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Lecture 8 - The Business Canvas Model

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Based on

Business Model
Generation

by

Alexander
Osterwalder
The Business Model Canvas
9 Building Blocks Of A Business Model
1. Value Proposition
Value Proposition

What problem are you trying to solve?


And how: The bundle of products and
services that create value for
a specific Customer Segment. This is
where you list all the features/attributes of
your products or services that would solve
the problem for your target segment(s)
Elements Of Value Proposition

Newness

Performance
Customization
Getting the job done
Design
Brand/status
2. Customer Segments
– who are you trying to solve the problem for?

the different groups of people or


organizations an enterprise aims
to reach and serve

For whom are we creating value?


Who are our most important
customers?
Customer Segment Types

Mass market
Niche market

Segmented market
Diversified market
3. Channels
- How are you going to deliver that solution to your target
Channels

How a company
communicates with and
reaches its Customer
Segments to deliver a
Value Proposition
Channels

Through which Channels do our


CS want to be reached?

Which channels work best?

Which ones are most cost-


efficient?

How are we integrating them with


customer routines?
Channels Types

Sales force

Web sales

Own stores

Partner stores

Wholesaler
4. Customer Relations
- The customers you just targeted: how are you going to get them, keep them and grow them
Customer Relations

Describes the types of


relationships a company
establishes with specific
Customer Segments
Customer Relations

What type of relationship do


we establish and maintain
with customer segment?
How costly are they?

How are they integrated with


the rest of our business
model?
Customer Relations Types

Personal assistance

Dedicated personal assistance


Self-service
Automated services
Communities
Co-creation
5. Revenue Streams
- How and what are they paying your in return for solving their problem
Revenue Streams

The cash a company


generates from each
Customer Segment (costs
must be subtracted from
revenues to create earnings)
Revenue Streams

For what value are our


customers really willing to pay?
For what do they currently
pay?

How are they currently paying?


How much does each RS
contribute to overall revenues?
Revenue Streams Types

Asset sale

Usage fee
Subscription fees

Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
6. Key Resources
- What resources would you need to make all those happen?
Key Resources

The most important assets


required to make a business
model work
Key Resources

What Key Resources do our


Value Propositions require?

Our Distribution Channels?


Customer Relationships?
Revenue Streams?
Key Resources Types

Physical

Intellectual

Human
Financial
7. Key Activities
- what are the most important thing you have to do for the business to work?
Key Activities

The most important things a


company must do to make its
business model work
Key Activities

What Key Activities do our


Value Propositions require?

Our Distribution Channels?


Customer Relationships?
Revenue Streams?
Key Activities Types

Production

Problem solving
Platform/network
8. Key Partnerships
- who do you need by your side to make all those happen?
Key Partnerships

The network of suppliers


and
partners that make the
business model work

LOOK AT YOUR VALUE


CHAIN
Key Partnerships

Who are our Key Partners?


Who are our key suppliers?
Which Key Resources are we
acquiring from partners?
Which Key Activities do
partners perform?
Partnership Types

Strategic alliances
between
non-competitors
Coopetition: strategic
partnerships between
competitors
Joint ventures to develop new
businesses
Buyer-supplier relationships to
assure reliable supplies
Motivations For Creating Partnerships

Optimization and economy


of scale
Reduction of risk and
uncertainty
Acquisition of particular
resources and activities
9. Cost Structure
- How much are all those going to cost you?
Cost Structure

All costs incurred to operate a


business model
Cost Structure

What are the most important


costs inherent in our business
model?
Which Key Resources are
most expensive?
Which Key Activities are most
expensive?
Cost Structure Types

Cost-driven

Value-driven
Fixed costs
Variable costs

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