Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
On Profit Models…
Ziya G. Boyacigiller
This presentation was created and given by Ziya
Boyacigiller who was leading Angel ...
Ziya G. Boyacigiller (c) 2005 2
The Profit Zone
How strategic business design will lead you
to tomorrow’s profits
Adrian J...
Ziya G. Boyacigiller (c) 2005 3
Market Share Triumphs (!)
• Intel had a high share of memory chips.
• WordPerfect had a hi...
Ziya G. Boyacigiller (c) 2005 4
Am I targeting for
Unit Volume Growth?
Conventional Thinking:
1. Gain market share.
2. Pro...
Ziya G. Boyacigiller (c) 2005 5
Think:
Am I targeting for Profit
Growth?
Ziya G. Boyacigiller (c) 2005 6
Re-Inventor’s Thinking:
A. How can we add value to the customer’s
products / services / bu...
Ziya G. Boyacigiller (c) 2005 7
Shift Focus to
Identify Bigger/More Value
Ziya G. Boyacigiller (c) 2005 8
Value Shift:
Why Good Companies
“Lose It”
Ziya G. Boyacigiller (c) 2005 9
Dimensions of
Business Model Design
Ziya G. Boyacigiller (c) 2005 10
Value Chain
Ziya G. Boyacigiller (c) 2005 11
Ziya G. Boyacigiller (c) 2005 12
Ziya G. Boyacigiller (c) 2005 13
Strategi
c
Control
Point
Index
Ziya G. Boyacigiller (c) 2005 14
Strategy:
Knowing What to Do, and
What Not to Do
Ziya G. Boyacigiller (c) 2005 15
What is
the value
of my
business
?
Ziya G. Boyacigiller (c) 2005 16
The 22 Profit Models
Or, 22 ways to
make money…
Ziya G. Boyacigiller (c) 2005 17
Profit Models & Examples
Ziya G. Boyacigiller (c) 2005 18
1. Customer Solutions Profit
Invest to know the customer, develop a solution, develop
the...
Ziya G. Boyacigiller (c) 2005 19
2. Product Pyramid Profit
Base is low-price high-volume, top is high-price low-
volume. (...
Ziya G. Boyacigiller (c) 2005 20
3. Multicomponent Profit
Segmentation dependent profitability (hotels, beverages).
Ziya G. Boyacigiller (c) 2005 21
4. Switchboard Profit
For high cost buyer seller markets, reduce costs for everyone
(schw...
Ziya G. Boyacigiller (c) 2005 22
5. Time Profit
First mover advantage (Time To Market) (intel, sony)
Ziya G. Boyacigiller (c) 2005 23
6. Blockbuster Profit
Small portion of successful products pays for all costs (VC,
films,...
Ziya G. Boyacigiller (c) 2005 24
7. Profit-Multiplier Profit
Generate additional revenue from same product (disney,
honda)
Ziya G. Boyacigiller (c) 2005 25
8. Entrepreneurial Profit
Overcome size related problems by focusing organization into
sm...
Ziya G. Boyacigiller (c) 2005 26
9. Specialization Profit
Focus strategy (Home Depot, Bebek Bademezmesi)
Ziya G. Boyacigiller (c) 2005 27
10. Installed Base Profit
Razor blade model (copiers, printers, elevators, landscaping)
Ziya G. Boyacigiller (c) 2005 28
11. De Facto Standard Profit
Network effect model (Intel, Microsoft, Oracle)
Ziya G. Boyacigiller (c) 2005 29
12. Brand Profit
Brand means reduced risk, trust, image you like,
etc. (HP, BMW, Sony…)
Ziya G. Boyacigiller (c) 2005 30
13. Specialty Product Profit
New product model (pharmaceuticals, intel, …)
S= specialty
C...
Ziya G. Boyacigiller (c) 2005 31
14. Local Leadership Profit
When physical proximity to customers or suppliers is
importan...
Ziya G. Boyacigiller (c) 2005 32
15. Transaction Scale Profit
When business is transaction based and costs go down in
tand...
Ziya G. Boyacigiller (c) 2005 33
16. Value Chain Position
Profit
All links of the value chain are not equally profitable.
...
Ziya G. Boyacigiller (c) 2005 34
17. Cycle Profit
When business is designed to function through industry
cycles – keep/rai...
Ziya G. Boyacigiller (c) 2005 35
18. After Sale Profit
Where profit in service and support is higher than in
the product (...
Ziya G. Boyacigiller (c) 2005 36
19. New Product Profit
When industry is driven by constant change
resulting in new produc...
Ziya G. Boyacigiller (c) 2005 37
20. Relative Market Share
Profit
When cost advantage results from high volume purchases,
...
Ziya G. Boyacigiller (c) 2005 38
21. Experience Curve Profit
When experience enables low cost position (emerson
electric, ...
Ziya G. Boyacigiller (c) 2005 39
22. Low Cost Business Profit
When business focus is on costs and expenses (Tandy,
South W...
Upcoming SlideShare
Loading in …5
×

Profit models

1,686 views

Published on

Profit models / kar modelleri

  • Be the first to comment

Profit models

  1. 1. On Profit Models… Ziya G. Boyacigiller This presentation was created and given by Ziya Boyacigiller who was leading Angel Investor and a loved mentor to many young entrepreneurs in Turkey. We have shared it on the web for everyone’s benefit. It is free to use but please cite Ziya Boyacigiller as the source when you use any part of this presentation. For more about Ziya Boyacigiller’s contributions to the start-up Ecosystem of Turkey, please go to www.ziyaboyacigiller.com
  2. 2. Ziya G. Boyacigiller (c) 2005 2 The Profit Zone How strategic business design will lead you to tomorrow’s profits Adrian J. Slywotzky, David J. Morrison
  3. 3. Ziya G. Boyacigiller (c) 2005 3 Market Share Triumphs (!) • Intel had a high share of memory chips. • WordPerfect had a high share of word processor software. • DEC had a high share of minicomputers • Kmart had a high share of urban discount merchandising
  4. 4. Ziya G. Boyacigiller (c) 2005 4 Am I targeting for Unit Volume Growth? Conventional Thinking: 1. Gain market share. 2. Profitability will follow.
  5. 5. Ziya G. Boyacigiller (c) 2005 5 Think: Am I targeting for Profit Growth?
  6. 6. Ziya G. Boyacigiller (c) 2005 6 Re-Inventor’s Thinking: A. How can we add value to the customer’s products / services / business practices? B. Will the customer allow us to keep some of that value as profits? C. Where is the profit zone today? Where will it be tomorrow? D. How can we gain market share in that space?
  7. 7. Ziya G. Boyacigiller (c) 2005 7 Shift Focus to Identify Bigger/More Value
  8. 8. Ziya G. Boyacigiller (c) 2005 8 Value Shift: Why Good Companies “Lose It”
  9. 9. Ziya G. Boyacigiller (c) 2005 9 Dimensions of Business Model Design
  10. 10. Ziya G. Boyacigiller (c) 2005 10 Value Chain
  11. 11. Ziya G. Boyacigiller (c) 2005 11
  12. 12. Ziya G. Boyacigiller (c) 2005 12
  13. 13. Ziya G. Boyacigiller (c) 2005 13 Strategi c Control Point Index
  14. 14. Ziya G. Boyacigiller (c) 2005 14 Strategy: Knowing What to Do, and What Not to Do
  15. 15. Ziya G. Boyacigiller (c) 2005 15 What is the value of my business ?
  16. 16. Ziya G. Boyacigiller (c) 2005 16 The 22 Profit Models Or, 22 ways to make money…
  17. 17. Ziya G. Boyacigiller (c) 2005 17 Profit Models & Examples
  18. 18. Ziya G. Boyacigiller (c) 2005 18 1. Customer Solutions Profit Invest to know the customer, develop a solution, develop the relationship (EDS, Broadcom)
  19. 19. Ziya G. Boyacigiller (c) 2005 19 2. Product Pyramid Profit Base is low-price high-volume, top is high-price low- volume. (swatch, mattel) firewall
  20. 20. Ziya G. Boyacigiller (c) 2005 20 3. Multicomponent Profit Segmentation dependent profitability (hotels, beverages).
  21. 21. Ziya G. Boyacigiller (c) 2005 21 4. Switchboard Profit For high cost buyer seller markets, reduce costs for everyone (schwab, expedia.com, hotels.com)
  22. 22. Ziya G. Boyacigiller (c) 2005 22 5. Time Profit First mover advantage (Time To Market) (intel, sony)
  23. 23. Ziya G. Boyacigiller (c) 2005 23 6. Blockbuster Profit Small portion of successful products pays for all costs (VC, films, music, pharmaceuticals)
  24. 24. Ziya G. Boyacigiller (c) 2005 24 7. Profit-Multiplier Profit Generate additional revenue from same product (disney, honda)
  25. 25. Ziya G. Boyacigiller (c) 2005 25 8. Entrepreneurial Profit Overcome size related problems by focusing organization into smaller units (ABB, Microsoft)
  26. 26. Ziya G. Boyacigiller (c) 2005 26 9. Specialization Profit Focus strategy (Home Depot, Bebek Bademezmesi)
  27. 27. Ziya G. Boyacigiller (c) 2005 27 10. Installed Base Profit Razor blade model (copiers, printers, elevators, landscaping)
  28. 28. Ziya G. Boyacigiller (c) 2005 28 11. De Facto Standard Profit Network effect model (Intel, Microsoft, Oracle)
  29. 29. Ziya G. Boyacigiller (c) 2005 29 12. Brand Profit Brand means reduced risk, trust, image you like, etc. (HP, BMW, Sony…)
  30. 30. Ziya G. Boyacigiller (c) 2005 30 13. Specialty Product Profit New product model (pharmaceuticals, intel, …) S= specialty C=commodity
  31. 31. Ziya G. Boyacigiller (c) 2005 31 14. Local Leadership Profit When physical proximity to customers or suppliers is important (Starbucks, grocery stores, building materials,…
  32. 32. Ziya G. Boyacigiller (c) 2005 32 15. Transaction Scale Profit When business is transaction based and costs go down in tandem with size of transactions (travel, real estate, UPS)
  33. 33. Ziya G. Boyacigiller (c) 2005 33 16. Value Chain Position Profit All links of the value chain are not equally profitable. Best links enable the value chain to exist, are well protected from competition, and focus on core competancy/capacity value. (intel/microsoft, read/write heads, Dolby)
  34. 34. Ziya G. Boyacigiller (c) 2005 34 17. Cycle Profit When business is designed to function through industry cycles – keep/raise price when cycle is up (memory chips, chemicals)
  35. 35. Ziya G. Boyacigiller (c) 2005 35 18. After Sale Profit Where profit in service and support is higher than in the product (GE, cell phones)
  36. 36. Ziya G. Boyacigiller (c) 2005 36 19. New Product Profit When industry is driven by constant change resulting in new products (PCs, cars, cell phones)
  37. 37. Ziya G. Boyacigiller (c) 2005 37 20. Relative Market Share Profit When cost advantage results from high volume purchases, and experience curve (P&G, amazon.com, wall-mart)
  38. 38. Ziya G. Boyacigiller (c) 2005 38 21. Experience Curve Profit When experience enables low cost position (emerson electric, micron)
  39. 39. Ziya G. Boyacigiller (c) 2005 39 22. Low Cost Business Profit When business focus is on costs and expenses (Tandy, South West Airlines, Wall-Mart)

×