Business Model Canvas for Successful Business

A template for preparing successful business models and the components of Business model canvas, Enhances Business Plan, Types of Business Models, Steps in preparing business model, a sample business model

1. BUSINESS MODEL CANVAS By Dr. P. SUGANTHI, Assistant Professor

2. INTRODUCTION Introduced by Alexander Osterwalder in 2004 Business Model – meaning: A company's core strategy for profitably doing business. Includes information like products or services the business plans to sell, target markets, and any anticipated expenses. Two important concepts – pricing and costs Allows to fulfill client needs at a competitive price and a sustainable cost Value proposition : a description of the goods or service, why they are desirable to customers or clients, how it differentiates the product or service from its competitors. 2

3. How to Create a BUSINESS MODEL Identify your Audience Define the problem Understand your offerings Document your needs Find key partners Set monetization solutions Test your Model Understand competitor’s business model Bottom line - create an ecosystem 3

4. TYPES Retailer Manufacturer Fee - For - Service Subscription Freemium Bundling Marketplace 4 Affiliate Business Models Razor Blade Reverse Razor Blade Franchise Pay as you Go Brokerage

5. EXAMPLES - BUSINESS MODEL SWIGGY Hyper Local Customers - Business restaurants partners - Delivery partners An app & website to take orders Delivery partners signal for delivery Accept the request and deliver food Live order status Commission from restaurant - 15% - 20% Better visibility for premium restaurants - Free dlivery to customers Membership to customers - offers on select bank cards PAYTM Marketplace Customers - Business restaurants partners - Delivery partners Mobile centric, cashless 5 business - Paytm Mall, Recharge, Payments, Wallet, Bank Commission income 5

6. STRUCTURE – Business Model Canvas (BMC) 1

7. Business Model Canvas 7 Key Activities Insert your content Key Resources Insert your content Value Propositions Insert your content Customer Relationships Insert your content Channels Insert your content Customer Segments Insert your content Key Partners Insert your content Cost Structure Insert your content Revenue Streams Insert your content

8. 8 BMC STRUCTURE KEY PARTNERS KEY ACTIVITIES KEY RESOURCES BUILDING BLOCKS Key Partners Key activities Key Resources Value Proposition Customer Relationships Channels Customer Segments Cost structure Revenue streams VALUE PROPOSITION CUSTOMER RELATION -SHIPS CHANNELS CUSTOMER SEGMENTS COST STRUCTURE REVENUE STREAMS

9. CUSTOMER SEGMENTS Create Customer personas Geographical area, gender, age, education, marital status, behaviors, interests, professional information, worries and fears, hopes and dreams, online behaviour , what influences her, what she’s looking for, how to make her life easier? etc.  Mass market, Niche market, Segmented, Diversified, Multi-sided markets 9

10. CUSTOMER RELATIONSHIPS CUSTOMER JOURNEY MAP: Visualize and analyze your customer’s experiences with your business Easily identify where to make changes to improve customer experiences Collaborate with team members to brainstorm alternative journey maps Personal assistance, Dedicated personal assistance, Self-service, Automated services, Communities, Co-creation 10

11. CHANNELS How your company will communicate with and reach out to your customers Channels are the touchpoints that let your customers connect with your company. Avenue for buying and post-purchase support. Owned Channels and Partner Channels 11

12. REVENUE STREAMS Sources from which a company generates money by selling their product or service to the customers How you will earn revenue from your value propositions.    Transaction-based revenue & Recurring revenue Asset sales, Usage free, Subscription fees, Lending/ Leasing/renting, Licensing, Brokerage fees, Advertising 12

13. KEY ACTIVITIES What are the activities/ tasks that need to be completed to fulfill your business purpose?  focus on fulfilling its value proposition, reaching customer segments and maintaining customer relationships, and generating revenue.   Production, Problem-solving, Platform / network 13

14. KEY RESOURCES the main inputs you need to carry out your key activities in order to create your value proposition. Human (employees) Financial (cash, lines of credit, etc.) Intellectual (brand, patents, IP, copyright)  Physical (equipment, inventory, buildings)  14

15. KEY PARTNERS external companies or suppliers that will help you carry out your key activities in order to reduce risks and acquire resources PARTNERSHIPS: Strategic alliance: partnership between non-competitors Coopetition : strategic partnership between partners Joint ventures: partners developing a new business Buyer-supplier relationships: ensure reliable supplies 15

16. COST STRUCTURE all the costs associated with operating your business model evaluating the cost of creating and delivering your value propositions, creating revenue streams, and maintaining customer relationships. cost-driven (focuses on minimizing costs whenever possible) and value-driven (focuses on providing maximum value to the customer).  16

17. VALUE PROPOSITIONS H eart of the business model canvas U nique solution (product or service) for a problem faced by a customer segment, or that creates value for the customer segment. U nique or should be different from that of your competitors New Product - innovative and disruptive or Existing Product - new features and attributes Q uantitative (price and speed of service) or Q ualitative (customer experience or design) 17

18. ADVANTAGES: Easy to understand Focussed Flexible Customer- focussed Shows connections Easy to communicate 20

19. 21 Thanks! Any questions ?