMER CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS CLIENT SEGMENTS OFFEROFFER COST STRUCTURECOST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS CUSTOMER SEGMENTS KEY RESOURCESKEY RESOURCES CAPABILITIESCAPABILITIES REVENUE FLOWS REVENUE FLOWS DISTRIBUTION CHANNELS DISTRIBUTION CHANNELS PARTNER NETWORK PARTNER NETWORK
  14. 14. how much did the coffee price change for Swiss households over the last couple of years?
  15. 15. 6-8 x more
  16. 16. Nespresso changed the business model for coffee
  17. 17. The business model system TARGETED CUSTOMER SEGMENTS PARTNERSHIP NETWORK OFFER – VALUE PROPOSITION Nespresso coffee machines households distribution channels marketing machine sales capsule sales REVENUE MODEL espresso capsules retail outlets Nespresso.com DISTRIBUTION CHANNELS call center Nespresso stores retail logistics machine manufacturer production CAPABILITIES distribution KEY RESOURCES marketing Nespresso club CUSTOMER RELATIONSHIPS COST STRUCTURE business production facilities patents production
  18. 18. RESULTS
  19. 19. 35% growth p.a. for the last 7 consecutive years
  20. 20. fastest-growing business in the Nestlé group
  21. 21. Nespresso has a 26.6 % global share in Espresso machine sales
  22. 22. Sketch many business models and select the ONE
  23. 23. Customer Discovery, Phase Two: "Get Out of the Building" to Test the Problem: "Do Customers Care?" Get your team "out of the building" to test the problem and to answer three key questions: •Do we really understand the customer's problem? •Do enough people really care enough about the problem for this to become a huge business? •And will they care enough to tell their friends?
  24. 24. Customer Discovery, Phase Three: "Get out of the Building" and Test the Product/Service Solution
  25. 25. Alar Kolk President, European Innovation Academy
  26. 26. building blocks9
  27. 27. Business Model Innovation… Alar Kolk President, European Innovation Academy
  28. 28. Traditional Value Chain vs. Modern Value Chain
  29. 29. Who? Which new customer segments will emerge in the next 5 years? YUPPIES YUFFIES MOBY/DOBY WOOFS SKIPPIES SANDWICHERS Adults caught between caring their children and their older parents School Kids with Income + Purchaing Power Well Off Older Folks Mom/Dad Older – Baby Younger Young Urban Failures Youg Urban Professionals

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