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U-Experience Team11
The document summarizes an advantage card business proposal over five days. On day one, the proposal focused on discounts for retailers and consumers. Customer research found people want exclusive perks rather than small discounts. On day three, the model pivoted to focus on dining discounts and rewards. Further research found consumers prefer experiences over discounts and want an airline-style loyalty program. By day five, the proposal pivoted again to focus on curating exclusive experiences for members and generating revenue for partners. Next steps include further customer research, studying competition, and iterating the business model.
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U-Experience Team11
- 1. Advantage Card U-Experience Lean LaunchPadFinal Presentation – Team 11 Calvin Chen Mark Grundman Ria Kapila # of Customers Consumers Retailers Day 1 8 4 Day 2 20 0 Day 3 6 6 Day 4 13 2 Total 47 12 Business Type: Startup ?
- 2. Business Model Canvas Cost Structure -Membership card (create & distribute) - Website creation - Marketing Revenue Streams - Direct Sales - Subscription Fees - Point of Sale conversion Key Partners - Retail Shops - Service Companies - 3rd Party Social Networks - Clubs - Charities Key Activities - Selling - Building Website - Retail Partnerships Value Proposition - Monetary Savings (Discounts) - Additional Services - More Business (customers) - Business marketing Customer Relationships - Onboard local boutique retailers - Justify need - Maintain retail relationship - Word of mouth popularity Customer Segments - Boutique Store Retailers looking to expand small business - Students - Immigrants - Females (age 15 - 45) who like to try different boutique services - Customers >> New to the city >> Not loyal to brands >> Money conscious Key Resources - Network of Retail Stores - Savings offered Channels - Web sales of Advantage Card - Retail sales of Advantage Card Day 1 Business Model Canvas
- 3. Existing Discount Model CustomersRestaurants ??? How do I get customers to return?
- 4. Business Model Canvas Cost Structure -Advantage card (create & distribute) - Website creation - Marketing & advertising - Overhead costs Revenue Streams - Direct Sales of Advantage card - Annual Subscription Fees - Point of Sale conversion - Add-on Services (customer consumption data, etc) Key Partners - Retail Shops - Restaurants - Service Companies (beauty related, Spa) - 3rd Party Social Networks - Clubs (Zagat, Open Table) - Charities Key Activities - Marketing via 3rd Party Social Networks - Card Sales - Building Website - Retail Partnerships - Consumer Partnership Value Proposition - Monetary Savings (Discounts) - Additional Services - More Business (customers) - Perks & Benefits to customers (set by retailers) - New & recurring customers streams - Less severe margin erosion for returning customers - Business marketing - Flexibility of promotions Customer Relationships - Onboard local retailers (restaurants & beauty) - Justify need - Maintain retail relationships - Consumer awareness - Word of mouth popularity - Ensure ease of use - Ensure advantages are honored Customer Segments - Boutique Store Retailers - Health & Beauty Store Owners & Managers - Restaurant Owners & Managers - Young professionals (18-30) - Consultants, Bankers, etc - Students - Females (age 15 - 45) who like to try different boutique services - Customers >> New to the city >> Not loyal to brands >> Money conscious Key Resources - Network of Retail Stores - Personal network of target consumers - Savings offered Channels - Web sales of Advantage Card - Retail sales of Advantage Card - Columbia University - Gourmet Clubs Day 2 Business Model Canvas
- 5. Total NYC Retail Sales= $78B Total NYC Restaurant/Healt h & Beauty Sales = $40B Target= $5.7M *Projected target value based on comparable service in UK using # of members as a percentage of total population. Applying that to NYC total population and per capita spending yields $5.7M. *Projections based on NYC and is not indicative of total market. Expandable to other cities. Initial Market Size
- 6.
- 7. Business Model Canvas Cost Structure -Advantage card (create & distribute) - Website creation - Marketing & advertising - Overhead costs Revenue Streams - Direct Sales of Advantage card - Annual Subscription Fees - Point of Sale conversion - Add-on Services (customer consumption data, etc) Key Partners - Retail Shops - Restaurants - Service Companies (beauty related, Spa) - 3rd Party Social Networks - Clubs (Zagat, Open Table) - Charities - -Seamless.com Key Activities - Marketing via 3rd Party Social Networks - Card Sales - Building Website - Retail Partnerships - Consumer Partnership - App development Value Proposition - Monetary Savings (Discounts) - Additional Services - More Business (customers) - Perks & Benefits to customers (set by retailers) Big prize - New & recurring customers streams - Less severe margin erosion for returning customers - Business marketing - Flexibility of promotions - Exclusivity - -Alcoholic Beverages - Point System (Airline Loyalty) - Curation Customer Relationships - Onboard local retailers (restaurants & beauty) - Justify need - Maintain retail relationships - Consumer awareness - Word of mouth popularity - Ensure ease of use - Ensure advantages are honored Customer Segments - Boutique Store Retailers - Health & Beauty Store Owners & Managers - Restaurant Owners & Managers - Young professionals (18-30) - Consultants, Bankers, etc - Students - Females (age 15 - 45) who like to try different boutique services - Customers >> New to the city >> Not loyal to brands >> Money conscious - Foodies - -Budget - -High Spender Key Resources - Network of Retail Stores - Personal network of target consumers - Savings offered Channels - Web sales of Advantage Card - Retail sales of Advantage Card - Columbia University - Gourmet Clubs -Foodie networks Day 3 Business Model Canvas
- 8. Customer Segments & ValueProposition
- 9. Proposed Model –Consumer Study NYC Experience Dining Customers Restaurants
- 10. Customer Discovery: Learning HypothesesWhat we were asking What we learned Small benefits upon each visit will drive new customers and make them loyal FALSE • What would you need to go out of your way to try a new place? • What would you need to go back? • What type of perks would enhance the experience and make you loyal? • How do you envision this working? • Would you pay for these benefits? • People want exclusivity and big paydays even if it means waiting or spending more. • People are more likely to try a new place based on monetary incentives but are more willing to return based on non-monetary experiences. • Consumers want an airline model that rewards loyalty. • Consumers will pay • Two types of consumers at opposite sides of spectrum Budget conscious and up front lock-in fee would drive behavior FALSE • If you were to pay up front for perpetual annual benefits would you be more inclined to go back? • What do you look for in a restaurant? • One time deal versus perpetual deals. • Prize experience on par with food • Will pay for that experience • Want exclusivity at higher end restaurants • Willing to try new restaurants if quality is ensured and special perk
- 11. Business Model Canvas Cost Structure -Advantage card (create & distribute) - Website creation - Marketing & advertising - Overhead costs Revenue Streams - Direct Sales of Advantage card - Annual Subscription Fees - Point of Sale conversion - Add-on Services (customer consumption data, etc) Key Partners - Retail Shops - Restaurants - Service Companies (beauty related, Spa) - 3rd Party Social Networks - Clubs (Zagat, Open Table) - Charities - Seamless.com Key Activities - Marketing via 3rd Party Social Networks - Card Sales - Building Website - Retail Partnerships - Consumer Partnership - App development Value Proposition - Monetary Savings (Discounts) - Additional Services - More Business (customers) - Perks & Benefits to customers (set by retailers) Big prize - New & recurring customers streams - Less severe margin erosion for returning customers - Business marketing - Flexibility of promotions - Exclusivity - Alcoholic Beverages - Point System (Airline Loyalty) - Curation Customer Relationships - Onboard local retailers (restaurants & beauty) - Justify need - Maintain retail relationships - Consumer awareness - Word of mouth popularity - Ensure ease of use - Ensure advantages are honored Customer Segments - Boutique Store Retailers - Health & Beauty Store Owners & Managers - Mid-tier Restaurant Owners & Managers - Young professionals (18-30) - Consultants, Bankers, etc - Students - Females (age 15 - 45) who like to try different boutique services - Customers >> New to the city >> Not loyal to brands - Foodies - Budget - High Spender Key Resources - Network of Retail Stores - Personal network of target consumers - Savings offered Channels - Web sales of Advantage Card - Retail sales of Advantage Card - Columbia University - Gourmet Clubs - Foodie networks Day 4 Business Model Canvas
- 12. Channels, Get Strategy,Revenue Retailers: • C: Direct Sales • G: Interesting value proposition, distance self away from Groupon • R: Take a transaction cost on rewards spent, no upfront fee Consumers: • C: Direct Sales, Dining clubs and organizations • G: Social Media, network, word of mouth • R: Direct Sales of card, Subscription fee
- 13. Proposed Model –Retailer Study NYC Experience Dining Customers Restaurants
- 14. Customer Discovery: Learning HypothesesWhat we were asking What we learned Restaurants would be willing to create offerings to increase customer experience in exchange for loyalty TRUE • How do they retain customers? • What type of perks would you be willing to offer recurring customers? • What is the breakdown of your customers segment? • Three types of restaurants - High Traffic - Proximity - Destination • Restaurants already have offerings for their loyal customers • Higher end restaurants aren’t as willing to offer monetary incentives for new customers Restaurants would be willing to use external sites as a channel to advertise and bring in new customers Depends • Have you ever offered discounts, or daily deals through external sites? • How do you feel about the idea of using discounts? • When would you tend to offer these incentives (seasonal/by day or hours)? • How do you currently market or advertise? • All restaurants at some point have tried some sort of discounts • The majority of proximity, higher end restaurants were no longer offering or willing to offer discounts • High traffic, mid-priced restaurants continue to offer promotions for specific times throughout the year • Typically advertise through word of mouth or external sites
- 15. 4th Day! Major Pivot Focuson Consumer Experience & Become Revenue Streams for Restaurants
- 16. Business Model Canvas Cost Structure -Advantage card (create & distribute) - Website creation - Marketing & advertising - Overhead costs - Membership card costs - Experience Reservation costs Revenue Streams - Point of Sale conversion - Direct Sales of Advantage card - Annual Subscription Fees - Add-on Services (customer consumption data, etc) - Service mark-up Key Partners - Retail Shops - Service Companies (beauty related Spa) - 3rd Party Social Networks - Clubs (Zagat, Open Table) - Charities - Seamless.com - Restaurants - Museums - Day Trips - Tourist Attractions Key Activities - Marketing via Social Networks - Card Sales - Building Website - Retail & Consumer Partnerships - App development - Club Membership Sales Value Proposition - Monetary Savings/Discount - Additional Services - More Business (customers) - Perks/Benefits to customers (set by retailers) Big prize - New & recurring customers - Less severe margin erosion for returning customers - Alcoholic Beverages - Business marketing - Point System (Airline Loyalty) - Flexibility of promotions - Exclusivity - Curation - Special Experience @ Value for consumers - New Revenue source for partners Customer Relationships - Onboard local retailers (restaurants & beauty) - Justify need - Word of mouth popularity - Maintain retail relationships - Consumer awareness - Ensure ease of use - Ensure advantages are honored Customer Segments - Boutique Store Retailers - Health & Beauty Store - Owners & Managers - Females (age 15 - 45) who like to try different boutique services - High Spender - Mid-tier Restaurant Owners & Managers - Customers: New to the city, Not loyal to brands, Foodies Budget Targeted Retailers: - Owners/managers - Business Development Managers - VP of Sales Consumers: - Young professionals (18-30), Consultants, Bankers - Students - Singles (daters) - Corporate Relationship Managers Key Resources - Savings offered - Network of Retail Stores - Personal network of target consumers & partners - Software - Direct Sales Channels - Web sales of Advantage Card - Retail sales of Advantage Card - Gourmet Clubs - Foodie networks - Columbia University - Tourist Guides - Magazines - Social Networks Day 5 Business Model Canvas
- 17. Hypothesis What wewere asking What we learned Partners: Partners would be willing to offer exclusive services for guaranteed revenue Partners would be willing to allow us 30 day leeway to cancel if can’t hit quota TBD • Would you like to partner up for additional revenue source? • Would you allow us to buy services in bulk for a % discount? • Would you be able to handle a 30 day notice for any bulk reservations through our club? • Willing to partner if business is guaranteed • Need larger sample size to evaluate in near future Consumers: Consumers would prefer exclusive experiences and would be willing to pay for uniqueness TRUE • Would you be willing to be part of a club that gives you special experiences in NYC? • Would you prefer food experience or other intangible experience? • How often would you take advantage of this club for the special offers? • Consumers are willing to pay for experiences • Most of them would prefer both food and other intangible experiences • Most of the consumers would be willing to take advantage of club membership more than twice a month Customer Discovery - Learning
- 18. Next Steps… • CustomerRe-discovery • Further study Competition in market space • Re-evaluate Market Size & positioning • Test & iterate Hypothesis • Go out & interview potential consumers & partners • Identify roadblocks & potential solutions • Update Business Model Canvas • Rinse and Repeat