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29 Revenue Model Options for Industrial enterprises (curated by @arnevbalen - Board of Innovation)

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How to find new ways to make money as an industrial company? Explore 29 trigger cards with different business model options and pricing tactics (Industrial enterprise version). - by Board of Innovation

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29 Revenue Model Options for Industrial enterprises (curated by @arnevbalen - Board of Innovation)

  1. 1. Revenue Model Options for Industrial Companies curated by @arnevbalen 29 boardofinnovation.com
  2. 2. Download all files for free: www.boardofinnovation.com/FindNewRevenue Rules of the game: • Start from a concrete idea • Continue until you are at a location where you have been already (vicious cycle!) • Check all answers before choosing a path • Don’t judge yet, seriously! Do you think your users could feel uncomfortable if all their friends know that they use your product/service ? Does your product/service remember previous use of a user? (eg. memory card) Can the user receive a higher status by using the product? 1. Early Exit 2.Tip jar/donation3. Barter 4. Freemium 6. Vanity/ Reputation 7. Loss/Aversion 8. Privacy/ Anonymity 9. Mystery/Surprises 16. Data Resell 20. Leasing 21. Pay-per-use 5. Pay-what-you- want 10. Convenience/ Shortcuts 11. Helping peers/ Gifts 12. Exclusivity/ Limited Availability 22. Fractional Ownership Free! For the user. Paid! The user = Client Third party pays the bills Monetization driver (How to cash in) 18. Flat rate (one-time-fee) 19. Subscription (time related) 13. Get one - Give one 14. Advertising Do you want to offer a product/service to people that can't afford it? Would users value the possibility to share the product with their peers? Would the status only be relevant amongst the user base of your product? Hmmm... Making money on your product seems to be a tough one. Get out of your comfort zone! It's innovate or die. Answer quick! What comes to mind first is the right answer. Here we go: Will the majority of users pay for your product? Will users have to give their personal details in order to use your product/service? Is it your goal to have direct revenue from this product/service? Do you believe other companies would have interest in targeting your user base? Do you generate user-data relevant for others? Are there any complementary services/products to your offer that your users expect? Is the variabel cost per extra user non-existent or negligible? Can you think of features that only part of your user base would pay for? Does your product need a critical amount of users to show it's value? Do your users have non monetary resources the company (or other users) normally would have to pay for? Did you develop a feature/product significantly more convenient than the best alternative users have? What about offering a box without telling what's inside? #Awesome! You have some options that your users might be willing to pay for. 23. Crowdfunding Do you want the user to own the product once they pay? Would you like proof of interest from your users before you launch? Do you think the user might have trouble paying the entire product at once? Do your users want to pay every time they use your product/service? Yes! Damn right about that! We will launch anyway! Yes! Yes! Will the user have the exclusive right to use this product? Not nessecarely! Not really! Nope! Yes! No, let's give it for free! Yes! Maybe It's not about the ability to pay. I'm just not sure if everyone will pay! In fact, yes! Not at all, they already use everything they have! Exactly! Check! Ads, are you crazy? Not really... Shht... user data is our competitive advantage! No! My product is all they need! Yes! It's not about the money! Of course! Definitely! Nope, no critical mass needed! That's why we make software! Yes! We do have some extra costs... Afraid that you won't receive enough donations? Didn't I say I don't want them to pay? No! Of course! How can I let them pay otherwise? Not relevant for my product! Obviously... Not relevant! They would be devastated if their user data was lost! Nope!Absolutely! No! Amongst everyone! Yes, they would love it! No, it would lower the value! No... Hell yeah! Not knowing what's coming is always kind of exciting! Sounds like gambling! F*ck off! That's how it works! Nothing better than the smell of fresh money in the morning... Close... but yet so far... 25. Razor-blade Do you want more than one contact moment with your user? Not necessary! Yes, that would be useful! Seriously? We are not living in the Middle Ages anymore! Charity? No thanks! Ever played Monopoly? Go back to start! High chance that you'll find more reasons for users to pay! No! Don't forget to check this one as well! Can one product be shared amongst different users? Yes! Could you introduce physical consumables to be used together with the product? Nope! No! Good idea! Crowdfunding is only the beginning... No, but we do have a recurring cost in mind! Cool! You just teleported yourself here! Your journey requires a teleportation! Find the exit... 24. Add-ons Do you see the option to sell something extra to part of your customer base? Harder, better, faster, stronger! You can probably make even more money on this! Just give it a try! Remember: You can only walk this road once! 15. Affiliate/ Referral 17. Matchmaking platform Do you want to have an integrated solution that seems to be your own offering? Advice to trusted partner is fine! Yes, Integrated Solution Do you dream of making even more money with this idea? Hint >You might find gold at the other side of this tunnel You won't regret this! High chance that you'll find more reasons for users to pay! Find new revenue models for your idea Start here! What about these colours? One Laptop Per Child Always come togetherAlways come together How to cash in on your ne What would that mean ! for your idea?
 ! Try to imagine… What would that mean ! for your idea?
 ! Try to imagine… What would that mean ! for your idea?
 ! Try to imagine… What would that mean ! for your idea?
 ! Try to imagine… For example:
 10. Convenience/ shortcuts What would that mean ! for your idea?
 ! Try to imagine… What would that mean ! for your idea?
 ! Try to imagine… For example:
 10. Convenience/ shortcuts What wou for yo Try to What wou for yo Try to What wou for yo Try to Step 3: Brainstorm template As an agency specialised in business model innovation, we support our clients to develop sustainable new revenue streams. By asking the right questions, different options to monetise your idea arise. Unfortunately, we can’t be everywhere at the same time. That’s why we've made a flowchart to help you and your team to discuss the alternative monetisation tactics & pricing options. This flowchart will be most effective in one of the following cases: • You have a new idea and you are wondering if you can monetise it. • You already developed your business model and you would like to challenge your current monetisation strategy. 
 Note: This is not a scientific tool. Don’t expect the ultimate solution. Why did Board of Innovation make a tool to explore ways to find new revenues? When should I use it? Rules of the game: • Check cards to understand the monetisation principle if you need some clarification or examples. • It’s totally ok to peek into the revenue cards that you didn’t have as an outcome from the flowchart ;) Rules of the game: • Take all outcomes into consideration • Translate the theoretical outcome into concrete ways to earn money • Ask all team members to come up with their own translation Step 2: Revenue Cards Step 1: Flowchart
  3. 3. A technique used by drugs dealers for many years and also known as locking-in customers: give something for free (or cheap) and provide lots of hassle (€ or effort) when they want to change to a different service/solution. 2 Examples to turn theory into practice Do we really have to explain this one? SAP has roots that reach to the deepest core of your organisation. Trying to kill this parasite will take your sweet, blood and tears (without any guarantee of success). #1 Loss/Aversion Third Party pays the bill Free! For the user. Value Proposition Pricing tactic 2. SAP Dropbox is the most expensive player in the cloud storage market, but they were first and everyone integrated 3rd party services with their Dropbox account. Who knows what might stop working once you switch to an alternative? 1. Dropbox How much value do you create?
 Where we would start our pricing strategy: Costs related to risks of cutting loose the old solution + cost of training all employees to use it
  4. 4. Having something with a certain exclusivity is a show-off. It has always been like that and it will always be the case. The more people have access to the product, the harder it gets to use this as a value perceiver. Highly intensive programs like the ‘innovation bootcamp’ and services such as ‘Hire a lean entrepreneur‘ require an extensive amount of time and effort from the (limited) corporate disruptors available in Board of Innovation’s team. ‘Be different and be first’ is our advice when you choose this path. 2 Examples to turn theory into practice Most startup acquisitions are happening in a B2B context. The prime reason for a corporate giant to acquire a B2B startup is getting exclusive use of good people or products. Lots of B2B startups are built and launched to be acquired. (image: Monsanto buying Weather Corp. for $1.1B in 2013) #2 Exclusivity/ 
 Limited Availability Third Party pays the bill Free! For the user. Value Proposition Pricing tactic 1. Board of Innovation 2. Monsanto How much value do you create?
 Where we would start our pricing strategy: Set a (very) high price and lower if you don’t get traction
  5. 5. View our Accelerator Program Does your company need more internal startups? Or mail us via hello@boardofinnovation.com
  6. 6. The acquisition of new customers is an expensive business associated to convincing a customer to buy your product/service. Ultimate convenience is achieved when customers are coming to you without active sales or marketing. #3 Acquisition convenience Third Party pays the bill Free! For the user. Value Proposition Pricing tactic Blood-testing startup Theranos operated for years in near-total secrecy, despite raising hundreds of millions of dollars at a valuation of around $9 billion. Their technology works but apparently 90% of all tests are outsourced to others. The industry perceived it as cheating but in our opinion it’s damn smart to outsource when you can not deliver (everything) yet. 2 Examples to turn theory into practice Lafarge, world’s largest cement manufacturer, links retailers with micro- finance organisations so that the stores can offer loans and construction support to low-income consumers. Lafarge’s primary investment is in a team of home-improvement “counselors” who market the service through channels such as info kiosks set up in stores. Piloted in Indonesia and Nigeria. 1. Theranos 2. Lafarge retailer support How much value do you create?
 Where we would start our pricing strategy: Saved cost per acquisition (google ads, working hours, etc.)
  7. 7. The better your product/service meets (and surpasses) the customer expectation, the happier the customer will be and the longer they will stay customer, resulting in less acquisition costs and higher revenues per customer. #4 Client (of clients) satisfaction (retention) Third Party pays the bill Free! For the user. Value Proposition Pricing tactic Small business owners are expected to excel at every role — salesperson, marketer, taskmaster, accountant, dispatcher, and receptionist. Breezeworks assists them so they can deliver better service to their customers. (eg. It keeps a clear overview of remarks from previous jobs.) 2 Examples to turn theory into practice Joy Global Inc., a Fortune 1000 company, manufactures and services heavy machinery used in mining. The company also deals in aftermarket parts. By installing sensors in their machines they tell their clients when the machines need replacement parts or service. (Smart Services monitoring program) 1. Breezeworks 2. JoyGlobal How much value do you create?
 Where we would start our pricing strategy: Average of extra jobs (retention) X cost of acquiring a new client
  8. 8. Employees can be seen as internal clients of a company. Keeping them happy is as important as selling good products/services to external customers. The better you treat them, the better for your clients’ business. #5 Employee satisfaction Third Party pays the bill Free! For the user. Value Proposition Pricing tactic Yambla is an ideation tool that helps discover and execute the best ideas in organisations. By endorsing the idea owners and empowering them with the right team members and tools creates a fun, simple and social culture that supports innovation. 2 Examples to turn theory into practice Wranx provides employees quick, effective educational tools to become skilled in a number of areas. Employees can use this service wherever and whenever they want. Continuous learning does not require classrooms anymore. #awesome 1. Yambla 2. Wranx How much value do you create?
 Where we would start our pricing strategy: Average cost of hiring per year divided by average turnover time of employees
  9. 9. Risk comes with a ‘risk minimisation cost’. Lowering the perception of risk is often enough to convince a company to buy your service. Go and find those risk factors ;). #6 Certainty (aka. lower risk) Third Party pays the bill Free! For the user. Value Proposition Pricing tactic Democrata sells data to the construction and maritime sector. The aggregated data Democrata provides could save construction companies millions of dollars by avoiding ancient burial grounds and other archaeologically important sites. 2 Examples to turn theory into practice Viloc is a company automating tool management for the construction industry. By placing a handy little transmitter on all equipment of a construction company, the equipment is directly linked to a web application at their office. No more unused or stolen equipment! 1. Democrata 2. Viloc How much value do you create?
 Where we would start our pricing strategy: Current cost of yearly safety buffer X added risk of changing the current way of working (0-100%)
  10. 10. High investments equal high risk. Keeping investments low equals high flexibility, a goal of every CEO. #7 Flexibility (aka. lower fixed cost) Third Party pays the bill Free! For the user. Value Proposition Pricing tactic An international network of rapid prototypers and additive manufacturers. A given company uploads a 3D model to the Additively website in order for the Additively system to help optimise the costs and efficiency of getting the model 3D printed. Only variable costs for their clients to be found here. 2 Examples to turn theory into practice A co-intrapeneur that joins 1-2 days per week to keep everyone focused. Most of the time this person will steer the validation of critical business assumptions in the first months of a corporate venture. The collaboration can stop every month without consequences (= shameless BOI advertising). 1. Additively 2. Hire a lean entrepreneur How much value do you create?
 Where we would start our pricing strategy: Cost of a wrong investment (or hire) X the amount of times this happened during the last few years
  11. 11. Allowing businesses to distinguish themselves from other businesses will make them feel important. Often used in gaming! #8 Vanity/Reputation Third Party pays the bill Free! For the user. Value Proposition Pricing tactic 2 Examples to turn theory into practice Gore-Tex is THE membrane to make something 100% waterproof while keeping air going through. Using the membrane provides manufacturers of shoes, jackets, etc. a trademark that distinguishes them from manufacturers using other solutions. (Example in flooring: Quickstep Seal & Click) 2. Gore-Tex How much value do you create?
 Where we would start our pricing strategy: Pricing interviews are required in this case - and in all other cases ;) - While Windows Pro is priced much higher than the basic version, both versions of Windows do not differ that much in features, The reason is simple. Would you like to be the one opening your ‘Windows Home Edition’ at the first meeting with a potential client? 1. Windows 8 Pro
  12. 12. Robin provides an online service that recognises the arrival of people in a certain room. The service automatically schedules in spontaneous meetings, or indicates whether a room is being used or not. 1. Robin Automation of repetitive tasks and making an organisation ‘lean’ are examples of clean OPEX savings. No company is perfect. Search and find ;). #9 OPEX saving Third Party pays the bill Free! For the user. Value Proposition Pricing tactic Chitale Dairy places Allflex RFID tags in cows’ ears to receive information on whether the animals are in heat or need to be vaccinated or dewormed. This information is transmitted via the cloud to farmers’ mobile devices. the goal is to increase the amount of milk production while reducing the number of cows, which will also reduce the methane production of the farm. 2 Examples to turn theory into practice 2. Chitale Dairy How much value do you create?
 Where we would start our pricing strategy: For people: time saved in hours X proportion that can (or will be) used to do something productive for the company X average wage cost per hour. For other OPEX: fix a reference cost & claim part of the savings after a certain time
  13. 13. CEMEX installs sensors in the customer's silos to track consumption and inventory information. The cement inventory levels are monitored and transmitted. CEMEX personnel creates a demand plan and dispatches cement to the customer's site, ensuring a seamless and continuous supply.. Customers can view current stock levels and orders received in the CEMEX Connect customer Online resource center. By using light, color and patterns on a badge with a LED and e-ink display, Ticto is using a visual indicator that allows any group of individuals to regulate itself. Ideal for a flexible workforce with variable applicable rules on safety, security, allowances, credentials, contracts, etc. Open communication and transparency are key trends in business. The more leaders can share with their employees, clients, shareholders and partners, without unveiling ‘real’ company secrets, the more trust they receive. #10 Transparency Third Party pays the bill Free! For the user. Value Proposition Pricing tactic 2 Examples to turn theory into practice 1. Cemex Smart Silos 2. Ticto How much value do you create?
 Where we would start our pricing strategy: How much time do managers ‘lose’ by managing questions or mistakes based on limited information? What is the cost of fraud in your company?
  14. 14. If the Coca-Cola company can deliver a bottle of soda to a village deep in the African countryside on a daily basis, why can’t governments and nonprofits figure out how to do the same with life-saving pharmaceuticals? Coca Cola launched a pilot project in Tanzania and decreased delivery time by 84%. China banned game consoles from 2000 until 2014, which caused Sony difficulty in penetrating the Chinese market. The joint venture with Shanghai Oriental Pearl Group should help to market Sony’s PlayStation products in the country. Typically two companies form a strategic partnership when each possesses one or more business assets that will help the other, but that each respective other does not wish to develop internally. In a one time deal, we call it barter. #11 Strategic partnership Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Coca Cola & Global fund 2. Sony & SOPG 2 Examples to turn theory into practice IncIncHQHQ MyStartup.com Consumer Service 5 Lower price than service cost (often free) Data, the right to use data or something else non monetary and valuable for the MyStartup.com IncIncIncInc Company
  15. 15. Dropbox gives more online space to their PRO users that paid for the service. Meanwhile, Business users have unlimited space and extra services for teams to collaborate. Slack is a platform for team communication: everything in one place, instantly searchable, available wherever you go. Slack is free to use for as long as you want and with an unlimited number of people. Functionalities will be limited once your organisation reaches 10k messages. Segmenting your user base in users that get the service for free and users that pay, is called a freemium business model. The paying customers usually have access to superior features. #12 Freemium Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Slack 2. Dropbox 2 Examples to turn theory into practice Clients IncIncHQHQ My organization IncIncIncInc SME IncIncIncInc SME Pro IncIncIncInc Corporate Free Service Pro Service Pro Service 5 Pay per use 5 Subscription
  16. 16. Offer what you want for their services and they pick the offers they like. Apart from money, value drivers for 8k could be: availability of their designers, big brands for their portfolio, etc. Each year, business coach Jennifer Martin, owner of Zest Business Consulting, offers new clients the opportunity to pay what they want for a two-hour business strategy session. These clients are often happy to give her testimonials or offer referrals and 30% are converted into clients who pay regular rates after experiencing the value of her services. Similar to donation but with a stronger focus on revenues, not users. Here you get to choose what you pay for the product. Only works when variable costs are negligible (e.g. music, games, virtual books, software, etc.) #13 Pay-what-you- want Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Zest 2. 8k design agency 2 Examples to turn theory into practice IncIncHQHQ MyStartup.com Consumers Information 5 Money IncIncIncInc Company Product
  17. 17. SmartThings is building an open platform for smart homes and the consumer Internet of Things. They have been able to create a community of 5,000 developers that use its open platform. Consequently, 1,900 new devices and 2,300 new apps were developed on its platform in a span of 90 days. Makes all their electric vehicle patents available for free. Ford (Electric), BMW (Electric) and Toyota (hydrogen) followed their example in a race to get the entire industry to adopt their technology. Companies make one of their core assets (technology, user base, etc.) available for competitors and/or partners to accelerate the market and to make their technology the standard. Often only one technology can survive. Do you remember the Betamax vs. VHS cassette battle? #14 Setting the standard Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Tesla 2. SmartThings 2 Examples to turn theory into practice IncIncHQHQ MyStartup.com Consumer Service 5 Lower price than service cost (often free) RightService
  18. 18. Coursera is an education platform that partners with top universities and organisations worldwide, to offer courses online for anyone to take, for free. Imagine the impact of a powerful lecture with 200k students attending… All (big) industry conferences and fairs are sponsored by companies in return for exposure: a speaker, an exhibitor stand, a logo on all flyers, etc. Sponsorship is a way of advertising (with a nice fiscal advantage). The user becomes the product. Companies pay to reach the customers of your service. The desired result is to drive consumer behaviour with respect to a commercial offering. #15 Advertising Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Coursera 2. Mobile World Congress 2 Examples to turn theory into practice IncIncHQHQ My organization IncIncIncInc Company IncIncIncInc Advertiser Service Exposure 5 Pay per X 5 Money
  19. 19. Zenefits is offering free cloud-based HR software to any company. So companies can centralise all of their employees’ information in one dashboard, which is a big win. In this dashboard, there are suggestions for health care insurance plans, which the employer will pay for with a 5% referral fee. Bosch offers remote vehicle diagnostics services to vehicle owners and dealers through its tele-diagnostics system. To make the service effective for the users, Bosch’s system enables information exchange with third-party services such as car workshops and roadside assistance. When referring your customers to another company, you are driving their sales. Depending on the product and program, 5-10% of the product price is a good indicator of the lead fee you’ll receive. #16 Affiliate/Referral Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Zenefits 2. Bosch tele-diagnostics 2 Examples to turn theory into practice IncIncHQHQ My organization IncIncIncInc Company Buyer IncIncIncInc Company Seller Leads 5 Referral fee Contact data 5 MoneyProduct Free Service
  20. 20. KISS metrics connects all marketing data to real people. Companies can see everything a person has done, from the first touchpoint to the last and are able to anticipate on this behaviour. Selling customer data is a lucrative business for many purposes: targeted advertising, medical research, personalised services, etc. Being transparent is one of the keys to success! #17 Data Resell Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 2. KISSmetrics 2 Examples to turn theory into practice PatientsLikeMe offers a valuable (and free) P2P service for people searching for the best treatment of their disease. Anonymous data is sold to Pharma, so they can come up with better treatments. 1. PatientsLikeMe IncIncHQHQ My organization IncIncIncInc Users IncIncIncInc Data Buyer Free Service Data Insights 5 Access fee
  21. 21. When matching 2 relevant parties to each other, both value your service and might pay for it. Dating platforms are the best known example of matchmaking platforms. All kinds of Tinders for X exist already (eg. Jobr is a Tinder for jobs). #18 Matchmaking Platform Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 2 Examples to turn theory into practice IncIncHQHQ My organization Consumer Consumer Experience Experience Service 5 Money Service 5 Money “Finding your next strategic partner should take minutes, not months” is what they claim. Powerlinx is a platform to find suppliers, clients, partners, etc. Babelverse is P2P translator for spoken communication available on-demand in any language and remotely on any device. Fact: launched as a business service but envisioning a tool that will help bridging the language gap between oversees volunteers and victims of nature disasters. 1. Powerlinx 2. Babelverse IncIncIncInc Company IncIncIncInc Company
  22. 22. FLOOW2 is 'the World's Reset Button’, a sharing marketplace for business equipment, services and personnel. Perfect if you need short term resources or if you have overcapacity. StyleSeat is the platform for professionals in the beauty and wellness industry to run and grow their business. Consumers receive a one-stop-shop for beauty & wellness appointments. Easily copyable to healthcare or manufacturing industry. A marketplace always has clear supply and demand. Bringing these 2 sides together might require a platform (marketplace) or a serviceprovider (broker). The one delivered the most value to is mostly the one that pays the commission fee (can be buyer, seller or both). #19 Marketplace Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. FLOOW2 2. StyleSeat 2 Examples to turn theory into practice IncIncHQHQ MyStartUp.com ConsumerConsumer 5 Money Experience Product Service Community 5 CommissionPlatform IncIncIncInc Company IncIncIncInc Company
  23. 23. Being world's largest brewer with a 25 percent global market share, has its advantages. While clients have to pay after a month, suppliers (eg. farmers) get paid only 4 months after delivery. The result: a pile of cash of aprox. $10B for AB Inbev. Wireless and broadcasting companies are best in this business. Where they really generate cash is in their careful management of operating working capital. Verizon for example can use 50% of its revenues for growth investments. While most corporations have figured out how to start a business with other people’s money, some companies have figured out how to actually run a business on other people’s money by collecting as much money as possible in advance from customers and holding out on paying others. #20 Negative working capital requirement Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. AB Inbev 2. Verizon Communications 2 Examples to turn theory into practice Grain Cash-20Sell Beer Cash in Negative WCR (estimate for AB Inbev: 3 months = 10Bio)
  24. 24. This is how most products are sold. You pay a one time fee and you own the product or you receive access to a lifetime service. #21 Flat rate Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 2 Examples to turn theory into practice IncIncHQHQ MyStartUp.com Consumer5 One-Time Fee Service Product VPN Unlimited is your one-stop-shop for protecting your WiFi connection, securing your online activity, and bypassing web content restrictions. You pay €40 for a lifetime subscription. 2. VPN Unlimited You buy it. You draw a face on it to extend its lifetime for 3 more minutes. You eat it. You’re done. 1. A banana IncIncIncInc Company
  25. 25. Zubie is a connected-car app that provides location tracking, driver scoring, alert and location sharing services by connecting each car to the internet with a Zubie key. Subscription fee of $149/year/key A subscription is a service you sell in a certain timeframe. The service can vary: receiving a newspaper every day, using a cloud service (software), being able to call car assistance when needed, etc. #22 Subscription Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 2. Zubie 2 Examples to turn theory into practice IncIncHQHQ MyStartUp.com Consumer5 Subscription Service Adobe Creative Suite has had a ‘single purchase for life’ for a long time. Now they switched to a cloud service: you only pay for what you need for the time you need it. According to Adobe it’s cheaper. Disclaimer: for frequent users it’s not ;). 1. Adobe Creative Cloud IncIncIncInc Company
  26. 26. The fast pace of projection disruptions resulted in cinemas to either work with outdated technology or spend more than they earn. Barco proposed to deliver a projection service instead of selling the projectors with a cost per hour projected. Customers receive a physical product for a limited period to fulfil their needs. Within the leasing period, a product can only serve the needs of one customer (exclusive use). #23 Leasing Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation Clients pay for the light they use, while Philips remains the owner of all fixtures and installations. One of the main reasons: energy savings without investment costs of LED lights. Service in collaboration with Cofely. Implemented at Schiphol Airport. 1. Pay-per-lux (Philips) 2. Barco Leasing Program 2 Examples to turn theory into practice IncIncHQHQ MyStartUp.com Consumer5 Fee/Time IncIncIncInc Company 5 Flat Fee Product (bought) Service IncIncIncInc Company
  27. 27. Proximity monitors, speed controllers, lane keeping assistants – such systems are commonplace on cars. Now, similar systems are finding applications in mining vehicles as well. The objectives: greater productivity, efficiency, and safety. Currency: Cost per ton mined In India, Asian Paints offers the service of painted walls rather than selling a can of paint. This service strategy has benefitted beyond new revenues. It helps to ensure that their high end products are applied properly, which further helps in improving customer satisfaction. Moreover, selling services also helps the firm to get closer to the end-customer. Some products are only used a limited amount of times per customer (a car is idle 97% of the time on average). Paying only for the times you need a product/ service creates flexibility and increases the value per use. #24 Pay-per-use (= result based) Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Siemens mining 2. Asian Paints 2 Examples to turn theory into practice IncIncHQHQ MyStartUp.com Consumer5 Fee per use Service IncIncIncInc Company
  28. 28. A pricing strategy with highly flexible prices for products or services based on different variables: demand-based, time-based , profile-based, performance based, etc. #25 Dynamic pricing Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation DSM charges clients a percentage of the extra revenues or savings by the extra energy generated because of DSM anti- reflective coating on their solar panels. 2. DSM reflective coating 2 Examples to turn theory into practice Airlines change prices depending on the day of the week, time of day, and number of days before the flight, number of seats, departure time and average cancellations on similar flights 1. Qatar Airways IncIncHQHQ My organization Consumer 5 Price based on one or multiple variables Service IncIncIncInc Company
  29. 29. FirstBuild™, GE Appliances’ new global co-creation community of designers, engineers and appliances users, launched the Paragon Induction Cooktop with discount pricing through a campaign on IndieGogo. With success! Pre-sales is a way to offer a product/service/right for sale before it is developed entirely. Mostly used to fund a project or to receive proof of customer interest before launch. Used for decades by companies like Boeing, Airbus and Bombardier. Always to be combined with another pricing tactic! IncIncHQHQ MyStartUp.com Fund Seeker Community Member Community Member Service 5 % Commission Small Reward 5 Small Micro-Funding Large Reward 5 Large Macro-Funding Funding Crowd #26 Pre-sales Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. General Electric 2 Examples to turn theory into practice Intraboot is a tool to organise crowdfunding campaigns within your firm. All employees receive a virtual budget and choose together where investments go to and can propose new initiatives. IBM and Audi are pioneers in this area. 2. Intraboot IncIncIncInc Company IncIncIncInc Company IncIncIncInc Company
  30. 30. Salesforce offers lots of own apps in their AppExchange. Through acquisitions and own development they make sure to sell as much extra products as possible once a company chooses for SalesForce. aka. Add-ons. Some customers might have deeper pockets than you think. Always allow them them to spend all the money they have! The gaming industry understands this aspect, the music industry does not. #27 Up-selling Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation BASF developed an mobile online tool which enabled the digital disease identification of plants on the field. A direct connection between the most applicable BASF products and the disease is then established to treat the affected plants. Up- sales resulted in big growth in South America. 1. Salesforce AppExchange 2. BASF Agri tools 2 Examples to turn theory into practice IncIncHQHQ MyStartup.com 5 Low Price Cheap product Consumables 5 Recurring Premium Price IncIncIncInc Company
  31. 31. Revenues are spread over the lifetime of a product. After a flat fee, customers have recurring expenses they can’t refuse. (e.g. Razor blades, coffee pads, updates GPS devices, etc.) #28 Razor-blade Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation Nespresso doesn’t earn (much) on their coffee machines (they don’t even make them themselves). All of the money comes from the pads. Interesting fact: Dyson chose for the opposite strategy by taking away vacuum cleaner’s bags. “An update is still cheaper then a new GPS system, right?” This is exactly how Tomtom and Garmin made big money for years. Users choose to either pay or use outdated maps. 1. Nespresso 2. Tomtom GPS updates 2 Examples to turn theory into practice IncIncHQHQ MyStartup.com Customer5 Low Price Cheap product Consumables 5 Recurring Premium Price IncIncIncInc Company
  32. 32. The da Vinci Surgical System is a robotic surgical system made by the American company Intuitive Surgical. It is designed to facilitate complex surgery and allows remote surgery. Often several hospitals share the cost of one device. IMEC is a cutting edge research center based in Leuven, Belgium. Together with partners from across the value chain they tackle challenges to co-develop an economically scalable route to high-volume manufacturing of innovative products. When customers are not able to pay for the entire product, you can allow them to buy it together with peers. Another variation of buying together with peers is ‘group buying’ to achieve a discount on everyones product or service. #29 Co-investment Third Party pays the bill Free! For the user. Value Proposition Pricing tactic How it usually works - General visualisation 1. Da Vinci Robots 2. IMEC 2 Examples to turn theory into practice Group of companies IncIncHQHQ My organization 5 Total investment divided by # companies IncIncIncInc Company IncIncIncInc Company IncIncIncInc Company Product or development
  33. 33. Does your product/service remember previous use of a user? (eg. memory card) Can the user receive a higher status by using the product? 2.Tip 3. Barter 4. Freemium 9. Mystery/Surprises 16. Data Resell 5. Pay-what-you-want 10. Convenience/ Shortcuts 12. Exclusivity/ Limited Availability Free!or the user. Third partypays the bills 13. Get one -Give one 14. Advertising Do you want to offer a product/service to people that can't afford it? Would users value the possibility to hare the product with their peers? e status only be relevant user base of your product? Hmmm... Making money on your product seems to be a tough one. Get out of your comfort zone! It's innovate or die. Is it your goal to have direct revenue from this product/service? Do you believe other companies would have interest in targeting your user base? Do you generate user-data relevant for others? Are there any complementary services/products to your offer that your users expect? Is the variabel cost per extra user non-existent or negligible? Can you think of features that only part of your user base would pay for? Does your product need a critical amount of users to show it's value? Do your users have non monetary resources the company (or other users) normally would have to pay for? Did you develop a feature/product significantly more convenient than the best alternative users have? What about offering a box without telling what's inside? #Awesome! You have some options that your users might be willing to pay for. Do you want the user to own the product once they pay? Would you like proof interest fromb Yes! Will the user have the exclusive right to use this product? Not nessecarely! Not really! It's not about the ability to pay. I'mjust not sure ifeveryone will pay! In fact, yes! Not at all, they already use everything they have! Exactly! Check! Ads, areyou crazy? Not really... Shht... user data is our competitiveadvantage! No! My product is allthey need! Yes! It's not aboutthe money! Of course! Definitely! Nope, no criticalmass needed! That's whywe makesoftware! Yes! We do have someextra costs... Afraid th won't reenough dona Didn't I say I don't want them to pay? Not relevant! iftheir user datawas lost! Nope! Absolutely! No! Amongst everyone! ! No, it wouldlower the value! No... Hell yeah! Not knowingwhat's comingis always kindof exciting! Sounds likegambling! F*ck off! Close...but yet so far... nt more than one ontact moment with your user? Not necessary! Yes, that wouldbe useful! Seriously? We arenot living in the Middle Ages anymore! Charity?No thanks! Ever played Monopoly? Go back to start! Don't forgetto check thisone as well! Your journey requires a teleportation! Findthe exit... Do you want to have an integrated solution that seems to be your own offering? Adv trus partn is fin Yes, Integrated Solution You won'tregret this! High chance that you'll find more reasons for users to pay! hese colours? One Laptop Per Child Always come t Download all files for free: www.boardofinnovation.com/FindNewRevenue

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